Fresh Del Monte CEO looks back on 2012 challenges

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Fresh Del Monte CEO looks back on 2012 challenges

Fresh Del Monte CEO Mohammad Abu-Ghazaleh reflected on the global brand's 2012 financial success yesterday, despite an array of market challenges that made achieving growth less than easy.del_monte_logo_2443

He spoke confidently about the company's ability to keep ahead and protect gross profits under difficult conditions.

"We are probably the only fruit company that understands what fruit is about. That’s our mission; how to make money out of our business," he said in a company conference call.

He did acknowledge, however, that maintaining smooth operations has not always been easy.

"In many ways 2012 was a tough year. In Europe we contended with an intensely competitive market place, decreased demand for fresh produce and continued economic volatility. We experienced trade disruption upsetting markets in Asia and the Middle East and aggressive banana contract pricing by competitors in North America," he said.

Although core categories such as bananas and pineapples decreased in annual net sales, Abu-Ghazaleh said the company was proud of its successes in areas such as fresh cut produce.

"We are now becoming the leader in the Middle East, in Asia, ex-Soviet Union countries. Our core business is bananas, pineapples and fruits but we are moving toward added value. That’s why you see our business improving year after year," he said.

Abu-Ghazaleh attributed much of the category success to increased activity in new markets in North America, the Middle East, Europe and Asia.

"We extended our product line in non-traditional delivery channels such as club stores, convenience stores, food service operators, quick serve and casual dining outlets," he said.

The company is now considered the largest branded fresh cut supplier in the United States.

He said sales had been difficult in Asia though.

"What’s happening in the Asian market is that the markets themselves are a little bit weaker and secondly, there is over production in the Philippines in general. We will see two to three months, four months of a good, healthy market but I believe afterwards we will see a weakening again," he said.

On the European end, however, Abu-Ghazaleh congratulated the success of the brand.

"We are justifiably proud about our decision to take over the marketing, sales and distribution of Del Monte’s fresh produce in key markets in southern Europe. As a result of our decision, we delivered substantial profitability improvements during the year. Our fresh business in Europe will remain strong as we continue to grow our customer base," he said.

Overall, Abu-Ghazaleh praised the company's industry experience, innovation and financial discipline to achieve long-term goals.

Related story: U.S.: Del Monte income jumps 54.8% for 2012


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