Calavo Growers’ Q3 financial results affected by FDA temporary hold

SANTA PAULA, Calif., Sept. 09, 2025 (GLOBE NEWSWIRE) — Calavo Growers, Inc. BB #:113203, a global leader in sourcing, packing and distribution of fresh avocados, tomatoes, papayas and processing of guacamole and other avocado products, reported its financial results for the third fiscal quarter and nine-month period ended July 31, 2025.

Third Quarter Financial Overview

• Total net sales were $178.8 million, a decrease of less than one percent from the prior year.
  Fresh segment sales were $155.9 million, a 5% decrease from the prior year.
  Prepared segment sales were $22.9 million, a 40% increase from the prior year.
• Gross profit was $18.2 million, a 9% decrease from the prior year quarter. This quarter included approximately $4.2 million of discrete costs associated with a temporary Food and Drug Administration (“FDA”) detention hold on certain avocado imports from Mexico. The hold resulted in third-party inspection and testing costs, incremental logistics and handling expenses, and inventory write-downs on fruit diverted or sold at distressed prices. We believe these costs are unusual and not reflective of normal business operations.
• Fresh segment gross profit was $12.4 million, a 32% decrease from the prior year.
• Prepared segment gross profit was $5.8 million, a 201% increase from the prior year.
• Selling, general, and administrative (“SG&A”) expenses were $9.2 million, a 12% decrease from the prior year.
• Net income from continuing operations attributable to Calavo Growers, Inc. was $4.7 million, or $0.26 per diluted share, compared to $5.4 million, or $0.30 per diluted share, in the prior year.
• Adjusted net income1 was $10.2 million, or $0.57 per diluted share, compared to $10.0 million, or $0.56 per diluted share, in the prior year.
• Adjusted EBITDA was $15.1 million, compared to $12.9 million in the prior year.

Management Commentary
“Our third quarter results highlight both the challenges and the opportunities in our business,” said Lee Cole, President and Chief Executive Officer of Calavo Growers, Inc. “On the Fresh segment side, results were adversely affected by the temporary FDA detention hold tied to trace detection of Imazalil, a postharvest fungicide not approved for use on avocados, in a single shipment from our Mexican facility. This required enhanced testing and slowed cross-border movement. In addition, third quarter avocado selling prices were significantly lower sequentially versus the second quarter as avocado supply from Mexico, California, and Peru converged. In contrast, our Prepared segment delivered outstanding growth with higher volumes.”

“As of September 2, 2025, the FDA matter has been resolved. This was the first detention hold in the history of Calavo de Mexico since operations began in 1998, and we believe it was a non-recurring event,” Cole continued. “We also achieved an important legal milestone in August, when a Federal Court in Mexico formally recognized Calavo de Mexico as a maquila, which we believe strengthens our position to recover value-added tax (“IVA”) receivables and bolsters our defense in the 2013 assessment. Combined with the momentum in our Prepared segment, where July sales, on a monthly run-rate basis, annualize to over $100 million and where we currently project Prepared segment sales of approximately $115 million for fiscal 2026, I believe Calavo is well positioned for growth and increased shareholder value.”

About Calavo Growers, Inc.
Calavo Growers, Inc. (Nasdaq: CVGW) is a global leader in the processing and distribution of avocados, tomatoes, papayas and guacamole. Calavo products are sold under the trusted Calavo brand name, proprietary sub-brands, private label and store brands. Founded in 1924, Calavo has a rich culture of innovation, sustainable practices and market growth. The Company serves retail grocery, foodservice, club stores, mass merchandisers, food distributors and wholesalers worldwide. Calavo is headquartered in Santa Paula, California, with facilities throughout the U.S. and Mexico. Learn more about The Family of Fresh at calavo.com.