Fresh Del Monte Produce Inc. reported a 13% earnings increase for the first-quarter compared to 2011 despite decreases in net sales and gross profit, including a 7% drop in net sales of bananas, the company’s biggest commodity.

Mohammad Abu-Ghazaleh, chief executive officer of the Coral Gables, Fla.-based company, discussed the first-quarter numbers during a conference call May 1. He said he is optimistic about the rest of 2012, partly because of strategies he declined to detail.

He stopped short of discussing specific expectations when asked about his hopes for the second quarter, citing unpredictable weather in growing regions as a major factor.

Fresh Del Monte execs optimistic despite declining sales“We’ll do our best,” Abu-Ghazaleh said. “But only God will know about the weather.”

Financial analysts on the conference call said they thought the company’s smaller provision for income taxes was a key factor in the 13% earnings increase in the first quarter. Neither Abu-Ghazaleh nor Richard Contreras, chief financial officer, challenged that assessment.

However, both executives pointed to a net sales increase of 17% in fresh-cut produce as a positive sign. Volumes of fresh-cut were up 10% year over year for the quarter. Prices were up 6% while unit costs went up 5%.

Bananas account for 44% of Del Monte’s net sales and 34% of gross profit — even though sales volumes were down in the Middle East and Asia and selling prices were low in North America, Abu-Ghazaleh said. The balance sheet showed banana net sales for the first quarter at $397.5 million, which is 7% less than in 2011.

The company reported its worldwide banana pricing decreased 20 cents, or 1%, to $15.08 per unit, compared with $15.28 per unit in the first quarter of 2011. Volume was 6% lower. Gross profit from bananas for the quarter was $38.8 million, compared with gross profit of $51.5 million in the first quarter of 2011. Unit costs were 1% higher than the prior year period.

Abu-Ghazaleh said the company’s “aggressive restructuring” of its melon and tomato programs was responsible for the overall net sales decline of 7% in its “other fresh produce” division, which does not include bananas.

Melon net sales were down 8% with a volume decrease of 24% and a unit cost increase of 10%. Pricing for melons was up 21%, though.

Tomato net sales plummeted 53% with a 30% volume decrease. Pricing was down 34% and unit cost was 31% lower.

The company also saw net sales declines in gold pineapple and non-tropicals of 3% and 8% respectively.