Chiquita Brands International, the Cincinnati-based fresh produce group, has reported second-quarter net income of US$23m, or $0.54 per diluted share, down from $64m, or $1.36 per diluted share, in the corresponding quarter last year.
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The company attributed the drop to falling banana prices and a new banana import regime in Europe.
“The new banana import regime has presented us with challenges in Europe this year, particularly when compared to the pricing we achieved in that market in 2005,” said Chiquita’s chairman and chief executive officer Fernando Aguirre. “However, we continue to sustain our premium versus the competition as we attempt to pass through higher tariffs and industry-related cost increases.”
Net sales rose by 21% to $1.2bn, with the increase primarily attributed to the acquisition of Fresh Express and higher banana pricing in North America. However, these positive factors had been partly offset by lower banana pricing in Europe and lower banana volumes in both Europe and North America, the company said.
Operating income fell from $75m to $45m. The company said that the regulatory changes in Europe, which have resulted in lower local pricing and increased tariffs, and higher fuel and other industry costs more than offset higher North American banana pricing and profit improvements in retail value-added salads.
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By GlobalData
