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US fresh produce company Chiquita Brands International has posted lower quarterly earnings, but said its underlying business performance was strong despite difficult market conditions.

The company reported first-quarter net income of US$20m, or 46 cents per diluted share, compared to $25m, or 62 cents per diluted share, in the year-ago quarter.

Net sales for the quarter were $793m, up from $471m in the first quarter of 2003. Atlanta, a German fresh produce distributor acquired at the end of March 2003, accounted for $283m of the increase. The remainder resulted from favourable European exchange rates and increased other fresh produce sales, partially offset by lower local banana pricing.

Operating income from continuing operations in the first quarter of 2004 was $32m, compared to $38m in the year-ago period.

“We had a strong quarter,” said Fernando Aguirre, president and chief executive officer. “In spite of difficult market conditions, our underlying business performance was on par with the strong results posted in the year-ago period. We faced lower local pricing in North America and Europe, but we realised benefits from currency exchange and Atlanta’s restructuring. Moreover, pricing has improved since the end of the quarter.”