CORAL GABLES, FLA. — Improved banana market conditions benefited Fresh Del Monte Produce Inc. during the company’s third quarter. Net income attributable to Fresh Del Monte for the three-month period ended Sept. 26 was $19.9 million, equal to 36c per share on the common stock, up 211% from $6.4 million, or 11c per share, in the previous year’s third quarter, when an industry-wide oversupply of bananas pressured the produce company’s performance.
“Today we are seeing a more balanced supply-and-demand trend in global banana markets and, barring any unforeseen events, the trend should remain through the rest of 2014,” said Mohammad Abu-Ghazaleh, chairman and chief executive officer, during an Oct. 28 call with financial analysts to discuss third-quarter earnings.
Net sales for the quarter advanced 2.7% to $884.6 million from $861.1 million in the comparable period, driven by increased sales volume of bananas and pineapples in North America and higher worldwide banana selling prices.
In the company’s banana business segment, net sales increased 5% to $423.8 million, led a 3% increase in worldwide pricing and a 2% volume increase over the previous year’s third quarter.
In the other fresh produce business segment for the third quarter, net sales increased 1% to $371 million, as the result of higher sales volume in the company’s pineapple and tomato product lines, which was partially offset by lower sales volume in fresh-cut, melon and non-tropical product lines.
“We lead our industry in gold pineapple sales, and we expect to maintain this commanding lead due to our superior fruit quality combined with brand awareness and our sales and marketing expertise,” Mr. Abu-Ghazaleh said.
In the company’s prepared food segment, net sales decreased 3% to $89.8 million on lower sales volume in Fresh Del Monte’s canned deciduous product line and less demand for canned pineapple.“As we look to the end of the year, while we experienced better banana market conditions year-over-year, there are always challenges in our business,” Mr. Abu-Ghazaleh said. “We foresee the headwinds of a difficult economic market in Europe, an oversupply of fruit as a result of sanctions in the Ukraine and Russia, and logistical issues caused by the situation in the Middle East. We will continue to work hard in the knowledge that we are building value every day for our shareholders.”