Dole Food Company, Inc. Monday reported second-quarter net income from ongoing operations improved 20% to $45 million, or 81 cents per share, as compared with $38 million, or 66 cents per share, for the second quarter of 1999. Cash flow from ongoing operations (EBITDA) in the second quarter of 2000 totaled $114 million compared with $95 million for the same quarter in 1999. Revenues totaled $1.3 billion for the second quarter of both years.

During the second quarter of 1999, the company also received $15 million of insurance proceeds, net of rehabilitation expenses, related to damage from Hurricane Mitch, which occurred during the fourth quarter of 1998. Including these net insurance proceeds, the company reported net income of $47 million, or 83 cents per share, for the second quarter of 1999. The company did not receive additional Hurricane Mitch-related insurance proceeds in the second quarter of 2000; consequently, the company’s reported net income was equivalent to net income from ongoing operations during that quarter.

Interest expense increased to $24 million for the second quarter of 2000 from $21 million for the second quarter of 1999 due to higher average debt levels.

Earnings have improved in the company’s banana business largely as a result of significant cost-cutting activities initiated in the second half of 1999. Banana earnings in the second quarter of 2000 would have shown further improvement without the impact of the Euro’s decline against the dollar. In the company’s North American vegetables business, higher earnings resulted from productivity improvements and strong pricing in the commodities business combined with continued volume and market share growth in the fresh-cut salads business. Additionally, the company’s North American citrus business contributed to improved earnings, as that business has recovered from a severe freeze in California, which had impacted 1999 results. Also, the success of the company’s FRUIT BOWLS® packaged fruit product in North America added to higher second-quarter earnings.

David H. Murdock, chairman and chief executive officer, stated: “I am pleased by the sustained improvements achieved by our businesses. Our fresh fruit, fresh vegetables and processed foods segments have again demonstrated double-digit earnings gains. During the second quarter these gains ranged from approximately 20% to 50%.”

Dole Food Company, with 1999 revenues of $5.1 billion, is the world’s largest producer and marketer of high-quality fresh fruit, vegetables and fresh-cut flowers, and markets a growing line of packaged foods.

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This release contains forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially from those expressed or implied herein include the following: weather-related phenomena; market responses to industry volume pressures; product and raw materials supplies and pricing; changes in interest and currency exchange rates; economic crises in developing countries; and quotas, tariffs and other governmental actions. Further information on the factors that could affect Dole’s financial results is included in its filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K.

Summary of Consolidated Operations

Quarter Ended Half Year Ended
———————- ———————-
June 17, June 19, June 17, June 19,
2000 1999 2000 1999
——— ——— ——— ———

(in 000’s, except
per-share amounts)

Revenue 1,300,970 1,316,556 2,457,195 2,504,991
Cost of
products sold 1,089,404 1,137,437 2,055,821 2,161,084
——— ——— ——— ———

Gross margin 211,566 179,119 401,374 343,907

Selling, marketing
and administrative
expenses 130,862 114,125 252,653 222,759
Hurricane Mitch
net insurance
proceeds — (14,839) — (26,515)
——— ——— ——— ———

income 80,704 79,833 148,721 147,663

Interest income 1,958 2,751 4,057 5,296
Other expense
– net (700) (662) (158) (1,051)
——— ——— ——— ———

Earnings before
and taxes 81,962 81,922 152,620 151,908

Interest expense 23,577 21,259 46,797 42,834
——— ——— ——— ———

Income before
income taxes 58,385 60,663 105,823 109,074

Income taxes 13,300 13,300 24,300 24,000
——— ——— ——— ———

Net income 45,085 47,363 81,523 85,074
========= ========= ========= =========

Net income per
common share
Basic $ 0.81 $ 0.83 $ 1.46 $ 1.48
Diluted 0.81 0.83 1.45 1.48

Diluted average
number of
common shares
outstanding 55,998 57,223 56,206 57,537
========= ========= ========= =========

Excluding Hurricane
Mitch net insurance

Operating income $ 64,994 $ 121,148
Earnings before
interest and taxes 67,083 125,393
Net income 37,524 67,659
Net income per
common share
– diluted $ 0.66 $ 1.18