CALAVO GROWERS INC Leases Disclosure
15. Leases
We lease property and equipment under finance and operating leases. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. Many of our leases include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when appropriate.
We also lease certain property, plant and equipment, including office facilities, under operating leases. The lease term consists of the noncancellable period of the lease and the periods covered by options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. The Company's lease agreements do not contain any residual value guarantees.
Lease Position
The following table presents the lease-related assets and liabilities recorded on the balance sheet as of October 31, 2025 and 2024 (in thousands):
October 31, |
| October 31, | |||||
2025 |
| 2024 | |||||
Assets | | | | | |||
Non-current assets: | |
| | | |||
Operating lease assets | Operating lease right-of-use assets | $ | 16,333 | $ | 18,316 | ||
Finance lease assets |
| 4,307 |
| 4,609 | |||
$ | 20,640 | $ | 22,925 | ||||
Liabilities | |
| |
| | ||
Current liabilities: | |
| |
| | ||
Operating | Current portion of operating leases | $ | 3,568 | $ | 3,296 | ||
Finance | Current portion of long-term obligations and finance leases |
| 885 |
| 874 | ||
Long-term obligations | |
| |
| | ||
Operating | Long-term operating leases, less current portion |
| 14,962 |
| 17,476 | ||
Finance | Long-term obligations and finance leases, less current portion |
| 4,051 |
| 4,274 | ||
$ | 23,466 | $ | 25,920 | ||||
Weighted-average remaining lease term: | | Fiscal 2025 | Fiscal 2024 | |||
Operating leases |
| 5.5 years | 6.5 years | |||
Finance leases |
| 6.2 years | 7.0 years | |||
Weighted-average discount rate: |
| | | |||
Operating leases |
| 2.79 | % | 2.49 | % | |
Finance leases |
| 5.34 | % | 4.89 | % | |
Lease Costs
The following table presents certain information related to the lease costs for finance and operating leases for the years ended October 31, 2025 and 2024 (in thousands):
| Year ended | Year ended | ||||
| October 31, 2025 | October 31, 2024 | ||||
Amortization of financing lease assets (recorded in cost of sales) |
| $ | 1,017 | $ | 994 | |
Operating lease cost | 3,756 | 4,202 | ||||
Short-term lease cost | 599 | 952 | ||||
Sublease income | 17 | — | ||||
Variable lease cost | 98 | 62 | ||||
Interest on financing lease liabilities | 248 | 255 | ||||
Total lease cost | $ | 5,735 | $ | 6,465 | ||
Other Information
The following table presents supplemental cash flow information related to the leases for the years ended October 31, 2025 and 2024 (in thousands):
| Year ended | Year ended | ||||
Cash paid for amounts included in the measurement of lease liabilities |
| October 31, 2025 | October 31, 2024 | |||
Operating cash flows for operating leases |
| $ | 3,488 | $ | 3,878 | |
Financing cash flows for finance leases | 927 | 882 | ||||
Operating cash flows for finance leases | 247 | 255 | ||||
The total right-of-use assets obtained in exchange for new operating leases for the years ended October 31, 2025 and 2024 were $1.3 million and $3.7 million.
Undiscounted Cash Flows
The following table reconciles the undiscounted cash flows for each of the first five years and total remaining years to the finance lease liabilities and operating lease liabilities recorded on the balance sheet as of October 31, 2025 (in thousands):
| Operating | | Finance | |||
Year | Leases |
| Leases | |||
2026 |
| $ | 4,002 |
| $ | 1,121 |
2027 | 3,962 | 1,027 | ||||
2028 | 3,617 | 932 | ||||
2029 | 3,147 | 705 | ||||
2030 | 2,137 | 663 | ||||
Thereafter | 2,869 | 1,286 | ||||
Total lease payments | 19,734 | 5,734 | ||||
Less: imputed interest | 1,204 | 798 | ||||
Total lease liability |
| $ | 18,530 |
| $ | 4,936 |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jan 14, 2026 | Showing above |
| 2024 | Jan 14, 2025 | |
| 2023 | Jan 31, 2024 | |
| 2022 | Dec 20, 2022 | |
| 2021 | Dec 21, 2021 | |
| 2020 | Dec 21, 2020 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.