Chiquita Brands International, Inc. (NYSE: CQB) yesterday reported first quarter net income of $4 million ($.01 per share), compared to earnings of $35 million ($.43 per share) in the first quarter of 2000. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the first quarter of 2001 was $61 million compared to $92 million in the first quarter of 2000.
The Company’s results declined primarily as a result of a stronger dollar in relation to major European currencies. The effect of lower banana pricing in North America and Japan was partially offset by improved pricing in Europe on a local currency basis. Operating results for the Processed Foods business declined from the prior year primarily as a result of lower pricing for canned vegetables.
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Net sales for the first quarter of 2001, excluding the effects of prior year divestitures, decreased approximately 4% from the 2000 first quarter primarily as a result of the stronger dollar.
On April 11, 2001, the United States and European Commission announced an agreement regarding the long-standing dispute over the European Union (“EU”) banana import regime. The agreement is expected to result in partial recovery in future periods of the EU market opportunities previously available to Chiquita and Latin American producing nations. Subject to establishment of definitive regulations for this new regime, the agreement is a positive development for Chiquita and Latin American banana interests. However, the Company still intends to proceed with the previously announced parent company debt restructuring. This restructuring initiative is necessitated by the cumulative effect on Chiquita of the EU’s discriminatory banana import regimes over the past eight years, as well as the accelerated weakening of European currencies in recent years.
Chiquita is a leading international marketer, producer and distributor of quality fresh fruits and vegetables and processed foods.
This press release contains certain statements that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of assumptions, risks and uncertainties, including the implementation of the announced U.S. – EU agreement regarding the EU’s banana import regime, the Company’s ability to reach agreement with holders of the parent company debt regarding a restructuring of such debt, the terms of any such restructuring, prices at which Chiquita can sell its products, the costs at which it can purchase or grow (and availability of) fresh produce and other raw materials, currency exchange rate fluctuations, natural disasters and unusual weather conditions, operating efficiencies, labor relations, actions of governmental bodies, and other market and competitive conditions, many of which are beyond the control of Chiquita. Actual results or developments may differ materially from the expectations expressed or implied in the forward-looking statements, and the Company undertakes no obligation to update any such statements.
CHIQUITA BRANDS INTERNATIONAL, INC. PRELIMINARY
CONSOLIDATED INCOME STATEMENT
FOR THE QUARTER ENDED MARCH 31, 2001 AND 2000
(In millions, except per share amounts)
Quarter Ended
March 31,
2001 2000
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By GlobalDataNet sales $577.3 $658.1
Operating expenses:
Cost of sales 462.4 498.0
Selling, general and administrative 56.9 69.7
Depreciation 20.8 22.6
Total 540.1 590.3
Operating income 37.2 67.8
Interest income 3.0 3.1
Interest expense (32.7) (32.0)
Other income, net 0.1 0.1
Income before income taxes 7.6 39.0
Income taxes (3.5) (4.0)
Net income $4.1 $35.0
Diluted earnings per share $0.01 $0.43
Shares used to calculate diluted
earnings per share 68.8 81.9
EBITDA* $60.7 $92.1
Quarterly results are subject to significant seasonal variations and are not necessarily indicative of the results of operations for a full fiscal year.
* EBITDA for the 2001 first quarter excludes $1.1 million of costs
incurred in connection with the proposed parent company debt
restructuring.
