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What changed in Limoneira CO's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Limoneira CO's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+216 added−230 removedSource: 10-K (2024-12-23) vs 10-K (2023-12-21)

Top changes in Limoneira CO's 2024 10-K

216 paragraphs added · 230 removed · 191 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

50 edited+7 added−22 removed51 unchanged
Biggest changeWe market and sell lemons directly to our food service, wholesale and retail customers throughout the United States, Canada, Asia, Australia and certain other international markets. We are one of the largest lemon growers in the United States with approximately 3,500 acres of lemons planted primarily in Ventura County, California and in Yuma County, Arizona.
Biggest changeFinancial information and discussion of our four reportable segments are contained in the notes to the accompanying consolidated financial statements of this Annual Report. 6 Agribusiness Summary 7 Farming Lemons. We market and sell lemons directly to our food service, wholesale and retail customers throughout the United States, Canada, Asia, and certain other international markets.
We also partner with one of our tenants and have an organic recycling facility on our land in Ventura County. Effective November 1, 2021, we also lease our 1,200-acre Santa Clara ranch in Argentina. Real Estate Development Summary We invest in real estate investment projects and recognize that long-term strategies are required for successful real estate development activities.
We also partner with one of our tenants and have an organic recycling facility on our land in Ventura County. Effective November 1, 2021, we lease our 1,200-acre Santa Clara ranch in Argentina. Real Estate Development Summary We invest in real estate investment projects and recognize that long-term strategies are required for successful real estate development activities.
Our greatest direct competition for each of our current real estate development properties in Ventura County comes from other residential and commercial developments in nearby areas. Resources and Raw Materials In our fresh lemons and lemon packing segments, paper is considered a material raw product for our business because most of our products are packed in cardboard cartons for shipment.
Our greatest direct competition for each of our current real estate development properties in Ventura County comes from other residential and commercial developments in nearby areas. 13 Resources and Raw Materials In our fresh lemons and lemon packing segments, paper is considered a material raw product for our business because most of our products are packed in cardboard cartons for shipment.
We intend to strategically sell certain assets to reduce existing debt, increase farming efficiencies and expand packing capabilities. Increased volume of fruit sales is expected to be fueled by sourcing from third-party growers and suppliers, thus mitigating the volatility that commodity pricing has on growers. • Expand our Sources of Lemon Supply.
We intend to continue to strategically sell certain assets to reduce existing debt, increase farming efficiencies and expand packing capabilities. Increased volume of fruit sales is expected to be fueled by sourcing from third-party growers and suppliers, thus mitigating the volatility that commodity pricing has on growers. • Expand our Sources of Lemon Supply.
Competition in the various agribusiness markets is affected by reliability of supply, product quality, brand recognition and perception, price and the ability to satisfy changing customer preferences through innovative product offerings. 14 The sale and leasing of residential, commercial and industrial real estate is very competitive, with competition coming from numerous and varied sources throughout California.
Competition in the various agribusiness markets is affected by reliability of supply, product quality, brand recognition and perception, price and the ability to satisfy changing customer preferences through innovative product offerings. The sale and leasing of residential, commercial and industrial real estate is very competitive, with competition coming from numerous and varied sources throughout California.
Finally, over time, we expect that our customers and the end consumers of our fruit will value the investments that we have made in renewable energy as a part of our packing operations, which we believe may help us differentiate our products from similar commodities. • We have made various other investments in water rights and mutual water companies.
Finally, over time, we expect that our customers and the end consumers of our fruit will value the investments that we made in renewable energy as a part of our packing operations, which we believe may help us differentiate our products from similar commodities. • We made various other investments in water rights and mutual water companies.
The following table presents the number of acres planted by fruit variety and approximate age of our orchards: Age of Orchards 0-5 Years 6-25 Years Over 25 Years Total Lemons 300 2,400 800 3,500 Avocados 400 300 500 1,200 Oranges — 100 — 100 Wine grapes 100 300 — 400 Total 800 3,100 1,300 5,200 Lemon Packing and Sales We are one of the oldest continuous lemon packing operations in North America.
The following table presents the number of acres planted by fruit variety and approximate age of our orchards: Age of Orchards 0-5 Years 6-25 Years Over 25 Years Total Lemons 400 2,200 800 3,400 Avocados 600 300 500 1,400 Oranges — 100 — 100 Wine grapes 100 300 — 400 Total 1,100 2,900 1,300 5,300 Lemon Packing and Sales We are one of the oldest continuous lemon packing operations in North America.
Such factors could affect our results of operations, cash flows and liquidity. 10 For more than 100 years, we have been making strategic real estate investments in California agricultural and developable real estate. Our current real estate developments include developable land parcels, multi-family housing and single-family homes with approximately 800 units in various stages of planning and development.
Such factors could affect our results of operations, cash flows and liquidity. 9 For more than 100 years, we have been making strategic real estate investments in California agricultural and developable real estate. Our current real estate developments include developable land parcels, multi-family housing and single-family homes with approximately 800 units in various stages of planning and development.
Increases in lemons procured from third-party growers and suppliers and international sources improve our ability to provide our customers with fresh lemons throughout the year. 13 • Increase the Volume of our Lemon Packing Operations . We regularly monitor our costs for redundancies and opportunities for cost reductions. In this regard, cost per carton is a function of throughput.
Increases in lemons procured from third-party growers and suppliers and international sources improve our ability to provide our customers with fresh lemons throughout the year. 12 • Increase the Volume of our Lemon Packing Operations . We regularly monitor our costs for redundancies and opportunities for cost reductions. In this regard, cost per carton is a function of throughput.
The storage life of fresh lemons generally ranges from one to 18 weeks, depending upon the maturity of the fruit, the growing methods used and the handling conditions in the distribution chain. Avocados. We are one of the largest avocado growers in the United States with approximately 1,200 acres of avocados planted throughout Ventura County.
The storage life of fresh lemons generally ranges from one to 18 weeks, depending upon the maturity of the fruit, the growing methods used and the handling conditions in the distribution chain. Avocados. We are one of the largest avocado growers in the United States with approximately 1,400 acres of avocados planted throughout Ventura County.
The following is a summary of each of the strategic real estate investment properties in which we own an interest: East Area I - Santa Paula, California. East Area I consists of 523 acres that we historically used as agricultural land and is located in Santa Paula approximately ten miles from the City of Ventura and the Pacific Ocean.
The following is a summary of each of the strategic real estate investment properties in which we own an interest: East Area I - Santa Paula, California. East Area I consists of approximately 500 acres that we historically used as agricultural land and is located in Santa Paula approximately ten miles from the City of Ventura and the Pacific Ocean.
Our headquarters, lemon packing operations and storage facilities are located on this property. Other acres in the table above includes corporate and lemon packing facilities, land leased to other agricultural businesses, rental units, roads, creeks, hillsides and other open land. 9 Our orchards can maintain production for many years.
Our headquarters, lemon packing operations and storage facilities are located on this property. Other acres in the table above includes corporate and lemon packing facilities, land leased to other agricultural businesses, rental units, roads, creeks, hillsides and other open land. 8 Our orchards can maintain production for many years.
We own and maintain 238 residential housing units located in Ventura County in California that we lease to employees, former employees and outside tenants. We also own several commercial office buildings. These properties generate reliable cash flows that we use to partially fund the operating costs of our business.
We own and maintain 240 residential housing units located in Ventura County in California that we lease to employees, former employees and outside tenants. We also own several commercial office buildings. These properties generate reliable cash flows that we use to partially fund the operating costs of our business.
The following is a brief list of what we believe are our significant competitive strengths with respect to our agribusiness operations: • Our agricultural properties in Ventura County are located near the Pacific Ocean, which provides an ideal environment for growing lemons, avocados and row crops.
The following is a brief list of what we believe are our significant competitive strengths with respect to our agribusiness operations: • Our agricultural properties in Ventura County are located near the Pacific Ocean, which provides an ideal environment for growing lemons and avocados.
The harvest and sale of our lemons, avocados, oranges and other crops occurs in all quarters, but is generally more concentrated during our third quarter. Our lemons are generally grown and marketed throughout the year, our avocados are primarily sold from January through August and our wine grapes are primarily sold in September and October.
The harvest and sale of our lemons, avocados and oranges occurs in all quarters, but is generally more concentrated during our third quarter. Our lemons are generally grown and marketed throughout the year, our avocados are primarily sold from January through August and our wine grapes are primarily sold in September and October.
We own and maintain 238 residential housing units located in Ventura County, California. We lease these housing units to employees, former employees and outside tenants. Our residential units provide affordable housing to many of our employees, including our agribusiness employees. Employees live close to their work, which reduces traffic and commuting times.
We own and maintain 240 residential housing units located in Ventura County, California. We lease these housing units to employees, former employees and outside tenants. Our residential units provide affordable housing to many of our employees, including our agribusiness employees. Employees live close to their work, which reduces traffic and commuting times.
Our agricultural properties in Yuma, Arizona, are also located in an area that is well-suited for growing citrus crops. • Historically, a higher percentage of our crops goes to the fresh market, which is commonly referred to as fresh utilization, than that of other growers and packers with which we compete. • We have contiguous and nearby land resources that permit us to efficiently use our agricultural land and resources. • In all but one of our properties, we are not dependent on State or Federal water projects to support our agribusiness or real estate development operations. • We own a majority of our agricultural land and take a long view on our fruit production practices. • A significant amount of our agribusiness property was acquired many years ago, which results in a low-cost basis and associated expenses. • In our fresh lemons and lemon packing segments, our integrated business model with respect to growing, packing, marketing and selling citrus allows us to better serve our customers. • Our lemon packing operations provide marketing opportunities with other citrus companies and their respective products. 12 • We have made investments in ground-based solar projects that provide us with tangible and intangible non-revenue generating benefits.
Our agricultural properties in Yuma, Arizona, are also located in an area that is well-suited for growing citrus crops. • Historically, a higher percentage of our crops goes to the fresh market, which is commonly referred to as fresh utilization, than that of other growers and packers with which we compete. • We have contiguous and nearby land resources that permit us to efficiently use our agricultural land and resources. • We are not dependent on State or Federal water projects for our agribusiness or real estate development operations in California. • We own a majority of our agricultural land and take a long view on our fruit production practices. • A significant amount of our agribusiness property was acquired many years ago, which results in a low-cost basis and associated expenses. • In our fresh lemons and lemon packing segments, our integrated business model with respect to growing, packing, marketing and selling citrus allows us to better serve our customers. • Our lemon packing operations provide marketing opportunities with other citrus companies and their respective products. 11 • We made investments in ground-based solar projects that provide us with tangible and intangible non-revenue generating benefits.
Our lemons and oranges also compete with other fruits and vegetables for the share of consumer expenditures devoted to fresh fruit and vegetables: apples, pears, melons, pineapples and other tropical fruit. Avocado products compete in the supermarket with hummus products and other dips and salsas.
Our lemons and other citrus also compete with other fruits and vegetables for the share of consumer expenditures devoted to fresh fruit and vegetables: apples, pears, melons, pineapples and other tropical fruit. Avocado products compete in the supermarket with hummus products and other dips and salsas.
The following is a description of our agriculture properties: Ranch Name County / State or Country Total Acres Lemons Avocados Oranges Wine Grapes Other Limoneira/Olivelands Ventura, CA 1,700 500 700 — — 500 La Campana Ventura, CA 300 — 300 — — — Orchard Farm Ventura, CA 1,100 500 — — — 600 Rancho La Cuesta Ventura, CA 200 100 — — — 100 Limco Del Mar Ventura, CA 200 100 100 — — — Windfall Farms San Luis Obispo, CA 700 — — — 400 300 Associated Citrus Packers Yuma, AZ 1,300 600 — — — 700 Pan de Azucar & San Pablo La Serena, Chile 3,500 500 — 100 — 2,900 Santa Clara Jujuy, Argentina 1,200 1,000 — — — 200 Other agribusiness land Various Counties, CA 400 200 100 — — 100 Total 10,600 3,500 1,200 100 400 5,400 Percentage of Total 100 % 33 % 11 % 1 % 4 % 51 % The Limoneira/Olivelands Ranch is the original site of our Company.
The following is a description of our agriculture properties: Ranch Name County / State or Country Total Acres Lemons Avocados Oranges Wine Grapes Other Limoneira/Olivelands Ventura, CA 1,700 400 900 — — 400 La Campana Ventura, CA 300 — 300 — — — Orchard Farm Ventura, CA 1,100 700 — — — 400 Rancho La Cuesta Ventura, CA 200 — — — — 200 Limco Del Mar Ventura, CA 200 100 100 — — — Windfall Farms San Luis Obispo, CA 700 — — — 400 300 Associated Citrus Packers Yuma, AZ 1,300 600 — — — 700 Pan de Azucar & San Pablo La Serena, Chile 3,500 500 — 100 — 2,900 Santa Clara Jujuy, Argentina 1,200 1,000 — — — 200 Other agribusiness land Various Counties, CA 300 100 100 — — 100 Total 10,500 3,400 1,400 100 400 5,200 The Limoneira/Olivelands Ranch is the original site of our Company.
Agribusiness activities are performed through these four reporting segments: We are one of California’s oldest citrus growers. According to Sunkist Growers, Inc., we are one of the largest growers of lemons in the United States and, according to the California Avocado Commission, one of the largest growers of avocados in the United States.
Agribusiness activities are performed through these four reporting segments: We are one of California’s oldest citrus growers and are one of the largest growers of lemons in the United States. According to the California Avocado Commission, we are one of the largest growers of avocados in the United States.
Real Estate Development Operations With respect to our real estate development operations, we believe our competitive advantages are as follows: • We have entitlements to build approximately 1,500 residential units in our East Area I development. • We have partnered with an experienced and financially strong land developer for our East Area I residential master plan development. • Several of our agricultural and real estate investment properties are unique and carry longer-term development potential. • Our East Area II property has approximately 30 acres of land commercially zoned, which is adjacent to our East Area I property.
Real Estate Development Operations With respect to our real estate development operations, we believe our competitive advantages are as follows: • We have entitlements to build approximately 2,050 residential units in our East Area I development. • We partnered with an experienced and financially strong land developer for our East Area I residential master plan development. • Several of our agricultural and real estate investment properties are unique and carry longer-term development potential. • Our East Area II property has approximately 30 acres of land commercially zoned, which is adjacent to our East Area I property.
Overview We are primarily an agribusiness company founded and based in Santa Paula, California, committed to responsibly using and managing our approximately 11,100 acres of land, water resources and other assets to maximize long-term stockholder value. Our current operations consist of fruit production, sales and marketing, rental operations, real estate and capital investment activities.
Overview We are primarily an agribusiness company founded and based in Santa Paula, California, committed to responsibly using and managing our approximately 10,500 acres of land, water resources and other assets to maximize long-term stockholder value. Our current operations consist of fruit production, sales and marketing, rental operations, real estate and capital investment activities.
We intend to explore opportunities to expand our international sales and marketing of lemons. We have the ability to supply a wide range of customers and markets and, because we produce high quality lemons, we can export our lemons to international customers, which many of our competitors are unable to supply. • Opportunistically Expand our Plantings of Avocados .
We intend to explore opportunities to expand our international sales and marketing of lemons. We have the ability to supply a wide range of customers and markets and, because we produce high quality lemons, we can export our lemons to international customers, which many of our competitors are unable to supply.
Approximately 96% of our lemon plantings are of the Lisbon, Eureka and Genoa varieties and approximately 4% are of other varieties such as sweet Meyer lemons and Proprietary Seedless lemons. California-grown lemons are available throughout the year, with peak production periods occurring from January through August.
Approximately 99% of our lemon plantings are of the Lisbon, Eureka and Genoa varieties and approximately 1% are of other varieties such as sweet Meyer lemons and Proprietary Seedless lemons. California-grown lemons are available throughout the year, with peak production periods occurring from January through August.
In addition to growing lemons and avocados, we grow oranges and other crops. We have agricultural plantings throughout Ventura and San Luis Obispo in California and Yuma County in Arizona, La Serena, Chile and Jujuy, Argentina, which collectively consist of approximately 3,500 acres of lemons, 1,200 acres of avocados, 100 acres of oranges and 400 acres of wine grapes.
In addition to growing lemons and avocados, we grow oranges and wine grapes. We have agricultural plantings throughout Ventura and San Luis Obispo Counties in California, Yuma County in Arizona, La Serena, Chile and Jujuy, Argentina, which collectively consist of approximately 3,400 acres of lemons, 1,400 acres of avocados, 100 acres of oranges and 400 acres of wine grapes.
As of October 31, 2023, we lease approximately 400 acres of our land to third-party agricultural tenants who grow a variety of row crops. Our leased land business provides us with a profitable method to diversify the use of our land.
As of October 31, 2024, we lease approximately 300 acres of our land to third-party agricultural tenants who grow a variety of row crops. Our leased land business provides us with a profitable method to diversify the use of our land.
Approved project plans include approximately 1,500 residential units and site improvements. A total of 707 residential units have closed from the project's inception to October 31, 2023. In October 2022, we entered into another joint venture with Lewis for the development of our 17-acre East Area I Retained Property (“Retained Property”), which is located within the East Area I property.
Approved project plans include approximately 2,050 residential units and site improvements. A total of 1,261 residential units have closed from the project’s inception to October 31, 2024. In October 2022, we entered into another joint venture with Lewis for the development of our 17-acre East Area I Retained Property (“Retained Property”), which is located within the East Area I property.
Business Division Summary We have three business divisions: agribusiness, rental operations and real estate development. The agribusiness division is comprised of four reportable operating segments: fresh lemons, lemon packing, avocados and other agribusiness, which includes oranges, specialty citrus, other crops and farm management services. The agribusiness division includes our core operations of farming, harvesting, lemon packing and lemon sales operations.
Business Division Summary We have three business divisions: agribusiness, rental operations and real estate development. The agribusiness division is comprised of four reportable operating segments: fresh lemons, lemon packing, avocados and other agribusiness, which primarily includes oranges, specialty citrus, other crops and farm management services.
For financial reporting purposes, we depreciate our orchards from 20 to 40 years depending on the fruit variety with the majority of our orchards depreciated over 20 to 30 years. We regularly evaluate our orchards’ production and growing costs and based on these and other factors, we may decide to redevelop certain orchards.
For financial reporting purposes, we depreciate our orchards from 20 to 30 years depending on the fruit variety. We regularly evaluate our orchards’ production and growing costs and based on these and other factors, we may decide to redevelop certain orchards.
This property was formerly known as our Teague McKevett Ranch. East Area I is the location for our master planned community of commercial and residential properties, named Harvest at Limoneira , designed to satisfy expected demand in a region that we believe will have few other developments in this coming decade.
East Area I is the location for our master planned community of commercial and residential properties, named Harvest at Limoneira , designed to satisfy expected demand in a region that we believe will have few other developments in this coming decade.
The export market for fresh produce also significantly declined due to the COVID-19 pandemic impacts. 6 The decline in demand for our products beginning the second quarter of fiscal year 2020 has negatively impacted our sales and profitability for the last four fiscal years. The COVID-19 pandemic may continue to impact our sales and profitability in future periods.
In particular, the export market for fresh produce significantly declined due to the COVID-19 pandemic impacts. The decline in demand for our products beginning the second quarter of fiscal year 2020 negatively impacted our sales and profitability and may impact our sales and profitability in future periods.
Customers We market and sell our lemons directly to our food service, wholesale and retail customers in the United States, Canada, Asia, Australia, Europe and certain other international markets. We sold lemons to approximately 190 U.S. and international customers during fiscal year 2023. We sell our avocados and oranges to third-party packinghouses and our wine grapes to wine producers.
Customers We market and sell our lemons directly to our food service, wholesale and retail customers in the United States, Canada, Asia, and certain other international markets. We sold lemons and other citrus to 194 U.S. and international customers during fiscal year 2024. We sell our avocados to third-party packinghouses and our wine grapes to wine producers.
Human Capital Resources As of October 31, 2023, we had 257 employees, of which 100 were salaried and 157 were hourly. None of our employees are subject to a collective bargaining agreement. We believe that our relations with our employees are good.
Human Capital Resources As of October 31, 2024, we had 241 employees, of which 90 were salaried and 151 were hourly. None of our employees are subject to a collective bargaining agreement. We believe that our relations with our employees are good.
As our agricultural and non-strategic real estate development investments are monetized, we intend to use the cash flow to reduce existing debt, invest in farming efficiencies and expand packing capacities through our One World of Citrus Asset Lighter Business Model.
As our agricultural and non-strategic real estate development investments are monetized, we intend to use the cash flow to reduce existing debt, invest in farming efficiencies and expand packing capacities through our One World of Citrus asset-lighter business model. We will also use more third-party grower and supplier fruit to reduce the impact of pricing volatility and rising farming costs.
We have several diversity, inclusion and belonging efforts and programs to better ensure that we are supporting our employees. Limoneira’s overall culture emphasizes the health and safety of our employees and the customers we serve.
We also seek to support the welfare of the people who produce, process and harvest the products we sell. We have several diversity, inclusion and belonging efforts and programs to better ensure that we are supporting our employees. 14 Limoneira’s overall culture emphasizes the health and safety of our employees and the customers we serve.
For our specific crops, the size of the U.S. market is approximately $586 million for lemons, both fresh and juice, approximately $500 million for avocados, and approximately $1.5 billion for oranges, both fresh and juice.
For our specific crops, the size of the 2023 U.S. market was approximately $615 million for lemons, both fresh and juice, approximately $250 million for avocados, and approximately $985 million for oranges, both fresh and juice.
We formed LLCB II, LLC as the development entity, contributed our Retained Property to the joint venture and sold a 50% interest to Lewis for approximately $8.0 million.
We formed LLCB II, LLC as the development entity, contributed our Retained Property to the joint venture and sold a 50% interest to Lewis for approximately $8.0 million. The joint venture partners will share in capital contributions to fund project costs until loan proceeds and/or revenues are sufficient to fund the projects.
We expect to receive approximately $123.0 million from LLCB, LLCB II and East Area II over the next seven years of the projects. 11 East Area II - Santa Paula, California. Our design associates and we are in the process of formulating plans for East Area II, a parcel of approximately 30 acres adjacent to East Area I.
Our design associates and we are in the process of formulating plans for East Area II, a parcel of approximately 30 acres adjacent to East Area I.
We believe that an environment of diversity, inclusion and belonging fosters innovation, strengthens our global workforce, and drives our ability to serve customers.
We believe that an environment of diversity, inclusion and belonging fosters innovation, strengthens our global workforce, and drives our ability to serve customers. Our global presence is strengthened by having a workforce that reflects the diversity of the customers we serve and by maintaining an environment in which such diversity contributes to our mission.
The storage life of fresh avocados generally ranges from one to four weeks, depending upon the maturity of the fruit, the growing methods used and the handling conditions in the distribution chain. Through fiscal year 2021, the Company sold the majority of its avocado production to Calavo Growers, Inc.
The storage life of fresh avocados generally ranges from one to four weeks, depending upon the maturity of the fruit, the growing methods used and the handling conditions in the distribution chain. Primarily related to differing soil conditions, the care of avocado trees is intensive.
Ventura County is California’s top lemon producing county. Approximately 55% of our lemons are grown in Ventura County and 24% are grown in Yuma County. We also grow approximately 21% of our lemons near La Serena, Chile. There are many varieties of lemons, with the Lisbon, Eureka and Genoa being the predominant varieties marketed on a worldwide basis.
We are one of the largest lemon growers in the United States with approximately 3,400 acres of lemons planted primarily in Ventura County, California and in Yuma County, Arizona. Ventura County is California’s top lemon producing county. There are many varieties of lemons, with the Lisbon, Eureka and Genoa varieties being the predominant varieties marketed on a worldwide basis.
We are committed to improving the lives of all our stakeholders by helping to provide access to our products and increasing the diversity of our workforce. We also seek to support the welfare of the people who produce, process and harvest the products we sell.
Limoneira is committed to protecting the human rights, safety and dignity of the people who contribute to the success of our business. We are committed to improving the lives of all our stakeholders by helping to provide access to our products and increasing the diversity of our workforce.
We used ground water from the Cadiz Valley Basin in California's San Bernardino County. For more than 100 years, we have been making strategic investments in California agriculture and real estate. We currently have an interest in two real estate development projects in California.
We use ground water provided by wells and surface water for our PDA and San Pablo farming operations in Chile and our Trapani Fresh farming operations in Argentina. For more than 100 years, we have been making strategic investments in California agriculture and real estate. We currently have an interest in two real estate development projects in California.
Plantings We have agricultural plantings on properties located in the United States, Chile and Argentina.
Additionally, we provide farm management services, which include farming, management and operations services mainly related to the Northern Properties. Plantings We have agricultural plantings on properties located in the United States, Chile and Argentina.
The rental operations division includes our residential and commercial rentals, leased land operations and organic recycling. The real estate development division includes our investments in real estate development projects. Financial information and discussion of our four reportable segments are contained in the notes to the accompanying consolidated financial statements of this Annual Report. Agribusiness Summary 7 Farming Lemons.
The agribusiness division includes our core operations of farming, harvesting, lemon packing and lemon sales operations. The rental operations division includes our residential and commercial rentals, leased land operations and organic recycling. The real estate development division includes our investments in real estate development projects.
Of most importance is the overall fresh utilization rate for our fruit, which is directly related to quality. • Expand International Sales and Marketing of Lemons . We estimate that we currently have approximately 15% of the fresh lemon market in the United States and a larger share of the United States lemon export market.
We plan to expand our avocado production by 1,000 acres through fiscal year 2027 to capitalize on robust consumer demand trends. • Expand International Sales and Marketing of Lemons . We estimate that we currently have approximately 15% of the fresh lemon market in the United States and a larger share of the United States lemon export market.
The joint venture partners will share in capital contributions to fund project costs until loan proceeds and/or revenues are sufficient to fund the projects. Since inception, each partner has made funding contributions of $21.4 million to LLCB and $0.5 million to LLCB II.
Since inception, each partner has made funding contributions of $21.4 million to LLCB and $1.0 million to LLCB II.
At this time, we cannot predict the impact that such strategic alternatives might have on our business, operations or financial condition. On December 19, 2023, we declared a cash dividend of $0.075 per common share to be paid on January 12, 2024, in the aggregate amount of approximately $1.3 million to stockholders of record as of January 2, 2024.
At this time, we cannot predict the impact that such strategic alternatives might have on our business, operations or financial condition. In December 2023, we sold 12 acres of real property located in Yuma, Arizona for a sales price of $0.8 million. After transaction and closing costs, we recorded a gain on sale of approximately $0.2 million.
In October 2023, Limoneira Lewis Community Builders, LLC (“LLCB”) closed on lot sales representing 121 residential units and we recorded equity in earnings of investments of $5.1 million for fiscal year 2023. On December 1, 2023, we announced the commencement of a strategic review process to explore potential alternatives aimed at maximizing stockholder value.
These projects include multi-family housing, single-family homes and apartments of approximately 800 units in various stages of planning and development. 5 Fiscal Year 2024 Highlights and Recent Developments On December 1, 2023, we announced the commencement of a strategic review process to explore potential alternatives aimed at maximizing stockholder value.
As an agricultural cooperative, Sunkist coordinated the sales and marketing of the oranges and specialty citrus and orders were processed by Sunkist-member packinghouses for direct shipment to customers. We currently market our wine grapes utilizing processors that are not members of agricultural cooperatives. Our wine grapes are harvested and sold to various wine producers.
Other Agribusiness. We have approximately 100 acres of oranges planted near La Serena, Chile, and 400 acres of wine grapes planted in San Luis Obispo County, California. We currently market our wine grapes utilizing processors that are not members of agricultural cooperatives. Our wine grapes are harvested and sold to various wine producers.
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We use ground water provided by wells and surface water for our PDA and San Pablo farming operations in Chile and our Trapani Fresh farming operations in Argentina. We use ground water from the San Joaquin Valley Basin and water from local water and irrigation districts in Tulare County, which is in California’s San Joaquin Valley.
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In April 2024, the Company conducted an organization restructuring resulting in severance benefit costs of approximately $1.2 million.
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These projects include multi-family housing, single-family homes and apartments of approximately 800 units in various stages of planning and development. 5 Fiscal Year 2023 Highlights and Recent Developments On October 10, 2022, we entered into a Purchase and Sale Agreement, as amended (the “Agreement”), with PGIM Real Estate Finance, LLC (“PGIM”) to sell 3,537 acres of land and citrus orchards in Tulare County, California (the “Northern Properties”) for an adjusted purchase price of approximately $100.0 million.
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On April 30, 2024, our real estate development joint venture with The Lewis Group of Companies (“Lewis”) closed an additional 554 residential homesites at the Harvest at Limoneira master planned community in Santa Paula, CA (“Harvest”) and we recorded equity in earnings of investments of $16.6 million in the second quarter of fiscal year 2024.
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The agreement became effective on January 25, 2023, when the Board of Directors (the “Board”) approved the Agreement, binding us to sell the Northern Properties and the transaction closed on January 31, 2023. We received net cash proceeds of approximately $98.4 million and recorded a gain of approximately $40.0 million. The proceeds were used primarily to pay down debt.
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On June 5, 2024, we received a cash distribution of $15.0 million from the joint venture. On May 7, 2024, it was announced that the Santa Paula City Council approved the proposal brought by the Company’s real estate development joint venture with Lewis to increase the number of entitled lots at Harvest from 1,500 dwelling units to 2,050 dwelling units.
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On January 31, 2023, we entered into a Farm Management Agreement (the “FMA”) with an affiliate of PGIM to provide farming, management and operations services related to the Northern Properties. The FMA has an initial term expiring March 31, 2024, and thereafter continuing from year to year unless earlier terminated under the terms of the FMA.
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The Santa Paula City Council approved an amendment allowing for the 550-unit increase on April 3, 2024. The 550-unit increase will provide 250 additional single family for-sale homesites within Phase 3 of Harvest. Additionally, the Company in partnership with Lewis plans to construct 300 multi-family rental homes on a mixed-use portion of the project.
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Further, on January 31, 2023, we entered into a Grower Packing and Marketing Agreement to provide packing, marketing and selling services for lemons harvested on the Northern Properties for a minimum five-year term, subject to certain benchmarking standards.
Added
On December 17, 2024, we declared a cash dividend of $0.075 per common share payable on January 15, 2025, in the aggregate amount of approximately $1.4 million to common stockholders of record as of December 30, 2024. COVID-19 Pandemic The COVID-19 pandemic had an adverse impact on the industries and markets in which we conduct business.
Removed
During the three months ended January 31, 2023, the Company made funding contributions of $2.5 million to fully fund and settle the plan obligations of the Limoneira Company Retirement Plan. Lump sum payments were made to a portion of the active and vested terminated participants and annuities were purchased for all remaining participants from an insurance company.
Added
In June 2024, we received a cash distribution of $15.0 million from LLCB and we expect to receive approximately $165.0 million from LLCB, LLCB II and East Area II over the next six years of the projects. 10 East Area II - Santa Paula, California.
Removed
There are no remaining benefit obligations or plan assets and the remaining accumulated other comprehensive loss was fully recognized. On November 30, 2022, we sold our Sevilla property, received net proceeds of $2.6 million and recorded an immaterial loss in the first quarter of fiscal year 2023.
Added
Of most importance is the overall fresh utilization rate for our fruit, which is directly related to quality. • Expand our Plantings of Avocados . Our plantings of avocados have been profitable and historically have been pursued to diversify our product line.
Removed
On April 18, 2023, we entered into a Confidential Settlement Agreement and Release (the “Settlement Agreement”) with Southern California Edison and Edison International to formally resolve any and all claims related to the Thomas Fire in fiscal year 2018. Under the terms of the Settlement Agreement, the Company was awarded a total settlement of $9.0 million.
Removed
On May 19, 2023, the Company received approximately $6.1 million, net of legal and related costs. In April 2023, we determined that citrus farming operations were economically unviable on 670 acres of leased agricultural land at the Cadiz Ranch.
Removed
As a result, we ceased farming operations, disposed of the related property, plant and equipment and recorded a loss on disposal of assets of $9.0 million in the second quarter of fiscal year 2023. In August 2023, we engaged with YMIDD and the United States Bureau of Reclamation in a fallowing and forbearance program at our Associated Citrus Packers, Inc.
Removed
(“Associated”) ranch in Yuma, Arizona. We expect to receive approximately $1.3 million annually, paid in quarterly installments, for fallowing approximately 600 acres out of 1,300 acres of farmland through calendar year 2025.
Removed
COVID-19 Pandemic The COVID-19 pandemic has had an adverse impact on the industries and markets in which we conduct business. In particular, the United States lemon market saw a significant decline in volume, with lemon demand falling since widespread shelter in place orders were issued in March 2020, resulting in a significant market oversupply.
Removed
Given the economic uncertainty as a result of the COVID-19 pandemic over the past four fiscal years, we have taken actions to improve our current liquidity position, including strategically selling certain assets, temporarily postponing capital expenditures and substantially reducing discretionary spending.
Removed
There is continued uncertainty around the breadth and duration of our business disruptions related to the COVID-19 pandemic, as well as its impact on the U.S. economy and the ongoing business operations of our customers.
Removed
The ongoing impact of the COVID-19 pandemic on our results of operations, financial condition, or liquidity for fiscal year 2024 and beyond cannot be estimated at this point. The following discussions are subject to the future effects of the COVID-19 pandemic on our ongoing business operations.
Removed
(“Calavo”), a packing and marketing company listed on the NASDAQ Global Select Market under the symbol CVGW. In February 2022, the Company terminated its Avocado Marketing Agreement and the associated Letter Agreement Regarding Fruit Commitment with Calavo to pursue opportunities with other packing and marketing companies. 8 Primarily related to differing soil conditions, the care of avocado trees is intensive.
Removed
Other Agribusiness. We have approximately 100 acres of oranges planted near La Serena, Chile. Approximately 72% of our orange plantings are of the Navel variety and approximately 28% are of the Valencia variety. We have approximately 400 acres of wine grapes. Additionally, we provide farm management services, which include farming, management and operations services mainly related to the Northern Properties.
Removed
Prior to the Northern Properties sale, we utilized third-party packinghouses to process and pack our oranges. A portion of our oranges was marketed and sold under the Sunkist brand by Sunkist and orders were processed by Sunkist-member packinghouses.
Removed
In connection with the closing, we amended LLCB’s Limited Liability Company Agreement to provide that LLCB is to include the processing of final approval for additional residential units to be developed and constructed on the Retained Property.
Removed
We will also use more third-party grower and supplier fruit to reduce the impact of pricing volatility and rising farming costs.
Removed
Our plantings of avocados have been profitable and have been pursued to diversify our product line. Agricultural land that we believe is not suitable for lemons is typically planted with avocados or other crops. While we expand our avocado plantings, we expect to do so on an opportunistic basis in locations that we believe offer a record of historical profitability.
Removed
Our global presence is strengthened by having a workforce that reflects the diversity of the customers we serve and by maintaining an environment in which such diversity contributes to our mission. 15 Limoneira is committed to protecting the human rights, safety and dignity of the people who contribute to the success of our business.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

48 edited+4 added−4 removed133 unchanged
Biggest changeOur international sales are primarily transacted in U.S. dollars. Our results of operations are affected by fluctuations in currency exchange rates in both sourcing and selling locations. In the past, periods of a strong U.S. dollar relative to other currencies have led international customers, particularly in Asia, to find alternative sources of fruit.
Biggest changeWe distribute our products both nationally and internationally and have foreign subsidiaries with functional currencies besides the U.S. dollar. Our international sales are primarily transacted in U.S. dollars. Our results of operations are affected by fluctuations in currency exchange rates in both sourcing and selling locations and our foreign subsidiaries.
In addition, in the past, many states, cities and counties (including Ventura County) have approved various “slow growth” or “urban limit line” measures. If unforeseen regulatory challenges with East Areas I and II occur, we may not be able to develop these projects as planned. Third-party litigation could increase the time and cost of our real estate development efforts.
In addition, in the past, many states, cities and counties (including Ventura County) approved various “slow growth” or “urban limit line” measures. If unforeseen regulatory challenges with East Areas I and II occur, we may not be able to develop these projects as planned. Third-party litigation could increase the time and cost of our real estate development efforts.
In addition, the Sarbanes-Oxley Act of 2002, as well as rules promulgated by the SEC and NASDAQ, require us to adopt corporate governance practices applicable to U.S. public companies. These rules and regulations may increase our legal and financial compliance costs, which could adversely affect the trading price of our common stock. Item 1B. Unresolved Staff Comments None. 28
In addition, the Sarbanes-Oxley Act of 2002, as well as rules promulgated by the SEC and NASDAQ, require us to adopt corporate governance practices applicable to U.S. public companies. These rules and regulations may increase our legal and financial compliance costs, which could adversely affect the trading price of our common stock. Item 1B. Unresolved Staff Comments None.
Industry consolidation (horizontally and vertically) and other factors have increased the buying leverage of the major grocery retailers in our markets, which may put further downward pressure on our pricing and volume and could adversely affect our results of operations. 17 Our earnings are sensitive to fluctuations in market supply and prices and demand for our products.
Industry consolidation (horizontally and vertically) and other factors have increased the buying leverage of the major grocery retailers in our markets, which may put further downward pressure on our pricing and volume and could adversely affect our results of operations. Our earnings are sensitive to fluctuations in market supply and prices and demand for our products.
We may encounter risks associated with the real estate joint ventures we entered into in November 2015 and October 2022 with the Lewis Group of Companies including: • the joint ventures may not perform financially or operationally as expected; • land values, project costs, sales absorption or other assumptions included in the development plans may cause the joint ventures’ operating results to be less than expected; • the joint ventures may not be able to obtain project loans on acceptable terms; • the joint venture partners may not be able to provide capital to the joint ventures in the event external financing or project cash flows are not sufficient to finance the joint ventures’ operations; • the joint venture partners may not manage the project properly; and • disagreements could occur between the joint venture partners that could affect the operating results of the joint ventures or could result in a sale of a partner’s interest or the joint ventures at undesirable values. 25 We may encounter other risks that could impact our ability to develop our land.
We may encounter risks associated with the real estate joint ventures we entered into in November 2015 and October 2022 with the Lewis Group of Companies including: • the joint ventures may not perform financially or operationally as expected; • land values, project costs, sales absorption or other assumptions included in the development plans may cause the joint ventures’ operating results to be less than expected; • the joint ventures may not be able to obtain project loans on acceptable terms; • the joint venture partners may not be able to provide capital to the joint ventures in the event external financing or project cash flows are not sufficient to finance the joint ventures’ operations; • the joint venture partners may not manage the project properly; and • disagreements could occur between the joint venture partners that could affect the operating results of the joint ventures or could result in a sale of a partner’s interest or the joint ventures at undesirable values. 24 We may encounter other risks that could impact our ability to develop our land.
Water for our farming operations is sourced from the existing water resources associated with our land, which includes rights to water in the adjudicated Santa Paula Basin (aquifer) and the un-adjudicated Fillmore and Paso Robles Basins (aquifers). We use federal project water in Arizona from the Colorado River through the YMIDD. We also have acquired water rights in Chile.
Water for our farming operations is sourced from the existing water resources associated with our land, which includes rights to water in the adjudicated Santa Paula Basin (aquifer) and the un-adjudicated Fillmore and Paso Robles Basins (aquifers). We use federal project water in Arizona from the Colorado River through the YMIDD. We also acquired water rights in Chile.
These infestations can increase costs, decrease revenues and lead to additional charges to earnings, which may have a material adverse effect on our business, results of operations and financial condition. Our strategy of marketing and selling our lemons directly to our food service, wholesale and retail customers may not continue to be successful.
These infestations can increase costs, decrease revenues and lead to additional charges to earnings, which may have a material adverse effect on our business, results of operations and financial condition. 16 Our strategy of marketing and selling our lemons directly to our food service, wholesale and retail customers may not continue to be successful.
Our Company’s debt agreement with AgWest Farm Credit used LIBOR as a reference rate, which was converted to the Secure Overnight Financing Rate (“SOFR”) on January 1, 2023. Global capital and credit market issues affect our liquidity, increase our borrowing costs and may affect the operations of our suppliers and customers.
Our Company’s debt agreement with AgWest Farm Credit used LIBOR as a reference rate, which was converted to the Secure Overnight Financing Rate (“SOFR”) on January 1, 2023. 21 Global capital and credit market issues affect our liquidity, increase our borrowing costs and may affect the operations of our suppliers and customers.
In addition, current or future federal or state healthcare legislation and regulation, including the Affordable Care Act, may increase our medical costs or the medical costs of our labor contractors that could be passed on to us. 18 Changes in immigration laws could impact the ability of Limoneira to harvest its crops.
In addition, current or future federal or state healthcare legislation and regulation, including the Affordable Care Act, may increase our medical costs or the medical costs of our labor contractors that could be passed on to us. Changes in immigration laws could impact the ability of Limoneira to harvest its crops.
Issues such as health and safety, which may slow or otherwise restrict imports and exports, could adversely affect our business. In addition, the modification of existing laws or regulations or the introduction of new laws or regulations could require us to make material expenditures or otherwise adversely affect the way that we have historically operated our business.
Issues such as health and safety, which may slow or otherwise restrict imports and exports, could adversely affect our business. In addition, the modification of existing laws or regulations or the introduction of new laws or regulations could require us to make material expenditures or otherwise adversely affect the way that we historically operated our business.
The global capital and credit markets have experienced increased volatility and disruption over the past several years, making it more difficult for companies to access those markets. We depend in part on stable, liquid and well-functioning capital and credit markets to fund our operations.
The global capital and credit markets experienced increased volatility and disruption over the past several years, making it more difficult for companies to access those markets. We depend in part on stable, liquid and well-functioning capital and credit markets to fund our operations.
Therefore, it is difficult for us to accurately predict revenue and we cannot pass on cost increases caused by general inflation, except to the extent reflected in market conditions and commodity prices. 26 System security risks, data protection breaches, cyber-attacks and systems integration issues could disrupt our internal operations or services provided to customers, and any such disruption could reduce our expected revenue, increase our expenses, damage our reputation and adversely affect our stock price.
Therefore, it is difficult for us to accurately predict revenue, and we cannot pass on cost increases caused by general inflation, except to the extent reflected in market conditions and commodity prices. 25 System security risks, data protection breaches, cyber-attacks and systems integration issues could disrupt our internal operations or services provided to customers, and any such disruption could reduce our expected revenue, increase our expenses, damage our reputation and adversely affect our stock price.
The trading price of our common stock may be significantly affected by various factors, including: • quarterly fluctuations in our operating results; • changes in investors’ and analysts’ perception of the business risks and conditions of our business; • our ability to meet the earnings estimates and other performance expectations of financial analysts or investors; • unfavorable commentary or downgrades of our stock by equity research analysts; • fluctuations in the stock prices of our peer companies or in stock markets in general; and • general economic or political conditions. 27 Concentrated ownership of our common stock creates a risk of sudden change in our share price.
The trading price of our common stock may be significantly affected by various factors, including: • quarterly fluctuations in our operating results; • changes in investors’ and analysts’ perception of the business risks and conditions of our business; • our ability to meet the earnings estimates and other performance expectations of financial analysts or investors; • unfavorable commentary or downgrades of our stock by equity research analysts; • fluctuations in the stock prices of our peer companies or in stock markets in general; and • general economic or political conditions. 26 Concentrated ownership of our common stock creates a risk of sudden change in our share price.
Shortages of labor could delay our harvesting or lemon processing activities or could result in increases in labor costs. Our labor contractors and we are subject to government mandated wage and benefit laws and regulations.
Shortages of labor could delay our harvesting or lemon processing activities or could result in increases in labor costs. 17 Our labor contractors and we are subject to government mandated wage and benefit laws and regulations.
While we believe we are adequately insured and would attempt to transport our products by alternative means if we were to experience an interruption due to strike, natural disasters or otherwise, we cannot be sure that we would be able to do so or be successful in doing so in a timely and cost-effective manner. 20 Events or rumors relating to LIMONEIRA or our other trademarks and related brands could significantly impact our business.
While we believe we are adequately insured and would attempt to transport our products by alternative means if we were to experience an interruption due to strike, natural disasters or otherwise, we cannot be sure that we would be able to do so or be successful in doing so in a timely and cost-effective manner. 19 Events or rumors relating to LIMONEIRA or our other trademarks and related brands could significantly impact our business.
These factors include among others: • economic and competitive conditions; • changes in laws and regulations; • operating difficulties, increased operating costs or pricing pressures we may experience; and • delays in implementing any strategic projects. 21 If our cash flow and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell material assets or operations, obtain additional capital or restructure our debt.
These factors include among others: • economic and competitive conditions; • changes in laws and regulations; • operating difficulties, increased operating costs or pricing pressures we may experience; and • delays in implementing any strategic projects. 20 If our cash flow and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell material assets or operations, obtain additional capital or restructure our debt.
Termination of a significant number of personnel who are found to be unauthorized workers or the scarcity of available personnel to harvest our agricultural products could cause harvesting costs to increase or could lead to the loss of product that is not timely harvested, which could have a material adverse effect to our citrus grove operations, financial position, results of operations and cash flows.
Termination of a significant number of personnel who are found to be unauthorized workers or the scarcity of available personnel to harvest our agricultural products could cause harvesting costs to increase or could lead to the loss of product that is not timely harvested, which could have a material adverse effect to our citrus and avocado operations, financial position, results of operations and cash flows.
However, if future drought conditions are worse than prior drought conditions or if regulatory responses to such conditions limit our access to water, our business could be negatively impacted by these conditions and responses in terms of access to water and/or cost of water. 19 The use of herbicides, pesticides and other potentially hazardous substances in our operations may lead to environmental damage and result in increased costs to us.
However, if future drought conditions are worse than prior drought conditions or if regulatory responses to such conditions limit our access to water, our business could be negatively impacted by these conditions and responses in terms of access to water and/or cost of water. 18 The use of herbicides, pesticides and other potentially hazardous substances in our operations may lead to environmental damage and result in increased costs to us.
Accordingly, speculation regarding any developments related to the review of strategic alternatives and perceived uncertainties related to the future of the Company could cause our stock price to fluctuate significantly. 16 Risks Related to Our Agribusiness Operations Adverse weather conditions, natural disasters, including earthquakes and wildfires, and other natural conditions, including the effects of climate change, could impose significant costs and losses on our business.
Accordingly, speculation regarding any developments related to the review of strategic alternatives and perceived uncertainties related to the future of the Company could cause our stock price to fluctuate significantly. 15 Risks Related to Our Agribusiness Operations Adverse weather conditions, natural disasters, including earthquakes and wildfires, and other natural conditions, including the effects of climate change, could impose significant costs and losses on our business.
Any downturn in the economy or consumer confidence can also be expected to result in reduced housing demand and slower industrial development, which would negatively impact the demand for land we are developing. 23 We are subject to various land use regulations and require governmental approvals for our developments that could be denied.
Any downturn in the economy or consumer confidence can also be expected to result in reduced housing demand and slower industrial development, which would negatively impact the demand for land we are developing. 22 We are subject to various land use regulations and require governmental approvals for our developments that could be denied.
In addition, we cannot assure you that our third-party advisors would always act in our best interests. 24 If we are unable to complete land development projects within forecasted time and budget expectations, if at all, our financial results may be negatively affected.
In addition, we cannot assure you that our third-party advisors would always act in our best interests. 23 If we are unable to complete land development projects within forecasted time and budget expectations, if at all, our financial results may be negatively affected.
The cost of paper is also significant to us because some of our products are packed in cardboard boxes for shipment. If the price of paper increases and we are not able to effectively pass these price increases along to our customers, then our operating income will decrease.
The cost of paper is also significant to us because many of our products are packed in cardboard boxes for shipment. If the price of paper increases and we are not able to effectively pass these price increases along to our customers, then our operating income will decrease.
We depend on our infrastructure to have sufficient capacity to handle our annual lemon production needs. We have an infrastructure that has sufficient capacity for our lemon production needs, but if we lose machinery or facilities due to natural disasters or mechanical failure, we may not be able to operate at a sufficient capacity to meet our lemon production needs.
We depend on our infrastructure to have sufficient capacity to handle our annual lemon production needs. Our infrastructure has sufficient capacity for our lemon production needs, but if we lose machinery or facilities due to natural disasters or mechanical failure, we may not be able to operate at a sufficient capacity to meet our lemon production needs.
We may be unable to successfully integrate businesses or the personnel of any business that might be acquired in the future, and our failure to do so could have a material adverse effect on our business and on the market price of our common stock. The value of our common stock could be volatile.
We may be unable to successfully integrate businesses or the personnel of any business that might be acquired in the future, and our failure to do so could have a material adverse effect on our business and on the market price of our common stock.
Due to the discovery of ACP in our orchards, we have experienced costs related to the quarantine and treatment of ACP. In September 2023, two HLB-positive citrus trees were detected on one residential property in the City of Santa Paula, California.
Due to the discovery of ACP in our orchards, we have experienced costs related to the quarantine and treatment of ACP. In September 2023, two HLB-positive citrus trees were detected on a residential property in the City of Santa Paula, California.
Costs may increase as we pump more water than our historical averages and federal, state and local water delivery infrastructure costs may increase to access these limited water supplies. We have an ongoing plan for irrigation improvements continuing in fiscal year 2024 that includes drilling new wells and upgrading existing wells and irrigation systems.
Costs may increase as we pump more water than our historical averages and federal, state and local water delivery infrastructure costs may increase to access these limited water supplies. We have an ongoing plan for irrigation improvements continuing for fiscal year 2025 that includes drilling new wells and upgrading existing wells and irrigation systems.
We incur increased costs as a result of being a publicly traded company. As a company with publicly traded securities, we have incurred, and will continue to incur, significant legal, accounting and other expenses.
We incur increased costs as a result of being a publicly traded company. As a company with publicly traded securities, we incur, and will continue to incur, significant legal, accounting and other expenses.
There can be no assurance that we will continue to compete effectively with our present and future competitors, and our ability to compete could be materially adversely affected by our debt levels and debt service requirements. Currency exchange fluctuation may impact the results of our operations. We distribute our products both nationally and internationally.
There can be no assurance that we will continue to compete effectively with our present and future competitors, and our ability to compete could be materially adversely affected by our debt levels and debt service requirements. Currency exchange fluctuation may impact the results of our operations.
As of October 31, 2023, directors and members of our executive management team beneficially owned or controlled approximately 3.3% of our common stock. Investors who purchase our common stock may be subject to certain risks due to the concentrated ownership of our common stock.
As of October 31, 2024, directors and members of our executive management team beneficially owned or controlled approximately 8.9% of our common stock. Investors who purchase our common stock may be subject to certain risks due to the concentrated ownership of our common stock.
Defaults by LLCB could increase our indebtedness. 22 Some of our debt is based on variable rates of interest, which could result in higher interest expenses in the event of an increase in the interest rates. Our AgWest Farm Credit Facility is subject to variable rates, which generally change as interest rates change.
Some of our debt is based on variable rates of interest, which could result in higher interest expenses in the event of an increase in the interest rates. Our AgWest Farm Credit Facility is subject to variable rates, which generally change as interest rates change.
For example, the State of California, where a substantial number of our labor contractors are located, passed regulations that increased minimum wage rates from $15.00 per hour to $15.50 per hour, effective January 1, 2023, and will increase to $16.00 per hour in 2024 due to a cost-of-living increase provision found in the state's minimum wage law.
For example, the State of California, where a substantial number of our labor contractors are located, passed regulations that will increase minimum wage rates to $16.50 per hour effective January 1, 2025 due to a cost-of-living increase provision in the state’s minimum wage law.
In response to these water shortages, we entered into fallowing agreements during fiscal years 2023 and 2022 and continue to assess the impact these reductions may have on our Arizona orchards. For fiscal year 2023, irrigation costs for our agricultural operations were higher than fiscal year 2022.
In response to this and prior years’ water shortages, we entered into fallowing agreements during fiscal years 2023 and 2022 and continue to assess the impact these ongoing reductions may have on our Arizona orchards. For fiscal year 2024, irrigation costs for our agricultural operations were similar compared to fiscal year 2023.
In August 2023, the Bureau announced Lake Mead will operate in a Tier 1 shortage in 2024, which requires Arizona to forfeit approximately 18% of the state's yearly allotment of water from Lake Mead.
Bureau of Reclamation announced that Lake Mead will operate in a Tier 1 shortage in 2024 and 2025, respectively, which requires Arizona to forfeit approximately 18% of the state’s yearly allotment of water from Lake Mead.
The COVID-19 pandemic also reduced the demand for our products resulting in excess supply. Fresh produce is highly perishable and generally must be brought to market and sold soon after harvest. Some items, such as avocados and oranges, must be sold more quickly, while other items, such as lemons, can be held in cold storage for longer periods of time.
Fresh produce is highly perishable and generally must be brought to market and sold soon after harvest. Some items, such as avocados and oranges, must be sold more quickly, while other items, such as lemons, can be held in cold storage for longer periods of time.
Our revolving and non-revolving credit facility with the AgWest Farm Credit Facility contain a financial covenant that requires us to maintain compliance with a specific debt service coverage ratio on an annual basis.
Our revolving and non-revolving credit facility with the AgWest Farm Credit Facility contain a financial covenant that requires us to maintain compliance with a specific debt service coverage ratio on an annual basis. At October 31, 2024 we were in compliance with the debt service coverage ratio of 1.25:1.0.
Excess supply often causes severe price competition in our industry. Growing conditions in various parts of the world, particularly weather conditions such as windstorms, floods, droughts and freezes, as well as diseases and pests, are primary factors affecting market prices because of their influence on the supply and quality of product.
Growing conditions in various parts of the world, particularly weather conditions such as windstorms, floods, droughts and freezes, as well as diseases and pests, are primary factors affecting market prices because of their influence on the supply and quality of product. The COVID-19 pandemic also reduced the demand for our products resulting in excess supply.
The overall market and the price of our common stock may fluctuate greatly and we cannot assure you that you will be able to resell shares at or above market price.
In such event, the trading price of our common stock could decline and investors in our common stock could lose all or part of their investment. The overall market and the price of our common stock may fluctuate greatly and we cannot assure you that you will be able to resell shares at or above market price.
Additional costs to spray insecticides on our orchards within the quarantine area are estimated to be $0.3 million to $0.4 million in fiscal year 2024. There can be no assurance that HLB will not be detected on Limoneira orchards in the future.
The quarantine restricts the movement of citrus fruit, trees, and related plant materials, subject to specific protocols. The estimated additional costs to spray insecticides on our orchards within the quarantine area are $0.3 million to $0.4 million for fiscal year 2025. There is no assurance that HLB will not be detected on Limoneira orchards in the future.
The farming operations are most affected by escalating costs, unpredictable revenues (due to an oversupply of certain crops) and very high irrigation water costs. High fixed water costs related to our farm lands will continue to adversely affect earnings. Prices received for many of our products are dependent upon prevailing market conditions and commodity prices.
Inflation can have a major impact on our agribusiness operations. The farming operations are most affected by escalating costs, unpredictable revenues (due to an oversupply of certain crops) and very high irrigation water costs. High fixed water costs related to our farm lands will continue to adversely affect earnings.
The State of Arizona wage rates rise each year based on the annual cost of living and increased from $12.80 per hour to $13.85 per hour, effective January 1, 2023, and will increase to $14.35 per hour in 2024.
The State of Arizona minimum wage rates also rise each year based on the annual cost of living and will increase to $14.70 per hour effective January 1, 2025.
In 2023 and 2022, the Board of Governors of the Federal Reserve System took actions in tightening the monetary policy that resulted in higher interest rates prevailing in the marketplace. Market interest rates may continue to increase in the future and the increase may materially and negatively affect us.
During 2023 and 2022, the Board of Governors of the Federal Reserve System took actions in tightening the monetary policy that resulted in higher interest rates prevailing in the marketplace. During 2024, the Board of Governors of the Federal Reserve System took actions in easing the monetary policy by cutting interest rates.
California experienced above average precipitation during the 2022 - 2023 rainfall season after experiencing three years of below average precipitation and drought conditions. The above average precipitation helped to alleviate the drought conditions in California. As of October 31, 2023, the state was free from moderate drought conditions and Ventura County was free from any drought conditions.
California received above average precipitation during the 2022 - 2023 and 2023 - 2024 rainfall seasons, after experiencing three years of below average precipitation and drought conditions. The above average precipitation helped to alleviate the drought conditions in California.
Our success will also depend in part on our ability to attract and retain additional qualified management personnel. Inflation can have a significant adverse effect on our operations. Inflation can have a major impact on our agribusiness operations.
We currently depend heavily on the services of our key management personnel. The loss of any key personnel could materially and adversely affect our results of operations or financial condition. Our success will also depend in part on our ability to attract and retain additional qualified management personnel. Inflation can have a significant adverse effect on our operations.
Lack of available credit to finance real estate purchases can also negatively impact demand.
Market interest rates may increase in the future and the increase may materially and negatively affect us. Lack of available credit to finance real estate purchases can also negatively impact demand.
Investing in our common stock involves a high degree of risk. There are numerous and varied risks, known and unknown, that may prevent us from achieving our goals. The risks described here are not the only ones we will face.
There are numerous and varied risks, known and unknown, that may prevent us from achieving our goals. The risks described here are not the only ones we will face. If any of these risks or other risks actually occurs, our business, financial condition, results of operations or future prospects could be materially and adversely affected.
Effective as of February 22, 2023, the Loan maturity date was extended to February 22, 2024, and the maximum borrowing amount was reduced to $35.0 million. The Loan contains certain customary default provisions and LLCB may prepay any amounts outstanding under the Loan without penalty. The obligations under the Loan are guaranteed by certain principals from Lewis and us.
Effective as of February 22, 2023, the maximum borrowing amount was reduced to $35.0 million. The obligations under the Loan were guaranteed by certain principals from Lewis and us. In May 2024, the Loan and corresponding guarantee were cancelled. Our real estate development activities could require future loans that may result in future guarantees.
We are dependent on key personnel and the loss of one or more of those key personnel may materially and adversely affect our prospects . We currently depend heavily on the services of our key management personnel. The loss of any key personnel could materially and adversely affect our results of operations or financial condition.
In the past, periods of a strong U.S. dollar relative to other currencies led international customers, particularly in Asia, to find alternative sources of fruit. We are dependent on key personnel and the loss of one or more of those key personnel may materially and adversely affect our prospects .
In October 2023, the California Department of Food and Agriculture declared a mandatory five-mile-radius quarantine area, which includes approximately 1,100 acres of Limoneira-owned lemon orchards. The quarantine area restricts the movement of citrus fruit, trees and related plant material subject to certain protocols.
Following this detection, the California Department of Food and Agriculture established a mandatory five-mile-radius quarantine area, encompassing approximately 1,100 acres of Limoneira-owned lemon orchards. In July 2024, an additional 75 HLB-positive trees were detected on residential properties in the City of Santa Paula. In response, the quarantine area was expanded in September 2024 to account for the new detections.
Removed
We continue to assess the impact drought conditions may have on our California orchards. In August 2021, the U.S. Bureau of Reclamation (the “Bureau”) declared a Level 1 shortage condition at Lake Mead in the Lower Colorado River Basin for the first time ever, requiring shortage reductions and water savings contributions for states in the southwest.
Added
Excess supply often causes severe price competition in our industry and the worldwide lemon market is currently in an over-supplied position.
Removed
In August 2022, the Bureau announced Lake Mead to operate in a Tier 2 shortage, which further increased water restrictions. As a result, in January 2023, Arizona forfeited approximately 21% of the state's yearly allotment of water from Lake Mead.
Added
As of October 31, 2024, the state was free from extreme drought conditions and Ventura County was free from any drought conditions. We continue to assess the impact drought conditions may have on our California orchards. In August 2023 and August 2024, the U.S.
Removed
In September 2023, Farm Credit West, PCA (the “Lender”) modified the covenant to defer measurement as of October 31, 2023 and resume a debt service coverage ratio of 1.25:1.0 measured as of October 31, 2024.
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Prices received for many of our products are dependent upon prevailing market conditions and commodity prices.
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If any of these risks or other risks actually occurs, our business, financial condition, results of operations or future prospects could be materially and adversely affected. In such event, the trading price of our common stock could decline and investors in our common stock could lose all or part of their investment.
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Additionally, in fiscal year 2024 we recorded an impairment charge on our most recently acquired foreign subsidiary, and we may incur further impairment charges on this or other foreign subsidiaries in the future. The value of our common stock could be volatile. Investing in our common stock involves a high degree of risk.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur agribusiness land holdings are summarized below as of October 31, 2023 ($ in thousands): Ranch Name Acres Book Value Acquisition Date Book Value per Acre Limoneira/Olivelands Ranch 1,700 $ 767 1907, 1913, 1920 $ 451 La Campana Ranch 300 758 1964 $ 2,527 Orchard Farm Ranch 1,100 3,240 1990 $ 2,945 Rancho La Cuesta Ranch 200 2,899 1994 $ 14,495 Windfall Farms 700 16,162 2009 $ 23,089 Associated Citrus Packers 1,300 14,500 2013 $ 11,154 Pan de Azucar 200 2,395 2017 $ 11,975 San Pablo 3,300 5,837 2018 $ 1,769 Santa Clara 1,200 8,600 2019 $ 7,167 Other agribusiness land 600 574 various $ 957 Total agribusiness land holdings 10,600 $ 55,732 The book value of our agribusiness land holdings of approximately $55.7 million differs from the land balance of $56.0 million included in property, plant and equipment in the notes to the consolidated financial statements in Item 8 of this Annual Report as the table above excludes land holdings related to our other operations.
Biggest changeOur agribusiness land holdings are summarized below as of October 31, 2024 ($ in thousands): Ranch Name Acres Book Value Acquisition Date Book Value per Acre Limoneira/Olivelands Ranch 1,700 $ 767 1907, 1913, 1920 $ 451 La Campana Ranch 300 758 1964 $ 2,527 Orchard Farm Ranch 1,100 3,240 1990 $ 2,945 Rancho La Cuesta Ranch 200 2,899 1994 $ 14,495 Windfall Farms 700 16,162 2009 $ 23,089 Associated Citrus Packers 1,300 14,500 2013 $ 11,154 Pan de Azucar 200 2,249 2017 $ 11,244 San Pablo 3,300 5,480 2018 $ 1,661 Santa Clara 1,200 8,600 2019 $ 7,167 Other land 500 816 various $ 1,632 Total land holdings 10,500 $ 55,471 We own our packing facilities located in Santa Paula, California and Yuma, Arizona, where we process and pack our lemons as well as lemons for other growers.
Our Windfall Farms property located in San Luis Obispo County, California obtains water from wells that derive water from the Paso Robles Basin (aquifer). Our Associated farming operations in Yuma, Arizona source water from the Colorado River through the YMIDD, where we have access to approximately 11,700 acre-feet of Class 3 Colorado River water rights.
Our Windfall Farms property located in San Luis Obispo County, California obtains water from wells that derive water from the Paso Robles Basin (aquifer). Our farming operations in Yuma, Arizona source water from the Colorado River through the YMIDD, where we have access to approximately 11,700 acre-feet of Class 3 Colorado River water rights.
We use ground water provided by wells and surface water for our PDA and San Pablo farming operations in La Serena, Chile and our Trapani Fresh farming operations in Argentina. 29 Our rights to extract groundwater from the Santa Paula Basin are governed by the Santa Paula Basin Judgment (the “Judgment”).
We use ground water provided by wells and surface water for our PDA and San Pablo farming operations in La Serena, Chile and our Trapani Fresh farming operations in Argentina. Our rights to extract groundwater from the Santa Paula Basin are governed by the Santa Paula Basin Judgment (the “Judgment”).
These properties are in various stages of development for up to approximately 800 residential units. Water and Mineral Rights Our water resources include water rights, usage rights and pumping rights to the water in aquifers under, and canals that run through, the land we own.
These properties are in various stages of development for up to approximately 800 residential units. 28 Water and Mineral Rights Our water resources include water rights, usage rights and pumping rights to the water in aquifers under, and canals that run through, the land we own.
We own and maintain 238 residential units in Ventura County that we lease to our employees, former employees and outside tenants and we own several commercial office buildings and properties that are leased to various tenants. We own and have equity investments in real estate development property in Ventura County, California.
We own and maintain 240 residential units in Ventura County that we lease to our employees, former employees and outside tenants and we own several commercial office buildings and properties that are leased to various tenants. We own and have equity investments in real estate development property in Ventura County, California.
Our California water resources include approximately 17,000 acre-feet of water affiliated with our owned properties, of which approximately 8,600 acre-feet are adjudicated. Our Yuma, Arizona water resources include approximately 11,700 acre-feet of water sourced from the Colorado River. We own shares in various not-for-profit mutual benefit water companies.
Our California water resources include approximately 11,400 acre-feet of water affiliated with our owned properties, of which approximately 8,600 acre-feet are adjudicated. Our Yuma, Arizona water resources include approximately 11,700 acre-feet of water sourced from the Colorado River. We own shares in various not-for-profit mutual benefit water companies.
Item 2. Properties Real Estate We own our corporate headquarters in Santa Paula, California. We own approximately 4,300 acres of farm land in California, 1,300 acres in Yuma, Arizona, 3,500 acres in La Serena, Chile and 1,200 acres in Jujuy, Argentina.
Item 2. Properties Real Estate We own our corporate headquarters in Santa Paula, California. We own approximately 4,300 acres of farm land in California, 1,300 acres in Yuma, Arizona, 3,500 acres in La Serena, Chile and 1,200 acres in Jujuy, Argentina. We also have an interest in a partnership that owns approximately 200 acres of land.
We own our packing facilities located in Santa Paula, California and Yuma, Arizona, where we process and pack our lemons as well as lemons for other growers. We have a 5.5 acre, one-megawatt ground-based photovoltaic solar generator and one-megawatt roof array, which provides the majority of the power to operate our packing facility.
We have a 5.5 acre, one-megawatt ground-based photovoltaic solar generator and one-megawatt roof array, which provide the majority of the power to operate our packing facility.
We believe that our properties are generally suitable to meet our production needs for the foreseeable future.
The land used for agricultural plantings consists of approximately 3,400 acres of lemons, approximately 1,400 acres of avocados, approximately 100 acres of oranges and approximately 400 acres of wine grapes. We believe that our properties are generally suitable to meet our production needs for the foreseeable future.
Removed
We also lease approximately 100 acres of land and have an interest in a partnership that owns approximately 200 acres of land. The land used for agricultural plantings consists of approximately 3,500 acres of lemons, approximately 1,200 acres of avocados, approximately 100 acres of oranges and approximately 400 acres of other crops.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe disclosure called for by Part II, Item 3 regarding our legal proceedings is incorporated by reference herein from Note 18 – Commitments and Contingencies of the Notes to Consolidated Financial Statements in this Annual Report. Item 4. Mine Safety Disclosures Not applicable. 30 PART II
Biggest changeThe disclosure called for by Part I, Item 3 regarding our legal proceedings is incorporated by reference herein from Note 18 – Commitments and Contingencies of the Notes to Consolidated Financial Statements in this Annual Report. Item 4. Mine Safety Disclosures Not applicable. 29 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDividend 2023 Fourth Quarter Ended October 31, 2023 $ 0.075 Third Quarter Ended July 31, 2023 $ 0.075 Second Quarter Ended April 30, 2023 $ 0.075 First Quarter Ended January 31, 2023 $ 0.075 2022 Fourth Quarter Ended October 31, 2022 $ 0.075 Third Quarter Ended July 31, 2022 $ 0.075 Second Quarter Ended April 30, 2022 $ 0.075 First Quarter Ended January 31, 2022 $ 0.075 In December 2023, we declared our quarterly dividend of $0.075 per common share and we expect to continue to pay quarterly dividends at a similar rate to the extent permitted by the financial results of our business and other factors beyond management's control. 31 Performance Graph The line graph above compares the percentage change in cumulative total stockholder return of our common stock registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) with (i) the cumulative total return of the Russell 2000 Index, assuming reinvestment of dividends, and (ii) the cumulative total return of Dow Jones U.S.
Biggest changeDividend 2024 Fourth Quarter Ended October 31, 2024 $ 0.075 Third Quarter Ended July 31, 2024 $ 0.075 Second Quarter Ended April 30, 2024 $ 0.075 First Quarter Ended January 31, 2024 $ 0.075 2023 Fourth Quarter Ended October 31, 2023 $ 0.075 Third Quarter Ended July 31, 2023 $ 0.075 Second Quarter Ended April 30, 2023 $ 0.075 First Quarter Ended January 31, 2023 $ 0.075 In December 2024, we declared our quarterly dividend of $0.075 per common share and we expect to continue to pay quarterly dividends at a similar rate to the extent permitted by the financial results of our business and other factors beyond management’s control. 30 *$100 invested on 10/31/19 in stock or index, including reinvestment of dividends.
Holders On November 30, 2023, there were approximately 233 registered holders of our common stock. The number of registered holders includes banks and brokers who act as nominees, each of whom may represent more than one stockholder. Dividends The following table presents cash dividends per common share declared and paid in the periods shown.
Holders On November 30, 2024, there were approximately 220 registered holders of our common stock. The number of registered holders includes banks and brokers who act as nominees, each of whom may represent more than one stockholder. Dividends The following table presents cash dividends per common share declared and paid in the periods shown.
Recent Sales of Unregistered Securities None. 32 Purchases of Equity Securities by Issuer and Affiliated Purchasers Period Total Number of Shares Purchased (1) Weighted Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs August 1, 2023 - August 31, 2023 — $ — — — September 1, 2023 - September 30, 2023 — $ — — — October 1, 2023 - October 31, 2023 37,878 $ 14.29 — — Total 37,878 — — (1) Shares were acquired from employees in accordance with our stock-based compensation plan as a result of share withholdings to pay income tax related to the vesting and distribution of restricted stock awards.
Purchases of Equity Securities by Issuer and Affiliated Purchasers Period Total Number of Shares Purchased (1) Weighted Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs August 1, 2024 - August 31, 2024 — $ — — — September 1, 2024 - September 30, 2024 — $ — — — October 1, 2024 - October 31, 2024 18,730 $ 25.64 — — Total 18,730 — — (1) Shares were acquired from employees in accordance with our stock-based compensation plan as a result of share withholdings to pay income tax related to the vesting and distribution of restricted stock awards. 31 Item 6.
Added
Fiscal year ending October 31. Copyright© 2024 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved. Copyright© 2024 Russell Investment Group. All rights reserved.
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The line graph above compares the percentage change in cumulative total stockholder return of our common stock registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) with (i) the cumulative total return of the Russell 2000 Index, assuming reinvestment of dividends, and (ii) the cumulative total return of Dow Jones U.S.
Added
Food Producers Index, assuming reinvestment of dividends. Recent Sales of Unregistered Securities None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeRecent Developments – Refer to Part I, Item 1 “Fiscal Year 2023 Highlights and Recent Developments” 33 Results of Operations The following table shows the results of operations ($ in thousands): Years Ended October 31, 2023 2022 2021 Net revenues: Agribusiness $ 174,381 97 % $ 179,281 97 % $ 161,381 97 % Other operations 5,520 3 % 5,324 3 % 4,646 3 % Total net revenues 179,901 100 % 184,605 100 % 166,027 100 % Costs and expenses: Agribusiness 169,169 99 % 160,651 88 % 148,492 86 % Other operations 4,612 3 % 4,438 2 % 4,332 3 % (Gain) loss on disposal of assets, net (28,849) (17) % (4,500) (2) % 109 — % Gain on legal settlement (2,269) (1) % — — % — — % Selling, general and administrative 26,455 16 % 21,815 12 % 19,427 11 % Total costs and expenses 169,118 100 % 182,404 100 % 172,360 100 % Operating income (loss): Agribusiness 5,212 18,630 12,889 Other operations 908 886 314 Gain (loss) on disposal of assets, net 28,849 4,500 (109) Gain on legal settlement 2,269 — — Selling, general and administrative (26,455) (21,815) (19,427) Operating income (loss) 10,783 2,201 (6,333) Other income (expense): Interest income 364 53 379 Interest expense, net of patronage dividends (494) (2,291) (1,501) Equity in earnings of investments, net 5,322 1,341 3,203 Other (expense) income, net (2,611) (955) 89 Total other income (expense) 2,581 (1,852) 2,170 Income (loss) before income tax (provision) benefit 13,364 349 (4,163) Income tax (provision) benefit (4,247) (823) 266 Net income (loss) 9,117 (474) (3,897) Net loss attributable to noncontrolling interest 283 238 456 Net income (loss) attributable to Limoneira Company $ 9,400 $ (236) $ (3,441) Non-GAAP Financial Measures Due to significant depreciable assets associated with the nature of our operations and interest costs associated with our capital structure, management believes that earnings before interest, income taxes, depreciation and amortization (“EBITDA”) and adjusted EBITDA, which excludes stock-based compensation, named executive officer cash severance, pension settlement cost, (gain) loss on disposal of assets, net, cash bonus related to sale of assets and gain on legal settlement are important measures to evaluate our results of operations between periods on a more comparable basis.
Biggest changeRecent Developments – Refer to Part I, Item 1 “Fiscal Year 2024 Highlights and Recent Developments” 32 Results of Operations The following table shows the results of operations ($ in thousands): Years Ended October 31, 2024 2023 2022 Net revenues: Agribusiness $ 185,923 97 % $ 174,381 97 % $ 179,281 97 % Other operations 5,580 3 % 5,520 3 % 5,324 3 % Total net revenues 191,503 100 % 179,901 100 % 184,605 100 % Costs and expenses: Agribusiness 164,807 83 % 169,169 99 % 160,651 88 % Other operations 5,274 3 % 4,612 3 % 4,438 2 % Impairment of intangible asset 643 1 % — — % — — % Gain on disposal of assets, net (507) (1) % (28,849) (17) % (4,500) (2) % Gain on legal settlement — — % (2,269) (1) % — — % Selling, general and administrative 27,464 14 % 26,455 16 % 21,815 12 % Total costs and expenses 197,681 100 % 169,118 100 % 182,404 100 % Operating (loss) income: Agribusiness 21,116 5,212 18,630 Other operations 306 908 886 Impairment of intangible asset (643) — — Gain on disposal of assets, net 507 28,849 4,500 Gain on legal settlement — 2,269 — Selling, general and administrative (27,464) (26,455) (21,815) Operating (loss) income (6,178) 10,783 2,201 Other income (expense): Interest income 118 364 53 Interest expense, net of patronage dividends (961) (494) (2,291) Equity in earnings of investments, net 18,356 5,322 1,341 Other income (expense), net 212 (2,611) (955) Total other income (expense) 17,725 2,581 (1,852) Income before income tax provision 11,547 13,364 349 Income tax provision (4,373) (4,247) (823) Net income (loss) 7,174 9,117 (474) Net loss attributable to noncontrolling interest 542 283 238 Net income (loss) attributable to Limoneira Company $ 7,716 $ 9,400 $ (236) Non-GAAP Financial Measures Due to significant depreciable assets associated with the nature of our operations and interest costs associated with our capital structure, management believes that earnings before interest, income taxes, depreciation and amortization (“EBITDA”) and adjusted EBITDA, which excludes stock-based compensation, named executive officer cash severance, pension settlement cost, impairment of intangible asset, gain on disposal of assets, net, cash bonus related to sale of assets, gain on legal settlement and severance benefits are important measures to evaluate our results of operations between periods on a more comparable basis.
Raw materials needed to propagate the various crops grown by us consist primarily of fertilizer, herbicides, insecticides, fuel and water, all of which are readily available from local sources. 39 Material contractual obligations arising in the normal course of business consist primarily of purchase obligations, long-term fixed rate and variable rate debt and related interest payments and operating and finance leases.
Raw materials needed to propagate the various crops grown by us consist primarily of fertilizer, herbicides, insecticides, fuel and water, all of which are readily available from local sources. Material contractual obligations arising in the normal course of business consist primarily of purchase obligations, long-term fixed rate and variable rate debt and related interest payments and operating and finance leases.
Our current operations consist of fruit production, sales and marketing, rental operations, real estate and capital investment activities. We have three business divisions: agribusiness, rental operations and real estate development. The agribusiness division is comprised of four reportable operating segments: fresh lemons, lemon packing, avocados and other agribusiness, which includes oranges, specialty citrus, other crops and farm management services.
Our current operations consist of fruit production, sales and marketing, rental operations, real estate and capital investment activities. We have three business divisions: agribusiness, rental operations and real estate development. The agribusiness division is comprised of four reportable operating segments: fresh lemons, lemon packing, avocados and other agribusiness, which primarily includes oranges, specialty citrus, other crops and farm management services.
Possible indications of impairment may include events or changes in circumstances affecting the entitlement process, zoning, government regulation, geographical demand for new housing or commercial property, and market conditions related to residential or commercial land lots.
Possible indications of impairment may include events or changes in circumstances affecting the entitlement process, litigation, zoning, government regulation, geographical demand for new housing or commercial property, and market conditions related to residential or commercial land lots.
Actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to, those presented under “Risk Factors” included in Item 1A and elsewhere in this Annual Report on Form 10-K. This section generally discusses the results of operations for fiscal year 2023 compared to fiscal year 2022.
Actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to, those presented under “Risk Factors” included in Item 1A and elsewhere in this Annual Report on Form 10-K. This section generally discusses the results of operations for fiscal year 2024 compared to fiscal year 2023.
When events or changes in circumstances exist, we further evaluate the real estate development projects for impairment by a) comparing undiscounted future cash flows expected to be generated over the life of the real estate development projects to the respective carrying amount for our real estate development or b) determining if our equity in investment has incurred an other-than-temporary decline.
When events or changes in circumstances exist, we further evaluate the real estate development projects for impairment by a) comparing undiscounted future cash flows expected to be generated over the life of the real estate development projects to the respective carrying amount for our real estate development or b) determining if our equity in investment incurred an other-than-temporary decline in value.
We base our estimates and judgments on historical experience, available relevant data and other information that we believe to be reasonable under the circumstances, and we continue to review and evaluate these estimates. Actual results may materially differ from these estimates under different assumptions or conditions as new or additional information become available in future periods.
We base our estimates and judgments on historical experience, available relevant data and other information that we believe to be reasonable under the circumstances, and we continue to review and evaluate these estimates. Actual results may materially differ from these estimates under different assumptions or conditions as new or additional information becomes available in future periods.
We believe our revenue generating operations, distributions from equity investments and credit facilities will generate sufficient cash needed to operate beyond the next twelve months. In addition, we have the ability to control a portion of our investing cash flows to the extent necessary based on our liquidity demands.
We believe our revenue generating operations, distributions from equity investments and credit facilities will generate sufficient cash needed to operate beyond the next 12 months. In addition, we have the ability to control a portion of our investing cash flows to the extent necessary based on our liquidity demands.
See Note 11 - Long-Term Debt and Note 13 - Leases for amounts outstanding as of October 31, 2023, related to debt and leases. Purchase obligations consist of contracts primarily related to packing supplies, the majority of which are due in the next three years.
See Note 11 - Long-Term Debt and Note 13 - Leases for amounts outstanding as of October 31, 2024, related to debt and leases. Purchase obligations consist of contracts primarily related to packing supplies, the majority of which are due in the next three years.
We believe that the cash flows from operations and available borrowing capacity from our existing credit facilities will be sufficient to satisfy our capital expenditures, debt service, working capital needs and other contractual obligations for the next twelve months.
We believe that the cash flows from operations and available borrowing capacity from our existing credit facilities will be sufficient to satisfy our capital expenditures, debt service, working capital needs and other contractual obligations for the next 12 months.
The agribusiness division includes our core operations of farming, harvesting, lemon packing and lemon sales operations. The rental operations division includes our residential and commercial rentals comprised of 238 completed rental units, leased land operations and organic recycling. The real estate development division includes our investments in real estate development projects.
The agribusiness division includes our core operations of farming, harvesting, lemon packing and lemon sales operations. The rental operations division includes our residential and commercial rentals comprised of 240 completed rental units, leased land operations and organic recycling. The real estate development division includes our investments in real estate development projects.
For fiscal years 2023, 2022 and 2021, no impairment loss has been recognized on any real estate development and no other-than-temporary-impairment has been recognized on our equity in LLCB or LLCB II. The impairment calculation for real estate developments held by us compares the carrying value of the asset to the asset’s estimated future cash flows (undiscounted).
No impairment loss has been recognized on any real estate development and no other-than-temporary-impairment has been recognized on our equity in LLCB or LLCB II, for fiscal years 2024, 2023 and 2022. 41 The impairment calculation for real estate developments held by us compares the carrying value of the asset to the asset’s estimated future cash flows (undiscounted).
Health-conscious consumers are driving much of the growth in demand for fresh produce. Over the past several decades, the benefits of natural, preservative-free and organic foods have become an increasingly significant element of the public dialogue on health and nutrition. As a result, consumption of fresh fruit and vegetables has markedly increased.
Health-conscious consumers are driving much of the growth in demand for fresh produce. Over the past several decades, the benefits of natural, preservative-free and organic foods have become an increasingly significant element of the public dialogue on health and nutrition. As a result, consumption of fresh fruits and vegetables markedly increased.
Conversely, a decrease in demand, as was seen during the COVID-19 pandemic as a result of restaurant closures, has the impact of reducing our pricing and therefore our revenues and margins.
Conversely, a decrease in demand, as was seen during the COVID-19 pandemic as a result of restaurant closures, had the impact of reducing our pricing and therefore our revenues and margins.
Overview Limoneira Company, a Delaware corporation, is the successor to several businesses with operations in California since 1893. We are primarily an agribusiness company founded and based in Santa Paula, California, committed to responsibly using and managing our approximately 11,100 acres of land, water resources and other assets to maximize long-term stockholder value.
Overview Limoneira Company, a Delaware corporation, is the successor to several businesses with operations in California since 1893. We are primarily an agribusiness company founded and based in Santa Paula, California, committed to responsibly using and managing our approximately 10,500 acres of land, water resources and other assets to maximize long-term stockholder value.
The 1% increase of $0.6 million was primarily due to: • Fresh lemon sales decrease of $6.2 million; • Brokered lemons and other lemon sales increase of $5.8 million; • Lemon by-products decrease of $0.4 million; and • Legal settlement proceeds in fiscal year 2023 allocated to fresh lemons of $1.4 million.
The 1% increase of $1.6 million was primarily due to: • Brokered lemons and other lemon sales increase of $5.8 million; • Fresh lemon sales decrease of $2.8 million; and • Legal settlement proceeds of $1.4 million allocated to fresh lemons in fiscal year 2023.
We expect to receive approximately $123.0 million from LLCB, LLCB II and East Area II over the next seven years of the projects. 41 Trend Information The commodity pricing for our fresh produce, and therefore our revenues and margins, is significantly impacted by consumer demand. The worldwide fresh produce industry has historically enjoyed consistent underlying demand and favorable growth dynamics.
We expect to receive approximately $165.0 million from LLCB, LLCB II and East Area II over the next six years of the projects. Trend Information The commodity pricing for our fresh produce, and therefore our revenues and margins, is significantly impacted by consumer demand. The worldwide fresh produce industry has historically enjoyed consistent underlying demand and favorable growth dynamics.
The tax provision recorded for fiscal year 2023 differs from the U.S. federal statutory tax rate of 21.0% due primarily to foreign jurisdictions which are taxed at different rates, state taxes, tax impact of stock-based compensation, nondeductible tax items and valuation allowances on certain deferred tax assets of foreign subsidiaries.
The tax provision recorded for fiscal year 2024 differs from the U.S. federal statutory tax rate of 21.0% primarily due to foreign jurisdictions that are taxed at different rates, state taxes, tax impact of stock-based compensation, executive compensation, nondeductible tax items and valuation allowances on certain deferred tax assets of foreign subsidiaries.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to promote understanding of the results of operations and financial condition.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management ’ s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to promote understanding of the results of operations and financial condition.
Our effective tax rate for fiscal years 2023 and 2022 was 31.8% and 234.8%, respectively. Net Loss Attributable to Noncontrolling Interest Net loss attributable to noncontrolling interest represents 10% and 49% of the net loss of PDA and Trapani Fresh, respectively, for fiscal years 2023 and 2022.
Our effective tax rate for fiscal years 2024 and 2023 was 37.9% and 31.8%, respectively. Net Loss Attributable to Noncontrolling Interest Net loss attributable to noncontrolling interest represents 10% and 49% of the net loss of PDA and Trapani Fresh, respectively, for fiscal years 2024 and 2023.
For discussion related to the results of operations and changes in financial condition for fiscal year 2022 compared to fiscal year 2021 refer to Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in our fiscal year 2022 Form 10-K, which was filed with the United States Securities and Exchange Commission (SEC) on December 22, 2022.
For discussion related to the results of operations and changes in financial condition for fiscal year 2023 compared to fiscal year 2022 refer to Part II, Item 7, Management ’ s Discussion and Analysis of Financial Condition and Results of Operations in our fiscal year 2023 Form 10-K, which was filed with the United States Securities and Exchange Commission (SEC) on December 21, 2023.
Costs and expenses (gain) in our corporate and other operations were $(1.3) million and $20.6 million for fiscal years 2023 and 2022, respectively, and include selling, general and administrative costs and expenses, gain on disposal of assets, net and gain on legal settlement not allocated to the operating segments.
Costs and expenses (gains) in our corporate and other operations for fiscal years 2024 and 2023 were $31.6 million and $(1.3) million, respectively, and include selling, general and administrative costs and expenses, impairment of intangible asset, gain on disposal of assets, net and gain on legal settlement not allocated to the operating segments.
The non-GAAP information provided is unique to us and may not be consistent with methodologies used by other companies. 34 EBITDA and adjusted EBITDA are summarized and reconciled to net income (loss) attributable to Limoneira Company which management considers to be the most directly comparable financial measure calculated and presented in accordance with GAAP, as follows (in thousands): Years Ended October 31, 2023 2022 2021 Net income (loss) attributable to Limoneira Company $ 9,400 $ (236) $ (3,441) Interest income (364) (53) (379) Interest expense, net of patronage dividends 494 2,291 1,501 Income tax provision (benefit) 4,247 823 (266) Depreciation and amortization 8,576 9,798 9,812 EBITDA $ 22,353 $ 12,623 $ 7,227 Stock-based compensation 3,841 2,732 2,582 Named executive officer cash severance — 432 — Pension settlement cost 2,700 607 — (Gain) loss on disposal of assets, net (28,849) (4,500) 109 Cash bonus related to sale of assets 2,000 — — Gain on legal settlement (2,269) — — Adjusted EBITDA $ (224) $ 11,894 $ 9,918 Fiscal Year 2023 Compared to Fiscal Year 2022 Revenues Total net revenues for fiscal year 2023 were $179.9 million compared to $184.6 million for fiscal year 2022.
The non-GAAP information provided is unique to us and may not be consistent with methodologies used by other companies. 33 EBITDA and adjusted EBITDA are summarized and reconciled to net income (loss) attributable to Limoneira Company which management considers to be the most directly comparable financial measure calculated and presented in accordance with GAAP, as follows (in thousands): Years Ended October 31, 2024 2023 2022 Net income (loss) attributable to Limoneira Company $ 7,716 $ 9,400 $ (236) Interest income (118) (364) (53) Interest expense, net of patronage dividends 961 494 2,291 Income tax provision 4,373 4,247 823 Depreciation and amortization 8,374 8,576 9,798 EBITDA $ 21,306 $ 22,353 $ 12,623 Stock-based compensation 4,116 3,841 2,732 Named executive officer cash severance — — 432 Pension settlement cost — 2,700 607 Impairment of intangible asset 643 — — Gain on disposal of assets, net (507) (28,849) (4,500) Cash bonus related to sale of assets — 2,000 — Gain on legal settlement — (2,269) — Severance benefits 1,160 — — Adjusted EBITDA $ 26,718 $ (224) $ 11,894 Fiscal Year 2024 Compared to Fiscal Year 2023 Revenues Total net revenues for fiscal year 2024 were $191.5 million compared to $179.9 million for fiscal year 2023.
Costs and expenses associated with our lemon packing segment consist of the costs to pack lemons for sale such as labor and benefits, cardboard cartons, fruit treatments, packing and shipping supplies and facility operating costs. For fiscal years 2023 and 2022, our lemon packing costs and expenses were $45.7 million and $43.0 million, respectively.
Costs and expenses associated with our lemon packing segment consist of the costs to pack lemons for sale such as labor and benefits, cardboard cartons, fruit treatments, packing and shipping supplies, subcontracted and facility operating costs. Our lemon packing costs and expenses for fiscal year 2024 were $42.8 million compared to $45.7 million for fiscal year 2023.
Cash Flows from Operating Activities Net cash (used in) provided by operating activities was $(15.9) million and $14.8 million for fiscal years 2023 and 2022, respectively. The significant components of our cash flows (used in) provided by operating activities were as follows: • Net income (loss) was $9.1 million and $(0.5) million for fiscal years 2023 and 2022, respectively.
Cash Flows from Operating Activities Net cash provided by (used in) operating activities was $17.9 million and $(15.9) million for fiscal years 2024 and 2023, respectively. The significant components of our cash flows provided by (used in) operating activities were as follows: • Net income was $7.2 million and $9.1 million for fiscal years 2024 and 2023, respectively.
If we conclude the impairment is other-than-temporary, we determine the estimated fair value of the investment by performing a discounted cash flow or market approach analysis and recognize an other-than-temporary impairment to reduce the investment to its estimated fair value. 42 We believe that the accounting estimate related to impairment of real estate development projects held by us, or other-than-temporary impairment of our equity investments in LLCB and LLCB II, is a critical accounting estimate because it is very susceptible to change from period to period; it requires management to make assumptions about future prices, production, and costs, and the potential impact of a loss from impairment could be material to our earnings.
We believe that the accounting estimate related to impairment of real estate development projects held by us, or other-than-temporary impairment of our equity investments in LLCB and LLCB II, is a critical accounting estimate because it is very susceptible to change from period to period; it requires management to make assumptions about future prices, production, and costs, and the potential impact of a loss from impairment could be material to our earnings.
While we are frequently in discussions with potential external sources of capital in respect to all of our development projects, current market conditions for California real estate projects make it difficult to predict the timing and amounts of future capital that will be required to complete the development of our projects.
While we are frequently in discussions with potential external sources of capital in respect to all of our development projects, current market conditions for California real estate projects make it difficult to predict the timing and amounts of future capital that will be required to complete the development of our projects. 40 In November 2015, we entered into a joint venture with Lewis for the residential development of our East Area I real estate development project.
Cash Flows from Investing Activities ▪ The $90.6 million of net cash provided by investing activities during fiscal year 2023 was comprised primarily of net proceeds from sales of assets of $98.5 million, net proceeds from the sale of real estate development assets of $2.6 million, partially offset by capital expenditures of $10.3 million, primarily related to orchard and vineyard development. ▪ The $19.4 million of net cash provided by investing activities during fiscal year 2022 was comprised primarily of net proceeds from sale of assets of $19.3 million, net proceeds from the sale of real estate development assets of $7.9 million, collection on notes receivable of $2.8 million, partially offset by capital expenditures of $10.1 million related to orchard and vineyard development.
Cash Flows from Investing Activities ▪ The $9.2 million of net cash used in investing activities for fiscal year 2024 was comprised primarily of capital expenditures of $9.4 million related to orchard and vineyard development. ▪ The $90.6 million of net cash provided by investing activities for fiscal year 2023 was comprised primarily of net proceeds from sale of assets of $98.5 million, net proceeds from the sale of real estate development assets of $2.6 million, partially offset by capital expenditures of $10.3 million related to orchard and vineyard development.
Depreciation and amortization expenses for fiscal years 2023 and 2022 were $1.3 million and $1.2 million, respectively. Liquidity and Capital Resources Overview Our primary sources of liquidity are cash and cash flows generated from our operations and use of our revolving credit facility.
Depreciation and amortization expenses for were $1.3 million for both fiscal years 2024 and 2023. 38 Liquidity and Capital Resources Overview Our primary sources of liquidity are cash and cash flows generated from our operations, use of our revolving credit facility, sales of assets and distributions from our equity investments.
During fiscal years 2023 and 2022, fresh lemon sales were $86.8 million and $92.9 million, in aggregate, on 4.8 million and 4.9 million cartons of lemons sold at average per carton prices of $18.24 and $18.77, respectively.
Fresh lemon sales were $84.0 million and $86.8 million, in aggregate, on 4.5 million and 4.8 million cartons of lemons sold at average per carton prices of $18.87 and $18.24 for fiscal years 2024 and 2023, respectively.
The components of net income for fiscal year 2023, compared to net loss for fiscal year 2022, consists of an increase in operating income of $8.6 million and an increase in total other income of $4.4 million, offset by an increase in income tax provision of $3.4 million. • Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: ◦ Adjustments (used) provided $(22.5) million and $10.0 million for fiscal years 2023 and 2022, respectively, primarily related to depreciation and amortization, gain on disposal of assets, stock compensation expense, equity in earnings of investments, net and deferred income taxes. ◦ Changes in operating assets and liabilities (used in) provided by $(2.5) million and $5.3 million of operating cash for fiscal years 2023 and 2022, respectively, primarily related to cultural costs, prepaid expenses/other current assets, accounts payable/growers and suppliers payable, accrued liabilities/payables to related parties, and other long-term liabilities.
The components of net income for fiscal year 2024, compared to net income for fiscal year 2023, primarily consists of a decrease in operating income of $17.0 million and an increase in total other income of $15.1 million. • Adjustments to reconcile net income to net cash provided by (used in) operating activities: ◦ Adjustments provided (used) $9.0 million and $(22.5) million for fiscal years 2024 and 2023, respectively, primarily related to depreciation and amortization, gain on disposal of assets, net, stock compensation expense, equity in earnings of investments, net and cash distributions from equity investments. ◦ Changes in operating assets and liabilities provided by (used in) $1.7 million and $(2.5) million of operating cash for fiscal years 2024 and 2023, respectively, primarily related to cultural costs, accounts payable/growers and suppliers payable, accrued liabilities/payables to related parties, and other long-term liabilities.
Income Taxes We recorded for fiscal years 2023 and 2022 income tax provision of $4.2 million and $0.8 million on pre-tax income of $13.4 million and $0.3 million, respectively.
Income Taxes We recorded an income tax provision of $4.4 million and $4.2 million on pre-tax income of $11.5 million and $13.4 million for fiscal years 2024 and 2023, respectively.
Income Taxes In fiscal years 2023 and 2022 , we paid income taxes of $7.2 million and $0.1 million , respectively. Real Estate Development Activities and Related Capital Resources As noted under “Transactions Affecting Liquidity and Capital Resources,” we have the ability to control a portion of our investing cash flows to the extent necessary based upon our liquidity demands.
Real Estate Development Activities and Related Capital Resources As noted under “Transactions Affecting Liquidity and Capital Resources,” we have the ability to control a portion of our investing cash flows to the extent necessary based upon our liquidity demands.
The increase in fiscal year 2023, compared to fiscal year 2022, was primarily due to the Northern Properties farm management costs which were expensed in fiscal year 2023 and were capitalized as cultural costs in fiscal year 2022, as well as farm management decisions based on weather, harvest timing and crop conditions. • Third-party grower and supplier costs: We sell fruit that we grow and fruit that we procure from other growers and suppliers.
The decrease for fiscal year 2024, compared to fiscal year 2023, was primarily due to farm management decisions based on weather, harvest timing and crop conditions. • Third-party grower and supplier costs: We sell fruit that we grow and fruit that we procure from other growers and suppliers.
During fiscal years 2023 and 2022, 292,000 and 676,000 cartons of oranges were sold at an average per carton price of $19.79 and $14.66, respectively. 35 • Specialty citrus and other crops: The increase in fiscal year 2023, compared to fiscal year 2022, was primarily due to higher prices, partially offset by decreased volume of specialty citrus sold.
We sold 280,000 and 292,000 cartons of oranges at an average price per carton of $18.53 and $19.79 for fiscal years 2024 and 2023, respectively. • Specialty citrus and other crops: The decrease for fiscal year 2024, compared to fiscal year 2023, was primarily due to decreased volume, partially offset by higher prices of specialty citrus sold.
The $4.7 million increase was primarily due to: • $2.5 million net increase in salaries, benefits and incentive compensation; • $0.7 million increase in tax, legal and consulting fees primarily related to disposals of Northern Properties and Cadiz; • $0.2 million increase in selling expenses; and • $1.3 million net increase in other selling, general and administrative expenses, primarily associated with our strategic initiatives.
The $1.0 million increase was primarily due to: • $0.9 million increase in selling expenses; • $0.7 million increase in legal and consulting fees associated with our strategic initiatives; • $0.1 million net increase in salaries, benefits and incentive compensation; and • $0.7 million net decrease in other selling, general and administrative expenses.
In November 2015, we entered into a joint venture with Lewis for the residential development of our East Area I real estate development project. To consummate the transaction, we formed LLCB as the development entity, contributed our East Area I property to the joint venture and sold a 50% interest in the joint venture to Lewis for $20.0 million.
To consummate the transaction, we formed LLCB as the development entity, contributed our East Area I property to the joint venture and sold a 50% interest in the joint venture to Lewis for $20.0 million. The first phase of the project broke ground to commence mass grading in November 2017.
During fiscal years 2023 and 2022 of the 4.8 million and 4.9 million cartons of lemons packed and sold, 2.6 million (54%) and 2.6 million (52%), were procured from third-party growers and suppliers at average per carton prices of $12.44 and $13.03, respectively. • Depreciation and amortization: Depreciation and amortization expense for fiscal years 2023 and 2022 was $7.3 million and $8.6 million, respectively.
Of the 4.5 million and 4.8 million cartons of lemons packed and sold, 3.2 million (72%) and 2.6 million (54%), were procured from third-party growers at average per carton prices of $12.76 and $12.44 for fiscal years 2024 and 2023, respectively.
We are also subject to a financial covenant that requires us to maintain compliance with a specific debt service coverage ratio on an annual basis. In September 2023, the Lender modified the covenant to defer measurement as of October 31, 2023 and resume a debt service coverage ratio of 1.25:1.0 measured as of October 31, 2024.
We are also subject to a financial covenant that requires us to maintain compliance with a specific debt service coverage ratio of 1.25:1.0 on an annual basis. We were in compliance as of October 31, 2024. We received annual patronage dividends from the Lender of $0.6 million and $1.4 million for fiscal years 2024 and 2023, respectively.
The cost of procuring fruit from other growers and suppliers as well as the cost of brokered fruit is referred to as third-party grower and supplier costs. The increase in fiscal year 2023, compared to fiscal year 2022, was primarily due to increased costs incurred for brokered fruit, partially offset by decreased costs for third-party growers and suppliers' fruit.
The cost of procuring fruit from other growers and suppliers is referred to as third-party grower and supplier costs. The increase for fiscal year 2024, compared to fiscal year 2023, was primarily due to increased volume and higher prices of third-party grower fruit sold.
In addition, avocado revenues included settlement proceeds of $2.4 million allocated to avocados and crop insurance proceeds of $0.7 million in fiscal year 2023. • Oranges: The decrease in fiscal year 2023, compared to fiscal year 2022, was primarily due to decreased volume, mainly related to the Northern Properties sale.
Fiscal year 2023 revenues included settlement proceeds of $2.4 million allocated to avocados and crop insurance proceeds of $0.7 million. 34 • Oranges: The decrease for fiscal year 2024, compared to fiscal year 2023, was primarily due to decreased volume and lower prices of oranges sold.
Additionally, in fiscal years 2023 and 2022, packing costs included $2.9 million and $2.4 million of shipping costs, respectively. • Harvest costs: The decrease in harvest costs in fiscal year 2023, compared to fiscal year 2022, was primarily due to decreased volume of avocados, oranges and specialty citrus harvested, partially offset by increased volume of lemons harvested. • Growing costs: Growing costs, also referred to as cultural costs, consist of orchard maintenance costs such as cultivation, fertilization and soil amendments, pest control, pruning and irrigation.
We packed and sold 4.5 million and 4.8 million cartons of lemons at average per carton costs of $9.60 and $9.61 for fiscal years 2024 and 2023, respectively. • Harvest costs: The decrease in harvest costs for fiscal year 2024 compared to fiscal year 2023 was primarily due to decreased volume of lemons harvested related to the sale of the Northern Properties, partially offset by increased volume of avocados harvested. • Growing costs: Growing costs, also referred to as cultural costs, consist of orchard maintenance costs such as cultivation, fertilization and soil amendments, pest control, pruning and irrigation.
Such preferred dividends paid totaled $0.5 million in each of the fiscal years 2023 and 2022. Cash dividends declared in each of the fiscal years 2023 and 2022 totaled $0.30 per common share and such dividends paid totaled $5.4 million in fiscal year 2023 and $5.3 million in fiscal year 2022.
Cash dividends declared in each of the fiscal years 2024 and 2023 totaled $0.30 per common share and such dividends paid totaled $5.4 million for both fiscal years 2024 and 2023. Income Taxes We paid income taxes of $5.2 million and $7.2 million for fiscal years 2024 and 2023, respectively.
On January 31, 2023, the Company sold the Northern Properties which resulted in total net proceeds of $98.4 million. The proceeds were used to pay down all of the Company's domestic debt except the Non-Revolving Credit Supplement.
As of October 31, 2024, our outstanding borrowings under the AgWest Farm Credit Facility were $40.0 million and we had $75.0 million of availability. On January 31, 2023, we sold the Northern Properties which resulted in total net proceeds of $98.4 million. The proceeds were used to pay down all of our domestic debt except the Non-Revolving Credit Supplement.
The 5% increase of $5.4 million was primarily due to: • Harvest costs increase of $0.3 million; • Growing costs increase of $3.2 million; • Third-party grower and supplier costs increase of $0.1 million; • Transportation costs increase of $0.5 million; and • Intersegment costs and expenses increase of $1.3 million.
The 1% decrease of $1.3 million was primarily due to: • Harvest costs decrease of $8.5 million; • Growing costs decrease of $7.7 million; • Third-party grower and supplier costs increase of $13.9 million; and • Intersegment costs and expenses increase of $1.0 million. Lemon Packing Lemon packing segment revenue is comprised of packing revenue and intersegment packing revenue.
Lemon revenues in fiscal years 2023 and 2022 included brokered lemons and other lemon sales of $30.3 million and $24.5 million, shipping and handling of $20.6 million and $22.2 million, and lemon by-product sales of $3.0 million and $3.5 million, respectively.
Lemon revenues included brokered lemons and other lemon sales of $32.0 million and $26.2 million, lemon packing of $17.1 million and $20.6 million, and lemon by-product sales of $3.0 million and $3.0 million, respectively, for fiscal years 2024 and 2023.
In fiscal years 2023 and 2022 we received annual patronage dividends of $1.4 million and $1.6 million, respectively, from the Lender. Dividends The holders of the Series B Convertible Preferred Stock (the “Series B Stock”) and the Series B-2 Preferred Stock (the “Series B-2 Preferred Stock”) are entitled to receive cumulative cash dividends.
Dividends The holders of the Series B Convertible Preferred Stock (the “Series B Stock”) and the Series B-2 Preferred Stock (the “Series B-2 Preferred Stock”) are entitled to receive cumulative cash dividends. Such preferred dividends paid totaled $0.5 million in each of the fiscal years 2024 and 2023.
Agribusiness costs and expenses are detailed below (in thousands): Years Ended October 31, 2023 2022 Change Packing costs $ 48,581 $ 45,448 $ 3,133 7% Harvest costs 18,613 20,767 (2,154) (10)% Growing costs 33,379 26,277 7,102 27% Third-party grower and supplier costs 61,273 59,555 1,718 3% Depreciation and amortization 7,323 8,604 (1,281) (15)% Agribusiness costs and expenses $ 169,169 $ 160,651 $ 8,518 5% • Packing costs: Packing costs consist primarily of the costs to pack lemons for sale such as labor and benefits, cardboard cartons, fruit treatments, packing and shipping supplies and facility operating costs.
Agribusiness costs and expenses are detailed below ($ in thousands): Years Ended October 31, 2024 2023 Change Packing costs $ 42,751 $ 45,689 $ (2,938) (6)% Harvest costs 12,585 18,613 (6,028) (32)% Growing costs 27,577 33,379 (5,802) (17)% Third-party grower and supplier costs 72,176 61,273 10,903 18% Other costs 2,601 2,892 (291) (10)% Depreciation and amortization 7,117 7,323 (206) (3)% Agribusiness costs and expenses $ 164,807 $ 169,169 $ (4,362) (3)% • Packing costs: Packing costs consist primarily of the costs to pack lemons for sale such as labor and benefits, cardboard cartons, fruit treatments, packing and shipping supplies and facility operating costs.
The decrease in fiscal year 2023, compared to fiscal year 2022, was primarily due to the Northern Properties sale in fiscal year 2023. 36 Other operations expenses for fiscal years 2023 and 2022 were $4.6 million and $4.4 million, respectively. Gain on disposal of assets, net in fiscal years 2023 and 2022 were $28.8 million and $4.5 million, respectively.
Gain on disposal of assets, net for fiscal year 2024 was $0.5 million compared to $28.8 million for fiscal year 2023. The decrease was primarily due to the 2023 gain on the sale of the Northern Properties, partially offset by the 2023 loss on disposal of Cadiz Ranch assets.
In October 2022, we entered into a joint venture with Lewis for the development of our 17-acre East Area I Retained Property. We formed LLCB II as the development entity, contributed our Retained Property to the joint venture and sold a 50% interest to Lewis for approximately $8.0 million.
We formed LLCB II as the development entity, contributed our Retained Property to the joint venture and sold a 50% interest to Lewis for approximately $8.0 million. We recorded a gain on the transaction of approximately $4.7 million, of which $0.5 million was deferred and recognized in fiscal year 2024.
Costs and expenses associated with our fresh lemons segment include growing costs, harvest costs, cost of lemons we procure from third-party growers and suppliers, transportation costs and packing service charges incurred from the lemon packing segment to pack lemons for sale.
Costs and expenses associated with our fresh lemons segment include growing costs, harvest costs, cost of lemons we procure from third-party growers and suppliers. Our fresh lemons segment costs and expenses for fiscal year 2024 were $116.3 million compared to $117.6 million for fiscal year 2023.
See Note 21 - Segment Information for additional information regarding our operating segments. 37 Segment information for fiscal year 2023 (in thousands): Fresh Lemons Lemon Packing Eliminations Avocados Other Agribusiness Total Agribusiness Corporate and Other Total Revenues from external customers $ 121,537 $ 20,573 $ — $ 7,046 $ 25,225 $ 174,381 $ 5,520 $ 179,901 Intersegment revenue — 31,081 (31,081) — — — — — Total net revenues 121,537 51,654 (31,081) 7,046 25,225 174,381 5,520 179,901 Costs and expenses (gain) 120,494 45,689 (31,081) 4,034 22,710 161,846 (1,304) 160,542 Depreciation and amortization — — — — — 7,323 1,253 8,576 Operating income $ 1,043 $ 5,965 $ — $ 3,012 $ 2,515 $ 5,212 $ 5,571 $ 10,783 Segment information for fiscal year 2022 (in thousands): Fresh Lemons Lemon Packing Eliminations Avocados Other Agribusiness Total Agribusiness Corporate and Other Total Revenues from external customers $ 120,885 $ 22,176 $ — $ 17,331 $ 18,889 $ 179,281 $ 5,324 $ 184,605 Intersegment revenue — 29,817 (29,817) — — — — — Total net revenues 120,885 51,993 (29,817) 17,331 18,889 179,281 5,324 184,605 Costs and expenses 115,119 43,017 (29,817) 5,524 18,204 152,047 20,559 172,606 Depreciation and amortization — — — — — 8,604 1,194 9,798 Operating income (loss) $ 5,766 $ 8,976 $ — $ 11,807 $ 685 $ 18,630 $ (16,429) $ 2,201 Fiscal Year 2023 Segment Information Compared to Fiscal Year 2022 Segment Information The following analysis should be read in conjunction with the previous section “Results of Operations.” Fresh Lemons Fresh lemons segment revenue is comprised of sales of fresh lemons, lemon by-products, brokered lemons and other lemon revenue.
See Note 21 - Segment Information for additional information regarding our operating segments. 36 Segment information for fiscal year 2024 (in thousands): Fresh Lemons Lemon Packing Eliminations Avocados Other Agribusiness Total Agribusiness Corporate and Other Total Revenues from external customers $ 119,044 $ 17,131 $ — $ 25,114 $ 24,634 $ 185,923 $ 5,580 $ 191,503 Intersegment revenue — 32,127 (32,127) — — — — — Total net revenues 119,044 49,258 (32,127) 25,114 24,634 185,923 5,580 191,503 Costs and expenses 116,308 42,751 (32,127) 7,334 23,424 157,690 31,617 189,307 Depreciation and amortization — — — — — 7,117 1,257 8,374 Operating (loss) income $ 2,736 $ 6,507 $ — $ 17,780 $ 1,210 $ 21,116 $ (27,294) $ (6,178) Segment information for fiscal year 2023 (in thousands): Fresh Lemons Lemon Packing Eliminations Avocados Other Agribusiness Total Agribusiness Corporate and Other Total Revenues from external customers $ 117,445 $ 20,573 $ — $ 7,046 $ 29,317 $ 174,381 $ 5,520 $ 179,901 Intersegment revenue — 31,081 (31,081) — — — — — Total net revenues 117,445 51,654 (31,081) 7,046 29,317 174,381 5,520 179,901 Costs and expenses (gains) 117,602 45,689 (31,081) 4,034 25,602 161,846 (1,304) 160,542 Depreciation and amortization — — — — — 7,323 1,253 8,576 Operating income (loss) $ (157) $ 5,965 $ — $ 3,012 $ 3,715 $ 5,212 $ 5,571 $ 10,783 Fiscal Year 2024 Segment Information Compared to Fiscal Year 2023 Segment Information The following analysis should be read in conjunction with the previous section “Results of Operations.” Fresh Lemons Fresh lemons segment revenue is comprised of sales of fresh lemons, lemon by-products, brokered lemons and other lemon revenue.
We recorded a gain on the transaction of approximately $4.7 million, of which $0.5 million was deferred. The joint venture partners will share in the capital contributions to fund project costs until loan proceeds and/or revenues are sufficient to fund the projects.
The joint venture partners will share in the capital contributions to fund project costs until loan proceeds and/or revenues are sufficient to fund the projects. Since inception each partner has made funding contributions of $21.4 million to LLCB and $1.0 million to LLCB II.
The $4.4 million increase in total other income was primarily due to: • $4.0 million increase of equity earnings in investments primarily due to LLCB; • $1.8 million decrease of interest expense due to decreased long-term debt; and • $1.7 million increase of other expense primarily due to pension settlement cost.
The $15.1 million increase in total other income was primarily due to: • $13.0 million increase of equity in earnings of investments, net, primarily due to LLCB’s closing of 554 residential homesites in fiscal year 2024; • $2.8 million increase of other income, net primarily due to pension settlement cost in fiscal year 2023; and • $0.5 million increase of interest expense, net of patronage dividends, primarily due to decreased patronage dividends.
In fiscal years 2023 and 2022, we incurred costs for purchased, packed fruit for resale of $29.4 million and $26.2 million, respectively. In fiscal years 2023 and 2022, we incurred costs for third-party growers and suppliers' fruit of $31.9 million and $33.4 million, respectively.
We incurred costs for third-party grower fruit of $40.9 million and $31.9 million for fiscal years 2024 and 2023, respectively.
The 3% decrease of $4.7 million was primarily due to decreased avocados and oranges agribusiness revenues, partially offset by farm management agribusiness revenues, as detailed below (in thousands): Years Ended October 31, 2023 2022 Change Lemons $ 142,110 $ 143,061 $ (951) (1)% Avocados 7,046 17,331 (10,285) (59)% Oranges 5,779 9,911 (4,132) (42)% Specialty citrus and other crops 9,515 8,978 537 6% Farm management 9,931 — 9,931 —% Agribusiness revenues $ 174,381 $ 179,281 $ (4,900) (3)% • Lemons: The decrease in fiscal year 2023, compared to fiscal year 2022, was primarily due to decreased fresh lemon sales, partially offset by increased brokered lemons and other lemon sales.
The 6% increase of $11.6 million was primarily due to increased agribusiness revenues from avocados, partially offset by decreased agribusiness revenues from lemons and specialty citrus and other crops, as detailed below ($ in thousands): Years Ended October 31, 2024 2023 Change Lemons $ 136,175 $ 138,018 $ (1,843) (1)% Avocados 25,114 7,046 18,068 256% Oranges 5,189 5,779 (590) (10)% Specialty citrus and other crops 5,089 9,515 (4,426) (47)% Farm management 10,212 9,931 281 3% Other 4,144 4,092 52 1% Agribusiness revenues $ 185,923 $ 174,381 $ 11,542 7% • Lemons: The decrease for fiscal year 2024, compared to fiscal year 2023, was primarily due to decreased volume, partially offset by higher prices of fresh lemons sold.
Our avocados segment costs and expenses were $4.0 million and $5.5 million for fiscal years 2023 and 2022, respectively. The 27% decrease of $1.5 million primarily consisted of the following: • Harvest costs decrease of $0.9 million; and • Growing costs decrease of $0.6 million.
Costs and expenses associated with our avocados segment include growing and harvest costs. Our avocados segment costs and expenses for fiscal year 2024 were $7.3 million compared to $4.0 million for fiscal year 2023. The 82% increase of $3.3 million primarily consisted of the following: • Harvest costs increase of $2.3 million; and • Growing costs increase of $1.0 million.
Other operations revenue in fiscal years 2023 and 2022 was $5.5 million and $5.3 million, respectively. The increase in fiscal year 2023, compared to fiscal year 2022, was primarily due to increased leased land revenue.
Other operations expenses for fiscal year 2024 were $5.3 million compared to $4.6 million for fiscal year 2023. The increase in other operations expenses was primarily due to severance benefits paid in fiscal year 2024 and increased residential and commercial rental expenses.
In addition, lemon revenues included settlement proceeds of $1.4 million allocated to lemons in fiscal year 2023. • Avocados: The decrease in fiscal year 2023, compared to fiscal year 2022 was primarily due to decreased volume and lower prices of avocados sold.
Fiscal year 2023 revenues included settlement proceeds of $1.4 million allocated to lemons. • Avocados: The increase for fiscal year 2024, compared to fiscal year 2023 was due to increased volume and higher prices of avocados sold. The California avocado crop typically experiences alternating years of high and low production due to plant physiology.
Corporate and Other Our corporate and other operations revenues were $5.5 million and $5.3 million for fiscal years 2023 and 2022, respectively.
Total agribusiness depreciation and amortization expenses for fiscal year 2024 were $7.1 million compared to $7.3 million for fiscal year 2023. Corporate and Other Our corporate and other operations revenues for fiscal year 2024 were $5.6 million compared to $5.5 million for fiscal year 2023.
During fiscal years 2023 and 2022, 3.8 million and 8.2 million pounds of avocados were sold at an average per pound price of $1.06 and $2.08, respectively. The California avocado crop typically experiences alternating years of high and low production due to plant physiology.
We sold 15.1 million and 3.8 million pounds of avocados at an average price per pound of $1.67 and $1.06 for fiscal years 2024 and 2023, respectively.
Selling, general and administrative expenses for fiscal year 2023 were $26.5 million compared to $21.8 million for fiscal year 2022.
Gain on legal settlement was $2.3 million for fiscal year 2023 due to the Settlement Agreement related to the Thomas fire. Selling, general and administrative expenses for fiscal year 2024 were $27.5 million compared to $26.5 million for fiscal year 2023.
During fiscal years 2023 and 2022, we sold 240,000 and 434,000 40-pound carton equivalents of specialty citrus at an average per carton price of $27.18 and $13.22, respectively.
We sold 79,000 and 240,000 40-pound carton equivalents of specialty citrus at an average price per carton of $28.23 and $27.18 for fiscal years 2024 and 2023, respectively. Additionally, we sold $2.9 million of wine grapes for both fiscal years 2024 and 2023. • Farm management: Farm management revenue is comprised primarily of Northern Properties farming, management and operations services.
The lemon packing segment included $31.1 million and $29.8 million of intersegment revenues for fiscal years 2023 and 2022, respectively, that were charged to the fresh lemons segment to pack lemons for sale. Such intersegment revenues and expenses are eliminated in our consolidated financial statements.
Lemon packing segment operating income per carton sold for fiscal year 2024 was $1.46 compared to $1.25 for fiscal year 2023. 37 The lemon packing segment included intersegment revenues for fiscal year 2024 of $32.1 million compared to $31.1 million for fiscal year 2023, that were charged to the fresh lemons segment to pack lemons for sale.
Other Income (Expense) Total other income (expense) was $2.6 million and $(1.9) million for fiscal years 2023 and 2022, respectively.
Other Income Total other income for fiscal year 2024 was $17.7 million compared to $2.6 million for fiscal year 2023.
For fiscal years 2023 and 2022, our fresh lemons segment total net revenues were $121.5 million and $120.9 million, respectively.
Our fresh lemons segment total net revenues for fiscal year 2024 were $119.0 million compared to $117.4 million for fiscal year 2023.
Other Agribusiness Our other agribusiness segment total net revenues were $25.2 million and $18.9 million for fiscal years 2023 and 2022, respectively.
Other Agribusiness Our other agribusiness segment total net revenues for fiscal year 2024 were $24.6 million compared to $29.3 million for fiscal year 2023.
The 34% increase of $6.3 million was primarily due to: • Orange revenues decrease of $4.1 million; • Specialty citrus and other revenues increase of $0.5 million; and • Farm management revenues in fiscal year 2023 were $9.9 million. There were no farm management revenues in fiscal year 2022.
The 16% decrease of $4.7 million was primarily due to: • Specialty citrus and other crops revenues decrease of $4.4 million; • Orange revenues decrease of $0.6 million; and • Farm management revenues increase of $0.3 million. Costs and expenses associated with our other agribusiness segment include growing costs, harvest costs, purchased fruit costs and shipping costs.
The first phase of the project broke ground to commence mass grading in November 2017. Approved project plans currently include approximately 1,500 residential units and site improvements. A total of 707 residential units have closed from the project's inception to October 31, 2023.
Approved project plans currently include approximately 2,050 residential units and site improvements. A total of 1,261 residential units have closed from the project’s inception to October 31, 2024. In October 2022, we entered into a joint venture with Lewis for the development of our 17-acre East Area I Retained Property.
The 7% decrease of $13.3 million was primarily due to increased gain on disposal of assets, mainly related to the Northern Properties sale, partially offset by the loss on disposal of Cadiz Ranch assets and increased agribusiness costs and expenses.
The 17% increase of $28.6 million was primarily due to the 2023 net gain on disposal of assets, the 2023 gain on legal settlement and an increase in selling, general and administrative expenses, partially offset by a decrease in agribusiness costs and expenses.
Each segment is subject to review and evaluations related to current market conditions, market opportunities and available resources.
Each segment is subject to review and evaluations related to current market conditions, market opportunities and available resources. During fiscal year 2024, the Company changed its reporting of other revenue and other costs and includes these items in the other agribusiness segment instead of the fresh lemons segment.
Costs and Expenses Our total costs and expenses in fiscal year 2023 were $169.1 million, compared to $182.4 million in the same period of fiscal year 2022.
Our other agribusiness costs and expenses for fiscal year 2024 were $23.4 million compared to $25.6 million for fiscal year 2023.
Avocados Our avocados segment revenues were $7.0 million and $17.3 million for fiscal years 2023 and 2022, respectively, a 59% decrease of $10.3 million, due primarily to alternating years of high and low production due to plant physiology. Costs and expenses associated with our avocados segment include growing and harvest costs.
Such intersegment revenues and expenses are eliminated in our consolidated financial statements. Avocados Our avocados segment revenues for fiscal year 2024 were $25.1 million compared to $7.0 million for fiscal year 2023. The 256% increase of $18.1 million was primarily due to alternating years of high and low production due to plant physiology and higher pricing.
In fiscal years 2023 and 2022, lemon packing costs were $45.7 million and $43.0 million, respectively. The increase in fiscal year 2023 was primarily due to higher average per carton costs, partially offset by decreased volume of fresh lemons packed and sold compared to fiscal year 2022.
Our lemon packing segment total net revenues for fiscal year 2024 were $49.3 million compared to $51.7 million for fiscal year 2023. The 5% decrease of $2.4 million was primarily due to decreased volume of lemons packed and sold.
The 25% increase of $4.5 million was primarily due to: • Harvest costs decrease of $1.5 million; • Growing costs increase of $4.4 million; and • Purchased fruit costs increase of $1.6 million. Total agribusiness depreciation and amortization expenses were $7.3 million and $8.6 million for fiscal years 2023 and 2022, respectively.
Additionally, we incurred costs for supplier costs and purchased, packed fruit for resale of $31.3 million and $29.4 million for fiscal years 2024 and 2023, respectively. • Other costs: The decrease in other costs for fiscal year 2024 compared to fiscal year 2023 was primarily due to a decrease in shipping costs, mainly related to a decrease in volume of lemons sold. 35 • Depreciation and amortization: Depreciation and amortization expenses for fiscal year 2024 were similar to fiscal year 2023.
The MLA governs the terms of the Supplements. 40 The Supplements provide aggregate borrowing capacity of $115.0 million, comprised of $75.0 million under the Revolving Credit Supplement and $40.0 million under the Non-Revolving Credit Supplement. As of October 31, 2023, our outstanding borrowings under the AgWest Farm Credit Facility were $40.0 million and we had $75.0 million of availability.
The MLA governs the terms of the Supplements. In addition, we have Banco de Chile term and COVID-19 loans. Additional information regarding these loans can be found in Note 11- Long-Term Debt. The Supplements provide aggregate borrowing capacity of $115.0 million, comprised of $75.0 million under the Revolving Credit Supplement and $40.0 million under the Non-Revolving Credit Supplement.
Removed
Adjusted EBITDA in fiscal year 2021 did not exclude stock-based compensation which has now been excluded as management believes this is a better representation of cash generated by operations and is consistent with peer company reporting. Adjusted EBITDA for fiscal year 2021 has been restated to conform to the current presentation.
Added
The increase in farm management revenue for fiscal year 2024, compared to fiscal year 2023, was primarily due to twelve months of activity in fiscal year 2024 compared to nine months of activity in fiscal year 2023. • Other: Other revenue is comprised primarily of fallowing and freight revenue.
Removed
Additionally, during fiscal years 2023 and 2022, we sold $2.9 million and $3.2 million of wine grapes, respectively. • Farm management: Farm management revenues in fiscal year 2023 were $9.9 million, primarily due to the Northern Properties farming, management and operations services. There were no farm management revenues in fiscal year 2022.
Added
Other revenue for fiscal year 2024 was similar compared to fiscal year 2023. Other operations revenue for fiscal year 2024 was $5.6 million compared to $5.5 million for fiscal year 2023. Costs and Expenses Total costs and expenses for fiscal year 2024 were $197.7 million compared to $169.1 million for fiscal year 2023.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeRate changes are expected to be generally the same as the Federal Open Market Committee (the “FOMC”) recommended changes, however the changes may be marginally different than the FOMC's recommendation. As of October 31, 2023, our total debt outstanding under the AgWest Farm Credit Facility was $40.0 million.
Biggest changeRate changes are expected to be generally the same as the Federal Open Market Committee (the “FOMC”) recommended changes, however the changes may be marginally different than the FOMC’s recommendation. As of October 31, 2024, our total debt outstanding under the AgWest Farm Credit Facility was $40.0 million.
Additionally, a 100 basis points increase in the interest rate would not materially decrease our net income for fiscal year 2024 or the three subsequent fiscal years. We have strategies in place to manage our exposure to interest rate risk, including the potential early pay down of outstanding debt under the AgWest Farm Credit Facility.
Additionally, a 100 basis points increase in the interest rate would not materially decrease our net income for fiscal year 2025 or the three subsequent fiscal years. We have strategies in place to manage our exposure to interest rate risk, including the potential early pay down of outstanding debt under the AgWest Farm Credit Facility.
Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” for additional information.
Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” for additional information. 42
Based on our level of borrowings as of October 31, 2023, a 100 basis points increase in interest rates would not materially increase our interest expense for fiscal year 2024 or the three subsequent fiscal years.
Based on our level of borrowings as of October 31, 2024, a 100 basis points increase in interest rates would not materially increase our interest expense for fiscal year 2025 or the three subsequent fiscal years.

Other LMNR 10-K year-over-year comparisons