Del Monte profits from higher banana prices

Source: Food and Drink Exec

Date :29/04/2008 04:15:46

Fresh Del Monte Produce Inc. posts strong first-quarter as higher banana prices more than offset weakness in its other product lines.

The fruit-and-vegetables producer said net income rose 23 percent to $63.6 million, or $1 a share, up from $51.6 million, or 89 cents a share, a year earlier.

Excluding an asset impairment charge and other items, net income was above analysts’ consensus forecast of $1.02 per share, rising to $1.07 per share from 84 cents per share.

Banana sales

Revenue rose about seven percent to $894.9 million, but came below the analysts' average estimate of $902.9 million, due to higher prices for bananas and solid sales of pineapple and non-tropical fruit.

Banana sales, which account for more than a third of Fresh Del Monte's total sales, rose 18 percent to $340.1 million.

Strength in its prepared food operations also boosted revenue, the company said.

High costs

Mohammad Abu-Ghazaleh, Fresh Del Monte’s Chairman and Chief Executive Officer said that the first quarter had shown that the company is able to deliver solid financial results even in a tough market.

He added that he was proud of the results and encouraged by the progress the company had made in managing the ‘exceptionally high’ costs affecting the business.

“In spite of these challenges, our business is growing steadily and demand for our products is growing around the globe.”

New CFO

The news follows the appointment of Richard Contreras as chief financial officer.

Mr. Contreras, who is currently serving as senior vice president of finance, will succeed John F. Inserra who will retire from the post, effective May 1.

April 29, 2008