Q4 2024 Limoneira Co Earnings Call
Harold Edwards: In fiscal year 2024, we achieved two significant real estate First, in April, our joint venture with Lewis closed on lot sales representing 554 residential units, thus completing the sellout of phase two of the development. A total of 1,261 residential units have closed from the project's inception.
In fiscal year 'twenty 'twenty four we achieved two significant real estate milestones first in April our joint venture with Louis closed on lot sales, representing 554 residential units. Thus completing the sell out of phase two of the development of <unk>.
1261 residential units have closed from the project's inception.
Harold Edwards: Second, in May, we announced the Santa Paula City Council approved the joint ventures proposal to increase the total number of residential units for the project from 1,500 to 2050 units. A 550-unit increase will provide 250 additional single-family for-sale homesites within Phase 3 of HART. separate joint venture with Lewis, plans to construct 300 multifamily rental homes on a mixed-use portion of the project. This is a 37% increase in dwelling units, unlocking further value creation opportunities. Based on these events and the expected continued increase in land value associated with this project, we increased our cash flow projections by 46% in June and expect to receive $180 million in total proceeds spread out over seven fiscal years, with $15 million received this year.
Second in May we announced the Santa Paula City Council approved the joint Venture's proposal to increase the total number of residential units for the project from 1500 to 2050 units.
550 unit increase will provide 250 additional single family for sale homes sites within phase III of harvest.
<unk> joint venture with Louis plans to construct 300 multifamily rental homes on a mixed use portion of the project. This is a 37% increase in dwelling units unlocking further value creation opportunities.
Based on these events and the expected continued increase in land value associated with this project, we increased our cash flow projections by 46% in June and expect to receive $180 million in total proceeds spread out over seven fiscal years with $15 million received this year.
Harold Edwards: In addition, in December of 2024, we received approval from the Federal Emergency Management Agency, or FEMA, to revise a flood zone map area effective May 15, 2025, that significantly reduces the number of property owners that are required to pay flood insurance within East Area 1, East Area 2, and other real estate within the flood zone area west of Santa Paula Creek. Within East Area 1, approximately 1,100 existing and future residents will not be subject to mandatory flood insurance due to the revised flood zone map. It has been a time of intensive process, as we have been working with various public agencies since 2020 to correct the FEMA flood zone insurance rate Revising the flood zone map is expected to improve future interest in residential and commercial real estate in as it removes the concern of flooding and the cost of mandatory flood insurance.
In addition in December of 'twenty 'twenty four we received approval from the federal Emergency management agency or FEMA to revise the floods zelle map area effective may 15, 2025 that significantly reduces the number of property owners that are required to pay flood insurance within E. Scary.
Your one east area, two and other real estate within the flood zone area West of Santa Paula Creek well.
In East area, one approximately 1100 existing and future residents will not be subject to mandatory flood insurance due to the revised flood zone, Matt. It has been a time intensive process as we have been working with various public agencies since 'twenty 'twenty to correct. The FEMA flood zone insurer.
Right Matt.
I Didnt floods on map is expected to improve future interest in residential and commercial real estate in these zones as it removes the concern of flooding and the cost of mandatory flood insurance.
Harold Edwards: Turning to our balance sheet, our net debt as of October 31st, 2024 was $37.6 million. Additionally, our 50-50 real estate development joint venture had $66.9 million of cash and cash equivalents as of October 31st, 2024, of which 50% is approximately $33.5 million. The joint venture currently has no debt. We consider this approximately $33.5 million as an offset to our net debt position of $37.6 million.
Turning to our balance sheet, our net debt as of October 31st 2024 was $37.6 million. Additionally, our 50 50 real estate development joint venture had 66 $29 million of cash and cash equivalents as of October 31, 'twenty 'twenty four.
<unk> of which 50% is approximately $33.5 million. The joint venture currently has no debt. We can send it was approximately $33 $5 million as an offset to our net debt position of $37.6 million.
Harold Edwards: Now to provide a quick update on a decision to evaluate strategic alternatives for the overall business. Today we consider ourselves to be a very strong financial position, having recently reduced our net debt position and right-sized the balance sheet through our ongoing strategic shift towards an asset-lighter business model, and with stronger cash flow projections from Harvest at Limoneira. Since announcing our exploration of strategic alternatives, we have received significant interest and are diligently working with our advisors to evaluate these potential opportunities. We remain committed to thoroughly exploring all options to maximize stockholder value, and will provide updates if the Board of Directors find that further disclosure is necessary or Even after the recent non-strategic asset sales over the past year and a half, we continue to manage approximately 10,500 acres of land with approximately 21,000 acre feet of owned water.
Now I'll provide a quick update on the decision to evaluate strategic alternatives for the overall business today, and we consider ourselves to be a very strong financial position, having recently reduced our net debt position and right size the balance sheet through our ongoing strategic shift towards an asset light business model and with stronger cash flow projections.
From harvest didn't leave in Europe since announcing our exploration of strategic alternatives. We have received significant interest and are diligently working with our advisers to evaluate these potential opportunities we remain committed to thoroughly exploring all options to maximize stockholder value and will provide updates at the board of directors find it further.
Disclosure is necessary or advisable.
Even after the recent nonstrategic asset sales over the past year and a half we continue to manage approximately 10500 acres of land with approximately 21000 acre feet of owned water.
Harold Edwards: usage and pumping rights represented tremendous long-term value growth opportunities from our assets. You can see by our improvement in agribusiness operating income during the fourth quarter and full year, our transition to an asset lighter business model and focus on the best use of our assets to enhance stockholder value is having a positive effect.
Usage and pumping rights represented tremendous long term value growth opportunities from our assets you can see by our improvement in agribusiness operating income during the fourth quarter and full year, our transition to an asset light business model and focus on the best use of our assets to enhance stockholder value is having.
A positive effect, we removed our pension obligation achieved our significantly increased volume guidance for fiscal year 'twenty 'twenty four and are monetizing water through a following program with the Yuma Mesa irrigation and drainage ditch.
Harold Edwards: We removed our pension obligation, achieved our significantly increased volume guidance for fiscal year 2024, and are monetizing water through a following program with the Yuma Mesa Irrigation and And with that, I'll now turn the call over to Thank you, Harold, and good afternoon, everyone. To best gauge our performance, we encourage viewing our business on an annual basis given our natural seasonality, with Q2 and Q3 historically stronger and Q1 and Q4 more moderate. For the fourth quarter of fiscal year 2024, total net revenue increased 6% to $43.9 million compared to total net revenue of $41.4 million in the fourth quarter of the previous fiscal year.
March: And with that I'll now turn the call over to March.
March: Thank you Harold and good afternoon, everyone. The best gauge our performance, we encourage viewing our business on an annual basis, given our natural seasonality with Q2 and Q3 historically stronger in Q1 and Q4 more moderate.
March: For the fourth quarter of fiscal year 2024, total net revenue increased 6% to $43 $9 million compared to total net revenue of $41 $4 million in the fourth quarter of the previous fiscal year.
Harold Edwards: Agribusiness revenue was $42.5 million compared to $40.1 million in the fourth quarter last year. and their operations revenue was $1.4 million in the fourth quarter of fiscal year 2024 compared to $1.3 million in the fourth quarter last year. Agribusiness revenue for the fourth quarter of fiscal year 2024 includes $8.4 million in fresh packed lemon sales compared to $11.3 million during the same period of fiscal year 2023. Approximately 470,000 cartons of U.S. packed fresh lemons were sold during the fourth quarter of fiscal year 2024 at a $17.95 average price per carton compared to 550,000 cartons sold at a $20.39 average price per carton during the fourth quarter of fiscal year 2023.
March: Agribusiness revenue was $42.5 million compared to $41 million in the fourth quarter last year.
March: Other operations revenue was $1.4 million in the fourth quarter of fiscal year, 'twenty 'twenty four compared to $1.3 million in the fourth quarter last year.
March: Agribusiness revenue for the fourth quarter of fiscal year 'twenty 'twenty four includes $8 $4 million in fresh packed lemon sales compared to $11 $3 million during the same period of fiscal year 2023.
March: At least 470000 cartons of U S pack fresh lemons were sold during the fourth quarter of fiscal year, 2024, and a $17 95 average price per carton compared to 550000 cartons sold at a $20 and 39% average price per carton during the fourth quarter of fiscal year.
March: <unk> 2023.
Harold Edwards: During the fourth quarter of fiscal year 2024, our lemon volume was impacted by lower fresh utilization rates due to weather-driven events, coupled with a delayed start to the desert region harvest period. Brokered lemons and other lemon sales were $14.6 million and $13.2 million in the fourth quarter of fiscal years 2024 and 2023, respectively, representing 11% growth year over year. The company recognized $8.9 million of avocado revenue in the fourth quarter of fiscal year 2024 compared to no avocado revenue in the fourth quarter of fiscal year 2023 due to the biannual nature of this fruit. Approximately 4.6 million pounds of avocados were sold in aggregate during the fourth quarter of fiscal year 2024 at a $1.92 average price per pound.
During the fourth quarter of fiscal year 2024, our lemon volume was impacted by lower fresh utilization rate due to weather driven events, coupled with the delayed start to the desert region harvest period.
March: Brokered lemons and other lemon sales were $14 $6 million and $13 $2 million in the fourth quarter of fiscal years, 'twenty 'twenty, four and 2023 respectively, representing 11% growth year over year.
The company recognized $8 $9 million of avocado revenue in the fourth quarter of fiscal year 2024, compared to no avocado revenue in the fourth quarter of fiscal year 2023.
March: Two the biannual nature of this fruit.
March: Approximately 4.6 million pounds of avocados were sold in aggregate during the fourth quarter of fiscal year 2024 at a $1.92 average price per pound.
Harold Edwards: The company recognized $1.7 million of orange revenues in the fourth quarter of fiscal year 2024 compared to $1.9 million in the fourth quarter of fiscal year 2023. Approximately 91,000 cartons of oranges were sold during the fourth quarter of fiscal year 2024 at an average of $18.99 price per carton compared to approximately 69,000 cartons sold at a $28.32 average price per carton during the fourth quarter of fiscal year 2023. As a reminder, the company opportunistically has buy-sell arrangements for orange orders with our retail and food service customers to complement our lemon sales. Specialty citrus and other crop revenue was $3.6 million in the fourth quarter of fiscal year 2024 Compared to 6.5 million dollars in the fourth quarter of fiscal year 23 The decrease was primarily due to decreased volume of specialty citrus sold and decreased wine grape revenue.
March: The company recognized $1 $7 million of Orange revenues in the fourth quarter of fiscal year 2024, compared to $1 $9 million in the fourth quarter of fiscal year 2023.
March: Approximately 91000 cartons of oranges were sold during the fourth quarter of fiscal year 2024 at an average of $18.99 price per carton compared to approximately 69000 cartons sold at a $28 32 said average price per carton during the fourth quarter of fiscal year 2012.
March: <unk> three as a reminder, the company Opportunistically has buy sell arrangements for Orange orders with our retail and foodservice customers to complement our lemon sales.
March: Specialty citrus and other crop revenue was $3.6 million in the fourth quarter and fiscal year 2024, compared to $6 $5 million in the fourth quarter of fiscal year 'twenty three.
March: The decrease was primarily due to decreased volume of specialty citrus sold and decreased wind great revenue.
Harold Edwards: During the fourth quarters of fiscal year 2024 and 2023, approximately 8,075,040 pound carton equivalents were sold at an average price of $42.63 and $32.64, respectively. Wine grape revenues were $2.3 million in the fourth quarter of fiscal year 2024 compared to $2.9 million in the same period of fiscal year 2023. Farm management revenues were $2.9 million in the fourth quarter of fiscal year 2024, compared to $3.1 million in the same period of fiscal year 2023 on similar acreage. Total costs and expenses for the fourth quarter of fiscal year 2024 were $46.6 million compared to $51.1 million in the fourth quarter of last year.
March: During the fourth quarters of fiscal year, 'twenty 'twenty, four and 2023 approximately 8070 5040 pound carton equivalents were sold at an average price of $42.63 and fixed $32.64, respectively Y grade revenues were.
March: $2 3 million in the fourth quarter of fiscal year 2024, compared to $2 $9 million in the same period of fiscal year 2023.
March: Foreign management revenues were $2 $9 million in the fourth quarter of fiscal year 2024, compared to $3 $1 million in the same period of fiscal year 2023 on similar acreage.
March: Total costs and expenses for the fourth quarter of fiscal year, 'twenty, 'twenty, four or $46.6 million compared to $51.1 million in the fourth quarter of last year.
Harold Edwards: Operating loss for the fourth quarter of fiscal year 2024 was $2.8 million compared to an operating loss of $9.7 million in the fourth quarter of the previous fiscal year. Net loss applicable to common stock after preferred dividends for the fourth quarter of fiscal year 2024 was $2 million compared to a net loss applicable to common stock of $3.6 million in the fourth quarter of fiscal year 2023. Net loss per diluted share for the fourth quarter of fiscal year 2024 was $0.11 compared to net loss per diluted share of $0.20 for the same period of fiscal year 2023.
March: Operating loss for the fourth quarter of fiscal year, 'twenty 'twenty, four was $2 $8 million compared to an operating loss of $9 $7 million in the fourth quarter of the previous fiscal year.
March: Net loss applicable to common stock after preferred dividends for the fourth quarter of fiscal year 'twenty 'twenty four was $2 million compared to a net loss applicable to common stock of $3.6 million in the fourth quarter of fiscal year 2023.
March: Net loss per diluted share for the fourth quarter and fiscal year 'twenty 'twenty four was 11 cents compared to a net loss per diluted share of 20 cents for the same period of fiscal year 2023.
Harold Edwards: Adjusted net loss for diluted earnings per share for the fourth quarter of fiscal year 2024 was 1.6 million dollars Compared to 2.6 million dollars in the same period of fiscal year 2023 Adjusted net loss per diluted share for the fourth quarter of fiscal year 2024 was $0.09, compared to adjusted net loss per diluted share of $0.15 for the fourth quarter of fiscal year 2023. A reconciliation of net loss or income attributable to Limoneira Company to adjusted net loss or income for diluted earnings per share is provided at the end of our earnings release. Adjusted EBITDA for the fourth quarter of fiscal year 2024 was $1.2 million, compared to a loss of $1.3 million in the same period of fiscal year 2023.
March: Adjusted net loss for diluted earnings per share for the fourth quarter of fiscal year 'twenty 'twenty four was $1.6 million compared to $2.6 million in the same period of fiscal year 'twenty to 'twenty three.
March: Adjusted net loss per diluted share for the fourth quarter of fiscal year 'twenty 'twenty four was nine cents compared to adjusted net loss per diluted share a 15 cents for the fourth quarter of fiscal year 2023.
March: A reconciliation of net loss or income attributable to luminaire company to adjusted net loss or income for diluted earnings per share is provided at the end of our earnings release.
March: Adjusted EBITDA for the fourth quarter of fiscal year, 2024 was $1.2 million compared to a loss of $1.3 million in the same period of fiscal year 2020 three.
Harold Edwards: A reconciliation of net loss or income attributable to Limoneira Company to adjusted EBITDA is also provided at the end of our earnings release.
March: A reconciliation of net loss or income attributable to Luminaire company to adjusted EBITDA is also provided at the end of our earnings release.
Harold Edwards: For the fiscal year ended October 31, 2024, total net revenue was $191.5 million compared to $179.9 million last year, primarily driven by record avocado sales. Operating loss for fiscal year 2024 was $6.2 million compared to operating income of $10.8 million last year, primarily due to the net gain on disposal of assets. Net income applicable to common stock after preferred dividends was $7.2 million for fiscal year 2024 compared to $8.9 million for fiscal year 2023. Net income per diluted share for fiscal year 2024 was $0.40 compared to net income per diluted share of $0.50 in fiscal year 2023.
March: For the fiscal year ended October 31, 2024, total net revenue was $191.5 million compared to $179 $9 million last year, primarily driven by record avocado sales.
March: Operating loss for fiscal year, 'twenty 'twenty, four was $6 $2 million compared to operating income of $10 $8 million last year, primarily due to the net gain on disposal of assets.
March: Net income applicable to common stock after preferred dividends was $7.2 million for fiscal year 2024, compared to $8 $9 million for fiscal year 2023.
March: Net income per diluted share for fiscal year 'twenty 'twenty four was 40 cents compared to net income per diluted share up 50 cents in fiscal year 'twenty two 'twenty three.
Harold Edwards: For fiscal year 2024, adjusted net income for diluted earnings per share was $11 million compared to an adjusted net loss for diluted earnings per share of $7.6 million for fiscal year 2023. adjusted net income for diluted share for fiscal year 2024 was $0.62 compared to an adjusted net loss per diluted share of $0.43 for fiscal year 2023. Based on approximately $17.7 million and $17.6 million, weighted average diluted common share is outstanding, respectively. The effective tax rates for fiscal year 2024 and 2023 were 37.9% and 31.8% respectively. For fiscal year 2024, adjusted EBITDA was $26.7 million, compared to a loss of $224,000 for fiscal year 2023.
March: For fiscal year 'twenty 'twenty four adjusted net income for diluted earnings per share was $11 million compared to an adjusted net loss for diluted earnings per share of $7.6 million for fiscal year 2023.
March: Adjusted net income per diluted share for fiscal year 'twenty 'twenty four was 62 cents compared to an adjusted net loss per diluted share a 43 cents for fiscal year 2023 based on approximately $17 7 million and $17 6 million weighted average diluted common shares outstanding.
March: Danny respectively.
March: The effective tax rates for fiscal year, 'twenty 'twenty, four and 'twenty twenty-three were 37, 9% and 31, 8% respectively.
March: For fiscal year 2024, adjusted EBITDA was $26 $7 million compared to a loss of $224000 for fiscal year 2023.
Harold Edwards: Turning now to our balance sheet and liquidity, in the first quarter of last year, we sold our 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 AgWest Farm Credit $40 million non-revolving line of credit, which has a fixed interest rate of 3.57% until July 1, 2025. Long-term debt as of October 31, 2024 was $40 million compared to $40.6 million at the end of fiscal year 2023. Debt levels as of October 31, 2024 minus $3 million of cash on hand resulted in a net debt position of $37.6 million at the end of fiscal year 2024.
March: Turning now to our balance sheet and liquidity in the first quarter of last year, we sold our 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 AG West farm credit $40 million non revolving line of credit which has.
March: The fixed interest rate of 3.57% until July one 2025.
Long term debt as of October 31, 2024 was $40 million compared to $46 million at the end of fiscal year 2023.
March: Debt levels as of October 31, 2024, minus $3 million of cash on hand resulted in a net debt position of $37.6 million at the end of fiscal year 2024.
Harold Edwards: Our 50-50 real estate development joint venture had $66.9 million of cash and cash equivalents on hand as of October 31, 2024, of which 50%, or $33.5 million, is approximately Limoneira. The joint venture currently has no debt. We consider this approximately $33.5 million as an offset to our net debt position of $37.6 million. Furthermore, with the closure of the additional 554 residential homesites in April, the joint venture distributed $30 million in June, and Limoneira received $15 million in cash proceeds. This additional liquidity source from our joint venture partnership provides further financial flexibility.
March: Our 50 50 real estate development joint venture had $66 $9 million of cash and cash equivalents on hand as of October 31, 2024 of which 50% or $33 $5 million is approximately luminaries.
March: The joint venture currently has no debt, we consider this approximately $33 $5 million as an offset to our net debt position of 36 $37.6 million.
March: Furthermore, with the closure of the additional 554 residential Homesites in April the joint venture distributed $30 million in June and luminaire receive $15 million in cash proceeds.
March: Additional liquidity soy is sourced from our joint venture partnership provides further financial flexibility.
Harold Edwards: Now, I'd like to turn the call back to Harold to discuss our fiscal year 2025 outlook and longer term growth pipeline.
March: Now I'd like to turn the call back to Harold to discuss our fiscal year 2025 outlook and longer term growth pipelines.
Mark Palamountain: Thanks, Mark. We expect fresh lemon volumes to be in the range of 5 million to 5.5 million cartons for fiscal year 2025, and expect avocado volumes to be in the range of 7 million to 8 million pounds for fiscal year 2025. In addition, we now expect to receive total proceeds of $180 million from Harvest LLCB2 and LLC and East Area 2 spread out over seven fiscal years with $15 million received in fiscal year 2024.
Harold: Thanks Mark.
Harold: We expect fresh lemon volumes to be in the range of 5 million to $5 5 million cartons for fiscal year, 2025, and expect avocado volumes to be in the range of 7 million to 8 million pounds for fiscal year 2025.
Harold: In addition, we now expect to receive total proceeds of $180 million from harvest L. L. C. B, two and L. L C and E series to spread out over seven fiscal years with $15 million received in fiscal year 2024.
Mark Palamountain: Looking ahead, we continue to see a strong EBITDA outlook underpinned by plans to expand avocado production by 1000 acres through fiscal year 2027 to capitalize on robust consumer demand. During this transition, the company expects fiscal year 2025 avocado volume to be lower compared to fiscal year 2024 due to the alternate bearing nature of avocado.
Speaker Change: Yeah, we continue to see a strong EBITA outlet underpinned by plans to expand avocado production by 1000 acres through fiscal year 2027 to capitalize on robust consumer demand trends. During this transition the company expects fiscal year 2025, avocado volume to be lower compared to fiscal year 2002.
Harold: 24, due to the alternate bearing nature of avocado trees.
Operator: These operational results do not take into account anticipated additional gains from asset Operator will now open the call to questions. Thank you. We'll now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone. The confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the start One moment, please, while we pull for questions. Thank you.
Harold: These operational results do not take into account anticipated additional gains from asset monetization.
Harold: Operator, we'll now open the call to questions.
Harold: Yeah.
Speaker Change: Thank you well now be conducting a question and answer session if you'd like to ask a question. Please press star one.
Speaker Change: A confirmation tone will indicate your line is in the question queue.
Speaker Change: You May press star two if you'd like to remove your question from the queue for participants using speaker equipment and they'd be necessary to pick up the handset before pressing the star kit.
Speaker Change: One moment, please while we poll for questions.
Penn career: Thank you. Our first question is from Penn career with Lake Street Capital markets. Please proceed with your question.
Benjamin Klieve: Our first question is from Ben Klieve with Lake Street Capital Markets. Please proceed with your question. All right, thanks for taking my questions and congratulations on a really good year here.
Penn career: Thanks for taking my questions and congratulations on a really good year here.
Benjamin Klieve: First, I have a couple questions around the water monetization efforts. First of all, you characterized the events that you anticipate coming in fiscal 25 as being meaningful. And I'm wondering, relative to the following events, which were certainly appropriate and accretive, would you characterize those following events to have been meaningful as well? I'm just trying to get kind of a relative scale of what we can expect here.
Penn career: First I have a couple of questions around the water monetization efforts first of all you characterized the events.
Penn career: Events that you anticipate coming in fiscal 'twenty, five as being meaningful and I'm I'm wondering relative to the following events, which were certainly appropriate and accretive would you characterize those following events to have been meaningful as well I'm just trying to get kind of a relative scale of US you know what we can expect here in fiscal 'twenty five.
Harold Edwards: Yes.
Harold Edwards: So, first of all, good to talk to you, Ben. So, we believe that the following program for the Colorado River will be extended for another 25 years with new terms defined in 2025 but enacted in 2026. So, the new water monetization from the Colorado River rights won't take place in 2025.
Penn career: Yes, so first of all good to talk to you again, so we believe that the the following program for.
Penn career: <unk> for the Colorado River will be extended for another 25 years with new terms differ.
Penn career: Defined in 2025, but enacted in 2026, so the the the new water monetization from the Colorado River water rights won't take place in 2025, we do expect there will be meaningful a water monetization from the Santa Paula water basin.
Harold Edwards: We do expect there will be meaningful water monetization from the Santa Paula water basin and meaningful from the standpoint that as we have continued to create and accumulate surplus water shares in that basin, will be able to demonstrate some of our first transactions in that basin at meaningful values that will, I think, help us better point to the definition of the significant value that exists in those Santa Paula basins.
And meaningful from a standpoint that as we have.
Penn career: You need to create and accumulate surplus water shares in that basin will be able to demonstrate some of our first transactions in that basin at meaningful values that will I think help us better point to the definition of the significant value that exists in the Santa Paula Basin.
Penn career: Pumping rates.
Penn career: Yeah.
Benjamin Klieve: Got it. Thank you.
Penn career: Got it thank you.
Harold Edwards: And Harold, can you remind us what the relative value of an acre for the water in the Colorado River versus Santa Paula Basin? Well, they're very different. So the following program right now in the Colorado River allows us to follow half of our productive land there. So right now we have 600 acres that are followed. The Bureau of Reclamation grants us 5.5 acre-feet of water to follow per acre that we've followed, and we get paid $400 an acre-foot, which generates about $1.3 million of value for us and for not taking that water. So that's really the economics of.
Speaker Change: And remind us what the relative value of water in the Colorado River versus Santa Paula Basin is.
Speaker Change: Well, they're very different so the following program right now in Colorado River allows us to follow half of our productive land. There. So right now we have 600 acres that are followed the bureau of reclamation are granted 5.5 acre feet.
Of of water to follow a per acre that we followed.
Speaker Change: And we get paid $400, an acre foot, which generates about $1.3 million of value for us and we're not taking that water. There. So that's really the that's really the economics of it.
Harold Edwards: of those interests.
Speaker Change: Those interests in the Santa Paula Basin, I believe accumulated Santa acute.
Harold Edwards: In the Santa Paula Basin, as we've accumulated surplus water rights in that basin, we're finding the opportunity to begin to monetize some of those rights for urban needs surrounding us. And when we announce the transactions, we'll be able to announce the terms of those sales, but they are significant and actually significantly more valuable than the Colorado River water rights.
Speaker Change: Accumulated surplus water rights in that basin, we're finding the opportunities to begin to monetize some of those those rights for urban needs surrounding us.
And when.
Speaker Change: When we announced the transactions will be able to announce the the terms of those of those of those sales, but but they're there. They are significant and are actually significantly more valuable than then the Colorado River water rights.
Harold Edwards: Right. Okay. Very good. Thank you. We'll stay tuned for more information there.
Speaker Change: Right. Okay very good. Thank you all to stay tuned for more information there.
Harold Edwards: And then kind of a big picture question on this dynamic is, I'm wondering kind of the status of the regulatory environment as it pertains to these water assets. I mean, are there any barriers in place today or events coming soon that you think may be a catalyst for a monetization effort either via the Colorado River Compact or some other regulatory agency or state or local? Anything like that that we should have our ears open to? Well, I think the Department of Interior and their management arm of the Bureau of Reclamation have mandated that one-third of the consumptive use be cut off the Colorado River.
Speaker Change: Then.
Just from a big picture question on this dynamic is is the I'm wondering kind of the status of the regulatory environment as it pertains to these water assets.
Speaker Change: We are you know are there any barriers in place today or events coming soon that you think may be a catalyst for our monetization effort either via the Colorado River compact or some other regulatory agency or.
Speaker Change: The state or local or anything like that that we should have have our ears open to.
Speaker Change: Well I think the department of interior and their their management arm of the Bureau of reclamation have mandated that one third of the consumptive use be cut off the Colorado River and as you've probably been reading that the number the numerous states that derive benefit from the Colorado River had been.
Harold Edwards: And as you've probably been reading, the numerous states that derive benefit from the Colorado River have been sort of, fighting is not the right word, but negotiating on who's going to cut what. We believe that one of the biggest needs of actual water for urban development and urban needs exists in Arizona because of the Central Arizona Project, which is all the housing Scottsdale, Phoenix, all the way down to Tucson, but also Lake Mead, which is a primary feeder of Las Vegas and its water. We believe that that water will be necessary to divert from agricultural uses at some level into into meeting the urban demands and needs.
Speaker Change: And sort of fighting.
Speaker Change: Fighting is not the right word, but but negotiating on who's going to cut what.
Speaker Change: We believe that our one of the biggest needs of actual water for urban development in urban needs exist in Arizona because of the Central Arizona project, which is all the housing from.
Speaker Change: Scottsdale and Phoenix, all the way down to Tucson, but also lake Mead, which is a primary feeder of Las Vegas and its water we.
Speaker Change: We believe that that water will be necessary to divert from agricultural uses at some level anyways into into meeting the urban demands and needs and so therefore, we believe that a R class III, Colorado River rights will be.
Harold Edwards: And so therefore, we believe that our class three Colorado river rights will be in perfect position to take advantage of those following programs. So, and that new 25-year accord needs to be set and begun on the river beginning in 2026. So we believe that as administrations change right now, there'll be a big focus on putting that next 25-year accord onto the Colorado River. And I would keep our eye to your question. on those negotiations and the deal that's actually cut on the river that's going to add up to a third of the consumptive use being Got it.
Speaker Change: In perfect position to take advantage of those following programs, so and that that new 25 year, a court needs to be set and begun on the river beginning in 2026, So we believe that as as administration.
Speaker Change: Administrations change right now there'll be a big focus on putting that next 25 year, a cord onto the Colorado River and I would keep our eye to your question on those negotiations and the deal that's actually cut on the river, that's going to add up to a third of the consumptive use being cut.
Speaker Change: Got it very good a lot of lot going on here well, we'll stay tuned for more news there. One one question for me on the Agribusiness a front and then I'll get back in queue is around the Fracs are women targets here for 25, so you're you're targeting five to $5 5 million cartons.
Benjamin Klieve: Very good. A lot going on here. Well, we'll stay tuned for more news there.
Benjamin Klieve: One question for me on the agribusiness front, and then we'll get back in queue, is around the fresh lemon targets here for 2025. So you're targeting 5 to 5.5 million cartons, which a nice 10% or so step up from where you were this year, but I think that was on lower utilization. So can you talk about what is embedded in that 5 to 5.5 million in terms of the, you know, an improvement in the utilization rate, you know, more, more volume coming in from third party growers, you know, any, any other big, you know, big drivers here to, you know, to get to that, that 5 to 5.5 million dollar, excuse me, million carton figure.
Speaker Change: Nice you know, 10% or so step up from where you were this year, but I think that was on lower utilization. So can you talk about what is embedded in that five to $5 5 million in terms of the you know an improvement in the utilization rate more more volume coming in from third party growers.
Speaker Change: Any other big Big.
Speaker Change: Big drivers here or two to get to that that five to five and a half million dollars excuse me million carton figure.
Mark Palamountain: Yeah, you bet, Ben. Nice talking to you. So a couple things. So as we finished this year, you know, we had all of Mother Nature's normal challenges that we from heat in the wrong times to cold in the wrong times to wind. And so our fresh utilization was hovering near or at 70% for the year. And so when we get down to those levels, our unit costs obviously go up, you're only selling seven out of every 10 lemons. And so as we look at this year, and we mentioned our penetration into more quick service restaurants and food service restaurants, it gives us an opportunity to sell that standard lemon a little bit easier, which does two things, it helps fresh utilization.
Speaker Change: Yeah, you bet and a nice talking to you. So a couple of things. So as we finish. This year you know we had all of mother nature is normal challenges that we from heat in the wrong times took hold in the wrong times to wind and so our fresh utilization was hovering near or are at 70% for the year and so when we get down to those levels.
Speaker Change: Our unit costs, obviously go up you're you're you're only selling seven out of every 10 lemon and so as we look at this year and we mentioned our penetration into more quick service restaurants, and foodservice restaurants. It gives us an opportunity to sell that standard 11, a little bit easier, which does two things it helps fresh utilization.
Mark Palamountain: So if we can get up into the 80% range, by selling more quick serve, it'll bring down our average overall price, but our gross net dollars back to the grower and ourselves is goes up. And so that's sort of that's what we're seeing. We're gaining most of our volume through recruiting. We've we've recruited about over a half a million cartons so far this year. And as you know, we have our pivot from avocados, or excuse me, lemons into avocados and are planting 1000 acres of avocados. So some of our lemons will be coming out over time.
Speaker Change: So if we can get up into the 80% range and by selling more quick serve.
Speaker Change: Will bring down our average overall price, but our gross net dollars back to the grower and ourselves is it goes up and so that's that's what we're seeing we're gaining most of our volume through recruiting them. We're getting we've recruited about over half a million cartons. So far this year.
Speaker Change: As you know we have our pivot from avocados.
Speaker Change: Avocados or excuse me lemons and avocados and are planting a thousand acres of avocados. So some of our lemons, we'll be coming out over time, but the goal is still to get somewhere between 20 and 25% of our own fruit owned and then the balance.
Mark Palamountain: But the goal is still to get somewhere between 20 and 25% of our own fruit owned and then the balance of those five to five and a half million cartons will be outside growers.
Speaker Change: Of those five to $5 5 million cartons will be outside growers.
Benjamin Klieve: got it got it very good um all right well i appreciate you guys taking my questions that doesn't for me i'll get back Thank you. Thank you.
Speaker Change: Got it got it very good alright, well I. Appreciate you guys, taking my questions that does it for me I'll get back in queue.
Speaker Change: Great. Thank you.
Speaker Change: Yeah.
Speaker Change: Thank you. Our next question is from Gerard Sweeney with Roth Capital Partners. Please proceed with your question.
Gerard Sweeney: Our next question is from Gerard Sweeney with Roth Capital Partners. Please proceed with your question. Hi Jared. and asked a couple of my Thank you.
Gerard Sweeney: Harold and Mark Thanks for taking my call.
Speaker Change: Okay, Hi, Jerry.
Speaker Change:
Speaker Change: You've been asked a couple of my questions, which was great, but I wanted to touch on avocados right. So.
Speaker Change: Obviously, the underlying theme here is shifting from more lemons made less limits more avocados.
Speaker Change: You highlighted.
Speaker Change: Acres could you give us a little bit more details.
Harold Edwards: A little bit more detail is, you know, I know that this is going to be a multi-year process, but how So let me take a stab and then Mark can fill in the rest. So if you look back at our tremendous results of over 15 million pounds produced and sold in fiscal year 2024, we did that on 800 acres that were barren. But as of right now, we have a little over 1,300 acres planted. And so what you'll see is, over the course of the next two to three years, the balance of another 700 acres being planted.
I know that this is gonna be a multiyear process, but how those avocados coming into play and maybe if you're in a position to do so you know, it's sort of the economics behind that shift.
Speaker Change: So let me take a stab and then mark can fill in the rest so.
Speaker Change: If you look back at our tremendous results of over 15 million pounds produced and sold in in fiscal year 2024, we did that on 800 acres that were bearing.
Speaker Change: But as of right now we have a little over 1300 acres planted and so what you'll see is over the course of the next two to three years the balance of another 700 acres being planted a part of that comes from being able to get the nursery stock and enough trees to actually occur.
Mark Palamountain: Part of that comes from being able to get the nursery stock and enough trees to actually accomplish that. The great news is that we've got them, we've got them on order, they're being produced, so that's less of a concern. As it relates to the economics now, you're going to see, even though we mentioned the alternate bearing nature of production, you know, we just guided from seven to eight million pounds in fiscal year 2025. We've done that trying to be conservative. Part of what drives a crop is not only the number of pieces, but also how much size you can get, which the bigger the fruit, the heavier the amount of pounds that you get to sell.
Speaker Change: With that the Great news is that we've got them, we've got them on order, they're being produced so so that's less of a concern as it relates to the economics now youre going to see them, even though we mentioned the alternate bearing nature of production you know, we just guided from seven to 8 million pounds in fiscal year 'twenty.
Speaker Change: 25.
Speaker Change: We've done that trying to be conservative a part of what what drives a.
Speaker Change: Crop is not only the number of pieces, but also how much size you can get with the <unk>.
Speaker Change: The fruit the heavier the amount of pounds that you get to sell.
Mark Palamountain: A lot of that is driven by rainfall, and we're sitting here towards the end of December, have not had a lot of rain so far. It's too early to say whether that sizing will actually take place or not, but we've tried to guide being conservative that we wouldn't necessarily get the growth in the pieces that are hanging on the tree that we got last year. If we do, then you'll see considerably more avocado volume achieved, but we're, again, trying to be conservative as we make that guide. As we look forward, we expect that next year should be, or 2026, would be a bigger crop year on the existing acres, but also seeing some of the non-bearing acres that have been planted beginning to produce fruit.
Speaker Change: A lot of that is driven by rainfall and where we're sitting here towards the end of December had not had a lot of rain. So far it's too early to say, whether whether that sizing will actually take place or not but we've tried to guide being conservative that we wouldn't necessarily get the growth in the pieces that are hanging on the tree that we got last year.
Speaker Change: If we do then you'll see considerably more avocado volume achieved but we're again trying to be conservative as we make that guidance.
Speaker Change: As we look forward, we expect that next year should be a 2026 would be a bigger crop year, but also on the existing acres, but also seeing some of the non bearing acres that have been planted beginning to produce fruit and as we look forward and I'll turn it over to Mark maybe he can give us a look at what he would expect the volume.
Mark Palamountain: And as we look forward, and I'll turn it over to Mark, maybe he can give us a look at what he would expect the volume to be, but before I do that, we've also in our forecast, just so you know, we've used an average price per pound in our models of $1.30 a pound. There are tailwinds that are going with us at this point that could allow us to achieve significantly greater pricing than that, but again, in an attempt to be conservative, we used $1.30.
Speaker Change: To be.
But before I do that we've also in our forecast just so you know.
Speaker Change: We've used an average price per pound in our models of $1 30, a pound there there are tailwind that are going with us at this point that could allow us to achieve significantly greater pricing in that but again in an attempt to be conservative we used a $1 30. So if you're building a model that's kind of where you would.
Mark Palamountain: So, if you're building a model, that's kind of where you see our forecast, but I'll turn it over to Mark, and you can make a. Yeah, so if we think about the cadence, so we're two years into the call it four to five year replanting process. So as Cheryl mentioned, we're almost 1400 acres in the ground, of which 750 are bearing at this point. And that that replanting started about two years ago. So we think anywhere from three to four years is when you first start getting your real commercial fruit. And then six to seven years is full bearing.
Mark: Where you see our forecast, but I'll turn it over to Mark and he can.
Mark: Can make his comments.
Mark: Yeah. So if we think about the cadence. So we're two years into that call. It four to five year replanting process. So as Harold mentioned, where were almost 1400 acres in the ground of which 750 are bearing at this point and that that replanting started about two years ago. So we think anywhere from.
Mark: Three to four years is when you first start getting your your real commercial food and then six to seven years is its full bearing and you look at some of the trees. We planted right now in terms of our neighbor growers have even commented on on how how how well they've grown already and we got them a little bit bigger out of the nursery it seems and so we're really.
Mark Palamountain: You look at some of the trees we've planted right now, and some of our neighbor growers have even commented on how well they've grown already. We got them a little bit bigger out of the nursery, it seems. And so we're really anticipating sooner than four years of seeing our first crop. And so if we look at what we've done compared to historical plantings, we're planting higher density trees, different, more robust rootstocks, and also implementing technology to be able to best feed and water our trees when they need it, not just when we have the ability to serve.
Mark: Anticipating sooner.
Mark: And then four years of seeing our first crop and so if we look at what we've done compared to historical plantings, where we're planting higher density trees different more robust route stocks and also implementing technology to be able to best feed and water are trees, when they need it and not just them.
Mark: But when we have the ability to serve and so all of those contributing factors are going to are going to take our average pounds per acre, where historically, we were anywhere from seven to 15000 pounds. An acre now we think we will produce between 15 and 20000 pounds an acre between the on and off years, so quite a significant increase in production.
Mark Palamountain: And so all of those contributing factors are going to are going to take our average pounds per acre, where historically we were anywhere from seven to 15,000 pounds an acre. Now we think we'll produce between 15 and 20,000 pounds an acre between the on and off year. So quite a significant increase in production. And if you do the math, it costs us about $5,000 an acre currently to farm it. And at $20,000 an acre at $1.30, you're making over $20,000 per acre back to the farm. So quite different than where lemons are today at anywhere from $2,000 to $5,000, just depending on where the location is.
Mark: And if you do the math it cost us about $5000 an acre currently to farm it and that $20000 an acre at $1.30, you're making over $20000 per acre back to the farm so quite different than where lemons are today at anywhere from two to $5000 just depending on where the location is so that's why we were.
Mark Palamountain: So that's why we're really confident in this year validated that strategy change. and just, I don't know. This year, 2025, not. Yeah, so you can kind of go equally. So on our way to 30 million pounds is sort of is the target goal. As an average, once we have 2000 acres in, you'll see some years that have 40 million pounds, and you'll see some years that have 25 million pounds. And so we think 30 million pounds by 2029 is a good number to have as sort of your baseline average. And then, you know, assume price from there.
Mark: Confident in this year validated that strategy change.
Mark: Got it and.
Mark: And just a lot of numbers there.
This year 2025, not much change in avocado pounds, one because what Harold talked about the rain, but.
Mark: The non bearing acres should start to come into play a little bit in 'twenty six more than 27 and more than 28 is that sort of yeah. So you can you can kind of go equally so on our way to 30 million pounds is sort of is the target goal.
Mark: As an average we at once we have 2000 acres in you'll see some years that have 40 million pounds and you'll see some years that have 25 million pounds and so we think 30 million pounds by 2029 is a good number to have as sort of your baseline average and then assume price from there.
Mark: And 30.
Mark: 30 million pounds.
Mark Palamountain: I mean, but. It's $5,000 for us to farm it, and it's $15,000 to $20,000 of operating profit per acre when we get to those levels. So lemons, so if you go back to the 2018 days, we got up to about $10,000 per acre with a lot more noise and effort. Avocados, just depending on, we have Mexico who's the 10,000 pound gorilla down there that they produce about 90% of what the US consumes. As we see comments on tariffs, deforestation, and potential other cartel type issues, the US and California avocado, which is where all avocados or most avocados are produced in the US, has a distinct market advantage because 70% of avocados are consumed west of the Rockies and primarily a lot of the Latin influence.
Mark: But what it was.
Mark: Did you say $15000 an acre for avocados it on average.
Mark: It's it's 5000 fresh department and its 15 to $20000 of operating profit per acre when we get to those levels.
Mark: So very very compelling.
Mark: How's that compared to limits.
Mark: So lemons are so if you go back to the 2018 days, we got up to about $10000 per acre with a lot more noise and effort avocados. You know just depending on you know we have Mexico who's the 10000 pound gorilla down there that they they produce about 90% of what the U S consumes as we see.
Speaker Change: Comments on tariffs deforestation.
And potential other cartel type issues, you know the U S and California, avocado, which is where all of a kind of or most of it how does it produce in the U S has a distinct market advantage because 70% of avocados are consumed west of the Rockies.
Speaker Change: And primarily a lot of the Latin influence and so I think we feel really comfortable with with pricing at $1.30 to be conservative you saw mission produce them come out with their earnings.
Mark Palamountain: And so I think we feel really comfortable with pricing at $1.30 to be conservative. You saw Mission Produce come out with their earnings last week, that they see pricing to be up 20% year over year. So all things point up for avocados at this point.
Speaker Change: Last week that they see pricing to be up 20% year over year. So all things point for avocados at this point.
Speaker Change: Got it.
Gerard Sweeney: Shifting gears. questions on them. One, do you know when the next distribution will be? I mean, is it generally speaking June, the time frame they look at it? And two, I know you said about the CapEx side.
Speaker Change: <unk> gears real estate JV I think the last distribution was June of this past year.
Speaker Change: Two questions on that one do you know what the next distribution will be I mean, there's generally speaking Jim the timeframe they look at it too.
Speaker Change: I know you said Theres 30, some odd million in there no debt but.
Speaker Change: What about the capex side or or inflows outflows.
Speaker Change: On that number I know I know, it's going to grow over time, but I'm just curious as you.
Mark Palamountain: Yes, let me just take a swing at that, Jerry. So the one thing that happened is when we made our distributions, we actually terminated the revolving line of credit that the partnership had because we're now in position to self-fund our working capital in our CapEx. And so we do have some CapEx items. The next big one is we're about to build a bridge across Santa Paula Creek. And so that's scheduled to break ground and begin construction this spring. What's that? I think that's the Mark Palamountain bridge. So yeah, and that's actually a really great part of the project because that's actually going to create a lot more better access for people.
Speaker Change: Yes, I'll, let me just take a swing at that Jerry So the the one thing that happened is when we made our distributions we actually terminated the revolving line of credit that the partnership have because we're now in position to self fund, our working capital and our Capex and so we do have some some some capex item. The next big one is.
Speaker Change: We're about to build a bridge across Santa Paula Creek.
Speaker Change: And so that's scheduled to to break ground and begin construction this spring.
Speaker Change: And.
Speaker Change: Yes.
Speaker Change: What's that.
Harold Edwards Bridge I think that's the Mark Collin on bridge.
Speaker Change: So so yeah that and that's actually a really great part of the project because that's actually going to create a lot more better access for people in town to get out to the harvest project and and so that's actually going to be a really beneficial part of our project, but there will be some some <unk>.
Mark Palamountain: town to get out to the harvest project. And so that's actually going to be a really beneficial part of our project, but there will be some capital expenditure that's required from that. And then we still have the final part of the infrastructure for phase three to go as well. So there is a little bit more fund CAPEX requirements, but there's also community fund districts and the issuance of bond benefits that will come that will help balance that. The answer to your question is when the next distribution will be. We're not sure at this point, so we're keeping our share in the partnership at this point.
Speaker Change: Capital expenditure that's required from that and then we still have the final part of the infrastructure for phase III to to go as well. So there is a little bit more funded capital capex requirements, but there's also a community fund districts and the issuance of bonds benefits that will come that will help balance that.
Speaker Change: The answer to your question is when the next distribution will be we're not sure at this point so we're keeping.
Speaker Change: Our share in the partnership at this point.
Got it okay.
Speaker Change: I appreciate it thanks I'll jump back in line.
Gerard Sweeney: Great. Thanks, Jerry.
Eric: Thanks, Gary it's Eric.
Benjamin Klieve: Thank you. Our next question is from Ben Klieve with Lake Street Capital Market. Please proceed with your question. Yeah, thanks for taking my follow up. Mark, you were talking about avocado yield per acre. And I had a follow up on this. So your rough math is that this year in the down year in the alternating cycle that your 800 acres is going to yield something like 9000 pounds an acre. And you said that over the next few years that you think that 15,000 even in, you know, on the downside is going to be possible via, you know, via how you guys are constructing the, the orchards and the, you know, different technologies to, you know, support this.
Speaker Change: Thank you. Our next question is from Ben <unk> with Lake Street Capital markets. Please proceed with your question.
Ben: Thanks for taking my follow up.
Speaker Change: Mark you were talking about avocado yield per acre and I have a follow up on this so your rough math is that this year and are down year on the alternating cycle that your 800 acres.
It is going to yield something like nine.
Speaker Change: It was 9000 pounds, an acre and you said that over the next few years that you think that 15000 even in.
Speaker Change: The downside is gonna be possible via.
Speaker Change: How you guys are constructing the new Yorkers in the different technologies.
Benjamin Klieve: That's a huge increase. I want to make sure one that I've heard that right.
Speaker Change: To support this huge increase I want to make sure one that I've heard that right and then second if you can elaborate a bit on the talk about the real drivers here came flat yield and where do you think there'll be a few years from now.
Mark Palamountain: And then second, if you can elaborate a bit on this, talk about the real drivers here, between current yield and where you think you'll be a few years from now. Yeah, so you did hear right. You know, we've got a we have been obviously in replanting mode with a lot more trees per acre, almost potentially double in some instances. Our young and really intelligent agricultural team has put together the farming practices, pruning that we just never did. And, you know, I'll go back to say that, you know, since this last year, we started a group internally called the Avocado Congress, which has focused all the stakeholders together from sales to harvest to farming to the executive team, and even external farming board member to to come together sometimes weekly during the season to go through how best to to take from farm to market the avocados.
Speaker Change: Yeah. So you did hear right.
Speaker Change: We've got a we have been obviously in replanting mode with a lot more trees per acre almost potentially double in some instances or are young and and really intelligent agricultural team has put together the farming practices pruning that we just never did.
Speaker Change: And now I'll go back to say that you know it since.
Speaker Change: This last year, we started a group internally called the avocado Congress, which has focused all the stakeholders together from sales to harvest a farming to the executive team and even external farming board member.
To come together and sometimes weekly during the season to go through how best to to take from farm to market the avocados and so.
Mark Palamountain: And so when we have more trees per acre, obviously, that's pretty easy to get from a higher number. We had really antiquated irrigation systems for a long time, which were as we replant these new acreages going forward, we're going to have pressurized lines where before it was literally turn it on and turn it off, you know, and you just would have to do, you know, two week cycles where now we could spoon feed on a weekly basis, give all the nutrients you need. And it sounds fundamental, but it actually really, really helps as far as as long term productivity for a tree.
Speaker Change: When we have.
Speaker Change: More trees per acre, obviously, that's pretty easy to get from a higher number.
Speaker Change: We had really antiquated irrigation systems for a long time, which we're as we replant. These new acreages going forward, we're gonna have pressurized lines, where before it was literally turn it on and turn it off you know and you just would have to do two week cycles and we're now we could spoon feed on a weekly basis.
Speaker Change: Give all the nutrients you need and it sounds fundamental but it actually really really helps as far as as long term productivity for a tree and we're also doing things like drones sprays now, which they're much more precise versus helicopters. So if multifactor of things, but we're we like this year, we saw on the 700.
Mark Palamountain: And we're also doing things like drone sprays now, which they're much more precise, versus helicopters. So it's just multi factor of things. But we're we like this year, we saw on 700 acres, over 15 million pounds. And so just that alone, and and half of those trees are still older legacy trees. So we're really confident in that $15,000 or 15,000 pound number and getting to over 20 million 20,000 pounds per acre in those high years when we have perfect weather conditions. And so, Ben, just for statistics, so... The old plantings had approximately 90 trees planted per acre.
Speaker Change: Acres over 15 million pounds, and so just that alone and and half of those trees are still older legacy trees. So we're really confident in that $15000 or 15000 pound number and getting to over 20.020 million pounds per acre.
Speaker Change: And those high years, when we have perfect weather conditions.
Speaker Change: And then just just for statistics so.
Speaker Change: The old plantings had approximately 90 trees planted per acre all of our new plantings are high density with over 180 trees per acre. So you can see the significant increase there and also just as mark was mentioning in the way that we're farming them.
Mark Palamountain: All of our new plantings are high density with over 180 trees per acre. So you can see the significant increase there. And also, just as Mark was mentioning in the way that we're farming them, our internal models are sort of averaging at 17,000 pounds an acre on the new plantings and the new acreage. And as he said, there'll be years that are lower, there'll be years that are higher. But our team really feels pretty confident that the new planting should drive that 17,000 pounds per acre as we retool the operation.
Speaker Change: Our our internal models are sort of averaging at 17000 pounds an acre on the new plantings of the new acreage and as he said there'll be years that are lower than it would be years that are higher but but our team really feels pretty confident that the new planning should drive that 17000 pounds per acre as we as we retool the the op.
Speaker Change: Operations.
Speaker Change: Scott.
Benjamin Klieve: Very interesting. Well, congratulations to the Avocado Congress and hooray for Ag Tech. So, great to hear all that. Thanks for taking my follow-up. Thanks, man.
Speaker Change: Very interesting as well congratulations to the avocado Congress Ah and Jorge for AG type. So it's great to hear all that thanks for taking my follow up again.
Speaker Change: Thanks, Matt.
Harold Edwards: Thank you. There are no further questions at this time.
Speaker Change: Thank you there are no further questions at this time I'd like to hand, the floor back over to Harold Edwards for any closing comments.
Harold Edwards: I'd like to hand the floor back over to Harold Edwards for any closing comments. Thank you all for your questions and your interest in Limoneira. Happy Holidays to all.
Thank you all for your questions and your interest in leaving here are happy holidays salary.
Operator: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.
Speaker Change: This concludes today's conference you may disconnect your lines at this time. Thank you for your participation.