Mission Produce Q1 FY2026 Earnings Call - Volume Growth Shields Margins as Calavo Deal Targets $25M in Synergies

Conference Call Operator: Good afternoon, and welcome to the Mission Produce Fiscal First Quarter 2026 conference call. All participants will be in a listen-only mode. After today’s presentation, there will be an opportunity to ask questions. Please also note today’s event is being recorded. At this time, I’d like to turn the conference over to Jeff Sonnek, Investor Relations at ICR. Please go ahead.

Jeff Sonnek, Investor Relations, ICR: Thank you. Today’s presentation will be hosted by Steve Barnard, Chief Executive Officer, John Pawlowski, President and Chief Operating Officer, and Bryan Giles, Chief Financial Officer. The comments during today’s call and the accompanying presentation contain forward-looking statements within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts are considered forward-looking statements. These statements are based on management’s current expectations and beliefs, as well as a number of assumptions concerning future events. Such forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from the results discussed in the forward-looking statements. Some of these risks and uncertainties are identified and discussed in the company’s filings with the SEC. We’ll also refer to certain non-GAAP financial measures today.

Please refer to the tables included in the earnings release, which can be found on our investor relations website, investors.missionproduce.com, for reconciliations of non-GAAP financial measures to their most directly comparable GAAP measures. With that, I’d now like to turn the call over to Steve Barnard, CEO. Steve?

Steve Barnard, Chief Executive Officer (transitioning to Executive Chairman), Mission Produce: Thank you, Jeff Sonnek. Last quarter, we shared the news about our leadership transition, and next month at our annual meeting, that transition becomes official. John Pawlowski steps into the CEO role, and I move to executive chairman. This is my last earnings call in this seat, and I want to take a moment to say how grateful I am. 40+ years building this company alongside an incredible team of people, there’s nothing else like it. I’m proud of what we’ve accomplished together. With that said, I’m even more excited about what’s ahead. Between the momentum we’re carrying, the pending Calavo acquisition we announced in January, and the team we have in place, Mission has never been positioned better. John Pawlowski has brought a level of strategic rigor and global perspective that has elevated this organization, and I have complete confidence in his abilities and vision.

I’ll still be very much involved as executive chairman. This company is in my DNA, and that’s not gonna change. The future belongs to John and this team, and I can’t wait to watch it unfold. With that context, I’ll turn it over to John to walk you through the operational and commercial highlights of the quarter. John?

John Pawlowski, President and Chief Operating Officer (transitioning to CEO), Mission Produce: Thanks, Steve. On behalf of the entire Mission team, thank you. What you’ve built over four decades speaks for itself, and it’s a privilege to carry it forward. I wanna use my time today to walk through our first quarter results and the operational progress we’re making across the business. I also want to spend some time talking about the future of Mission because we have a lot to be excited about. We’re off to a strong start in fiscal 2026, and the first quarter is a good illustration of how we are able to manage this business in a shifting supply and price environment. We are a volume-centric business. Volume and per unit margins are the metrics we manage to.

In a quarter in which industry pricing normalized significantly from the elevated levels we experienced over the past year, our team delivered on both of those fronts, and I want to recognize their collaboration, which helped drive our results. We grew avocado volumes 14%. We expanded gross margin, and we grew adjusted EBITDA versus the prior year period. The headline revenue number reflects pricing dynamics that are outside of our control, but the underlying execution was strong, and that’s what drives our results. Our Marketing and Distribution segment is where this story really comes through. Despite the lower pricing backdrop, segment adjusted EBITDA increased 33%. Our commercial teams drove volume growth, improved per unit margins, and continued to deepen the customer relationships that underpin our business. That’s the combination we’re always working towards.

As expected, Mexican supply was abundant this quarter, with higher yields in the current harvest season versus last year. Our teams programmed that fruit well across our customer base. We’re expanding our reach, strengthening existing partnerships, and leveraging our category management tools to add value for our retail and food service customers. Precisely what our platform was built to do. The broader demand environment continues to trend in our favor as well, and the structural tailwinds for avocado consumption are real. Domestic GLP-1 penetration continues to accelerate, and the recent inclusion of avocados in the USDA’s updated Dietary Guidelines for Americans was a meaningful development, reinforcing what consumers are already telling us day in and day out with their purchasing behavior, that avocados are simply a staple in America’s diet.

In fact, we are seeing these dynamics play out in syndicated data as well, which showed that household penetration of avocados reached a high-water mark of approximately 72% in the fiscal fourth quarter this year. Per capita consumption has nearly tripled over the past 2 decades. With the health and wellness trend continuing to accelerate, we see a long runway for category growth that our platform is uniquely positioned to serve. Our International Farming segment plays an important role in driving year-round consumption here in North America and is also helping accelerate the category in emerging growth markets internationally. We have been working hard to maximize returns from our international asset base. For instance, we are focused on driving improved pack house utilization in Peru by running our own blueberry volume and additional third-party fruit through our facilities to generate better overhead absorption all year round.

Recently, we also modified a pack line in that same facility to support mangoes as well. These efforts, filling in the seasonal calendar and maximizing the productivity of our Peruvian assets, have been instrumental in helping us deliver more sustainable, positive adjusted EBITDA in our International Farming segment during what was historically a seasonally softer quarter. The blueberry segment itself continues to grow. Revenue was up 12% in the quarter on higher volumes and modestly higher pricing. Per acre yields on some of our newer acreage impacted profitability, but that’s part of the natural maturation process, and we expect yields to improve as those farms reach full productivity. The volumes are building, and we like where this business model is headed, both as a standalone category and for what it contributes to our broader platform.

It is this sort of thinking that exemplifies our broader strategy and informs our strategic designs for the future of this company, an area that I am especially excited about. When we announced the Calavo acquisition in January, we described it as a unique opportunity to acquire a strategic and synergistic asset, one that strengthens our core avocado business while adding capabilities in prepared foods through an established brand. Two months after announcing that transaction, I’m even more confident in this view. To be direct, we believe scaled assets in our space that contain this level of strategic fit are scarce. Calavo was a unique opportunity, and we believe Mission is the best-positioned company to unlock value through this combination.

This was an absolutely offensive move, an opportunity to accelerate our growth strategy from a position of strength, backed by two straight years of demonstrated execution, robust cash flow generation, and a very strong balance sheet. Integration planning is underway, and deal progress is moving forward. In fact, we recently filed our preliminary proxy for the transaction, which is now under SEC review, and we are advancing the regulatory approval process in both the United States and Mexico. This is all coming together as planned, and we believe the transaction is on track to close during our fiscal third quarter, subject to satisfaction of the closing conditions. On the strategic merits, we continue to believe the combined company will have greatly enhanced supply reliability for all of our customers.

Calavo will also bring tomatoes and papayas into our distribution network, which we believe will further enhance the year-round facility utilization goal that I spoke to earlier, while helping reduce the seasonal troughs that have historically been a feature of the produce industry. It’s the prepared foods opportunity that I’m particularly excited about. Calavo’s guacamole and ready-to-eat product lines sit within a large and growing market, and it’s a natural adjacency to our core avocado business. Having spent 20 years in the branded food industry, I have a deep appreciation for leveraging the power of strong execution and category leadership into adjacent business line expansions, and we have a perfect opportunity with an established consumer brand and the operational scale to support its continued growth. We see significant runway to build up this new capability and one that is genuinely value additive to what Mission does today.

On synergies, our conviction has only grown as we’ve started our integration planning. We continue to see at least $25 million of annualized cost synergies achievable within 18 months of close, and we believe, as we have stated earlier, that there is meaningful upside potential to that number as we bring these two platforms together. Importantly, we also believe that this transaction will help create a clear path to delever back to normalized levels within approximately 2 years of our close, which is a priority for us as we consider our go-forward capital allocation strategy. Stepping back for a moment, on a standalone basis, Mission has significant runway in front of us, both domestically and internationally. The demand tailwinds I described earlier are durable, and our platform is built to lead category growth along with our customers.

Layer on the Calavo acquisition with the expanded North American footprint, the diversified produce portfolio, entry into prepared foods, and cost synergies, and the combined company has the potential to be something truly differentiated in the fresh produce industry. We are building a platform that we believe can drive meaningful EBITDA growth over the next several years through a combination of organic execution and the value we unlock through this combination. Importantly, as we scale this platform and accelerate free cash flow, returning capital to shareholders is part of the equation that we are envisioning. We are actively developing a long-term capital allocation strategy that balances reinvestment in the business with meaningful return to our shareholders, and we look forward to laying that out alongside our detailed strategic plan at an investor day we are planning to hold following the closure of the Calavo acquisition this fall.

I want to be clear, the ambition here is significant, and I believe the foundation we have, combined with the capabilities Calavo brings, gives us a clear and credible path to get there. With that, I’ll turn over to Bryan for the financial details.

Bryan Giles, Chief Financial Officer, Mission Produce: Thank you, John, and good afternoon to everyone on the call. Fiscal 2026 first quarter revenue totaled $278.6 million, which was down 17% from prior year and driven by a 30% decrease in pricing, given higher industry supply, driven by greater availability of Mexican fruit, resulting from higher yields in the current harvest season. However, we are pleased to see strong 14% volume growth in the quarter, which, as John mentioned, is the primary focus of our operating strategy. Despite lower revenue, gross profit was consistent with the prior year at $31.6 million in the first quarter, enabling our gross margin to increase 190 basis points to 11.3% compared to the same period last year.

As a reminder, profitability in our Marketing and Distribution segment is managed primarily on a per unit basis, which can lead to volatility in margin percentage when sales prices fluctuate. The increase in margin percentage was primarily driven by improved performance in our Marketing and Distribution segment, reflecting higher avocado volumes and improved per unit margins compared to the prior year period. This performance was partially offset by lower gross profit in our blueberry segment due to lower per acre yield, resulting in higher per unit fruit production costs. SG&A expense increased $6.9 million, or 31% compared to the same period last year. The increase was driven entirely by $7 million of transaction advisory costs associated with the pending acquisition of Calavo Growers. Excluding transaction advisory costs, SG&A was essentially flat with the prior year period.

Adjusted net income for the quarter was $7.3 million, or $0.10 per diluted share, consistent with prior year results. Beyond the operating performance, we continued to benefit from a reduction in interest expense, down $0.5 million or approximately 23% versus prior year, reflecting our continued focus on maintaining a healthy balance sheet and the lower rates we incur on outstanding borrowings. We also realized a significant increase in equity method income to $1.5 million compared to $0.8 million in the prior year period, driven by strong performance from our joint venture investment in Henry Avocado Corporation.

Adjusted EBITDA increased 5% to $18.5 million compared to $17.7 million last year, driven by higher avocado volume sold and year-over-year improvement in per unit margins in our Marketing and Distribution segment, partially offset by higher per unit fruit production costs in our blueberry segment. Turning now to the segments. Our Marketing and Distribution segment net sales decreased 21% to $234.8 million, driven by the avocado pricing dynamics previously described. As we’ve mentioned, we manage this business primarily to volume and per unit margins, and on that basis, the segment performed well. Segment adjusted EBITDA increased 33% to $12.9 million, reflecting higher avocado volume sold and solid per unit margins.

In the first quarter, our International Farming results are typically focused on the provision of packing and processing services for our blueberry segment and for third-party blueberry producers, though this will evolve over time as our operations develop in other areas such as Guatemala. With this seasonality in mind, our International Farming segment total sales increased 15% to $10.6 million. Segment adjusted EBITDA increased $0.5 million or 28% to $2.3 million compared to the prior year period due to improved pack house utilization versus the prior year. As John discussed in his remarks, we are pleased to see the results of improved operating leverage in what has traditionally been a smaller quarter for that segment.

In blueberries, total sales increased 12% to $40.8 million due to increases in average per unit sales price and volume sold of 9% and 3% respectively. Segment adjusted EBITDA decreased to $3.3 million compared to $6.2 million last year. While our volumes were higher, overall yield per hectare was lower than the prior year, which drove up our per unit production costs. As we’ve discussed previously, this is part of the natural maturation process for newer acreage, and we expect yields in per unit cost to improve over time as these farms mature. Shifting now to our balance sheet and cash flow. Cash and cash equivalents were $44.8 million as of January 31, 2026, compared to $64.8 million as of October 31, 2025.

Now, cash used by operating activities was $3 million for the quarter compared to $1.2 million in the prior year period. The slight increase in cash usage was driven by higher working capital requirements. As a reminder, the first quarter is typically our weakest period for cash generation, given the seasonality of our business, and we expect a customary improvement in operating cash flow as we move toward the latter half of our fiscal year. Capital expenditures were $11.9 million for the quarter, compared to $14.8 million for the same period last year. Consistent with the anticipated step down we communicated previously. For full fiscal 2026, we continue to expect total capital expenditures of approximately $40 million. This setup positions us for accelerated free cash flow generation going forward.

Now, let me provide some context on our near-term outlook. For the second quarter of fiscal 2026, avocado industry volumes are expected to increase by approximately 10%-15% versus the prior year period, driven by a larger Mexican crop in the current harvest season. Pricing is expected to be lower on a year-over-year basis by approximately 30%-35% compared to the $2 per pound average experienced in the second quarter of fiscal 2025. While we expect higher volumes, we anticipate contraction in our per unit margins for the second quarter due to the lower pricing environment, particularly in a setting where we are sourcing primarily from a single origin.

The lower price environment is leading to a delayed start of the California harvest season, which is expected to be about a month behind the prior year as growers wait for improved market conditions. This delay reduces our ability to leverage our sourcing capabilities across regions and lowers asset utilization at our California packing facility in Q2 as we await volumes to ramp up. This is expected to result in lower levels of Q2 profitability in our Marketing and Distribution segment versus the prior year.

For blueberries, harvest timing for the 2025-26 Peruvian blueberry harvest season is accelerated in relation to the prior year, leaving 10%-15% of the harvest to be sold through in the fiscal second quarter. We expect to see volume reductions from own farms resulting from earlier pruning and unfavorable weather conditions in the current year, which should translate to lower revenue despite expectations for higher sales prices, as well as create headwind for our International Farming segment as a result of lower pack house utilization. Blueberries profitability will continue to be impacted by higher costs resulting from lower projected yields per hectare as we close out the current harvest season in the second quarter. Taking this all together, we anticipate our consolidated adjusted EBITDA performance to be below the prior year level.

Looking ahead, we remain focused on the fundamentals that drive long-term value creation, supporting consumption growth through building volume, strengthening customer partnerships, and maximizing the productivity of our global asset base. The structural tailwinds supporting avocado consumption are accelerating, and our platform is uniquely positioned to capitalize on this sustained category growth. While we’ll navigate some near term supply dynamics in Q2, we have great conviction in the underlying strength of our business model and our team that is driving it forward. Combined with the opportunities afforded by the pending Calavo acquisition, Mission is building a differentiated platform with significant runway for EBITDA growth and value creation in the years to come. That concludes our prepared remarks. With that, I will pass it back to the operator to take us to Q&A.

Conference Call Operator: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key.

Questioner/Analyst: Specifically-

Conference Call Operator: Your first question comes from Pooran Sharma with Stephens. Please go ahead.

Pooran Sharma, Analyst, Stephens: Good afternoon and thanks for the question. Congrats on putting up those results in kind of this lower pricing environment. I did want to start off by asking about the Calavo acquisition. You’ve said a lot here in the past few months about it, but in your prepared comments, you said you feel more confident, as you’ve had more time to maybe digest information about the deal. Does that mean that there could be even more upside to your previous comment about having further upside to the $25 million? Then just as a follow on, could you give us a sense as to what buckets you’re tackling? What do you see as lower hanging fruit and higher hanging fruit in terms of synergy realization?

John Pawlowski, President and Chief Operating Officer (transitioning to CEO), Mission Produce: Yeah. Hi, Pooran. This is John. Thanks for the question. Hope you’re doing well. In regards to the synergy question, you know, I’m gonna stick with my comments that I’ve been making over the last couple of months. You know, we feel, as we’ve been having conversations with the Calavo team, and we’re working towards, you know, consummating the relationship here and all the different elements that have to happen structurally, we feel really good about the estimate assumptions that we made around that $25 million.

Bryan Giles, Chief Financial Officer, Mission Produce: The estimates around that $25 were really built around some core cost structure items, and the buckets that we’ve been always talking about have been around the operating footprint and how synergistic that operating footprint is around some duplicative costs in the overall structure, and feel really good about our ability to execute against cost-related synergies in a very expedited, timely manner. As we think about the buckets for the future, there’s a lot of opportunity around how we think about growing together, how we think about engaging with our customers in regards to what we can do around the selling cycle and adding value in regards to how we think about the opportunities, particularly in adjacent spaces to where we’re at today.

I’m not gonna give any more color in regards to where I think those go, except for to stress that I feel really confident in the word meaningful, as I’ve been, quite frankly, pretty consistent in saying around where we go beyond that 25.

Pooran Sharma, Analyst, Stephens: No. That’s great. Appreciate the color there, John.

John Pawlowski, President and Chief Operating Officer (transitioning to CEO), Mission Produce: Sure.

Pooran Sharma, Analyst, Stephens: Hope you’re doing well as well. Just as a follow-up here, wanted to ask about this is, I guess, more on Bryan’s comments around guidance here. Understand that we’re going into a lower pricing environment, higher supply environment relative to last year, and that you would expect your per unit margins to show some compression in this type of environment. I just wanted to get a sense of you’re also getting a lot of volume throughput, and are you able to give us any color, qualitative or quantitative, into how much fixed cost deleveraging like benefit you would get from the increased volumes?

Bryan Giles, Chief Financial Officer, Mission Produce: Hey, Pooran. This is Bryan. Yeah, I mean, the vast majority of the cost, particularly this time of year and our cost structure, are variable in nature when we’re buying third-party fruit. That is by far the most significant item in our cost of goods sold. Even at lower price points, it’s still the most meaningful item in there. I mean, our goal is we focus on making margin on a per unit basis, so we can be profitable in times when prices are high or when prices are low. There’s no doubt, though, when prices are at the lower end, that it does compress that a bit. It makes it a little more challenging to really sell customers on the, you know, to get them to pay every dollar for the premium service that we provide. It creates challenges.

It does tighten up a bit. I think when we’re in a single source market like we are today with Mexico and there’s ample supply, again, it just makes it more difficult to lean into the competitive advantages that we really have. I do think that, you know, the lower price environment I made reference to California getting a little bit later start this year. Last year we were in a pricing environment that was more than 2x than where we’re at today. You know, in the moment it was meaningfully higher end price to retail. You know, when I look at where we’re at, there’s fixed cost overhead that’s associated with that facility that we’re not able to utilize completely when we’re not in the California season. That year-over-year comp is a little bit difficult.

I don’t think the general per unit margins that we’re gonna generate are gonna be dramatically lower than the historical ranges that we’ve seen. I just think that we’ve gone through a period of time where we were seeing elevated per unit margins that were kind of above that normal range. I think that’s what we’re seeing in Q2, is this kind of continuation of what we saw in Q1, which is a bit of a reversion back to the historical levels on per unit margins.

Questioner/Analyst: Okay, great. Appreciate the color there, Bryan.

Conference Call Operator: Next question, Mark Smith with Lake Street Capital Markets. Please proceed.

Questioner/Analyst: Yeah. Hi, guys. You got Alex Tursich on the line for Mark Smith today. Thanks for taking my questions. First one for me. On the blueberry segment, you know, you mentioned the yield pressure is largely tied to newer acreage maturing. Could you talk about the timeline for those farms reaching full productivity and what normalized margin profile for that business could look like once yields stabilize?

John Pawlowski, President and Chief Operating Officer (transitioning to CEO), Mission Produce: Yeah. This is John. Hi, Alex. Thanks for the question, and I’ll start and maybe Bryan would jump in. To help from a technical perspective side of things, you know, what we do on those farms is we do what we call a double density introduction into the harvest. So what we’re doing is we’re putting plants, which is a very typical part of the process in blueberries and in many other crops. You’re putting plants very, very tightly close together as they’re maturing from, like, the, you know, the year one into year one and a half, when those plants are becoming much more productive and mature. Then you’re spreading them out as they get into the later stages of maturity.

Bryan Giles, Chief Financial Officer, Mission Produce: Sometimes when you do that and you spread them out, you have a little bit less productivity for those first couple months or first year of that, of the time that that plant is executing against what it’s trying to do. We’re kind of in a phase where we just did that in a lot of the portions of our farm. Over the course of the next 12-18 months, we should really be reverting back to our traditional margins from both a well, at least back to a better cost structure, the right cost structure, as those plants become mature. I would love to tell you it’s 3 months, but it’s probably more along the lines of 12-18 months until we reach that full zone where we’d like to be.

Yeah. I would just kind of building off what John said, I mean, there’s a couple of metrics we look at. We’re certainly looking at cost per hectare planted. We do that for our avocados and our blueberry farms. We’re also looking at costs on a per unit basis. You know, the triangle here for profitability is overall like cost incurred, production yield and sales price. Then we work those three together. Certainly the cost per unit is driven heavily on the overall cost that we incur as well as that yield number. To the point that John made, we do expect those yields to improve as they mature. Blueberries do get into a mature production much faster than an avocado tree does.

Many of these plantings where we’re seeing you know, reduced yield this year, these are plants that are, you know, 1-2 years old, and we would expect them to ramp their productivity very quickly. Whereas an avocado tree, it can take 4 years before you even get to break even production. It’s a meaningful difference. It’s a faster ramp. I think that, you know, we were planting a fair amount of new acreage in blueberries. You know, we’re up over 700 hectares in production today. Of that 700, probably 25% of it is new acreage that was impacted by the drought. Certainly as we go forward, we expect those yields to ramp fairly quickly. We do think that, you know, we mentioned other factors that play into this.

Certainly the timing of pruning in a harvest season, where we let the seasons run a little bit longer the year before and we ended them at a more normalized time this year, had a nominal impact. We’re also, you know, in decisions around pruning are oftentimes driven by the weather conditions that exist at any given time. The timing of pruning is gonna determine when harvest is gonna begin the following season. We’re making decisions, again, that are really the best in the long-term interests of the business, and sometimes they don’t always align with an individual quarter.

Questioner/Analyst: Okay. Yeah, that’s really helpful. The last one for me, you know, you touched on the prepared remarks about developing that long-term capital allocation strategy and your plans to discuss that at the Investor Day after the acquisition closes. Just at a high level, you know, how should we think about the balance between reinvestment, deleveraging, and returning capital to shareholders as free cash flow ramps?

Bryan Giles, Chief Financial Officer, Mission Produce: I mean, I think we wanna stop short of committing to specifics at this point, but I think this is really a continuation of the messaging we’ve started to deliver over the last 12-18 months, which is initial priority, paying down debt, and I think we’ve spent two years doing that. With this acquisition, debt will ramp back up a little bit again, so we will have a process to bring it back down. These combined entities are gonna create meaningful more, or meaningfully more operating cash flow, than we did individually. We feel like we can bring that debt back down in short order. We’ve already had discussions about consistent capital, you know, returning cash to shareholders, and those discussions are gonna continue to happen as we move forward.

I think the message that we’d wanna deliver right now is that we’re committed to a program to kinda look at that balance. We don’t know what the figures are gonna be yet. We don’t know when it’s gonna start, but we understand it matters to us, and we feel that it creates value for our external stakeholders as well.

John Pawlowski, President and Chief Operating Officer (transitioning to CEO), Mission Produce: I would add to that, Alex, too, that I think in the past we’ve been very clear on our priorities of using our capital, right? That they were around debt management as well as investing in the growth of the business. At this time, I think we’re pivoting a little on that by starting to say that as we develop this capital allocation strategy, the return to shareholder piece is rising on the priority list for us.

I would say that as a combined entity, as we think about the future, the priorities don’t necessarily have to be mutually exclusive, that we think that there’s opportunity to parallel path that over the course of the next 12-18 months, and we won’t have to wait for that debt leveraging to be able to provide some of that shareholder return.

Questioner/Analyst: That’s very helpful. Thanks for taking my questions today, guys.

Bryan Giles, Chief Financial Officer, Mission Produce: Certainly welcome.

Conference Call Operator: Ladies and gentlemen, at this time, I’m showing no further questions. I’d like to end the Q&A session and turn the conference call back over to management for any closing remarks.

John Pawlowski, President and Chief Operating Officer (transitioning to CEO), Mission Produce: Thanks everybody. This is John. Thanks for joining us today. I hope you can feel the positive energy that we have here with respect to our future. We believe Mission is at a very critical juncture in our journey, and the pending acquisition of Calavo will only serve to accelerate our growth ambitions. We appreciate your interest in Mission Produce. I wanna thank Steve for all his contributions and let him know I look forward to the future together, and we collectively look forward to speaking with you again next quarter.

Conference Call Operator: Ladies and gentlemen, that concludes today’s conference call. We do thank you for attending. You may now disconnect your lines and have a wonderful day.