US fresh produce company Fresh Del Monte Produce has announced that it is lowering its earnings estimates for 2004.
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The company attributed the revision to lower-than-expected performance due to weak banana pricing, lower melon profitability in the US, high fruit cost in Costa Rica due to difficult growing conditions, the recent hurricanes in Florida affecting tomato crops, and high bunker fuel, transportation and other commodity costs.
For the full year 2004, Fresh Del Monte Produce now expects to achieve earnings per share in the range of US$2.05 to $2.15 versus earlier estimates of $2.55 to $2.65 per share.
“While we anticipated somewhat softer banana pricing in 2004, pricing has been weaker than expected. Our guidance for the balance of 2004 assumes that banana pricing will continue to be challenging, and commodity costs will remain high,” said chairman and CEO Mohammad Abu-Ghazaleh.
“While our results continue to be strong in our fresh-cut and pineapple businesses, we have not generated the margins we expected in our other businesses. We also continue to be affected by rising fuel and containerboard prices, pricing volatility in our banana markets, and unfavourable climate conditions,” he added.
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