A fall in costs pushed up half-year profits at Fresh Del Monte Produce despite the US company reporting lower sales.
Fresh Del Monte said today (31 July) its first-half net income was US$119.7m, up from $90.4m a year earlier.
The higher profits came despite a 7.9% in net sales to $1.86bn. Sales fell across Fresh Del Monte's business segments.
"The strength of our operations, logistics flexibility, prudent product supply management, and our expanded global customer base were key contributors to our performance," chairman and CEO Mohammad Abu-Ghazaleh. "We remain focused on the bottom line, long-term growth and our established cost savings program to increase shareholder value."
July 31, 2012 06:00 AM Eastern Daylight Time
Fresh Del Monte Produce Inc. Announces Second Quarter 2012 Financial Results
CORAL GABLES, Fla.--(BUSINESS WIRE)--Fresh Del Monte Produce Inc. (NYSE: FDP) today reported financial results for the quarter ended June 29, 2012. For the second quarter of 2012, the Company reported earnings per diluted share of $0.99, compared with earnings per diluted share of $0.59 in the second quarter of 2011. Excluding asset impairment and other charges, earnings per diluted share were $1.01 in the second quarter of 2012, compared with earnings per diluted share of $0.77 in the second quarter of 2011.
"We are extremely pleased with the strong earnings growth we achieved in the second quarter," said Mohammad Abu-Ghazaleh, Chairman and Chief Executive Officer. "Our performance reflected the momentum we have created through our strategic initiatives and our ability to navigate the challenging global economic environment over the past few years. The strength of our operations, logistics flexibility, prudent product supply management, and our expanded global customer base were key contributors to our performance. Moving forward, we remain focused on the bottom line, long-term growth and our established cost savings program to increase shareholder value.”
Net sales for the second quarter of 2012 were $957.6 million, compared with $1,039.7 million in the prior year period. The decrease in net sales for the quarter was the result of lower net sales across all of the Company's business segments, primarily due to lower banana sales volume in the Middle East secondary markets and in Europe, and lower sales volume in the Company's other fresh produce business.
Gross profit for the second quarter of 2012 was $116.4 million, compared with $102.9 million in the second quarter of 2011. The Company had gross profit of $103.7 million in the second quarter of 2011, excluding other charges of $0.8 million. The increase in gross profit for the quarter was primarily due to higher selling prices in the Company's other fresh produce business, operational improvements and lower ocean freight costs.
Operating income for the second quarter of 2012 was $69.8 million, compared with $44.9 million in the prior year period. Excluding asset impairment and other charges, the Company had operating income of $70.8 million in the second quarter of 2012, compared with operating income of $56.0 million in the second quarter of 2011. The increase in operating income for the quarter was primarily attributable to higher gross profit, lower asset impairment and other charges, and lower selling, general and administrative expenses.
Net income for the second quarter of 2012 was $57.2 million, compared with $35.2 million in the second quarter of 2011. Excluding asset impairment and other charges, the Company had net income of $58.2 million in the second quarter of 2012, compared with net income of $46.3 million in the second quarter of 2011.