Del Monte Foods, the US food group, today (5 June) warned shareholders that earnings would fall during its next fiscal year but said it would “sharpen” plans to grow the business.
The company, which last month admitted it may sell its seafood business due to rising costs, said net income would be lower in fiscal 2009.
The group also forecast lower earnings per share, which it estimated would reach US$0.58-0.62 – compared to $0.66 in fiscal 2008.
However, chairman and CEO Richard Wolford said Del Monte would be “more aggressive, targeted and innovative” to meet rising costs and boost returns for shareholders.
Wolford said Del Monte would spend more money on its “high-margin” businesses, including packaged produce and pet food, and plough more cash into its brands.
Wolford said the moves, alongside the possible sale of the company’s seafood business and its plans to shift more marketing roles to its San Francisco headquarters, would take Del Monte “to the next level”.
Del Monte refused to give further details on its plans for packaged produce and brand portfolio. The company said it would expand more on its programme next month at an investor meeting.
The news came as Del Monte posted rising profits and sales for its fiscal 2008 period.
The company booked income from continuing operations of $133.3 million for the year to 27 April, compared to $113m a year earlier. Net sales were up 9.4% to $3.7bn.
Wolford said “solid volume growth, successful pricing and record new product sales” had driven the results.
