Avocado specialist saw a drop in net income and gross profit, driven by the impact of lower avocado volumes sold in its marketing and distribution segment
Mission Produce has announced its results for the fiscal second quarter (Q2) of 2022, with total revenue for the period jumping 18 per cent on the previous year to US$278.1m.
The avocado leader said that revenue was impacted by average selling price increases of 44 per cent, partially offset by a 19 per cent decrease in avocado volume sold.
Gross profit for the second quarter decreased 27 per cent to US$19.8m, primarily driven by the impact of lower avocado volume sold in Mission’s marketing and distribution segment, and its related impact on fixed cost absorption.
In addition, the group said that it experienced gross profit decreases in its international farming segment due to the timing of cost incurred and impact of pricing at early-stage mango farms.
Net income was US$2.4m, down from, US$7.4m in Q2 2021, while adjusted net income was US$2.6m, falling from US$8.7m.
Adjusted EBITDA stood at US$9.2m for the second quarter, compared with US$16.3m last year, driven by lower avocado volume sold and higher SG&A costs.
“I’m pleased with our ability to get the business back on track quickly following the temporary operational challenges associated with our ERP implementation in the first quarter,” said founder and chief executive Steve Barnard.
”Our per-box margins have recovered and returned to the high-end of normal historical ranges,” he continued. “The fresh avocado market realised record-high per unit sales pricing during fiscal second quarter which is the result of a smaller Mexican harvest and lower industry volumes.
”Consumer demand remains strong. The volume constraints the industry faces are due to lack of supply which Mission is uniquely able to address through our strategy to invest in vertical integration. Specifically, our owned Peruvian production gives us reliable access to fruit to meet customer needs on a scale and at volumes that only Mission can deliver.
”We are well positioned to leverage these capabilities in the second half of our fiscal year when our owned Peruvian production comes online and typically contributes to a significant step-up in adjusted EBITDA generation,” Barnard added. ”In addition, we continue to invest in owned farms in Guatemala and Colombia which we expect to further bolster Mission’s ability to supply year-round fruit to our customers over the long term.”
