Chiquita Brands International posted a 26% year-on-year drop in first-quarter profit yesterday (30 April) as a result of poor weather and a strong dollar.
The company reported income from continuing operations of US$23m versus income of $32m in the first quarter of 2008.
On a comparable basis, Chiquita reported income from continuing operations of $22m, down from $41m in 2008.
The decline was due to around $18m lower European exchange rates, as well as $17m in incremental banana sourcing and logistics costs resulting from flooding in Panama and Costa Rica in the fourth quarter of 2008.
Net sales also experienced a drop, decreasing by 10% year-on-year to $842m due to lower euro exchange rates, which principally affected European banana sales, as well as a reduction of foodservice and retail volumes in North American salad operations.
Net sales for the company’s banana segment dropped 8% to $485m, while the salads and healthy snacks segment sales decreased 16% to $281m.
“Our first quarter was strong, especially considering the challenges we faced from currency and temporary flood-related costs,” said Fernando Aguirre, chairman and CEO. “We now have a head start on the year, and we are confident in the execution of our profit-improvement and cost reduction initiatives and our plan to improve full-year 2009 results on a comparable basis.”
Aguirre said the company was on track to achieve a full-year target of 3-4% operating margins in salads in 2009.