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LMNR
Earnings call · Jul 2026 (Q3 FY26)

Limoneira Q3 FY26 earnings call LMNR

Sep 9, 2026 Source

Executive summary

Limoneira Q3 FY26 — Strong Avocado Volume and Asset Monetization Progress Offset Lemon Headwinds

Limoneira's Q3 FY26 results were mixed, with strong avocado volumes and significant progress on asset monetization initiatives offsetting headwinds in lemon sales due to unexpected import oversupply. The company is actively streamlining operations, expanding avocado production, and pursuing real estate and water rights monetization, with several key events anticipated in the near future to drive sustained profitability and shareholder value.

Highlights

5

  • Adjusted EBITDA increased to $3.9 million in Q3 FY26, up from $3 million in Q3 FY25.

  • Avocado volume guidance for FY26 was raised to 7 million to 7.25 million pounds, exceeding the previous high end of 6.5 million pounds.

  • Expected avocado volume for FY27 is over 10 million pounds, representing an increase of approximately 30% over FY26.

  • Selling, general and administrative expenses decreased to $4 million in Q3 FY26 from $5 million in Q3 FY25.

  • The sale of Windfall Farms for $15 million is expected to close on September 14, 2026.

Concerns

5

  • Lemon sales volume was below expectations due to higher imports, leading to a revised FY26 guidance of 4.0 million to 4.25 million cartons (lower end of previous range).

  • Total net revenue decreased to $43.8 million in Q3 FY26 from $47.8 million in Q3 FY25.

  • Operating loss increased to $3 million in Q3 FY26 compared to $600,000 in Q3 FY25.

  • Net loss applicable to common stock was $3 million, or $0.17 per diluted share, in Q3 FY26, compared to $1 million, or $0.06 per diluted share, in Q3 FY25.

  • Avocado average price per pound decreased to $1.15 in Q3 FY26 from $1.50 in Q3 FY25.

Guidance & targets

CategoryTargetConfidence
Avocado volume
7 million to 7.25 million pounds
high materiality
High
Avocado volume increase
at least a 30% increase
high materiality
High
Avocado volume
more than 10 million pounds
high materiality
High
Fresh lemon volumes
4.0 million to 4.25 million cartons
high materiality
Medium
Real estate development and non-strategic asset monetization proceeds
$155 million
high materiality
High
Colorado River water rights monetization event
monetization event
high materiality
High
Organic recycling facility earnings
significant shared earnings
medium materiality
Medium
Operating improvement
$4 million
medium materiality
High
Adjusted EBITDA
positive adjusted EBITDA
high materiality
High
Adjusted EBITDA
meaningfully stronger EBITDA
high materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Agribusiness
Revenue decreased compared to $45.9 million in the prior year third quarter, primarily due to the transition of citrus brokerage operations to Sunkist, which eliminated orange and specialty citrus revenues and decreased brokered lemon and other lemon sales, partially offset by increased fresh lemon and carton sales driven by higher pricing. Avocado revenues also decreased due to lower prices, despite higher volume.
$42.2 million———
Other Operations
Revenue increased compared to $1.5 million in the prior year third quarter.
$1.6 million———

LMNR operating KPIs by quarter

LMNR operating KPIs stated on its earnings calls, by fiscal quarter
KPI Apr 2026 Q2 FY26This call Jul 2026 Q3 FY26Change vs prior quarter
Fresh lemon cartons sold
~1.028M We sold approximately 1,028,000 cartons of fresh lemons at an average price of $16.63 per carton during the second quarter of fiscal year 2026, compared to 1,357,000 cartons at $14.52 per carton in the prior year second quarter. Source transcript
~1.373M We sold approximately 1,373,000 cartons of fresh lemons at an average price of $19.88 per carton during the third quarter of fiscal year 2026, compared to 1,397,000 cartons at $17.02 per carton in the prior year third quarter. Source transcript
—
Average fresh lemon price per carton
$16.63 We sold approximately 1,028,000 cartons of fresh lemons at an average price of $16.63 per carton during the second quarter of fiscal year 2026, compared to 1,357,000 cartons at $14.52 per carton in the prior year second quarter. Source transcript
$19.88 We sold approximately 1,373,000 cartons of fresh lemons at an average price of $19.88 per carton during the third quarter of fiscal year 2026, compared to 1,397,000 cartons at $17.02 per carton in the prior year third quarter. Source transcript
+19.5%

Operating figures the company states on every call, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Deals & partnerships

Agromin 50-50 organic recycling joint venture

Joint venture to create a high-return facility with capacity to process up to 25,000 tons of organic waste annually.

Sunkist Transition of citrus brokerage operations and lemon packing optimization

The partnership involved transitioning citrus brokerage operations and optimizing lemon packing, impacting revenue mix and cost structure.

Unnamed buyer Sale of Windfall Farms $15 million

All-cash sale following a competitive public auction process. Limoneira will continue to farm the vineyard property and collect economic benefit of the 2026 vineyard crop.

Capital programs

Organic Recycling Joint Venture underway

Benefit:25,000 tons organic waste annually

50-50 joint venture with Agromin, expected to generate significant shared earnings when operational.

Risks & headwinds

Lemon import oversupply Q3 FY26, with lingering effects into Q4 FY26

Impacted Q3 FY26 lemon sales volume and price, leading to lower end of FY26 guidance (4.0 million to 4.25 million cartons).

Mitigation:Intentionally held back additional supply in Q4; prices beginning to firm and strengthen.

Avocado price decrease Q3 FY26

Average price of $1.15 per pound in Q3 FY26 compared to $1.50 per pound in Q3 FY25.

Mitigation:Partially offset by higher volume of avocados sold.

El Niño weather pattern Upcoming period

Prediction of quite a bit of rain in California, with potential for flooding if it comes all at once.

Mitigation:Teams are ready, culverts and barrancas cleaned out. Less rainfall predicted in Mexico could benefit California avocados.

What to watch in Q4 FY26

Colorado River Water Rights Monetization

Q4 FY26
Current Very close to entering into a long-term agreement
Target Monetization event

Why it matters

This monetization event is expected to provide significant benefit for shareholders and contribute to debt reduction.

we're very confident that we're very close to entering into a long-term agreement to take advantage of these fallowing programs, which will provide significant benefit for us and our shareholders as we monetize those water rights in the fourth quarter of this fiscal year.

Q&A highlights

What caused the higher lemon imports and the impact on volume guidance? Is it a timing issue or sustained oversupply?

The oversupply was due to Argentine lemons diverting to the U.S. market after Western Europe became oversupplied by South African fruit. This impacted both volume and price, but the situation is beginning to improve, and the company is cautiously managing Q4 supply.

“So, the first thing that happened was Western Europe got oversupplied with lemons from South Africa. And Western Europe is typically the outlet for Argentina fruit. And so, as the price went down in Western Europe, the Argentina fruit diverted to the United States and, in essence, oversupplied the market.”

asked by Pooran Sharma · answered by Harold Edwards

2 min read 6 chapters

Detailed narrative

Strategic Focus and Asset Monetization

Limoneira is actively pursuing a value creation strategy centered on growing agricultural income, streamlining operations, and monetizing non-strategic assets. The company has identified over $200 million in real estate development, non-strategic land assets, and water rights for monetization. The sale of Windfall Farms for $15 million is expected to close on September 14, 2026, and a monetization event for Class III Colorado River water rights is anticipated in Q4 FY26.

Avocado Growth Trajectory

Avocado production is a key growth driver for Limoneira. The company raised its FY26 avocado volume guidance to 7 million to 7.25 million pounds. Looking ahead, Limoneira expects to produce over 10 million pounds of avocados in FY27, representing an increase of approximately 30% over FY26. This growth is primarily driven by 400 acres of avocados planted in 2023 and 2024, which are expected to contribute to volume in FY27, with an additional 400 non-bearing acres coming online in the next 2-4 years.

Lemon Market Headwinds

Lemon sales volume in Q3 FY26 was below expectations, leading to a revision to the lower end of FY26 guidance (4.0 million to 4.25 million cartons). This was attributed to an oversupply in the U.S. market, primarily from Argentine fruit diverted from an oversupplied Western European market. This unexpected import volume negatively impacted both lemon volume and pricing, though prices are beginning to firm in Q4.

Cost Savings and Operational Improvements

Limoneira is making significant progress on its cost-saving initiatives, including a targeted $10 million in annual selling, general and administrative expense (SG&A) savings. The company also anticipates an additional $4 million in operating improvement in FY27 from Windfall Farm management, improved lemon storage margins, and enhanced lemon logistics. The transition of lemon packing operations to Sunkist is also expected to optimize efficiency.

Real Estate Development Progress

The Harvest at Limoneira real estate development project continues to advance, with robust home sales in Phase 2. Phase 3, comprising approximately 500 home lots, is expected to go to market in FY27. Additionally, 300 approved apartments are slated for groundbreaking in the second half of FY27, and the 25-acre East Area II medical pavilion project could begin monetization in FY26, contributing to future proceeds of $155 million over the next five fiscal years.

Organic Recycling Joint Venture

Limoneira has entered into a 50-50 organic recycling joint venture with Agromin. This facility is designed to process up to 25,000 tons of organic waste annually and is expected to generate significant shared earnings when it becomes operational in the second half of fiscal year 2027. This initiative is part of the company's broader strategy to optimize its asset base and drive sustainable EBITDA growth.

AI-generated summary of the company's earnings call. Not investment advice.