Fresh Del Monte has reported on its result for the full-year of 2017, revealing a large fall in net income despite growth in sales for the 12-month period.
Net income attributable to Fresh Del Monte Produce for the year was US$120.8m, compared with net income of US$225.1m in 2016, a drop linked to lower gross profit and higher provision for income taxes.
Indeed, gross profit fell to US$331.6m from US$461.4m during the previous year, hit by lower selling prices in the company's banana and prepared food business segments and higher fruit and distribution costs in its other fresh produce business segment, partially offset by lower ocean freight costs.
Net sales for the year were US$4.08bn, compared with $4.01bn in 2016, an increase driven by higher sales in Del Monte's other fresh produce business segment.
In the banana segment, net sales fell to US$1.77bn from US$1.81bn in 2016, primarily due to lower selling prices and sales volume in the Middle East and Asia regions, while net sales in the other fresh produce segment climbed to just under US$2bn, compared with US$1.85bn in 2016.
“We were pleased with the momentum in diversifying our business in 2017,” said Mohammad Abu-Ghazaleh, chairman and chief executive officer, reacting to the results.
“Throughout the year, we continued to execute our strategic initiatives to leverage our infrastructure and keep pace with the rapidly evolving consumer needs," he explained. "We expanded our diverse product suite, led by our fresh-cut category that grew by 18 per cent. We extended our presence in global markets by increasing our sourcing capabilities and distribution channels around the world.
"Our diversification strategy is working, and the investments we have made across our business are in progress," Abu-Ghazaleh added. "We expect this momentum to continue as we seek opportunities, such as our pending acquisition of Mann Packing, that will further strengthen our company, drive profitability, and increase shareholder value over the long-term.”