avo-20250131

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_____________

FORM 10-Q

_____________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended January 31, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-39561

_____________

MISSION PRODUCE, INC.

(Exact name of Registrant as specified in its charter)

_____________

Delaware

(State or Other Jurisdiction of

Incorporation or Organization)

2710 Camino Del Sol

Oxnard, California

(Address of Principal Executive Offices)

95-3847744

(I.R.S. Employer

Identification No.)

93030

(Zip Code)

Registrant’s Telephone Number, Including Area Code: (805) 981-3650

_____________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

AVO

NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of February 28, 2025, the registrant had 71,071,752 shares of common stock at $0.001 par value outstanding.

MISSION PRODUCE, INC.

TABLE OF CONTENTS

FORM 10-Q

FISCAL FIRST QUARTER 2025


PART I- FINANCIAL INFORMATION		5

Item 1.	Financial Statements	5
	Condensed Consolidated Balance Sheets (Unaudited)	5
	Condensed Consolidated Statements of Income (Unaudited)	6
	Condensed Consolidated Statements of Comprehensive Income (Unaudited)	7
	Condensed Consolidated Statements of Changes in Equity (Unaudited)	8
	Condensed Consolidated Statements of Cash Flows (Unaudited)	9
	Notes to Unaudited Condensed Consolidated Financial Statements	11
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.	Controls and Procedures	27

PART II- OTHER INFORMATION		28

Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	30
Item 4.	Mine Safety Disclosures	30
Item 5.	Other Information	30
Item 6.	Exhibits	31

	Signatures	31

FORWARD LOOKING STATEMENTS

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may”, “will”, “should”, “expects”, “plans”, “anticipates”, “could”, “intends”, “target”, “projects”, “contemplates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. We believe that these factors include, but are not limited to, the following:

•Risks related to our business, including: reliance on primarily one main product; limitations regarding the supply of fruit, either through purchasing or growing; fluctuations in the market price of fruit; increasing competition; risks associated with doing business internationally, including Mexican and Peruvian economic, political and/or societal conditions; inflationary pressures; establishment of sales channels and geographic markets; loss of one or more of our largest customers; general economic conditions or downturns; supply chain failures or disruptions; disruption to the supply of reliable and cost-effective transportation; failure to recruit or retain employees, poor employee relations, and/or ineffective organizational structure; inherent farming risks, including climate change; seasonality in operating results; failures associated with information technology infrastructure, system security and cyber risks; new and changing privacy laws and our compliance with such laws; food safety events and recalls; failure to comply with laws and regulations; changes to trade policy and/or export/import laws and regulations; risks from business acquisitions, if any; lack of or failure of infrastructure; material litigation or governmental inquiries/actions; failure to maintain or protect our brand; changes in tax rates or international tax legislation; risks associated with global conflicts; and inability to accurately forecast future performance.

•Risks related to our common stock, including: the viability of an active, liquid, and orderly market for our common stock; volatility in the trading price of our common stock; concentration of control in our executive officers, and directors over matters submitted to stockholders for approval; limited sources of capital appreciation; significant costs associated with being a public company and the allocation of significant management resources thereto; reliance on analyst reports; failure to maintain proper and effective internal control over financial reporting; restrictions on takeover attempts in our charter documents and under Delaware law; and the selection of Delaware as the exclusive forum for substantially all disputes between us and our stockholders.

•Risks related to restrictive covenants under our credit facility, which could affect our flexibility to fund ongoing operations, uses of capital and strategic initiatives, and, if we are unable to maintain compliance with such covenants, lead to significant challenges in meeting our liquidity requirements and acceleration of our debt.

•Other risks and factors listed under “Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K for the year ended October 31, 2024 and elsewhere in this report.

We have based the forward-looking statements contained in this report primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, prospects, business strategy and financial needs. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, assumptions and other factors described in “Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K for the year ended October 31, 2024 and elsewhere in this report. These risks are not exhaustive. Other sections of this report include additional factors that could adversely impact our business and financial performance. Furthermore, new risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

You should read this report, including documents that we reference and exhibits that have been filed, in this report and have filed as exhibits to this report, with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

The forward-looking statements made in this report relate only to events as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements after the date of this report or to conform such statements to actual results or revised expectations, except as required by law.

This quarterly report may also include trademarks, tradenames and service marks that are the property of the Company and also certain trademarks, tradenames and service marks that are the property of other organizations. Solely for convenience,

trademarks and tradenames referred to in this quarterly report appear without the ® and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or that the applicable owner will not assert its rights, to these trademarks and tradenames.

We maintain a website at www.missionproduce.com, to which we regularly post copies of our press releases as well as additional information about us. Our filings with the Securities and Exchange Commission (“SEC”), are available free of charge through our website as soon as reasonably practicable after being electronically filed with or furnished to the SEC. Information contained in our website does not constitute a part of this report or our other filings with the SEC.

PART I- FINANCIAL INFORMATION

Item 1. Financial Statements

MISSION PRODUCE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)


(In millions, except for shares)	January 31, 2025		October 31, 2024
Assets
Current Assets:
Cash and cash equivalents	$	40.1	$	58.0
Restricted cash	2.1		1.3
Accounts receivable
Trade, net of allowances of $0.7 and $0.8, respectively	100.1		95.4
Grower and fruit advances	3.7		1.7
Other	16.5		15.3
Inventory	122.7		91.2
Prepaid expenses and other current assets	9.5		9.4
Income taxes receivable	2.5		6.7
Total current assets	297.2		279.0
Property, plant and equipment, net	528.4		523.4
Operating lease right-of-use assets	66.7		67.8
Equity method investees	33.5		33.0
Deferred income tax assets, net	9.4		9.7
Goodwill	39.4		39.4

Other assets	23.2		19.2
Total assets	$	997.8	$	971.5

Liabilities and Equity
Liabilities
Accounts payable	$	47.6	$	35.3
Accrued expenses	46.3		39.9
Income taxes payable	3.0		7.7
Grower payables	60.6		50.3
Short-term borrowings	—		3.0
Notes payable	—		0.5
Loans from noncontrolling interest holders—current portion	0.6		0.1
Long-term debt—current portion	3.0		3.0
Operating leases—current portion	7.2		6.4
Finance leases—current portion	1.4		2.9
Total current liabilities	169.7		149.1
Long-term debt, net of current portion	114.9		110.7
Loans from noncontrolling interest holders, net of current portion	0.9		1.8
Operating leases, net of current portion	66.4		67.4
Finance leases, net of current portion	21.6		21.5
Income taxes payable	1.3		1.3
Deferred income tax liabilities, net	16.5		16.6
Other long-term liabilities	23.6		26.0
Total liabilities	414.9		394.4
Commitments and contingencies (Note 7)
Shareholders’ Equity
Common stock ($0.001 par value, 1,000,000,000 shares authorized; 71,065,552 and 70,914,767 shares issued and outstanding as of January 31, 2025 and October 31, 2024, respectively)	0.1		0.1
Additional paid-in capital	240.7		239.7
Accumulated other comprehensive loss	(1.3)		(0.2)
Retained earnings	311.3		307.7
Mission Produce shareholders' equity	550.8		547.3
Noncontrolling interest	32.1		29.8
Total equity	582.9		577.1
Total liabilities and equity	$	997.8	$	971.5

See accompanying notes to unaudited condensed consolidated financial statements.

MISSION PRODUCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)


	Three Months Ended January 31,
(In millions, except for per share amounts)	2025		2024
Net sales	$	334.2	$	258.7
Cost of sales	302.7		230.0
Gross profit	31.5		28.7
Selling, general and administrative expenses	22.2		20.7

Operating income	9.3		8.0
Interest expense	(2.2)		(3.3)
Equity method income	0.8		0.4
Other income (expense), net	1.5		(1.0)
Income before income taxes	9.4		4.1
Provision for income taxes	3.2		2.1
Net income	$	6.2	$	2.0
Less: Net income attributable to noncontrolling interest	2.3		2.0
Net income attributable to Mission Produce	$	3.9	$	—

Net income per share attributable to Mission Produce:
Basic	$	0.06	$	0.00
Diluted	$	0.05	$	0.00

See accompanying notes to unaudited condensed consolidated financial statements.

MISSION PRODUCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)


	Three Months Ended January 31,
(In millions)		2025		2024
Net income		$	6.2	$	2.0
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments		(1.1)		0.8
Total comprehensive income, net of tax		5.1		2.8
Less: Comprehensive income attributable to noncontrolling interest		2.3		2.0
Comprehensive income		$	2.8	$	0.8

See accompanying notes to unaudited condensed consolidated financial statements.

MISSION PRODUCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)


(In millions, except for shares)	Common stock			Additional paid-in capital		Accumulated other comprehensive loss		Retained earnings		Noncontrolling interest		Total equity
	Shares	Amount
Balance at October 31, 2023	70,728,404	$	0.1	$	233.4	$	(0.9)	$	271.0	$	24.7	$	528.3
Stock-based compensation	—	—		1.4		—		—		—		1.4

Issuance of common stock for equity awards, net of shares withheld for the settlement of taxes	112,899	—		(0.7)		—		—		—		(0.7)

Net income	—	—		—		—		—		2.0		2.0
Other comprehensive income	—	—		—		0.8		—		—		0.8
Balance at January 31, 2024	70,841,303	$	0.1	$	234.1	$	(0.1)	$	271.0	$	26.7	$	531.8













Balance at October 31, 2024	70,914,767	$	0.1	$	239.7	$	(0.2)	$	307.7	$	29.8	$	577.1
Stock-based compensation	—	—		2.0		—		—		—		2.0
Issuance of common stock for equity awards, net of shares withheld for the settlement of taxes	153,856	—		(1.3)		—		—		—		(1.3)
Exercise of stock options	21,929	—		0.3		—		—		—		0.3
Purchase and retirement of common stock	(25,000)	—		—		—		(0.3)		—		(0.3)
Net income	—	—		—		—		3.9		2.3		6.2
Other comprehensive loss	—	—		—		(1.1)		—		—		(1.1)
Balance at January 31, 2025	71,065,552	$	0.1	$	240.7	$	(1.3)	$	311.3	$	32.1	$	582.9

See accompanying notes to unaudited condensed consolidated financial statements.

MISSION PRODUCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)


	Three Months Ended January 31,
(In millions)	2025		2024
Operating Activities
Net income	$	6.2	$	2.0
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	8.7		12.9
Amortization of debt issuance costs	0.1		0.1
Equity method income	(0.8)		(0.4)
Noncash lease expense	1.8		1.5
Stock-based compensation	2.0		1.4
Dividends received from equity method investees	—		3.2
Losses on asset impairment, disposals and sales	0.1		0.2
Deferred income taxes	—		(0.8)
Unrealized gain on derivative financial instruments	(0.1)		—
Other	(0.6)		0.9
Effect on cash of changes in operating assets and liabilities:
Trade accounts receivable	(5.0)		(10.9)
Grower fruit advances	(2.0)		(0.5)
Other receivables	(1.6)		(0.7)
Inventory	(31.5)		(14.8)
Prepaid expenses and other current assets	(0.3)		—
Income taxes receivable	4.4		0.3
Other assets	(4.0)		0.1
Accounts payable and accrued expenses	18.5		4.6
Income taxes payable	(4.8)		1.2
Grower payables	10.4		10.1
Operating lease liabilities	(0.9)		(0.9)
Other long-term liabilities	(1.8)		—
Net cash (used in) provided by operating activities	$	(1.2)	$	9.5
Investing Activities
Purchases of property, plant and equipment	(14.8)		(9.9)





Other	(0.1)		—
Net cash used in investing activities	$	(14.9)	$	(9.9)
Financing Activities
Borrowings on revolving credit facility	15.0		15.0
Payments on revolving credit facility	(10.0)		(10.0)

Repayment of short-term borrowings	(3.5)		(2.8)

Principal payments on long-term debt obligations	(0.8)		(0.9)
Principal payments on finance lease obligations	(0.1)		(2.3)
Payments for long-term supplier financing	(0.3)		(0.3)

Principal payments on loans due to noncontrolling interest holder	—		(0.5)
Payments of minimum withholding taxes on net share settlement of equity awards	(1.3)		(0.7)
Exercise of stock options	0.3		—
Purchase and retirement of common stock	(0.3)		—


Net cash used in financing activities	$	(1.0)	$	(2.5)
Effect of exchange rate changes on cash	—		0.2
Net decrease in cash, cash equivalents and restricted cash	(17.1)		(2.7)
Cash, cash equivalents and restricted cash, beginning of period	59.3		43.2
Cash, cash equivalents and restricted cash, end of period	$	42.2	$	40.5


	Three Months Ended January 31,
(In millions)	2025		2024
Summary of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets:
Cash and cash equivalents	$	40.1	$	39.9
Restricted cash	2.1		0.6

Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	42.2	$	40.5

See accompanying notes to unaudited condensed consolidated financial statements.

MISSION PRODUCE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. General

Business

Mission Produce, Inc. together with its consolidated subsidiaries (“Mission,” “the Company,” “we,” “us” or “our”), is a global leader in the avocado industry. The Company’s expertise lies in the farming, packaging, marketing and distribution of avocados to food retailers, distributors and produce wholesalers worldwide. The Company procures avocados principally from California, Mexico and Peru. Through our various operating facilities, we grow, sort, pack, bag and ripen avocados and a small amount of other fruits for distribution to domestic and international markets. We report our results of operations in three operating segments: Marketing & Distribution, International Farming and Blueberries (see Note 12).

Basis of presentation and consolidation

The unaudited interim condensed consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and include the Company’s consolidated domestic and international subsidiaries and variable interest entity (“VIE”) for which we are the primary beneficiary and have a controlling interest. Certain information and disclosures normally included in annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, these unaudited interim condensed consolidated financial statements and accompanying footnotes should be read in conjunction with the Company’s Annual Report for the year ended October 31, 2024. In the opinion of management, all adjustments, of a normal recurring nature, considered necessary for a fair statement have been included in the unaudited condensed consolidated financial statements. Interim results of operations are not necessarily indicative of future results, including results that may be expected for the twelve months ended October 31, 2025.

Recently issued accounting and disclosure standards

In November 2024, and as updated in January 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures. The ASU requires that an entity disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. This information is generally not presented in the financial statements today. The amendments in this ASU are required to be adopted for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendments should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this update or (2) retrospectively to any or all prior periods presented in the financial statements. We are currently evaluating the impact of adoption on our financial disclosures.

In March 2024, the Securities and Exchange Commission ("SEC") adopted final climate-related disclosure rules that will require registrants to disclose (subject to materiality conditions): climate-related risks, material direct greenhouse gas emissions, and the effects of severe weather events and other natural conditions. Adoption is required on a phase-in basis with respect to annual periods beginning in calendar year 2025 (the Company's fiscal year 2026). In April 2024, the SEC issued a stay on the rules, pending the completion of judicial review of the U.S. Court of Appeals of the Eighth Circuit. We are currently monitoring the status of the judicial review and we are evaluating the impact of the rules on our financial disclosures.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740)—Improvements to Income Tax Disclosures. The ASU requires that an entity disclose specific categories in the effective tax rate reconciliation as well as provide additional information for reconciling items that meet a quantitative threshold. Further, the ASU requires certain disclosures of state versus federal income tax expense and taxes paid. The amendments in this ASU are required to be adopted for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments should be applied on a prospective basis although retrospective application is permitted. We are currently evaluating the impact of adoption on our financial disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures. The ASU requires that an entity disclose significant segment expenses impacting profit and loss that are regularly provided to the chief operating decision maker. The update is required to be applied retrospectively to prior periods presented, based on the significant segment expense categories identified and disclosed in the period of adoption. The amendments in this ASU are required to be adopted for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. We are currently evaluating the impact of adoption on our financial disclosures.

MISSION PRODUCE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2. Inventory

Major classes of inventory were as follows:


(In millions)	January 31, 2025		October 31, 2024
Finished goods	$	64.7	$	45.1
Crop growing costs	40.6		27.1
Packaging and supplies	17.4		19.0
Inventory	$	122.7	$	91.2

3. Goodwill and Intangible Asset, net

Goodwill


(In millions)	International Farming		Blueberries		Total
Goodwill as of January 31, 2025 and October 31, 2024	$	26.9	$	12.5	$	39.4

The carrying amounts of goodwill as of January 31, 2025 and October 31, 2024 were net of accumulated impairment losses of $49.5 million, attributable to the International Farming segment. Goodwill is tested for impairment on an annual basis in the fourth quarter, or when an event or changes in circumstances indicate that its carrying value may not be recoverable.

Intangible asset, net

As of January 31, 2025 and October 31, 2024, our intangible asset was fully-amortized. Amortization expense was $0.3 million for the three months ended January 31, 2024, and included in selling, general and administrative expenses.

4. Details of Certain Account Balances

Accrued expenses


(In millions)	January 31, 2025		October 31, 2024
Employee-related	$	26.7	$	22.1
Freight	7.0		5.8
Outside fruit purchase	7.0		4.7


Other	5.6		7.3
Accrued expenses	$	46.3	$	39.9

Other long-term liabilities


(In millions)	January 31, 2025		October 31, 2024
Uncertain tax positions(1)	$	17.6	$	17.9
Employee-related	2.2		2.2
Trade payables to noncontrolling interest holders	1.7		3.5

Other	2.1		2.4
Other long-term liabilities	$	23.6	$	26.0

(1)Includes uncertain tax positions related to both income taxes and other statutory tax reserves, plus related penalties and interest.

MISSION PRODUCE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Other income (expense), net


	Three Months Ended January 31,
(In millions)		2025		2024
Gains on derivative financial instruments		$	0.1	$	—
Foreign currency transaction gain (loss)		1.1		(1.4)
Interest income		0.3		0.3
Other		—		0.1
Other income (expense), net		$	1.5	$	(1.0)

Other amounts attributable to noncontrolling interest holders

Amounts included in trade accounts receivable due from noncontrolling interest holders were $4.9 million and $5.1 million as of January 31, 2025 and October 31, 2024, respectively. Amounts included in trade accounts payable due to noncontrolling interest holders were $9.4 million and $2.6 million as of January 31, 2025 and October 31, 2024, respectively.

5. Variable Interest Entity

Assets of our variable interest in our blueberry joint-venture entity Moruga, may only be used to settle its own liabilities and creditors of Moruga only have recourse for the liabilities of Moruga. A summary of these balances, which are wholly included in our condensed consolidated balance sheets, is as follows:


(In millions)	January 31, 2025		October 31, 2024
Current assets	$	34.9	$	40.7
Long-term assets	80.7		74.2
Current liabilities	21.1		22.0
Long-term liabilities	25.0		27.9

6. Debt

Credit facility

Long-term debt under our syndicated credit facility with Bank of America (“BoA”) Merrill Lynch consisted of the following:


(In millions)	January 31, 2025		October 31, 2024
Revolving line of credit. The interest rate is variable, based on SOFR plus a spread that varies with the Company’s leverage ratio. As of January 31, 2025 and October 31, 2024, the interest rate was 5.90% and 6.38%, respectively. Interest is payable monthly and principal is due in full in October 2027	$	25.0	$	20.0
Senior term loan (A-1). The interest rate is variable, based on SOFR plus a spread that varies with the Company’s leverage ratio. As of January 31, 2025 and October 31, 2024, the interest rate was 5.91% and 6.29%, respectively. Interest is payable monthly, principal is payable quarterly and due in full in October 2027.	44.4		45.0
Senior term loan (A-2). The interest rate is variable, based on SOFR plus a spread that varies with the Company’s leverage ratio. As of January 31, 2025 and October 31, 2024, the interest rate was 6.16% and 6.54% respectively. Interest is payable monthly, principal is payable quarterly and due in full in October 2029.	48.8		49.0
Total long-term debt	118.2		114.0
Less debt issuance costs	(0.3)		(0.3)
Long-term debt, net of debt issuance costs	117.9		113.7
Less current portion of long-term debt	(3.0)		(3.0)
Long-term debt, net of current portion	$	114.9	$	110.7

MISSION PRODUCE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The credit facility requires the Company to comply with financial and other covenants, including limitations on investments, capital expenditures, dividend payments, amounts and types of liens and indebtedness, and material asset sales. The Company is also required to maintain certain leverage and fixed charge coverage ratios. As of January 31, 2025, the Company was in compliance with all financial covenants of the credit facility.

Other

Certain of our consolidated subsidiaries may also enter into short-term bank borrowings from time to time. No short-term bank borrowings were outstanding as of January 31, 2025 and $3.0 million were outstanding as of October 31, 2024. The weighted average interest rate on short-term bank borrowings outstanding was 9.91% as of October 31, 2024. Our Blueberries business also obtains loans from shareholders from time to time, which accrue interest at rates ranging from 5.0 to 6.5%. Amounts outstanding as of January 31, 2025 are expected to be repaid by the end of fiscal 2026.

Interest rate swaps

From time to time, the Company may enter into interest rate swap contracts to hedge changes in variable interest rates on the principal value of the Company’s term loans. We account for interest rate swaps in accordance with ASC 815, Derivatives and Hedging, as amended, which requires the recognition of all derivative instruments as either assets or liabilities in the condensed consolidated balance sheets and measurement of those instruments at fair value. The Company did not designate the interest rate swaps as cash flow hedges, and as a result under the accounting guidance, changes in the fair value of the interest rate swaps were recorded in other income (expense), net in the condensed consolidated statements of income and changes in the assets are presented in net cash (used in) provided by operating activities in the condensed consolidated statements of cash flow. As of January 31, 2025 and October 31, 2024, a notional amount of $10 million was outstanding, carrying a fixed SOFR rate of 4.47%. Refer to Note 9 for more details.

7. Commitments and Contingencies

Litigation

We are from time to time involved in legal proceedings and investigations arising in the ordinary course of business, including those relating to employment matters, relationships with clients and contractors, intellectual property disputes and other business matters.

On April 23, 2020, former Mission Produce, Inc. employees filed a class action lawsuit in the Superior Court of the State of California for the County of Los Angeles against us alleging violation of certain wage and labor laws in California, including failure to pay all overtime wages, minimum wage violations, and meal and rest period violations, among others. Additionally, on June 10, 2020, former Mission Produce, Inc. employees filed a class action lawsuit in the Superior Court of the State of California for the County of Ventura against us alleging similar violations of certain wage and labor laws. The plaintiffs in both cases seek damages primarily consisting of class certification and payment of wages earned and owed, plus other consequential and special damages. While the Company believes that it did not violate any wage or labor laws, in May 2021, the plaintiffs in both class action lawsuits and the Company agreed to settle the class action cases. Per the terms of the settlement agreement between the parties, the total amount of the settlement is $1.5 million. The Court granted Final Approval of the Class Action Settlement on June 10, 2024. Payment was sent to the Settlement Administrator on June 26, 2024, to be distributed directly to the class members. Once all settlement checks have been distributed and cashed or returned pursuant to the terms of the Settlement Agreement, the action will be dismissed with prejudice. The Court has set a deadline of June 2025 for Plaintiff to file a declaration from the settlement administrator regarding disbursal of funds.

On October 21, 2024, a former temporary worker placed at the Company’s California packinghouse by a labor contractor utilized by the Company, filed a class action lawsuit in the Superior Court of the State of California for the County of Ventura County against us alleging violations of certain wage and hour laws. The plaintiff seeks damages primarily consisting of class certification, payment of wages earned and owed, liquidated damages, penalties and fees, and injunctive relief. The Company is vigorously defending against the claims. At this time, it is too soon to determine the outcome of the litigation. As a result, the Company has not accrued for any loss contingencies related to these claims because the amount and range of loss, if any, cannot currently be reasonably estimated.

On November 6, 2024, the Organics Consumers Association filed a lawsuit in the Superior Court of the District of Columbia alleging the Company engaged in false and deceptive advertising in violation of the D.C. Consumer Protection and Procedures Act by making representations about sustainable sourcing practice in connection with its sale of avocados. Plaintiff seeks only declaratory and injunctive relief. On February 21, 2025, the same lawyers that represent the Organic Consumers Association filed a putative class action lawsuit on behalf of Kachuk Enterprises, Bantle Avocado Farm, Maskell Family Trust, and Northern Capital, Inc., owners and operators of avocado orchards located in California, against the Company and certain other avocado distributors. The lawsuit alleges violations of California’s False Advertising Law, California’s Unfair Competition Law, and unjust enrichment related to defendants’ alleged representations to consumers that their avocados are sustainably and responsibly sourced. Plaintiffs primarily seek injunctive relief, monetary and statutory damages, disgorgement of profits, and restitution. The

MISSION PRODUCE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Company is vigorously defending against the claims asserted in both these lawsuits. At this time, it is too soon to determine the outcome of these lawsuits. As a result, the Company has not accrued for any loss contingencies related to these matters because the amount and range of loss, if any, cannot be reasonably estimated.

The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and if one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s financial condition and operating results for that period could be materially adversely affected.

8. Income Taxes

The provision for income tax recorded for the three months ended January 31, 2025 and 2024 differs from the income taxes expected at the U.S. federal statutory tax rate of 21.0%, primarily due to income attributable to foreign jurisdictions which is taxed at different rates, changes in foreign exchange rates taxable in foreign jurisdictions, state taxes, nondeductible tax items and changes in uncertain tax positions (“UTP”).

As of January 31, 2025, the Company had $15.4 million accrued in UTP on income taxes, of which $8.5 million relates to interest and penalties, inclusive of inflationary adjustments. The period for assessing interest and penalties has expired. However, the Company continues to record certain statutory adjustments related to inflation. Changes in the UTP related to changes in foreign exchange rates during the period are included in other income (expense), net in the condensed consolidated statements of income.

9. Fair Value Measurements

Financial assets or liabilities measured and recorded at fair value on a recurring basis included in the condensed consolidated balance sheets were as follows:

SEC Form 10-Q filed by Mission Produce Inc.