(Bloomberg) -- When it rains, it pours oversized lemons.
Southern California got so much rain this year that the state's lemons have become gigantic, and in a surprising twist, that's bad news for Limoneira Co., one of the top producers. It turns out that bigger lemons are less profitable because they more often get turned into juice, rather than heading to grocery stores to be sold as fresh fruit.
The hefty fruits only net about $18 a carton, while normal-sized lemons can garner $30. That's forced Limoneira to cut its 2019 outlook. About half of the company's lemons were turned into lemon juice, the company said in a Wednesday statement.
Since the next quarter “is a seasonally less significant earnings period, the company will not be able to recoup the losses incurred,” analysts at Stephens Inc. said in a report Thursday.
Limoneira expects an operating loss of $500,000 to $3 million, compared with previous expectations of operating income of $7.5 million to $12.5 million.
A heatwave in California last year resulted in a smaller avocado harvest this season, which also hurt the company's revenue.
To contact the reporters on this story: Lydia Mulvany in Chicago at lmulvany2@bloomberg.net;Michael Hirtzer in Chicago at mhirtzer@bloomberg.net
To contact the editors responsible for this story: James Attwood at jattwood3@bloomberg.net, Millie Munshi, Patrick McKiernan
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