Fresh Del Monte's sales and net income rise in Q3 - FreshFruitPortal.com

Fresh Del Monte's sales and net income rise in Q3

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Fresh Del Monte's sales and net income rise in Q3

Fresh Del Monte has reported a "strong" third financial quarter that saw increases to net sales and net income

In the three-month period ended Sept. 30, net sales rose by 5% year-on year to $1.05 billion, while net income jumped from $1.3 million to $33.3 million.

"We delivered solid performance across our business generating strong net sales and profitability despite continued macroeconomic headwinds," said Mohammad Abu-Ghazaleh, Chairman and CEO.

"We continue to make investments to grow our business focused on technology, product innovation, and diversification, including new higher-margin product offerings in the ready-to-eat and convenience category and an investment in blockchain-driven traceability technology."

Abu-Ghazaleh added: "Our team’s efforts enabled us to thrive this quarter in the face of wide-range challenges, including persistent inflation, geopolitical risks, and volatility in the fuel market.

"I remain confident in our growth path grounded on profitable sales, disciplined expense management, digital transformation, and sustainability — all while remaining true to our core mission of high-quality fresh and fresh-cut fruit and vegetables.”

Net sales primarily benefited from inflation-justified price increases. The increase in net sales was partially offset by the negative impact of fluctuations in exchange rates, primarily versus the euro, Japanese yen, Korean won and British pound compared with the prior-year period.

The negative impact of fluctuations in exchange rates was partially mitigated by the company's foreign currency hedges.

Gross profit for the third quarter of 2022 was $88.0 million compared with $48.9 million in the prior-year period driven by increases across all our segments. The increase in gross profit primarily relates to higher consolidated net sales and product mix in our fresh and value-added products segment.

The increase was partially offset by higher per unit production and distribution costs, including packaging material, fertilizer, ocean and inland freight, fuel and labor.

Operating income for the third quarter of 2022 was $51.0 million compared with $1.3 million in the prior-year period. The increase was primarily due to higher gross profit, a $9.9 million one-time benefit related to a reduction in a North America environmental reserve and lower advertising expenses. 

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