Fresh Del Monte's income halves in Q1

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Fresh Del Monte's income halves in Q1

U.S.-based multinational Fresh Del Monte Produce (NYSE: FDP) has reported that factors including high costs, a weak banana market and a poor Chilean season let to a significant reduction in income for the first quarter of 2017. 

Net income dropped from US$81.7 million in the same period last year to US$46.4 million, while gross profit slipped from US$140.7 million to US$99.1 million.

The entity largely attributed this result to "higher fruit costs in the Company's other fresh produce business segment, lower selling prices in the banana business segment and unfavorable exchange rates, partially offset by higher sales volume."

Net sales increased by one percentage point to US$1,018 million, thanks to higher sales in the company's 'other fresh produce' and prepared food business segments, partially offset by lower sales in the banana segment.

Despite the year-on-year reduction in income and profit, chairman and CEO Mohammad Abu-Ghazaleh stuck an optimistic note.

“We are very pleased with the progress we made in the first quarter, achieving key objectives that will enhance our diversified business platform,” he said in a statement.

“During the quarter, we also introduced new products, added customers in our global fresh-cut business, and increased market share in our avocado product line. We faced a number of headwinds during the quarter, including a weak banana market, lower pineapple volume, and a poor Chilean season that constrained our performance.

"As we move forward, we remain optimistic that investing in our diverse global operations, implementing product innovations, and continuing to instill cost-savings and efficiencies in all of our businesses, will deliver long-term value to our shareholders.”


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