LMNR 10-K & 10-Q changes, risk factors and insider trading

ACP is an aphid-like insect that is a serious pest to all citrus plants because it can transmit the disease Huanglongbing (“HLB”) when it feeds on the plants’ leaves and trees. ACP is a federal action quarantine pest subject to interstate and international quarantine restrictions by the United States Department of Agriculture (“USDA”), including a prohibition on the movement of nursery stock out of quarantine areas and a requirement that all citrus fruit be cleaned of leaves and stems prior to movement out of the quarantine area. Due to the discovery of ACP in our orchards, we have experienced costs related to the quarantine and treatment of ACP.

In September 2023, two HLB-positive citrus trees were detected on a residential property in the City of Santa Paula, California. Following this detection, the California Department of Food and Agriculture established a mandatory five-mile-radius quarantine area, encompassing approximately 1,100 acres of Limoneira-owned lemon orchards. In July 2024, an additional 75 HLB-positive trees were detected on residential properties in the City of Santa Paula. In response, the quarantine area was expanded in September 2024 to account for the new detections.detections and is still in effect. The quarantine restricts the movement of citrus fruit, trees, and related plant materials, subject to specific protocols. The estimated additional costs to spray insecticides on our orchards within the quarantine area are $0.3 million to $0.4 million for fiscal year 2025.2026. There is no assurance that HLB will not be detected on Limoneira orchards in the future.

Excess supply often causes severe price competition in our industryindustry, and the worldwide lemon market is currently in an over-supplied position. Growing conditions in various parts of the world, particularly weather conditions such as windstorms, floods, droughts and freezes, as well as diseases and pests, are primary factors affecting market prices because of their influence on the supply and quality of product. The COVID-19 pandemic also reduced the demand for our products resulting in excess supply.

Fresh produce is highly perishable and generally must be brought to market and sold soon after harvest. Some items, such as avocados and oranges,avocados, must be sold more quickly, while other items, such as lemons, can be held in cold storage for longer periods of time. The selling price received for each type of produce depends on all of these factors, including the availability and quality of the produce item in the market and the availability and quality of competing types of produce.

Our labor contractors and we are subject to government mandated wage and benefit laws and regulations. For example, the State of California, where a substantial number of our labor contractors are located, passed regulations that will increase minimum wage rates to $16.50$16.90 per hour effective January 1, 20252026 due to a cost-of-living increase provision in the state’s minimum wage law. The State of Arizona minimum wage rates also rise each year based on the annual cost of living and will increase to $14.70$15.15 per hour effective January 1, 2025.2026. In addition, current or future federal or state healthcare legislation and regulation, includingsuch as the Affordable Care Act, may increase our medical costs or the medical costs of our labor contractors that could be passed on to us.

We engage third parties to provide personnel for our harvesting operations. The availability and number of such workers is subject to decrease if there are changes in U.S. immigration laws. The states in which we operate are considering or have already adopted new immigration laws or enforcement programs, and the U.S. Congress and the Department of Homeland Security from time to time consider and may implement changes to federal immigration laws, regulations or enforcement programs. Immigration laws have recently been an area of considerable focus by the Department of Homeland Security, with enforcement operations taking place across the country,country and specifically within Ventura County, resulting in arrests and detentions of unauthorized workers. Termination of a significant number of personnel who are found to be unauthorized workers or the scarcity of available personnel to harvest our agricultural products could cause harvesting costs to increase or could lead to the loss of product that is not timely harvested, which could have a material adverse effect to our citrus and avocado operations, financial position, results of operations and cash flows.

Our water resources include water rights, usage rights and pumping rights to the water in aquifers under, and canals that run through, the land we own. Water for our farming operations is sourced from the existing water resources associated with our land, which includes rights to water in the adjudicated Santa Paula Basin (aquifer) and the un-adjudicated Fillmore and Paso Robles Basins (aquifers). We use federal project water in Arizona from the Colorado River through the YMIDD. We also acquired water rights in Chile.

Southern California received above average precipitation during the 2022 - 2023 and 2023 - 2024 rainfall seasons, after experiencing three years ofexperienced below average precipitation andfor droughtthe conditions. The above average precipitation helped2024 to alleviate2025 therainfall drought conditions in California.season. As of October 31, 2024, the state was free from extreme drought conditions and2025, Ventura County was freeexperiencing from anymoderate drought conditions. We continue to assess the impact drought conditions may have on our California orchards.

In August 2023 and August 2024,2025, the U.S. Bureau of Reclamation announced that Lake Mead will continue to operate in a Tier 1 shortage in 2024 and 2025, respectively,2026, which requires Arizona to forfeit approximately 18% of the state’s yearly allotment of water from Lake Mead. In response to this and prior years’ water shortages, we entered into fallowing agreements during fiscal years 2022 and 2023 and 2022in andFebruary 2025, extended an existing fallowing agreement through calendar year 2026. We continue to assess the impact these ongoing water reductions may have on our Arizona orchards.

For fiscal year 2024,2025, irrigation costs for our agricultural operations were similardecreased compared to fiscal year 2023.2024. Costs may increase as we pump more water than our historical averages and federal, state and local water delivery infrastructure costs may increase to access these limited water supplies. We have an ongoing plan for irrigation improvements continuing for fiscal year 20252026 that includes drilling new wells and upgrading existing wells and irrigation systems.

An extended interruption in ourthe abilityshipping to shipof our products could have a material adverse effect on our business, financial condition and results of operations. Similarly, any extended disruption in the distribution of our products or supply chain issues could have a material adverse effect on our business, financial condition and results of operations. While we believe we are adequately insured and would attempt to transport our products by alternative means if we were to experience an interruption due to strike, natural disasters or otherwise, we cannot be sure that we would be able to do so or be successful in doing so in a timely and cost-effective manner.

Events or rumors relating to LIMONEIRA or our other trademarks and related brands or Sunkist could significantly impact our business.

Consumer and institutional recognition of the LIMONEIRA, Sunkist, One World of Citrus®, Santa®, Paula®, Bridal Veil®, Fountain®, Golden Bowl®, Level®, Compass®, Pitcher®, Kiva®, Kachina®, Oxnard Lemon and Trapani Fresh trademarks and related brands and the association of these brands with high quality and safe food products are an integral part of our business. The occurrence of any events or rumors that cause consumers and/or institutions to no longer associate these brands with high quality and safe food products may materially adversely affect the value of our brand names and demand for our products.

Government regulation could increase our production costs of production and increase legal and regulatory expenses.

Our infrastructure has sufficient capacity for our lemon production needs, but if we lose machinery or facilities due to natural disastersdisasters, accidents or mechanical failure, we may not be able to operate at a sufficient capacity to meet our lemon production needs. This could have a material adverse effect on our business, which could impact our results of operations and our financial condition.

Our revolving and non-revolving credit and term loan facilities contain various restrictive covenants that limit our ability to take certain actions. In particular, these agreements limit our ability to, among other things:

Our revolving and non-revolving credit facility with the AgWestLender Farm Credit Facility containcontains a financial covenant that requires us to maintain compliance with a specific debt service coverage ratio on an annual basis. At October 31, 2024 we were in compliance with the debt service coverage ratio of 1.25:1.0. OurIn failureSeptember 2025, the Lender modified the annual debt service coverage ratio covenant to complydefer withmeasurement thisas of October 31, 2025. In December 2025, the Lender modified the annual debt service coverage ratio covenant into thedefer futuremeasurement may result in the declarationas of anOctober event31, 2026 and resume a debt service coverage ratio of default1.25:1.0 undermeasured ouras AgWestof FarmOctober Credit31, Facility.2027 and for any fiscal year ending thereafter.

Any or all of these covenants could have a material adverse effect on our business by limiting our ability to take advantage of financing, merger and acquisition or other corporate opportunities and to fund our operations. Any future debt could also contain financial and other covenants more restrictive than those imposed under our line of credit and term loan facilities. A breach of a covenant or other provision in any credit facility governing our current and future indebtedness could result in a default under that facility and, due to cross-default and cross-acceleration provisions, could result in a default under our other credit facilities. Upon the occurrence of an event of default under any of our credit facilities, the applicable lender(s) could elect to declare all amounts outstanding to be immediately due and payable and, with respect to our revolving credit facility, terminate all commitments to extend further credit. If we were unable to repay those amounts, our lenders could proceed against the collateral granted to them to secure the indebtedness. If the lenders under our current or future indebtedness were to accelerate the payment of the indebtedness, we cannot assure you that our assets or cash flow would be sufficient to repay in full our outstanding indebtedness.

Our AgWest Farm Credit Facility is subject to variable rates, which generally change as interest rates change. We bear the risk that the rates we are charged by our lender will increase faster than the earnings and cash flow of our business, which could reduce profitability, adversely affect our ability to service our debt, cause us to breach covenants contained in our AgWest Farm Credit Facility, which could materially adversely affect our business, financial condition and results of operations. Our Company’s debt agreement with AgWest Farm Credit used LIBOR as a reference rate, which was converted touses the Secure Overnight Financing Rate (“SOFR”) on January 1, 2023..

Higher interest rates generally impact the real estate industry by making it harder for buyers to qualify for financing, which can lead to a decrease in the demand for residential, commercial or industrial sites. Any decrease in demand will negatively impact our proposed developments. During 20232025 and 2022, the Board of Governors of the Federal Reserve System took actions in tightening the monetary policy that resulted in higher interest rates prevailing in the marketplace. During 2024, the Board of Governors of the Federal Reserve System took actions in easing the monetary policy by cutting interest rates. Market interest rates may increase in the future and the increase may materially and negatively affect us. Lack of available credit to finance real estate purchases can also negatively impact demand. Any downturn in the economy or consumer confidence can also be expected to result in reduced housing demand and slower industrial development, which would negatively impact the demand for land we are developing.

If unforeseen regulatory challenges with East Areas I and II occur, we may not be able to develop these projects as planned. Additionally, a voter-approved initiative may prevent us from developing the Limco Del Mar ranch.

The real estate development industry is capital intensive, and development requires significant up-front expenditures to develop land and begin real estate construction. Accordingly, we have and may continue to incur substantial indebtedness to finance our real estate development and land development activities. Although we believe that internally generated funds and current and available borrowing capacity will be sufficient to fund our capital and other expenditures, including additional land acquisition, development and construction activities, and the amounts available from such sources, may not be adequate to meet our needs. If such sources were insufficient, we would seek additional capital in the form of debt from a variety of potential sources, including bank financing. The availability of borrowed funds to be used for additional land acquisition, development and construction may be greatly reduced, and the lending community may require increased amounts of equity to be invested in a project by borrowers in connection with new loans. The failure to obtain sufficient capital to fund our planned expenditures could have a material adverse effect on our business and operations and our results of operations in future periods.

We may encounter risks associated with the real estate joint ventures we entered into in November 2015 and October 2022have with the Lewis Group of CompaniesCompanies, including:

Many companies compete in our different businesses. However, only a few well-established companies operate on an international, national and regional basis with one or several product lines. We face strong competition from these and other companies in all our product lines.

•Some of our competitors may have greater operating flexibility and, in certain cases, this may permit them to respond better or more quickly to changes in the industry or to introduce new products and packaging more quickly and with greater marketing support.industry.

We distribute ourOur products are distributed both nationally and internationally and we have foreign subsidiaries with functional currencies besides the U.S. dollar. Our international sales are primarily transacted in U.S. dollars. Our results of operations are affected by fluctuations in currency exchange rates in both sourcing and selling locations and our foreign subsidiaries. In the past, periods of a strong U.S. dollar relative to other currencies led international customers, particularly in Asia, to find alternative sources of fruit.

We intend to continue to consider acquisition prospects that complement our business. While we are not currently a party to any agreement with respect to any acquisitions, we may acquire other businesses in the future. Future acquisitions by us could result in accounting charges, potentially dilutive issuances of equity securities, and increased debt and contingent liabilities, any of which could have a material adverse effect on our business and the market price of our common stock. Acquisitions entail numerous risks, including the integration of the acquired operations, diversion of management’s attention to other business concerns, risks of entering markets in which we have limited prior experience, and potential loss of key employees of acquired organizations. We may be unable to successfully integrate businesses or the personnel of any business that might be acquired in the future, and our failure to do so could have a material adverse effect on our business and on the market price of our common stock. Additionally, in fiscal year 2024 and 2025 we recorded an impairment charge and reserves on our most recently acquired foreign subsidiary, and we may incur further impairment charges or reserves on this or other foreign subsidiaries in the future.

Investing in our common stock involves a high degree of risk. There are numerous and varied risks, known and unknown, that may prevent us from achieving our goals. The risks described here are not the only ones we will face. If any of these risks or other risks actually occurs,occur, our business, financial condition, results of operations or future prospects could be materially and adversely affected. In such event, the trading price of our common stock could decline and investors in our common stock could lose all or part of their investment.

The overall market and the price of our common stock may fluctuate greatlygreatly, and we cannot assure you that you will be able to resell shares at or above market price. The trading price of our common stock may be significantly affected by various factors, including:

•fluctuations in the stock prices of our peer companies or in stock markets in general; and

Limoneira Company, a Delaware corporation, is the successor to several businesses with operations in California since 1893. We are primarily an agribusiness company founded and based in Santa Paula, California, committed to responsibly using and managing our approximately 10,500 acres of land, water resources and other assets to maximize long-term stockholder value. Our current operations consist of fruit production, sales and marketing, rental operations, real estate and capital investment activities.

We have three business divisions: agribusiness, rental operations and real estate development. The agribusiness division is comprised of four reportable operating segments: fresh lemons, lemon packing, avocados and other agribusiness, which primarily includes oranges, specialty citrus, otherwine cropsgrapes and farm management services. The agribusiness division includes our core operations of farming, harvesting, lemon packing and lemon sales operations. The rental operations division includes our residential and commercial rentals comprised of 240 completed rental units,rentals, leased land operations and organic recycling. The real estate development division includes our investments in real estate development projects. Generally, we see our Company as a land and farming company that generates annual cash flows to support our progress into diversified real estate development activities. As real estate developments are monetized, our agriculture business will then be able to expand more rapidly into new regions and markets.

The following table shows the results of operations ($ in thousands):

Due to significant depreciable assets associated with the nature of our operations and interest costs associated with our capital structure, management believes that earnings before interest, income taxes, depreciation and amortization (“EBITDA”) and adjusted EBITDA, which excludes stock-based compensation, named executive officer cash severance, pension settlement cost, impairment of intangible asset, loss (gain) on disposal of assets, net, cash bonus related to sale of assets, gain on legal settlementsettlement, cash severance benefits, contract termination fee and severancegain benefitson remeasurement of previously held equity method investment are important measures to evaluate our results of operations between periods on a more comparable basis. Such measurements are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and should not be construed as an alternative to reported results determined in accordance with GAAP. The non-GAAP information provided is unique to us and may not be consistent with methodologies used by other companies.

EBITDA and adjusted EBITDA are summarized and reconciled to net income (loss) income attributable to Limoneira Company which management considers to be the most directly comparable financial measure calculated and presented in accordance with GAAP, as follows (in thousands):

Total net revenues for fiscal year 20242025 were $191.5$159.7 millionmillion, compared to $179.9$191.5 million for fiscal year 2023.2024. The 6%17% increasedecrease of $11.6$31.8 million was primarily due to decreased agribusiness revenue from lemons, avocados, wine grapes and farm management, partially offset by increased agribusiness revenues from avocados, partially offset by decreased agribusiness revenues from lemons and specialty citrus and other crops,oranges, as detailed below ($ in thousands):

•Lemons: The decrease for fiscal year 2024,2025, compared to fiscal year 2023,2024, was primarily due to decreasedlower volume,prices, partially offset by higherincreased pricesvolume of fresh and brokered lemons sold.sold and other lemon sales. Fresh lemoncarton sales were $84.0$83.8 million and $86.8$84.0 million, in aggregate, on 4.54.7 million and 4.84.5 million cartons of lemons sold at average per carton prices of $18.87$17.74 and $18.24$18.87 for fiscal years 20242025 and 2023,2024, respectively. Lemon revenuesrevenue included brokered lemons and other lemon sales of $32.0$21.6 million and $26.2$32.0 million, lemonpacking packingand handling revenue of $17.1$17.9 million and $20.6$17.1 million, and lemon by-product sales of $3.0$1.7 million and $3.0 million, respectively,million for fiscal years 20242025 and 2023.2024, Fiscal year 2023 revenues included settlement proceeds of $1.4 million allocated to lemons.respectively.

•Avocados: The increasedecrease for fiscal year 2024,2025, compared to fiscal year 20232024, was due to increaseddecreased volume and higherlower prices of avocados sold. The California avocado crop typically experiences alternating years of high and low production due to plant physiology. We sold 15.17.4 million and 3.815.1 million pounds of avocados at an average priceprices per pound of $1.67$1.60 and $1.06$1.67 for fiscal years 20242025 and 2023,2024, respectively. Fiscal year 2023 revenues included settlement proceeds of $2.4 million allocated to avocados and crop insurance proceeds of $0.7 million.

•Oranges: The decreaseincrease for fiscal year 2024,2025, compared to fiscal year 2023,2024, was primarily due to decreasedincreased volume and lowerhigher prices of oranges sold. We sold 280,000409,000 and 292,000280,000 cartons of oranges at an average price per carton of $18.53$18.93 and $19.79$18.53 for fiscal years 20242025 and 2023,2024, respectively.

•Specialty citrus and otherwine cropsgrapes: The decrease for fiscal year 2024,2025, compared to fiscal year 2023,2024, was primarily due to decreased volume, partially offset by higher pricesvolume of specialtywine citrusgrapes sold. We sold 79,000$1.8 million and 240,000 40-pound carton equivalents of specialty citrus at an average price per carton of $28.23 and $27.18 for fiscal years 2024 and 2023, respectively. Additionally, we sold $2.9 million of wine grapes for bothduring fiscal years 20242025 and 2023.2024, respectively.

•Farm management: Farm management revenue iswas comprised primarily of Northern Properties farming, management and operations services.services Theand increase in farm management revenuedecreased for fiscal year 2024,2025 compared to fiscal year 2023, was primarily2024 due to twelvethe monthsFMA oftermination activityeffective inMarch fiscal31, year 2024 compared to nine months of activity in fiscal year 2023.2025.

•Other: Other revenue isrevenue, comprised primarily of fallowing and freightshipping, revenue. Other revenuedecreased for fiscal year 2024 was similar2025, compared to fiscal year 2023.2024, due to decreased shipping revenue.

Other operations revenue for fiscal year 20242025 was $5.6$6.0 millionmillion, compared to $5.5$5.6 million for fiscal year 2023.2024.

Total costs and expenses for fiscal year 20242025 were $197.7$180.1 millionmillion, compared to $169.1$197.7 million for fiscal year 2023.2024. The 17%9% increasedecrease of $28.6$17.6 million was primarily due to thedecreased 2023agribusiness net gain on disposal of assets, the 2023 gain on legal settlementcosts and anexpenses increase inand selling, general and administrative expenses, partially offset by a decrease in agribusiness costs and expenses. Agribusiness costs and expenses are detailed below ($ in thousands):

•Packing costs: Packing costs consist primarily of the costs to pack lemons for sale such as labor and benefits, cardboard cartons, fruit treatments, packing and shipping supplies and facility operating costs. The decreaseincrease for fiscal year 2024,2025, compared to fiscal year 2023,2024, was primarily due to decreasedincreased volume.volume, higher labor costs, and higher packing costs due to a $2.1 million contract termination fee related to our Commercial Packinghouse License Agreement with Sunkist. We packed and sold 4.54.7 million and 4.84.5 million cartons of lemons at average per carton costs of $9.60$10.03 and $9.61$9.60 for fiscal years 20242025 and 2023,2024, respectively.

•Harvest costs: The decrease in harvest costs for fiscal year 20242025, compared to fiscal year 20232024. was primarily due to decreased volume of lemons harvested related to the sale of the Northern Properties, partially offset by increased volume ofand avocados harvested.

•Growing costs: Growing costs, also referred to as cultural costs, consist of orchard maintenance costs such as cultivation, fertilization and soil amendments, pest control, pruning and irrigation. The decrease for fiscal year 2024,2025, compared to fiscal year 2023,2024, was primarily due to the decrease in farm management growing costs related to the FMA termination and farm management decisions basedmade onin response to weather, harvest timing and crop conditions.

•Third-party grower and supplier costs: We sell fruit that we grow and fruit that we procure from other growers and suppliers. The cost of procuring fruit from other growers and suppliers is referred to as third-party grower and supplier costs. The increasedecrease for fiscal year 2024,2025, compared to fiscal year 2023,2024, was primarily due to increaseda volumedecrease and higher prices of third-party grower fruit sold. Wein incurred costs for third-partybrokered fruit for resale of $27.5 million compared to $31.3 million, respectively, partially offset by an increase in incurred costs of third party grower fruit of $40.9$42.5 million andcompared $31.9to million$40.9 for fiscal years 2024 and 2023,million, respectively. Of the 4.54.7 million and 4.84.5 million cartons of lemons packed and sold, 3.7 million (78%) and 3.2 million (72%) and 2.6 million (54%), were procured from third-party growers at average per carton prices of $12.76$11.55 and $12.44$12.76 for fiscal years 20242025 and 2023,2024, respectively. The increased volume for third-party grower fruit was primarily due to the sale of the Northern Properties and the related marketing agreement. Additionally, we incurred costs for supplier costs and purchased, packed fruit for resale of $31.3 million and $29.4 million for fiscal years 2024 and 2023, respectively.

•Other costs: The decrease in other costs for fiscal year 20242025, compared to fiscal year 20232024, was primarily due to adecreased decreasefreight in shipping costs, mainly related to a decrease in volume of lemons sold.costs.

•Depreciation and amortization: DepreciationThe increase in depreciation and amortization expenses for fiscal year 20242025, were similarcompared to fiscal year 2023.2024, was primarily due to increases in agribusiness depreciation and amortization of finance leases.

Other operations expenses for fiscal year 20242025 were $5.3$4.5 million compared to $4.6$5.3 million for fiscal year 2023.2024. The increasedecrease in other operations expenses was primarily due to severance benefits paid in fiscal year 2024 and increaseddecreased residential and commercial rental expenses.

Gain on legalsales settlementof water rights was $2.3$1.5 million for fiscal year 20232025. dueThere towas theno Settlementsale Agreementof relatedwater torights thefor Thomasfiscal fire.year 2024.

Selling,Loss general(gain) andon administrativedisposal expensesof assets, net for fiscal year 20242025 werewas $27.5$0.7 million compared to $26.5$(0.5) million for fiscal year 2023.2024. The $1.02025 million increase wasloss primarily duerelates to: the disposal of orchards and the 2024 gain primarily relates to a deferred gain on the LLCB II sale.

TotalSelling, othergeneral incomeand administrative expenses for fiscal year 20242025 waswere $17.7$24.5 million compared to $2.6$27.5 million for fiscal year 2023.2024. The $15.1$3.0 million increase in total other incomedecrease was primarily due to:

•$13.0$17.6 million increasedecrease of equity in earnings of investments, net, primarily due to LLCB’s closing of 554 residential homesites in fiscal year 2024;

•$0.5$0.6 million increase of interest expense, net of patronage dividends,dividends; primarily due to decreased patronage dividends.and

We recorded an income tax benefit (provision) of $4.4$4.6 million and $4.2$(4.4) million on pre-tax (loss) income of $11.5$(21.0) million and $13.4$11.5 million for fiscal years 20242025 and 2023,2024, respectively. The tax provisionbenefit recorded for fiscal year 20242025 differs from the U.S. federal statutory tax rate of 21.0% primarily due to foreign jurisdictions that are taxed at different rates, state taxes, tax impact of stock-based compensation, executive compensation, nondeductible tax items and valuation allowances on certain deferred tax assets of foreign subsidiaries. Our effective tax rate for fiscal years 20242025 and 20232024 was 37.9%22.1% and 31.8%,37.9%, respectively.

Net Loss Attributable to Noncontrolling InterestInterests, Net

Net loss attributable to noncontrolling interestinterests represents 10% and 49% of the net loss of PDA and Trapani Fresh, respectively, for fiscal years 20242025 and 2023.2024. Fiscal year 2025 includes 45.5% of the net income of Del Mar for the period August 4, 2025 to October 31, 2025.

We operate in four reportable operating segments: fresh lemons, lemon packing, avocados and other agribusiness. Our reportable operating segments are strategic business units with different products and services, distribution processes and customer bases. We evaluate the performance of our operating segments separately to monitor the different factors affecting financial results. Each segment is subject to review and evaluations related to current market conditions, market opportunities and available resources. During fiscal year 2024,2025, the Company changed its reportingpresentation of otherfresh lemons and lemon packing revenue and othercosts to remove reference to intersegment revenue and costs and includes these items in the other agribusiness segment instead of the fresh lemons segment.eliminations. Prior years’ information has been restated to conform to the current year’s presentation. The Company adopted ASU 2023-07 as of fiscal year 2025 and, as a result, expanded its segment information to include significant segment expenses and other segment items. See Note 2120 - Segment Information for additional information regarding our operating segments.

Segment information for fiscal year 20242025 is as follows (in thousands):

Segment information for fiscal year 20232024 is as follows (in thousands):

Fresh lemons segment revenue is comprised of sales of fresh lemons,lemons net of pack charge, lemon by-products, brokered lemons and other lemon revenue. Our fresh lemons segment total net revenues for fiscal year 20242025 were $119.0$75.8 million compared to $117.4$86.9 million for fiscal year 2023.2024. The 1%13% increasedecrease of $1.6$11.1 million was primarily due to:

•Brokered lemons and other lemon sales increasedecrease of $5.8$10.4 million;

•FreshLemon lemonby-products sales decrease of $2.8$1.3 million; and

•IntersegmentFresh costslemons andsales expensesnet of pack charge increase of $1.0$0.6 million.

Lemon packing segment revenue is comprised of packing revenue and intersegmentpacking packingand handling revenue. Our lemon packing segment total net revenues for fiscal year 20242025 were $49.3$49.1 million compared to $51.7$49.3 million for fiscal year 2023. The 5% decrease of $2.4 million was primarily due to decreased volume of lemons packed and sold.2024.

We are one of California’s oldest lemon growers and according to the California Avocado Commission, we are one of the largest growers of avocados in the United States. In addition to growing lemons and avocados, we grow wine grapes. We have agricultural plantings throughout Ventura and San Luis Obispo Counties in California, Yuma County in ArizonaCalifornia and Jujuy, Argentina, which collectively consist of approximately 2,3001,700 acres of lemons, 1,700 acres of avocados and 400 acres of wine grapes. We also operate our own packinghousespackinghouse in Santa Paula, California and Yuma, Arizona,California, where we process and pack lemons that we grow, as well as lemons grown by others. We have a 51% interest in a joint venture, Trapani Fresh Consorcio de Cooperacion (“Trapani Fresh”), a lemon orchard in Argentina. We have a 47% interest in Rosales S.A. (“Rosales”), a citrus packing, marketing and sales business located near La Serena, Chile. We have a 90% interest in Fruticola Pan de Azucar S.A. (“PDA”) and a 100% interest in Agricola San Pablo, SpA (“San Pablo”). Through November 7, 2025, thesePDA entitiesand San Pablo owned lemon and orange orchards located near La Serena, Chile.

Historically, our agribusiness division has been seasonal in nature, with quarterly revenues fluctuating depending on the timing and variety of crops being harvested. CulturalGrowing costs, also referred to as growingcultural costs, in our agribusiness division tend to be higherlower in the first and second quarters and lowerhigher in the third and fourth quarters because of the timing of expensing cultural costs in the current year that were inventoried in the prior year. Our harvest costs generally increase in the second quarter and peak in the third quarter. In connection with the Sunkist Agreement, lemon revenues are expected to peak in the third and fourth quarters.

Southern California is experiencing above average precipitation for the 2025 to 2026 rainfall season. As of AprilJuly 30,31, 2026, Ventura County was free from general drought conditions. We continue to assess the impact drought conditions may have on our California orchards.

In August 2025,2026, the U.S. Bureau of Reclamation announced that Lake Mead will continue to operate in a Tier 1 shortage in 2026,2027, which requires Arizona to forfeit approximately 18% of the state’s yearly allotment of water from Lake Mead. In response to this and prior years’ water shortages, we entered into fallowing agreements during fiscal years 2022 and 20232023, and in February 2025, extended an existing fallowing agreement through calendar year 2026. In April 2026, we made a decision to remove all of our remaining lemon orchards in Yuma, Arizona. This decision aligns with our strategic plan to monetize Class 3 Colorado River water rights by conserving water via crop substitution to low water use crops. We continue to assess the impact these ongoing water reductions may have on our Arizona orchards.land.

In April 2026, we made the decision to cease citrus farming operations on the remaining 600 lemon acres located at our Associated Citrus Packers property in Yuma, Arizona. This decision aligns with our strategic plan to monetize Class 3 Colorado River water rights by conserving water via crop substitution to low water uselow-water-use crops. As a result, we recorded a loss on disposal of assets of $7.2 million in the second quarter of fiscal year 2026.

Due to significant depreciable assets associated with the nature of our operations and interest costs associated with our capital structure, management believes that earnings before interest, income taxes, depreciation and amortization (“EBITDA”) and adjusted EBITDA, which excludes stock-based compensation, impairment of assets, loss and expected loss on disposal of assets, net, and foreign currency gains or losses, are important measures to evaluate our results of operations between periods on a more comparable basis. Beginning in fiscal year 2026, adjusted EBITDA excludes foreign currency gains or losses, as management believes this is a better representation of cash generated by operations. Foreign currency losses were immaterial in fiscal year 2025 and, therefore, were not separately adjusted. Such measurements are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and should not be construed as an alternative to reported results determined in accordance with GAAP. The non-GAAP information provided is unique to us and may not be consistent with methodologies used by other companies.

Three Months Ended AprilJuly 30,31, 2026 Compared to the Three Months Ended AprilJuly 30,31, 2025

Total net revenues were $23.9$43.8 million for the three months ended AprilJuly 30,31, 2026, compared to $35.1$47.5 million for the same period of fiscal year 2025. The 32%8% decrease of $11.2$3.7 million was primarily due to decreased agribusiness revenues from lemons, avocadosoranges and orangesspecialty citrus and wine grapes as detailed below ($ in thousands):

•Lemons: The decrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily due to our partnershiptransition withto Sunkist, which resulted in decreased volume of fresh lemon carton sales and brokered lemons and other lemon sales, partially offset by higher prices ofincreased fresh lemon carton sales.sales driven primarily by higher prices. Fresh lemon carton sales were $17.1$27.3 million and $19.7$23.8 million on 1,028,0001,373,000 and 1,357,0001,397,000 cartons of lemons sold at average per carton prices of $16.63$19.88 and $14.52,$17.02, for the secondthird quarter of fiscal years 2026 and 2025, respectively. The decrease in fresh lemon carton volume was primarily related to a shift in our volume under the Sunkist Agreement from the first and second quarters and into our third and fourth quarters. Fresh lemon carton sales and per carton prices for the secondthird quarter of fiscal year 2026 are net of the Sunkist marketing fee. Brokered lemons and other lemon sales were immaterial and $2.3$3.8 million for the secondthird quarter of fiscal years 2026 and 2025, respectively. Lemon revenue included pack handling revenue of $6.0 million and $6.1 million for the third quarter of fiscal years 2026 and 2025, respectively, primarily due to the sale of our Chilean farms. Lemon revenue included pack handling revenue of $4.4 million and $4.7 million and lemon by-product sales of $0.3 million and $0.6$0.5 million for the secondthird quarterquarters of fiscal years 2026 and 2025, respectively.2025.

•Avocados: The decrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily due to decreasedlower prices, partially offset by increased volume related to harvest timing and lower prices of avocados sold. The California avocado crop typically experiences alternating years of high and low production due to plant physiology. We sold 285,0007,013,000 and 1,232,0005,654,000 pounds of avocados at average per pound prices of $0.96$1.15 and $2.26,$1.50, for the secondthird quarter of fiscal years 2026 and 2025, respectively.

•Oranges: The decrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily related to the transition of our citrus brokerage operations to Sunkist.

•Specialty citrus and wine grapes: The decrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily due to decreased specialty citrus sales related to the transition of our citrus brokerage operations to Sunkist.

•Other: Other revenue, comprised primarily of fallowing and shipping, decreased for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, primarily due to decreased shipping revenue. The Company no longer provides shipping services under the Sunkist Agreement.

Other operations revenue was $1.4$1.6 million for the secondthird quarter of fiscal year 2026, compared to $1.5 million for the same period of fiscal year 2025.

Total costs and expenses were $45.6$46.8 million for the three months ended AprilJuly 30,31, 2026, compared to $38.5$48.1 million for the same period of fiscal year 2025. The 19%3% increasedecrease of $7.1$1.3 million was primarily due to andecreases in agribusiness costs and expenses and selling, general and administrative expenses, partially offset by impairment of the Windfall Farms property assets and loss on disposal of the lemon orchardsassets in Yuma,the Arizona,third partiallyquarter offsetof byfiscal ayear decrease in agribusiness costs and expenses, an increase in other operating income, and a decrease in selling, general and administrative expenses.2026. Agribusiness costs and expenses are detailed below ($ in thousands):

•Packing costs: Packing costs consist primarily of the costs to pack lemons for sale such as labor and benefits, cardboard cartons, fruit treatments, packing and shipping supplies, shipping, cold storage and facility operating costs. We packed and sold 1,028,0001,373,000 and 1,357,0001,397,000 cartons of lemons at average per carton costs of $9.48$9.79 and $8.94,$9.11, for the secondthird quarter of fiscal years 2026 and 2025, respectively. The increase in per carton packing costs was primarily due to decreased volume and increased costs related to shipping and cold storage of lemons. Additionally, we incurred packinghouse repair costs in the first quarter of fiscal year 2026 and received insurance proceeds related to these costs in the second quarter of fiscal year 2026.

•Harvest costs: The decrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily due to decreased volume of avocadoslemons harvested.harvested, partially offset by higher avocado volume.

•Growing costs: Growing costs, also referred to as cultural costs,costs consist of orchard maintenance costs such as cultivation, fertilization and soil amendments, pest control, pruning and irrigation. The decreaseincrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily due to the termination of the farm management agreement effective March 31, 2025 and farming operational decisions made in response to weather, harvest timing and crop conditions.

•Third-party grower and supplier costs: We sell fruit that we grow and fruit that we procure from other growers and suppliers. The cost of procuring fruit from other growers and suppliers is referred to as third-party grower and supplier costs. The decrease for the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was primarily due to decreased volumecosts for brokered fruit of $7.3 million, partially offset by increased costs for third-party grower fruit packedof and$1.6 sold,million. partiallyThe offsetincrease byin third-party grower fruit was primarily due to higher prices of third-party grower fruit sold. We incurred costs for third-party grower fruit of $9.4$13.1 million and $10.1$11.5 million, for the secondthird quarter of fiscal years 2026 and 2025, respectively. Of the 1,028,0001,373,000 and 1,357,0001,397,000 cartons of lemons packed and sold, 1,012,0001,002,000 (98%73%) and 1,250,0001,012,000 (92%72%) were procured from third-party growers at average per carton prices of $9.20$13.03 and $8.12,$11.35, for the secondthird quarter of fiscal years 2026 and 2025, respectively. Additionally, we incurred costs for brokered fruit of $0.1 million and $2.3 million, for the second quarter of fiscal years 2026 and 2025, respectively.

•Other costs: The decrease in the secondthird quarter of fiscal year 2026, compared to the same period of fiscal year 2025, was due to decreased freight costs.

•Depreciation and amortization: DepreciationThe and amortization was $1.8 milliondecrease in the secondthird quarter of fiscal year 2026, compared to $1.9 million in the same period of fiscal year 2025.2025, was due to asset disposals.

Other operations expenses forwere $1.0 million in the secondthird quarter of fiscal year 2026 were similar2026, compared to $1.1 million in the same period of fiscal year 2025 at $1.0 million.2025.

Impairment of assets was $9.3$4.1 million for the secondthird quarter of fiscal year 2026, relateddue to impairment of the Windfall Farms property assets.

Loss and expected loss on disposal of assets, net was $7.8$0.3 million for the secondthird quarter of fiscal year 2026, compared to an immaterial loss for the same period of fiscal year 2025. The increase was primarily due to the decision to remove alldisposal of ourmiscellaneous remainingagricultural lemon orchards in Yuma, Arizona. This decision aligns with the Company’s strategic plan to monetize Class 3 Colorado River water rights by conserving water via crop substitution to low water use crops.equipment.

Selling, general and administrative costs and expenses were $5.4$4.0 million for the secondthird quarter of fiscal year 2026, compared to $5.7$5.0 million for the same period of fiscal year 2025. The 5%20% decrease of $0.3$1.0 million was primarily due to:

•$1.1$0.6 million net decrease in other general and administrative expenseexpenses; and