Limoneira Company (NASDAQ:LMNR) Q4 2019 Earnings Conference Call - Final Transcript
Jan 13, 2020 • 04:30 pm ET
reduced our avocado crop for fiscal year 2019. Our lemon volume was very strong in fiscal year 2019 as we grew a record tree crop. Unfortunately, due to the lower fresh utilization rate for part of the year and lower pricing due to sizing of fruit, our record volumes did not translate into our expected bottom line profits. It is important to point out that the weather events that affected the overall lemon and orange industry throughout the year offset the fact that we increased our market share.
Also, the overall lemon industry continues to expand globally, and we fully expect that to continue for many years to come. As we enter fiscal year 2020, pricing per carton has improved, and our fresh utilization rates have now increased back to a range of 70% to 75% from a low of 50% in the third quarter last year. We experienced strong wins during the first quarter on our ranches in Southern California and this could affect the grade of a portion of our lemons, which could negatively impact the overall grade of lemons we harvest later this year. Even with this effect, we believe we will see prices increase over last year.
I'm pleased that with the temporary challenges we faced in fiscal year 2019, we still were able to generate positive adjusted EBITDA, close a strategic acquisition and are very well positioned to continue our market share growth and return to strong adjusted EBITDA results in fiscal year 2020.
I'll now shift to discussing our business segments starting with a full review of our agribusiness. Over the past few years, we have made important investments that have us positioned for long-term growth and improved efficiencies. We've expanded our customer base to over 250 customers, including leading restaurants and grocery store chains. We've been able to achieve this expansion by leveraging our domestic and international marketing and sales channels, focusing more on trade marketing, and consumer-facing strategies and utilizing our increased packing capacity.
In addition, we've significantly reduced seasonality for our customers by sourcing citrus from different global locations giving us 365 days of fresh lemon supply. A great example of this global expansion is the joint venture we closed this year. In May of 2019, we acquired a 51% interest in a joint venture, Trapani Fresh, formed with FGF Trapani, a multi-generational family owned citrus operation in Argentina.
Also, in fiscal year 2019, we surpassed our new carton goal by securing over 700,000 cartons with another 500,000 fresh cartons expected by the end of 2020. We now have over 9,700 planted agricultural acres, of which approximately 1,200 acres are currently non-bearing lemons but estimated to become full bearing over the next four years. In 2020, we expect 300 acres of these acres to be full bearing with an additional 300 acres to be full bearing by 2021 and the remaining 600 to become full bearing by 2023. Beyond these 1,200 acres, we have plans to plant an additional 250 acres