Fresh Del Monte Produce Inc. reported gains in pineapple, melon and avocado sales for the quarter ending March 29.
Net sales for the first quarter of 2024 were $1.1 billion, off slightly compared with $1.13 billion a year ago. The decrease was a result of lower banana net sales — driven by lower volume and pricing — and lower net sales in the other products and services segment, according to a news release.
However, net sales for the fresh and value-added products division for the first quarter of 2024 were $676.8 million, up 5% compared with $643.4 million for the same quarter a year ago.
The increase was primarily due to higher sales volume of pineapples, melons, and prepared food products and higher per unit selling prices of avocados, the release said. Those gains were partially offset by lower net sales of fresh-cut fruit due to lower sales volumes.
Banana sales for the quarter were $379.5 million, down 11% compared with $425.1 million a year ago. The decline was mostly driven by 5% lower volume due partially to service level issues in the first two months of the year and lower selling prices due to competitive market pressures in North America and Europe, the release said.
Gross profit for the first quarter of 2024 was $82.3 million, down 15% compared with $97 million in the prior-year period. Gross profit was impacted by lower overall net sales, higher production and procurement costs, and the negative impact of fluctuations in exchange rates partially offset by lower ocean freight and distribution costs, according to the release.
“We are pleased with the ongoing momentum in our higher-margin fresh and value-added segment, Mohammad Abu-Ghazaleh, Fresh Del Monte’s chairman and CEO, said in the release. “During the first quarter of 2024, this prioritized area of our business delivered 5% revenue growth driven by our strategic initiatives around distribution, pricing, and premiumization. While service level issues and competitive market pressures in North America and Europe reduced our banana revenue, we continued to generate very strong cash flow, which fuels our growth strategy tied to innovation around fresh-cut and pineapples.”
Fresh Del Monte enhanced its pineapple program with the release of two new products this quarter, Abu-Ghazaleh said.
“Furthermore, our leadership team remains focused on operational excellence, cost discipline, and strategic capital allocation to further improve profitability across all areas of our business,” he said. “With our diverse product portfolio, strong brand recognition and unwavering commitment to innovation, we believe we are well-positioned to generate sustainable value for our shareholders.”
