Dole Food Company, Inc. (NYSE:DOL – news) Monday announced a $51 million settlement of the majority of its remaining insurance claims related to damages suffered from Hurricane Mitch in the fourth quarter of 1998. Proceeds will be received early in the third quarter and will result in a gain of approximately 70 cents per share for the quarter.
Additionally, the Company announced that it successfully completed the redemption of its $225 million notes that matured on July 15, 2000. The company also recently entered into a $250 million, 364-day bank credit facility led by Bank of America, which will provide the company with additional short-term liquidity to meet its financing needs. It is anticipated that funds drawn on this facility will be repaid from the above-mentioned insurance recoveries, proceeds from previously announced sales of non-core assets and businesses as well as ongoing cash flow from operations.
David H. Murdock, chairman and chief executive officer, stated: “Hurricane Mitch was a severe disaster that affected not only Dole and its stakeholders but the entire country of Honduras and, to a lesser extent, the countries of Guatemala and Nicaragua. The losses and disruption caused by Hurricane Mitch are now behind us, and I am pleased that the company was able to make a satisfactory settlement with its insurance carriers. The positive impact on our cash flow and the increase to our shareholders’ equity from these proceeds will contribute to the further strengthening of our financial position.”
Dole Food Company, Inc., with 1999 revenues of $5.1 billion, is the world’s largest producer and marketer of high-quality fresh fruit, fresh vegetables and fresh-cut flowers, and markets a growing line of packaged foods.
This release contains forward-looking statements that involve a number of risks and uncertainties. Forward looking statements, which are based on management’s current expectations, are generally identifiable by the use of terms such as “anticipates,” “will,” and similar expressions. The potential risks and uncertainties that could cause actual results to differ materially from those expressed or implied herein include 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 Securities and Exchange Commission filings, including its Annual Report on Form 10-K.