Calavo Growers Ends Year With Loss

NEW YORK - Jan 17/06 - SNS -- Calavo Growers, Inc. posted a net loss of U.S. $517,000 on sales of $62.25 million during the fourth quarter ending October 31, compared to a profit of $1.11 million on sales of $59.4 million during the same three-month period one year earlier.

This lowered profits for the full fiscal year to $3.322 million on sales of $258.8 million, compared to a profit of $6.21 million on sales of $274.22 million the previous fiscal year.

The packager of fresh and processed avocados and other perishable food products said, "Results were constrained by a cyclically smaller California crop, which significantly hampered performance in the company's core domestic business segment, as well as the onerous costs related to implementing provisions required under Section 404 of the Sarbanes-Oxley Act (SOX)."

Calavo Chairman, President and Chief Executive Officer Lee E. Cole added, "As indication of its effect, this industry-wide downturn saw the total California avocado crop contract to 300 million pounds in the most recent year from 432 million pounds in 2004, according to California Avocado Commission figures.

"While our market share (as percentage of the state's total harvest) remained strong, the substantially smaller crop resulted in Calavo selling 54 million fewer pounds of California fruit year-to-year. Our packinghouses are scale-driven facilities and, consequently, lower volumes adversely affect production efficiencies by spreading fixed costs across fewer pounds."

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