UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of Report (Date of earliest event reported): September 13, 2010
Limoneira
Company
(Exact
name of registrant as specified in its charter)
|
Delaware
|
001-34755
|
77-0260692
|
||
|
(State
or other jurisdiction
|
(Commission
File Number)
|
(I.R.S.
Employer Identification No.)
|
||
|
of
incorporation)
|
1141
Cummings Road
Santa
Paula, CA 93060
(Address
of principal executive offices and zip code)
Registrant’s
telephone number, including area code: (805) 525-5541
Check the
appropriate box below if the Form 8-K is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following
provisions:
o Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Section 2
|
Financial
Information
|
|
|
Item 2.02
|
Results of Operations and
Financial Condition
|
On September 13, 2010, Limoneira Company (NASDAQ: LMNR)
issued a press release announcing its financial results for the third quarter
and nine-months ended July 31, 2010. A copy of the press release is
furnished within this report as Exhibit 99.1.
|
Section 9
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Financial Statements and
Exhibits
|
|||
|
Item 9.01
|
Financial Statements and
Exhibits
|
|||
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(d)
|
Exhibits.
|
|||
|
99.1
|
Limoneira
Press Release dated September 13,
2010.
|
|||
SIGNATURES
JOSEPH D.
RUMLEY
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
Date:
September 13, 2010
|
LIMONEIRA
COMPANY
|
||||
|
By:
|
/s/
JOSEPH D. RUMLEY
|
||||
|
Joseph
D. Rumley
|
|||||
|
Chief
Financial Officer, Treasurer and Corporate Secretary
(Principal
Financial and Accounting Officer)
|
|||||
Investor
Contact:
John
Mills
Senior
Managing Director
ICR
310.954.1105
Limoneira
Company Announces Third Quarter 2010 Financial Results
|
-Third
quarter revenue increased 71% to $22.2 million –
|
|
-Operating
income grew 262% to $9.0 million, driven primarily by
agribusiness –
|
|
-Achieved
net income of $4.8 million and diluted earnings per share of
$0.43–
|
|
-Generated
positive cash flow from operating activities of $2.2 million
–
|
Santa
Paula, CA., September 13, 2010 – Limoneira Company (NASDAQ: LMNR), a leading
agribusiness with prime agricultural land and operations, real estate and water
rights throughout California, today reported financial results for the third
quarter and nine-months ended July 31, 2010.
Fiscal
2010 Third Quarter Results
For the
third quarter of fiscal 2010, revenue increased 71% to $22.2 million compared to
revenue of $13.0 million in the third quarter last year. Both of the
Company’s main revenue sources—agriculture and rental—contributed to this
period-over-period revenue growth. Agriculture revenue was $21.2
million, compared to $12.1 million in the third quarter last
year. Rental revenue was $964,000 in the third quarter, up from
$913,000 in the third quarter last year.
The 75% year-over-year increase in
the Company’s agriculture revenue reflects higher revenue in all varieties of
the Company’s crops for the fiscal 2010 third quarter compared to the third
quarter last year. Revenue from lemon sales increased to $10.7
million in the third quarter of fiscal 2010 from $8.0 million in the third
quarter last year. This increase resulted from both higher volume and higher
lemon prices in the 2010 third quarter compared to the third quarter of 2009.
Revenue from avocado sales was $7.7 million in the third quarter of fiscal 2010
compared to $2.5 million in the third quarter last year. This 208% increase was
primarily due to a higher volume of fruit harvested in the third quarter of 2010
compared to the third quarter of 2009. Navel and Valencia orange and specialty
citrus also contributed to favorable third quarter fiscal 2010 results with
combined revenues $1.3 million greater than the same period of fiscal
2009.
Costs and
expenses for the third quarter of fiscal 2010 were $13.2 million, or 60% of
revenue, compared to $10.5 million, or 81% or revenue, in the third quarter last
year. This year-over-year improvement in costs and expenses as a
percentage of revenue reflects the Company’s ability to leverage its
infrastructure with higher sales volumes from its Agriculture
business. Third quarter fiscal 2010 costs and expenses include a
$517,000 asset impairment charge related to the Company’s Cactus Wren real
estate project.
Operating
income for the fiscal 2010 third quarter improved to $9.0 million, compared to
$2.5 million in the third quarter last year.
For the
fiscal third quarter of 2010, net income applicable to common stock,
after preferred dividends and including $1.0 million in non-cash
charges primarily for the mark-to-market adjustments on interest rate swaps, was
$4.8 million, or $0.43 per share, compared to net income of $1.2 million, or
$0.10 per share, in the third quarter last year. Weighted average
shares outstanding were 11.2 million in the third quarter fiscal 2010, compared
to 11.3 million in the third quarter last year.
Harold
Edwards, President and Chief Executive Officer, stated, “We are excited by the
positive momentum in our overall business. We delivered strong third
quarter financial results across the board—we achieved double digit revenue
growth, triple digit operating income growth and triple digit net income growth
and strong cash flow from operations. Our agribusiness benefitted
from all of our varieties, especially avocados, for which we more than doubled
production compared to the same period last year. Our results also
reflect our ability to successfully leverage our fixed costs across higher
sales, as we continue to manage our overall costs and expenses and pay down
debt.”
Mr.
Edwards continued, “In addition to our improved financial results, we are
encouraged by recent developments in the branding of our lemons and a successful
transaction with one of our real estate properties. As we previously
announced, beginning later this year, we will be implementing a direct selling
and marketing strategy for our lemon business. This will enable
us to improve efficiencies throughout our distribution channels and further
establish the global recognition of the Limoneira brand. In August,
we completed the sale of one of our properties in Arizona, which resulted in net
proceeds of $2.8 million that we plan to use in combination with our strong
third quarter cash flow to further reduce our debt.”
Mr.
Edwards concluded, “As we begin the final quarter of fiscal 2010 and look
towards next year, we will remain diligently focused on expanding our core
agribusiness while taking advantage of opportunities to enhance the value of our
real estate assets. We are confident in our ability to continue to
make progress with our business and improve our top and bottom line results and
enhance our shareholder value.”
Fiscal
2010 Nine-Month Results
For the
nine-months ended July 31, 2010, revenue increased 63% to $41.8 million, from
$25.7 million for the same period last year. Operating income for the
nine-months of fiscal 2010 was $5.2 million, compared to an operating loss of
($2.9 million) in the same period last year. Net income applicable
to common stock, after preferred dividends for
the nine-months of fiscal 2010 was $1.7 million, or $0.15 per share,
compared to a net loss of ($2.0 million), or ($0.17) per share, in the same
period last year.
Balance
Sheet and Liquidity
During
the third quarter of fiscal 2010, the Company decreased its long-term debt by
$4.3 million. The Company has working capital of $4.9 million as of
July 31, 2010, compared to $2.4 million as of its October 31, 2009 year
end. Net cash provided by operating activities for the nine months
ended July 31, 2010 was $2.2 million, compared to a net use of cash from
operating activities of $4.5 million in the same period of last
year.
Real
Estate Development
During
the third quarter and nine months ended July 31, 2010, the Company continued to
execute its real estate development strategy capitalizing development costs of
$0.9 million and $2.7 million, respectively. During the same periods
of fiscal 2009, the Company capitalized real estate development costs of $1.5
million and $4.4 million, respectively.
In August
2010, the Company sold one of its Arizona properties, Cactus Wren, for $3.0
million cash; realizing net cash of $2.8 million after selling and other closing
costs. The Company recognized an impairment charge of $0.5 million in
connection with the sale in the third quarter of fiscal 2010. The
Company plans to use the funds received from the transaction to pay down its
debt.
Recent
Business Highlights
The
Company recently announced its strategic decision to increase its brand exposure
in agribusiness by marketing and selling its lemons directly to foodservice,
wholesale and retail customers around the world. Beginning November
1, 2010, the Company will add its commercial lemons to its existing specialty
lemon sales.
About
Limoneira Company
Limoneira
Company, a 117-year old international agribusiness headquartered in Santa Paula,
California, has grown to become one of the premier integrated
agribusinesses in the world. Limoneira (pronounced lē mon΄âra), is a
dedicated sustainability company with approximately 7,300 acres of rich
agricultural lands, real estate properties and water rights throughout
California. The Company is a leading producer of lemons, avocados, oranges, and
other specialty crops that are enjoyed throughout the world. For more
about Limoneira Company, visit www.limoneira.com.
Forward-Looking
Statements
This
press release contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking
statements are based on Limoneira’s current expectations about future events and
can be identified by terms such as “expect,” “may,” “anticipate,” “intend,”
“should be,” “will be,” “is likely to,” “strive to,” and similar expressions
referring to future periods.
Limoneira
believes the expectations reflected in the forward-looking statements are
reasonable but cannot guarantee future results, level of activity, performance
or achievements. Actual results may differ materially from
those expressed or implied in the forward-looking
statements. Therefore, Limoneira cautions you against relying on any
of these forward-looking statements. Factors which may cause future outcomes to
differ materially from those foreseen in forward-looking statements include, but
are not limited to: changes in laws, regulations, rules, quotas,
tariffs, and import laws; weather conditions that affect production,
transportation, storage, import and export of fresh product; increased pressure
from disease, insects and other pests; disruption of water supplies or changes
in water allocations; pricing and supply of raw materials and products; market
responses to industry volume pressures; pricing and supply of energy; changes in
interest and currency exchange rates; availability of financing for land
development activities; political changes and economic crises; international
conflict; acts of terrorism; labor disruptions, strikes or work stoppages; loss
of important intellectual property rights; inability to pay debt obligations;
inability to engage in certain transactions due to restrictive covenants in debt
instruments; government restrictions on land use; increased costs from becoming
a public company; and market and pricing risks due to concentrated ownership of
stock. Other risks and uncertainties include those that are described
in Limoneira’s SEC filings, which are available on the SEC’s website at http://www.sec.gov. Limoneira
undertakes no obligation to subsequently update or revise the forward-looking
statements made in this press release, except as required by law.
Limoneira
Company and Subsidiaries
Consolidated
Condensed Balance Sheets (unaudited)
|
July
31,
2010
|
October
31,
2009
|
|||||||
|
Assets
|
||||||||
|
Current
assets:
|
||||||||
|
Cash
and cash equivalents
|
$
|
197,000
|
$
|
603,000
|
||||
|
Accounts
receivable
|
10,174,000
|
3,735,000
|
||||||
|
Notes
receivable – related parties
|
-
|
1,519,000
|
||||||
|
Inventoried
cultural costs
|
698,000
|
858,000
|
||||||
|
Prepaid
expenses and other current assets
|
1,242,000
|
894,000
|
||||||
|
Current
assets of discontinued operations
|
169,000
|
9,000
|
||||||
|
Total
current assets
|
12,480,000
|
7,618,000
|
||||||
|
Property,
plant, and equipment, net
|
53,743,000
|
53,817,000
|
||||||
|
Real
estate development
|
62,275,000
|
53,125,000
|
||||||
|
Assets
held for sale
|
9,441,000
|
6,774,000
|
||||||
|
Equity
in investments
|
8,860,000
|
1,635,000
|
||||||
|
Investment
in Calavo Growers, Inc.
|
14,045,000
|
11,870,000
|
||||||
|
Notes
receivable – related parties
|
92,000
|
284,000
|
||||||
|
Notes
receivable
|
2,132,000
|
2,000,000
|
||||||
|
Other
assets
|
4,537,000
|
4,307,000
|
||||||
|
Noncurrent
assets of discontinued operations
|
277,000
|
438,000
|
||||||
|
Total
assets
|
$
|
167,882,000
|
$
|
141,868,000
|
||||
|
Liabilities
and stockholders’ equity
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable
|
$
|
945,000
|
$
|
970,000
|
||||
|
Growers
payable
|
1,448,000
|
988,000
|
||||||
|
Accrued
liabilities
|
4,566,000
|
2,764,000
|
||||||
|
Current
portion of long-term debt
|
619,000
|
465,000
|
||||||
|
Current
liabilities of discontinued operations
|
-
|
2,000
|
||||||
|
Total
current liabilities
|
7,578,000
|
5,189,000
|
||||||
|
Long-term
liabilities:
|
||||||||
|
Long-term
debt, less current portion
|
91,277,000
|
69,251,000
|
||||||
|
Deferred
income taxes
|
9,642,000
|
8,764,000
|
||||||
|
Other
long-term liabilities
|
5,865,000
|
6,903,000
|
||||||
|
Total
long-term liabilities
|
106,784,000
|
84,918,000
|
||||||
|
Commitments
and contingencies
|
||||||||
|
Stockholders’
equity:
|
||||||||
|
Series
B Convertible Preferred Stock – $100.00 par value (50,000
shares
authorized:
30,000 shares issued and outstanding at July 31, 2010
and
October 31, 2009) (8.75% coupon rate)
|
3,000,000
|
3,000,000
|
||||||
|
Series
A Junior Participating Preferred Stock – $.01 par value (50,000
shares
authorized:
0 issued or outstanding at July 31, 2010 and October 31,
2009)
|
-
|
-
|
||||||
|
Common
Stock – $.01 par value (19,900,000 shares authorized:
|
||||||||
|
11,194,460
and 11,262,880 shares issued and outstanding at July 31,
2010
and October 31, 2009, respectively)
|
112,000
|
113,000
|
||||||
|
Additional
paid-in capital
|
33,981,000
|
34,718,000
|
||||||
|
Retained
earnings
|
17,032,000
|
16,386,000
|
||||||
|
Accumulated
other comprehensive loss
|
(605,000
|
)
|
(2,456,000
|
)
|
||||
|
Total
stockholders’ equity
|
53,520,000
|
51,761,000
|
||||||
|
Total
liabilities and stockholders’ equity
|
$
|
167,882,000
|
$
|
141,868,000
|
||||
Limoneira
Company and Subsidiaries
Consolidated
Condensed Statements of Operations (unaudited)
|
Three
months ended
July
31,
|
Nine
months ended
July
31,
|
||||||||||||||
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
|
Revenues:
|
|||||||||||||||
|
Agriculture
|
$
|
21,215,000
|
$
|
12,055,000
|
$
|
38,689,000
|
$
|
22,857,000
|
|||||||
|
Rental
|
964,000
|
913,000
|
2,881,000
|
2,779,000
|
|||||||||||
|
Real
estate development
|
51,000
|
16,000
|
231,000
|
24,000
|
|||||||||||
|
Total
revenues
|
22,230,000
|
12,984,000
|
41,801,000
|
25,660,000
|
|||||||||||
|
Costs
and expenses:
|
|||||||||||||||
|
Agriculture
|
9,552,000
|
8,494,000
|
25,236,000
|
22,127,000
|
|||||||||||
|
Rental
|
534,000
|
484,000
|
1,625,000
|
1,545,000
|
|||||||||||
|
Real
estate development
|
394,000
|
92,000
|
1,117,000
|
233,000
|
|||||||||||
|
Selling,
general and administrative
|
2,239,000
|
1,428,000
|
8,068,000
|
4,690,000
|
|||||||||||
|
Impairment
of real estate assets
|
517,000
|
-
|
517,000
|
-
|
|||||||||||
|
Total
costs and expenses
|
13,236,000
|
10,498,000
|
36,563,000
|
28,595,000
|
|||||||||||
|
Operating
income (loss)
|
8,994,000
|
2,486,000
|
5,238,000
|
(2,935,000
|
)
|
||||||||||
|
Other
income (expense):
|
|||||||||||||||
|
Interest
expense
|
(437,000
|
)
|
(203,000
|
)
|
(1,256,000
|
)
|
(504,000
|
)
|
|||||||
|
Interest
expense related to derivative instruments
|
(976,000
|
)
|
-
|
(1,540,000
|
)
|
-
|
|||||||||
|
Interest
income
|
27,000
|
54,000
|
85,000
|
177,000
|
|||||||||||
|
Other
income (expense), net
|
(10,000
|
)
|
(26,000
|
)
|
354,000
|
285,000
|
|||||||||
|
Total
other (expense)
|
(1,396,000
|
)
|
(175,000
|
)
|
(2,357,000
|
)
|
(42,000
|
)
|
|||||||
|
Income
(loss) from continuing operations before
income
tax (provision) benefit and
equity
in earnings (losses) of investments
|
7,598,000
|
2,311,000
|
2,881,000
|
(2,977,000
|
)
|
||||||||||
|
Income
tax (provision) benefit
|
(2,704,000
|
)
|
(991,000
|
)
|
(1,043,000
|
)
|
1,400,000
|
||||||||
|
Equity
in earnings (losses) of investments
|
27,000
|
(84,000
|
)
|
75,000
|
(183,000
|
)
|
|||||||||
|
Income
(loss) from continuing operations
|
4,921,000
|
1,236,000
|
1,913,000
|
(1,760,000
|
)
|
||||||||||
|
Loss
from discontinued operations, net of income taxes
|
(6,000
|
)
|
(1,000
|
)
|
(18,000
|
)
|
(7,000
|
)
|
|||||||
|
Net
income (loss)
|
4,915,000
|
1,235,000
|
1,895,000
|
(1,767,000
|
)
|
||||||||||
|
Preferred
dividends
|
(66,000
|
)
|
(66,000
|
)
|
(197,000
|
)
|
(197,000
|
)
|
|||||||
|
Net
income (loss) applicable to common stock
|
$
|
4,849,000
|
$
|
1,169,000
|
$
|
1,698,000
|
$
|
(1,964,000
|
)
|
||||||
|
Per
common share basic:
|
|||||||||||||||
|
Continuing
operations
|
$
|
0.43
|
$
|
0.10
|
$
|
0.15
|
$
|
(0.17
|
)
|
||||||
|
Discontinued
operations
|
(0.00
|
)
|
(0.00
|
)
|
(0.00
|
)
|
(0.00
|
)
|
|||||||
|
Basic
net income (loss) per share
|
$
|
0.43
|
$
|
0.10
|
$
|
0.15
|
$
|
(0.17
|
)
|
||||||
|
Per
common share-diluted:
|
|||||||||||||||
|
Continuing
operations
|
$
|
0.43
|
$
|
0.10
|
$
|
0.15
|
$
|
(0.17
|
)
|
||||||
|
Discontinued
operations
|
(0.00
|
)
|
(0.00
|
)
|
(0.00
|
)
|
(0.00
|
)
|
|||||||
|
Diluted
net income (loss) per share
|
$
|
0.43
|
$
|
0.10
|
$
|
0.15
|
$
|
(0.17
|
)
|
||||||
|
Dividends
per common share
|
$
|
0.03
|
$
|
-
|
$
|
0.09
|
$
|
0.03
|
|||||||
|
Weighted-average
shares outstanding-basic
|
11,194,000
|
11,263,000
|
11,215,000
|
11,236,000
|
|||||||||||
|
Weighted-average
shares outstanding-diluted
|
11,194,000
|
11,263,000
|
11,215,000
|
11,252,000
|
|||||||||||