Mission Produce Inc
For the period ended Apr 30, 2025. Filed Jun 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 30, 2025 · Filed Jun 5, 2025
AVO$11.66+1.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-01-31; filed 2025-03-10.
0001802974-25-000006
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-04-30; filed 2025-06-05.
0001802974-25-000028
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 86 previous paragraphs and 95 current paragraphs.
60 unchanged; 21 reworded; 14 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 15 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Macroeconomic environment
Current report
On February 1, 2025, the United States imposed 25% tariffs against certain foreign goods, including a 25% tariff on all imports from Mexico. The tariffs were effective March 4 through March 6, 2025, during which we incurred $1.1 million in tariffs on Mexican imports. Due to the abrupt and brief duration of tariff application, we were unable to effectively pass the charges to customers. On March 6, 2025, the United States exempted imports from Mexico satisfying the United States–Mexico–Canada Agreement (USMCA) requirements.
Current report
On April 2, 2025, the U.S. imposed a minimum 10% tariff on all foreign imports, effective April 9, 2025. Our imported avocados are primarily sourced from Mexico and Peru with additional sourcing from various Central and South American countries. As Mexican fruit is exempted under the USMCA, we are primarily impacted by 10% tariffs on Peruvian fruit. Our International Farming segment cultivates and exports avocados from Peru. Sales of Peruvian fruit are concentrated in the second half of the fiscal year in alignment with the Peruvian avocado harvest season. If we are unable to pass the cost of tariffs to customers, we could experience an adverse impact on gross profit.
Current report
If U.S. or global trade policies change again, our costs of foreign fruit could be impacted. It is difficult to predict the impact of future changes. We continue to monitor regulatory changes and their impact on our industry, and are actively strategizing to align our pricing strategy to policy changes.
Current report
Net sales increased $82.7 million or 28% and $158.2 million or 28% in the three and six months ended April 30, 2025 compared to the same periods last year, primarily driven by our Marketing & Distribution segment, where average per-unit avocado sales prices increased 26% and 25%, respectively, while volumes sold were flat. Consumer demand outpaced supply, driving higher per-unit pricing as volume was limited by continuing constraints on Mexican fruit availability.
Current report
Gross profit decreased $2.6 million or 8% in the three months ended April 30, 2025 compared to the same period last year to $28.4 million and gross profit percentage decreased 290 basis points compared to the same period last year, to 7.5% of revenue. Our Marketing & Distribution segment was impacted by lower per-unit margins on avocados sold due to challenges in obtaining Mexican supply required to meet customer commitments. In addition, the Marketing & Distribution segment incurred $1.5 million of costs associated with the closure of our Canadian facilities and $1.1 million in tariffs levied on USMCA-compliant goods imported from Mexico for the three days they were in effect during March 2025. Gross profit at the International Farming segment increased due to higher pricing and yield from owned mango orchards as well as higher volume of blueberry packing and cooling services.
Current report
Gross profit was flat for the six months ended April 30, 2025 compared to the same period last year. Gross profit percentage decreased 230 basis points compared to the same period last year, to 8.4% of revenue. The Marketing & Distribution and International Farming segments were impacted by the same factors impacting the quarter. Charges incurred for the six months ended April 30, 2025 related to the closure of Canadian facilities were $2.9 million.
Current report
SG&A expenses increased $2.8 million or 15% and $4.3 million or 11% in the three and six months ended April 30, 2025 compared to the same periods last year. The increases were primarily due to higher employee related costs, inclusive of performance-based stock compensation expense, as well as higher professional fees, inclusive of fees for external legal counsel associated with outstanding legal proceedings.
Current report
Other expense (income), net
Current report
Other income was $0.9 million in the six months ended April 30, 2025 compared to zero in the same period last year, primarily due to greater foreign currency losses resulting from the weakening of the U.S. dollar relative to the Mexican peso in the previous year.
Current report
(4)Represents tariff charges levied on USMCA-compliant goods imported from Mexico for the three-day period from March 4th to March 6th, 2025. The extremely short-term nature of the charges prevented the Company from effectively passing the charges in both pricing to customers and prices paid for goods from suppliers. USMCA-compliant goods have subsequently been exempted from tariff charges on U.S. imports and additional adjustments are not expected in the future.
Current report
Net sales in our Blueberries segment increased $5.7 million or 57% in the three months ended April 30, 2025 compared to the same period last year, primarily due to higher volume driven by increased total acreage and yields from our farms.
Current report
Segment adjusted EBITDA was flat for the three months ended April 30, 2025 compared to the same period last year as the volume growth offset the lower per-unit margin.
Current report
Segment adjusted EBITDA decreased $2.4 million or 26% for the six months ended April 30, 2025 compared to the same period last year, primarily due to lower per-unit margins attributed to lower selling prices.
Removed paragraphs (5)
Previous report
On February 1, 2025, President Trump signed executive orders to impose 25% tariffs against certain foreign goods, including a 25% tariff on all imports from Mexico. The tariffs became effective on March 4, 2025. On March 6, 2025, President Trump made an announcement pausing the tariffs until April 2, 2025. If tariff levies resume, they will likely increase the cost of fruit we import from Mexico, which we may not be able to pass on to our customers.
Previous report
SG&A expenses increased $1.5 million or 7% in the three months ended January 31, 2025 compared to the same period last year, primarily due to higher employee related costs, including statutory profit-sharing expense and stock-based compensation expense.
Previous report
Other income (expense), net
Previous report
Net sales in our Blueberries segment increased $3.9 million or 12% in the three months ended January 31, 2025 compared to the same period last year, driven by blueberry volume and pricing dynamics as described above.
Previous report
Segment adjusted EBITDA decreased $2.5 million or 29% for the three months ended January 31, 2025 compared to the same period last year, driven by lower per-unit sales prices resulting from increased industry production in the current year.
Reworded paragraphs (21)
Previous wording
We are a world leader in sourcing, producing, growing and distributing Hass avocados, serving retail, wholesale and foodservice customers. We source, produce, pack and distribute avocados and a small amount of other fruits, including mangos, to our customers and provide value-added services including ripening, bagging, custom packaging and logistical management. In addition, we provide our customers with merchandising and promotional support, insights on market trends and training designed to increase their retail avocado sales.
Current wording
We are a world leader in sourcing, producing, growing and distributing Hass avocados, serving retail, wholesale and foodservice customers. We source, produce, pack and distribute avocados along with other fruits, including mangos, to our customers and provide value-added services including ripening, bagging, custom packaging and logistical management. In addition, we provide our customers with merchandising and promotional support, insights on market trends and training designed to increase their retail avocado sales.
Previous wording
As previously announced, the Company closed its Canadian distribution centers within its Marketing & Distribution segment during the first quarter of 2025. In connection with the closure, we recognized approximately $1.4 million in charges during the quarter, consisting of accelerated depreciation expense of property, plant and equipment, accelerated amortization expense of operating lease right-of-use assets and severance costs. Distribution volume from these facilities has been absorbed by our other distribution centers and third-party service providers.
Current wording
The Company closed its Canadian distribution centers within its Marketing & Distribution segment during the first quarter of 2025. In connection with the closure, we recognized approximately $1.5 million in charges during the three months ended April 30, 2025 and $2.9 million for the six months ended April 30, 2025. Charges consisted of accelerated depreciation expense of property, plant and equipment, accelerated amortization expense of operating lease right-of-use assets, loss on disposal of property, plant and equipment and severance costs. Distribution volume from these facilities has been absorbed by our other distribution centers and third-party service providers.
Previous wording
Gross profit increased $2.8 million or 10% in the three months ended January 31, 2025 compared to the same period last year to $31.5 million, driven by our International Farming segment, which benefited from increased packing and cooling service activity that correlated with higher blueberry production volumes, partially offset by lower gross profit in our Marketing & Distribution segment, which was negatively impacted by lower per-unit margins on avocados sold due to challenges in obtaining Mexican supply required to meet customer commitments. Gross profit percentage decreased 170 basis points to 9.4% of revenue, compared to the same period last year. Gross profit percentage will fluctuate based upon per-unit sales price levels in relation to per-unit costs. Margin is primarily managed on a per-unit basis in our Marketing & Distribution segment, which can lead to movement in gross profit percentage when sales prices fluctuate.
Current wording
Gross profit percentage will fluctuate based upon per-unit sales price levels in relation to per-unit costs. Margin is primarily managed on a per-unit basis in our Marketing & Distribution segment, which can lead to movement in gross profit percentage when sales prices fluctuate.
Previous wording
Interest expense decreased $1.1 million or 33% in the three months ended January 31, 2025 compared to the same period last year, due to lower average balances on our revolving line of credit and lower interest rates on our borrowings.
Current wording
Interest expense decreased $0.9 million or 26% and $2.0 million or 30% in the three and six months ended April 30, 2025 compared to the same periods last year. The decreases were due to lower average balances on our revolving line of credit and lower interest rates on our borrowings under our credit facility. Interest rates applicable to our credit facility are variable, based on SOFR and a spread depending on our net leverage ratio.
Previous wording
Equity method income increased $0.4 million or 100% in the three months ended January 31, 2025 compared to the same period last year, primarily due to improved margins on fruit sold at Mr. Avocado.
Current wording
Equity method income increased $0.4 million or 80% and $0.8 million or 89% in the three and six months ended April 30, 2025 compared to the same periods last year. The increases were primarily due to improved margins on fruit sold by Mr. Avocado in China.
Previous wording
Other income (expense), net consists of interest income, currency exchange gains or losses, interest rate derivative gains or losses and other miscellaneous income and expense items.
Current wording
Other expense (income), net consists of interest income, currency exchange gains or losses, interest rate derivative gains or losses and other miscellaneous income and expense items.
Previous wording
Other income was $1.5 million in the three months ended January 31, 2025 compared to expense of $1.0 million for the same period last year. Other income in the current year was driven by foreign currency transaction gains resulting from a strengthening U.S. dollar relative to the Mexican peso during the period, as compared to weakening in the prior year period.
Current wording
Other expense was $0.6 million in the three months ended April 30, 2025 compared to other income of $1.0 million for the same period last year. Other expense in the current year quarter was driven by foreign currency transaction loss resulting from a weakening of the U.S. dollar relative to the Mexican peso during the period, which more than offset interest income.
Previous wording
The provision for income tax increased $1.1 million or 52% in the three months ended January 31, 2025 compared to the same period last year, primarily due to the effect of higher income before taxes in the current year. Our effective tax rate in both years was impacted by book losses in jurisdictions where either a full valuation allowance has been recorded or where loss carryforward is disallowed.
Current wording
The provision for income tax decreased $1.7 million or 50% and $0.6 million or 11% in the three and six months ended April 30, 2025 compared to the same periods last year, primarily due to the effect of lower income before taxes in the current year. Our effective tax rate was impacted by book losses in jurisdictions where either a full valuation allowance has been recorded or where loss carryforward is disallowed in both years.
Previous wording
(1)Includes interest expense from finance leases, the most significant of which is for land at our Blueberries segment of $0.5 million for both the three months ended January 31, 2025 and 2024.
Current wording
(1)Includes interest expense from finance leases, the most significant of which is for land at our Blueberries segment of $0.5 million for both the three months ended April 30, 2025 and 2024 and $1.0 million for both the six months ended April 30, 2025 and 2024.
Previous wording
(2)Includes depreciation and amortization of purchase accounting assets of $0.3 million and $2.9 million for the three months ended January 31, 2025 and 2024, respectively, and $0.2 million of amortization of the Blueberries finance lease for both the three months ended January 31, 2025 and 2024. The three months ended January 31, 2025 also include $0.9 million of accelerated depreciation expense from fixed assets related to the closure of our Canada facilities during the respective quarter. The three months ended January 31, 2024 also include $4.1 million of accelerated depreciation expense, $2.0 million of which was from purchase accounting assets, for certain blueberry plants determined to have no remaining useful life during the respective quarter.
Current wording
(2)Includes depreciation and amortization of purchase accounting assets of $0.5 million and $0.4 million for the three months ended April 30, 2025 and 2024, respectively, and $0.8 million and $3.3 million six months ended April 30, 2025 and 2024, respectively. Includes $0.2 million of amortization of the Blueberries finance lease for both the three months ended April 30, 2025 and 2024 and $0.4 million for both the six months ended April 30, 2025 and 2024. The six months ended April 30, 2025 also include $0.9 million of accelerated depreciation expense from fixed assets related to the closure of our Canada facilities during the respective quarter. The six months ended April 30, 2024 also include $4.1 million of accelerated depreciation expense, $2.0 million of which was from purchase accounting assets, for certain blueberry plants determined to have no remaining useful life.
Previous wording
(3)Includes accelerated amortization of operating lease right-of-use assets and severance costs incurred due to the closure of our Canada facilities during the first quarter of 2025, both recognized in cost of sales.
Current wording
(3)Represents accelerated amortization of operating lease right-of-use assets, early lease termination costs and severance costs incurred due to the closure of our Canada facilities recognized in cost of sales.
Previous wording
(4)Represents net income (loss) attributable to noncontrolling interest plus the impact of non-GAAP adjustments, allocable to the noncontrolling owner based on their percentage of ownership interest.
Current wording
(5)Represents net income (loss) attributable to noncontrolling interest plus the impact of non-GAAP adjustments, allocable to the noncontrolling owner based on their percentage of ownership interest.
Previous wording
Net sales in our Marketing & Distribution segment increased $71.2 million or 32% in the three months ended January 31, 2025 compared to the same period last year, driven by avocado pricing and volume increases as described above.
Current wording
Net sales in our Marketing & Distribution segment increased $75.4 million or 26% and $146.6 million or 29% in the three and six months ended April 30, 2025 compared to the same periods last year, driven by the avocado pricing increases as described above.
Previous wording
Segment adjusted EBITDA decreased $1.3 million or 12% in the three months ended January 31, 2025 compared to the same period last year primarily due to the decrease in per-unit gross margin on avocados sold.
Current wording
Segment adjusted EBITDA decreased $4.9 million or 23% and $6.2 million or 19% in the three and six months ended April 30, 2025 compared to the same periods last year, primarily due to lower per-unit gross margin on avocados sold and higher SG&A expenses, as described above.
Previous wording
Total segment sales in our International Farming segment increased $3.4 million or 59% in the three months ended January 31, 2025, compared to the same period last year and segment adjusted EBITDA increased $2.3 million or 460% in the three months ended January 31, 2025, compared to the same period last year. The increases were primarily due to higher volume of blueberry packing service revenue.
Current wording
Total segment sales in our International Farming segment increased $6.7 million or 479% and $10.1 million or 140% in the three and six months ended April 30, 2025 compared to the same periods last year. Segment adjusted EBITDA increased $3.7 million or 168% and $6.0 million or 222% in the three and six months ended April 30, 2025 compared to the same periods last year. The increases were driven by higher pricing and higher yield from owned mango orchards as well as higher volume of blueberry packing and cooling services.
Previous wording
Sales in our Blueberries segment have been traditionally concentrated in the first and fourth quarters of our fiscal year in alignment with the Peruvian blueberry harvest season, which typically runs from July through February.
Current wording
Sales in our Blueberries segment have traditionally been concentrated in the first and fourth quarters of our fiscal year in alignment with the Peruvian blueberry harvest season, which typically runs from July through February.
Previous wording
Net sales increased $75.5 million or 29% in the three months ended January 31, 2025 compared to the same period last year, primarily driven by our Marketing & Distribution segment, where average per-unit avocado sales prices increased 25% and avocado volume sold increased 5%. Consumer demand outpaced supply, driven by constraints on Mexican fruit availability. Blueberry revenue increased by $3.9 million or 12% during the period. The revenue growth was driven by an approximate 70% increase in blueberry volume sold, substantially offset by a 33% decrease in average per-unit sales price. Higher volumes were driven by both increased total acreage and yields from our farms, while decreased prices were driven by higher total industry production from Peru after unfavorable regional weather conditions negatively impacted supply during the prior year.
Current wording
Net sales in our Blueberries segment increased $9.6 million or 23% in the six months ended April 30, 2025 compared to the same period last year, due to a 64% increase in volume, partially offset by a 25% decrease in average per-unit sales price. Higher volumes were driven by both increased total acreage and higher yields from our farms, while decreased prices were driven by higher total industry production from Peru after unfavorable regional weather conditions negatively impacted supply during the prior year.
Previous wording
Net cash used in operating activities was $1.2 million for the three months ended January 31, 2025, compared to cash provided of $9.5 million in the same period last year, driven largely by growth in working capital. In the current year, working capital was driven by higher inventory and receivable balances in our Marketing & Distribution segment that correlated with high avocado unit prices, while increased productive acreage has increased growing crop inventory in our International Farming and Blueberries segments.
Current wording
Net cash used in operating activities was $13.0 million for the six months ended April 30, 2025, compared to cash provided of $12.9 million in the same period last year, driven largely by growth in working capital. The increase in working capital in the current year is driven by the higher avocado price environment which has increased receivable balances in our Marketing & Distribution segment, while increased acreage and harvest timing has resulted in higher inventory balances in our International Farming segment.
Previous wording
In the three months ended January 31, 2025 and 2024, capital expenditures were comprised primarily of avocado orchard development, pre-production orchard maintenance and land improvements, packhouse construction in Guatemala and pre-production land development and blueberry plant cultivation in Peru. The three months ended January 31, 2024 also included distribution facility construction costs in the UK in our Marketing & Distribution segment.
Current wording
In the six months ended April 30, 2025 and 2024, capital expenditures were comprised primarily of avocado orchard development, pre-production orchard maintenance and land improvements, packhouse construction in Guatemala and pre-production land development and blueberry plant cultivation in Peru. The six months ended April 30, 2024 also included distribution facility construction costs in the U.K. in our Marketing & Distribution segment.
Previous wording
We are party to various leases, the most material of which are for facilities and land. Our undiscounted cash liabilities were approximately $174.3 million as of January 31, 2025, of which, approximately $107.4 million was for long-term land leases in our International Farming and Blueberries segments.
Current wording
We are party to various leases, the most material of which are for facilities and land. Our undiscounted cash liabilities were approximately $173.5 million as of April 30, 2025, of which, approximately $105.9 million was for long-term land leases in our International Farming and Blueberries segments.
Previous wording
As of January 31, 2025, remaining maturities on our term loans were $118.2 million. See Note 6 to the consolidated financial statements for more information.
Current wording
As of April 30, 2025, outstanding borrowings on our syndicated debt facility totaled $147.5 million. See Note 6 to the consolidated financial statements for more information.