Chiquita Brands International has posted a larger loss for the fourth quarter of 2012, a result that president and chief executive Ed Lonergan said highlighted the challenges the group faced through the latter part of the year.
The US-based fresh produce multinational posted a loss of US$335m (€258m) for the three-month period, down from a loss of US$16m (€12.3m) at the same stage of 2011, including US$180m of impairment charges related to the goodwill and trademarks of its salad operations, US$130m of valuation allowances against US deferred income tax assets, and US$5m for restructuring and relocation charges.
For the full 12 months of 2012, Chiquita said that it slid to a loss of US$408m (€314m) from net income of US$57m (€44m) in 2011, with comparable operating income of US$7m.
'Chiquita has made significant progress implementing its refocused strategic direction in the second half of 2012, and is well positioned for future growth,' said Lonergan. 'Nevertheless, after adjusting for non-comparable items, both the fourth quarter and the full year reflect the challenges the company faced throughout the year and present difficult comparisons to prior periods due to the impact of euro exchange rates and lower retail salad results.
'However, we also have experienced higher local banana pricing in Europe as a result of a relatively balanced banana market and have benefited from savings associated with our value chain and corporate restructurings,' he noted.
Net sales in the banana segment came to US$2bn in 2012, a decrease of 2 per cent from the prior year primarily because of the product supply surcharge imposed in North America during the first six months of 2011 to recover higher sourcing costs.
Salads and Healthy Snacks, meanwhile, saw net sales remain consistent year-on-year at approximately US$953m, as foodservice and healthy snack sales offset lower sales of retail value-added salads.
'Chiquita has momentum as we start 2013,' Lonergan continued. 'We remain focused on our core businesses of bananas and salads, and recent successes in both areas will add profitable volume in the coming year.
'In addition, our value chain and overhead reduction initiatives are substantially complete and further opportunities exist,' he added. 'We are already seeing tangible benefits and remain confident in our ability to achieve our long-term target operating margins. As well, the recent refinancing provides us with financial flexibility and capability to focus fully on delivering against our refreshed strategic choices.'
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