Limoneira Co (LMNR) (Q3 2026) Earnings Call Highlights: Revenue Slips but Avocado Outlook Brightens

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Release Date: September 09, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript .

Positive Points

• Adjusted EBITDA exceeded prior-year third-quarter results, reaching $3.9 million compared to $3.0 million.

• Avocado volume guidance was raised again, with fiscal year 2026 expected at 7.0-7.25 million pounds and fiscal year 2027 projected to exceed 10 million pounds, a 30% increase.

• Progress on $10 million annual SG&A savings, with SG&A expenses down to $4.0 million from $5.0 million year-over-year.

• Windfall Farms sale for $15 million all cash is expected to close on September 14, 2026, with additional benefits including a farming agreement and retention of 2026 crop economics.

• Identified over $200 million in real estate development and non-strategic land assets and water rights for monetization, including expected Colorado River water rights monetization in fiscal 2026.

Negative Points

• Third-quarter results came in below expectations due to lighter-than-anticipated lemon sales volume.

• Total net revenue decreased to $43.8 million from $47.5 million in the prior-year third quarter.

• Fresh lemon volume guidance was lowered to 4.0-4.25 million cartons for fiscal year 2026 due to higher imports, particularly from Argentina.

• Operating loss widened to $3.0 million from $0.6 million in the prior-year period.

• Net loss applicable to common stock increased to $3.0 million, or $0.17 per diluted share, compared to $1.0 million, or $0.06 per diluted share, in the prior-year third quarter.

Q & A Highlights

Q: You mentioned higher lemon imports as the reason for guiding to the lower end of the volume range. Where are these imports coming from, and is this a timing issue or more industry supply than anticipated? A: CEO Harold Edwards explained that Western Europe became oversupplied with lemons from South Africa, which is typically the outlet for Argentine fruit. As European prices fell, Argentine fruit diverted to the United States and oversupplied the market, causing Sunkist's sales plan to fall short on both volume and price. He noted Argentina was the sole culprit, and while the oversupply is beginning to relieve itself, Limoneira intentionally held back supply from the fourth quarter out of caution. Prices are beginning to firm, but challenges from the aftermath remain.

Q: On water monetization, you're expecting a Colorado River water monetization event in fiscal 2026, which leaves a narrow window. What needs to happen to complete a transaction, and has your confidence around timing and value changed? A: CEO Harold Edwards said the process is right on track with last quarter. Limoneira has already removed lemons from its 1,300 acres of Yuma, Arizona farmland and is close to announcing lower water-using substitute crops. This frees up water that can be contributed to long-term fallowing programs benefiting municipalities, principally the Central Arizona Project serving Phoenix through Tucson. He expressed strong confidence in entering a long-term agreement to monetize those water rights in the fourth quarter of this fiscal year.

Q: You raised avocado volume guidance again and expect over 10 million pounds in fiscal 2027, about a 30% year-over-year increase. Can you walk through the cadence of the 400 acres planted in 2023 and 2024 coming online, and how much of the fiscal 2027 number is locked in versus weather or yield dependent? A: CFO Greg Hamm said roughly 6 million to 7 million pounds is effectively locked in because it comes from acreage already producing and contributing to this year's volume, with the remainder from expanded 2022-2024 plantings. CEO Harold Edwards cautioned against using the term "locked in," noting fruit must grow, remain on the tree, and survive wind and weather events to be harvestable. He added that a very large crop is already set for next year with fruit visible on the trees, and he is confident the 2023 and 2024 plantings will begin contributing to production in 2027.

Q: What weather impact do you expect if the El Nino pattern continues? A: CEO Harold Edwards said significant rain is predicted for this part of California, which is generally good for Limoneira as it fills aquifers and helps tree physiology, provided it doesn't all come at once and cause flooding. He noted teams, culverts, and barrancas are cleaned out and ready. CFO Greg Hamm added that El Nino is predicted to bring less rainfall to Mexico, which in theory would reduce the size of the Mexican crop and provide more opportunity for California avocados.

Q: What drove the third-quarter revenue decline and the improvement in adjusted EBITDA? A: CFO Greg Hamm reported total net revenue of $43.8 million versus $47.5 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 reduced brokered lemon sales, partially offset by higher fresh lemon carton pricing. Avocado revenues fell on lower prices despite higher volume. Non-GAAP adjusted EBITDA rose to $3.9 million from $3.0 million a year earlier, and adjusted diluted EPS improved to $0.02 from a loss of $0.02.

Q: Can you provide details on the Windfall Farms sale and how proceeds will be used? A: CFO Greg Hamm said Limoneira entered a new agreement on August 17 to sell Windfall Farms for $15 million in cash following a competitive public auction, with closing expected September 14, 2026, subject to customary conditions. Proceeds will reduce debt and fund continued avocado acreage expansion. The buyer also executed a farming agreement under which Limoneira will continue to farm the vineyard and be paid $200,000 per year plus full expense reimbursement, and the buyer excluded the 2026 crop from the sale, allowing Limoneira to collect this year's vineyard crop economic benefit, expected substantially complete by October 31.

Q: What is the outlook for the organic recycling joint venture and its contribution to fiscal 2027? A: CEO Harold Edwards said the recently signed 50/50 organic recycling joint venture with Agromin is expected to create a potential high-return facility with capacity to process up to 295,000 tons of organic waste annually. It is expected to generate significant shared earnings when operational in the second half of fiscal 2027, contributing to meaningfully stronger EBITDA that year.

Q: What are the key components of the expected stronger fiscal 2027 EBITDA? A: CEO Harold Edwards cited several drivers: the organic recycling joint venture with Agromin, a dramatic increase in avocado volume from 2023 and 2024 plantings, full realization of current cost savings initiatives, optimized lemon packing through the Sunkist transition, and an additional $4 million in anticipated operating improvement from Windfall Farms management, improved lemon storage margins, and improved lemon logistics.

Q: What is the status of the Harvest at Limoneira real estate development and expected proceeds? A: CEO Harold Edwards said future proceeds from Harvest, Limoneira Lewis Community Builders II, and East Area II are expected to total $155 million over the next five fiscal years, with total proceeds of approximately $180 million spread over seven fiscal years including $10 million received in fiscal 2025 and $15 million in fiscal 2024. Phase two home sales remain robust at two to seven homes per week, phase three consists of approximately 500 home lots expected to go to market in fiscal 2027, and 300 approved apartments are expected to break ground in the second half of fiscal 2027. The 25-acre East Area II medical pavilion project could begin monetizing in fiscal 2026.

Q: What is the updated fiscal 2026 guidance for lemons and avocados? A: CEO Harold Edwards said Limoneira now expects to achieve the lower end of fresh lemon volume guidance at 4.0 million to 4.25 million cartons for fiscal 2026 due to higher import volume. Avocado volume guidance was raised to

For the complete transcript of the earnings call, please refer to the full earnings call transcript .