Group reports on increase in net sales during second quarter but sees income fall
Fresh Del Monte has said that it recorded a “strong” set of second-quarter (Q2) results despite facing what it described as “unprecedented cost pressures”.
Net sales for the quarter ended 1 July came in at US$1.21bn, higher than the US$1.14bn recorded in the same period of 2021.
The group said that sales benefited from inflation-justified price increases, although they were also impacted by the negative impact of fluctuations in exchange rates.
Gross profit was US$80.7m compared with US$110m in the prior-year period, hurt by ”multilayered cost pressures” including packaging materials, fertilisers, ocean and inland freight, fuel and labour.
Net income attributable to Fresh Del Monte was US$21.2m compared with US$47.2m last year, while adjusted net income stood at US$20.7m compared with US$46.8m.
Adjusted EBITDA for the second quarter was US$55.7m compared with US$83.6m in Q2 2021.
“We delivered strong net sales during the second quarter, marking the fifth consecutive quarter of net sales growth compared with the prior-year periods – demonstrating the resilience of our iconic brand,” said Mohammad Abu-Ghazaleh, chairman and CEO.
”Our net sales increased by US$70m, resulting from necessary pricing actions generating growth across most product categories.
“We continue to operate in one of the most volatile and uncertain macroeconomic environments in recent history,” he continued. ”As a result, the cost of product sold increased by US$100m, driven by broad-based inflationary, supply chain, and logistical headwinds.
”Despite these headwinds, we generated positive earnings – all while maintaining our debt balance in line with last year, generating strong cash flow from operations and continuing our dividend payout.
“As we move forward, I am confident in our team’s dedication to drive profitable sales,” Abu-Ghazaleh added. ”We plan to do that by focusing on our sustainable growth strategy and delivering against its key elements – organic expansion, product innovation, investments in technology, best-in-class customer relationships and sustainability.”