(Jan. 29) Chiquita Brands International Inc. reported bagged salad sales increased 10% during the fourth quarter of 2007 for its Salinas, Calif.-based subsidiary Fresh Express LLC.
Cincinnati-based Chiquita also reported net revenue per case increased 1% compared to the year-ago period for Fresh Express, which finalized the acquisition of Verdelli Farms Inc., Harrisburg, Pa., in October.
A Chiquita spokesman could not be reached for comment, but the company said in a news release that the 10% increase “reflected strong recovery in the value-added salads category in the first full quarter following the one-year anniversary of the E. coli outbreak” that was linked to fresh spinach.
The company, which released its preliminary fourth-quarter and year-end results Jan. 28, said it expects recovery to continue at a moderate pace in future quarters.
Chiquita said its overall fourth-quarter sales increased 6% to $1.2 billion, while sales for the year increased 4% to $4.7 billion.
In its banana business, Chiquita reported that North American prices were 7% higher than in the fourth quarter of 2006 because of increased base contract prices and fuel surcharges. Volume increased 1% compared to the year-ago period.
In Europe, prices were 5% higher based on local currency or 18% higher based on the U.S. dollar. Volume was 7% lower than a year ago as Chiquita intentionally limited supply after being negatively affected by oversupply in the fourth quarter of 2006. Prices were 6% higher in Asia, while volume decreased 9%.
Chairman and chief executive officer Fernando Aguirre said in the news release that a restructuring initiative announced by Chiquita in October is expected to save the company $60 million to $80 million this year. The company plans to eliminate more than 400 U.S. employees and 160 worldwide management positions as part of the cost-cutting plan.
Because of the restructuring plan and contract and market price increases, the company reported it expects increases in sales and operating income this year. However, Chiquita also noted increases in costs of product, ocean shipping, production and other areas could exceed $120 million.
Chiquita, which plans to announce its full quarterly and year-end results Feb. 19, also reported in the news release that it is reviewing its capital structure and might refinance its debt. The company owed $814 million at the end of 2007, down from more than $1 billion at the end of 2006.