(Nov. 9, PACKER WEB EXCLUSIVE) Chiquita’s net sales increased 3% to $1.1 billion in the third quarter, and senior vice president and chief financial officer Jeffrey Zalla said he expected the company to experience continued improvement during the fourth quarter due to higher banana prices and favorable exchange rates.

Cincinnati-based Chiquita Brands International Inc. reported during a Nov. 8 conference call that its banana sales increased 3% to $458 million in the third quarter. Operating income was $4 million, compared to a loss of $32 million in the year ago period.

The company reported a net loss of $28 million for the quarter, including a $4 million charge related to downsizing its Chilean operations.

The $28 million loss compared to a $96 million loss in the same period a year ago.

During the call, chairman and chief executive officer Fernando Aguirre called the results a “modest improvement.”

Chiquita reported a 7% increase and $314 million in net sales in its salads and healthy snacks division. Operating income was $13 million, up from $2 million in the third quarter of 2006.

Zalla said he was pleased by a rebound in the bagged salad business, which had been slow to recover from last year’s E. coli outbreak.

Sales for Salinas-Calif.-based Chiquita subsidiary Fresh Express increased 5% during the quarter, and Zalla said he was optimistic that sales will continue to increase following the company’s recent acquisition of Verdelli Farms Inc., Harrisburg, Pa.

In its other produce segment, Chiquita reported a 2% decrease in sales to $289 million. Operating loss was $14 million, compared to $33 million a year ago.

Chiquita announced Oct. 29 that it plans to discontinue the line of fruit bowls it introduced in 2003 and instead will focus its fresh-cut efforts on value-added salads and snack packs.

The move is part of a restructuring Aguirre said will save the company $60 million to $80 million in 2008.

Fresh-cut plants in Edgington, Ill., and Salinas, Calif., will be converted from fruit bowl production to snack pack and bagged salad production in the next few months.

Chiquita, which will eliminate about 400 hourly workers, plans to close its bagged salad production facility in Carrollton, Ga., and a distribution facility in Greencastle, Pa.

Chiquita also plans to close its banana distribution facility in Bradenton, Fla., and plans to shift volume from that facility to its distribution facility in Port Everglades, Fla.

During the conference call, Zalla reiterated that Chiquita plans to sell Bremen, Germany-based produce distributor Atlanta AG. That subsidiary has more than $1 billion in annual revenues, primarily in Germany and Austria.

The company, which emerged from Chapter 11 bankruptcy in March 2002, reported that it had reduced its debt by $40 million in the quarter to $857 million as of Sept. 30.

The company plans to eliminate more than 700 jobs by mid-January, including about 160 management positions.