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Information regarding our operations in different segments
 9 Months Ended
Jul. 31, 2022
Information regarding our operations in different segments  
Information regarding our operations in different segments

2. Information regarding our operations in different segments

​

On April 13, 2022, the Company issued a press release announcing its plans to reorganize the business into two reporting segments, Grown and Prepared. The management transition to operate as Grown and Prepared began at the start of the third quarter of 2022. The Grown segment consists of fresh avocados, tomatoes and papayas. The Prepared segment comprises all other products including fresh cut fruits and vegetables, ready-to-eat sandwiches, wraps, salads and snacks, guacamole, and salsa sold at retail and food service as well as avocado pulp sold to foodservice.

​

As a result of the Company's operating segment realignment, the composition of its reporting units for the evaluation of goodwill impairment was changed. RFG reporting unit goodwill is now included within the Prepared reporting unit. Therefore, the goodwill of $24.7 million, which was previously recorded within the RFG reporting unit, is now within Prepared and the goodwill previously reported as part of the Fresh segment remained unchanged in the amount of $4.0 million and is part of the Grown segment. Prior to the change in its reporting unit, the Company tested goodwill for impairment at the previous reporting unit, which did not result in any impairment charge. Goodwill impairment testing requires significant judgment and management estimates, including, but not limited to, the determination of (i) the number of reporting units, (ii) the goodwill and other assets and liabilities to be allocated to the reporting units and (iii) the fair values of the reporting units which includes forecasted cash flow. The fair value of the Company’s reporting

units is determined using a combination of valuation techniques, including a discounted cash flow methodology. To corroborate the discounted cash flow analysis, a market approach is utilized using observable market data such as comparable companies in similar lines of business that are publicly traded. 

​

These two business segments are presented based on how information is used by our Chief Executive Officer (our Chief Operating Decision Maker) to measure performance and allocate resources. Selling, general and administrative expenses, as well as other non-operating income/expense items, are evaluated by our Chief Executive Officer in the aggregate. We do not allocate assets, or specifically identify them, to our operating segments. Prior year information has been recast to conform with the new segment disclosures. The sales data in the following tables is presented in thousands:

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Three months ended July 31, 2022

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Three months ended July 31, 2021

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​

    

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​

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​

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Grown

​

Prepared

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Total

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Grown

​

Prepared

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Total

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​

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​

​

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​

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Avocados

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$

196,443

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$

—

​

$

196,443

​

$

148,757

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$

—

​

$

148,757

​

Tomatoes

​

 

8,990

​

 

—

​

 

8,990

​

 

11,344

​

 

—

​

 

11,344

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Papayas

​

 

2,679

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—

​

 

2,679

​

 

2,683

​

 

—

​

 

2,683

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Other fresh income

​

 

54

​

 

—

​

 

54

​

 

95

​

 

—

​

 

95

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Fresh-cut fruit

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​

—

​

​

59,159

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​

59,159

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​

—

​

​

58,703

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​

58,703

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Fresh-cut vegetables

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​

—

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​

27,299

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​

27,299

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—

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​

23,226

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​

23,226

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Prepared products

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—

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31,083

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31,083

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—

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25,917

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25,917

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Guacamole

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​

—

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19,606

​

 

19,606

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—

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21,096

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21,096

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Salsa

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—

​

 

524

​

 

524

​

 

—

​

 

746

​

 

746

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Total gross sales

​

 

208,166

​

 

137,671

​

 

345,837

​

 

162,879

​

 

129,688

​

 

292,567

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Less sales allowances

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(577)

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(2,799)

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(3,376)

​

 

(1,299)

​

 

(5,588)

​

 

(6,887)

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Less inter-company eliminations

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​

(470)

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​

—

​

​

(470)

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​

(672)

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​

—

​

​

(672)

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Net sales

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$

207,119

​

$

134,872

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$

341,991

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$

160,908

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$

124,100

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$

285,008

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​

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​

​

​

​

​

​

​

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​

​

​

​

​

​

​

​

​

​

​

Nine months ended July 31, 2022

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Nine months ended July 31, 2021

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Grown

​

Prepared

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Total

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Grown

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Prepared

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Total

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Avocados

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$

538,882

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$

—

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$

538,882

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$

398,887

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$

—

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$

398,887

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Tomatoes

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36,331

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—

​

 

36,331

​

 

33,963

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—

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33,963

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Papayas

​

 

8,462

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—

​

 

8,462

​

 

8,081

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—

​

 

8,081

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Other fresh income

​

 

87

​

 

—

​

 

87

​

 

548

​

 

—

​

 

548

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Fresh-cut fruit

​

​

—

​

​

151,361

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​

151,361

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​

—

​

​

149,652

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​

149,652

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Fresh-cut vegetables

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—

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82,162

​

 

82,162

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—

​

 

78,030

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78,030

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Prepared products

​

​

—

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​

83,281

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​

83,281

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​

—

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​

68,425

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​

68,425

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Guacamole

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​

—

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​

56,976

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​

56,976

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​

—

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​

56,557

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​

56,557

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Salsa

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—

​

 

1,349

​

 

1,349

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—

​

 

2,154

​

 

2,154

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Total gross sales

​

 

583,762

​

 

375,129

​

 

958,891

​

 

441,479

​

 

354,818

​

 

796,297

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Less sales allowances

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(2,591)

​

 

(7,240)

​

 

(9,831)

​

 

(2,754)

​

 

(9,221)

​

 

(11,975)

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Less inter-company eliminations

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​

(1,559)

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​

—

​

​

(1,559)

​

​

(1,915)

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​

—

​

​

(1,915)

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Net sales

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$

579,612

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$

367,889

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$

947,501

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$

436,810

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$

345,597

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$

782,407

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​

​

​

​

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​

​

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​

​

​

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Interco.

    

​

​

​

​

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Grown

​

Prepared

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Elimins.

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Total

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(All amounts are presented in thousands)

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Three months ended July 31, 2022

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​

​

​

​

​

​

​

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Net sales

​

$

207,589

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$

134,872

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$

(470)

​

$

341,991

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Cost of sales

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​

195,818

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​

128,129

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​

(470)

​

​

323,477

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Gross profit

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$

11,771

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$

6,743

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$

—

​

$

18,514

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​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three months ended July 31, 2021

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​

​

​

​

​

​

​

​

​

​

​

​

Net sales

​

$

161,580

​

$

124,100

​

$

(672)

​

$

285,008

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Cost of sales

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​

149,378

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​

128,435

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​

(672)

​

​

277,141

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Gross profit

​

$

12,202

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$

(4,335)

​

$

—

​

$

7,867

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Interco.

    

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Grown

​

Prepared

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Elimins.

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Total

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(All amounts are presented in thousands)

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Nine months ended July 31, 2022

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Net sales

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$

581,171

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$

367,889

​

$

(1,559)

​

$

947,501

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Cost of sales

​

​

539,577

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​

355,999

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​

(1,559)

​

​

894,017

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Gross profit

​

$

41,594

​

$

11,890

​

$

—

​

$

53,484

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​

​

​

​

​

​

​

​

​

​

​

​

​

​

Nine months ended July 31, 2021

​

​

​

​

​

​

​

​

​

​

​

​

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Net sales

​

$

438,725

​

$

345,597

​

$

(1,915)

​

$

782,407

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Cost of sales

​

​

398,370

​

​

337,646

​

​

(1,915)

​

​

734,101

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Gross profit

​

$

40,355

​

$

7,951

​

$

—

​

$

48,306

​

​

For the three months ended July 31, 2022 and 2021, intercompany sales and cost of sales of $0.5 million and $0.7 million between Grown products and Prepared products were eliminated. For the nine months ended July 31, 2022 and 2021, intercompany sales and cost of sales of $1.6 million and $1.9 million between Grown products and Prepared products were eliminated.

​

Sales to customers outside the U.S. were approximately $6.1 million, and $8.8 million for the three months ended July 31, 2022 and 2021. Sales to customers outside the U.S. were approximately $21.5 million, and $25.7 million for the nine months ended July 31, 2022 and 2021.

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Our foreign operations in Mexico are subject to exchange rate fluctuations and foreign currency transaction costs. The functional currency of our foreign subsidiaries in Mexico is the United States dollar (U.S. dollar). As a result, monetary assets and liabilities are translated into U.S. dollars at exchange rates as of the balance sheet date and non-monetary assets, liabilities and equity are translated at historical rates. Sales and expenses are translated using a weighted-average exchange rate for the period. Gains and losses resulting from those remeasurements and foreign currency transactions are recognized within cost of sales. We recognized foreign currency remeasurement losses in the current quarter. These losses were due primarily to certain long-term net peso receivables. Foreign currency remeasurement losses, net of gains, for the three months ended July 31, 2022 was $0.4 million. Foreign currency remeasurement gains, net of losses, for the three months ended July 31, 2021 was $0.6 million. Foreign currency remeasurement losses, net of gains, for the nine months ended July 31, 2022 was $1.3 million. Foreign currency remeasurement gains, net of losses, for the nine months ended July 31, 2021 was $1.2 million.

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The net carrying value of long-lived assets attributed to geographic areas as of July 31, 2022 and October 31, 2021, are as follows (in thousands):

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United States

    

Mexico

    

Consolidated

July 31, 2022

​

$

78,087

​

$

36,394

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$

114,481

October 31, 2021

​

$

81,059

​

$

37,221

​

$

118,280

​