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Peso sinks; Calavo profit soars

By   /   Thursday, January 8th, 2009  /   Comments Off on Peso sinks; Calavo profit soars

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Santa Paula-based avocado marketer Calavo Growers said its net income shot up 235 percent in the fourth quarter to $4 million, making it the single best quarter in company history.

Calavo’s fourth-quarter revenue jumped to $93.6 million — a 10 percent increase over the same quarter in 2007 but slightly lower than the $96.9 million it pulled in during the third quarter of 2008.

The collapse of the Mexican peso beginning in September offers one reason for Calavo’s fourth-quarter surge.

Calavo grows many of its avocados in Mexico and thus pays for expenses in the peso but sells in American markets on the stronger dollar. Between September and December, the value of the peso shrunk, as one U.S. dollar equaled about 10 pesos in September but soared to about 14 pesos by year’s end.

Calavo announced its fourth-quarter gross profit rallied 72 percent over the same time period the year before to $12.2 million.

“Calavo Growers delivered a simply outstanding performance on virtually every front in both the fourth quarter and in fiscal 2008 as a whole,” Lee E. Cole, Calavo’s chairman, president and chief executive officer, said in a statement.

Full-year net income climbed 5 percent to a record $7.7 million, or 53 cents per diluted share, from $7.3 million, or 51 cents per diluted share, in fiscal 2007. Calavo posted fiscal 2008 revenues at $361.5 million, climbing 19 percent from $303.0 million in the year before, the prior sales record.

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