High banana prices boost Fresh Del Monte earnings

by Keith Nunes
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CORAL GABLES, FLA. — The Banana and Prepared Foods business units supported profitability for Fresh Del Monte Produce during fiscal year 2011, ended Dec. 30, 2011. Net income for the year was $94.8 million, equal to $1.57 per share on the common stock, up from $62.2 million, or $1.03 per share, in fiscal 2010.

Sales for the year increased 1%, reaching $3,589.7 million in 2011 versus $3,552.9 million during fiscal 2010.

“Despite higher fuel costs worldwide and continued weakness in the European economy that negatively impacted consumer demand for fresh produce, we delivered full-year 2011 results that were significantly higher than 2010,” said Mohammad Abu-Ghazaleh, chairman and chief executive officer. “Throughout the year, we expanded our presence in emerging markets, bolstered our distribution channels and added new product offerings. We believe with our strong balance sheet and these strategic initiatives we are well positioned to deliver attractive returns for Fresh Del Monte shareholders over the long term.”

Sales within the company’s Banana business unit increased 2% to $1.7 billion, which compared with $1.6 billion during the prior year. Gross profit within the category was $88.3 million, which compared with $31.4 million during the prior year. The company attributed the increased revenue and gross profit to higher selling prices in Asia and North America.

Prepared Foods sales declined 1% during fiscal 2011 to $355 million, but gross profit increased to $53.3 million, an increase compared with fiscal 2010 when the business unit earned $45.6 million.

During the fourth quarter of fiscal 2011, Fresh Del Monte Produce recorded a loss of $10.1 million. The loss was greater than fiscal 2010 when the company recorded a loss of $9.6 million during the quarter.
Sales for the period were $780.8 million, a decline compared with the previous year when revenues were $816.7 million.

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