Global avocado provider Calavo Growers recently announced its financial results for thefirst quarter of 2023, with the company reporting an 18% decline year-on-year in total revenue.

For the firm’s grown segment - which includes avocados, tomatoes and papayas - profits decreased 27% year-over-year to $117.7 million.

Avocado prices in particular were 35% lower year-on-year, while volume was 3.4% higher. The company states that performance was negatively affected by the strengthening peso relative to the U.S. dollar, which increased operating costs in Mexico in dollar terms. 

Additionally, industry volume of avocados from Mexico was up by over 8%, driving a decrease in prices.

“Grown segment market conditions started to recover in February, and we have realized avocado margins within our targeted range of $3 to $4 per case for most of the second quarter. Supply pressure, however, may lead to ongoing volatility in avocado margins,” said Brian W. Kocher, President and Chief Executive Officer.

On the other hand, Calavo’s prepared foods revenue also decreased 3% year-over-year to $108.5 million.

Regarding the secondquarter and the rest of the year, Koch said that the company plans to reduce fiscal 2023 capital expenditures “while we navigate near-term challenges”.

“We now expect capital expenditures for fiscal 2023 of approximately $13 million. These adjustments reflect deliberate fiscal discipline that will allow us to continue prioritizing investment for growth while maintaining competitive dividend metrics,” he said.

Calavo also reports that it has finalized its latest initiatives to streamline operations and improve performance.