Fruit and vegetable producer and processor Fresh Del Monte Produce Inc. has blamed higher commodity costs and adverse weather for a fall in profits.
Net income for the 2004 fourth quarter was $19.1 million, compared with $22.8 million, or $0.40 per diluted share, in the fourth quarter of 2003, the company said. Fresh Del Monte’s annual net income was $139.2 million, compared with $226.4 million in 2003. “The decrease in net income was principally due to higher commodity costs, and adverse weather conditions,” it said.
Net sales for the fourth quarter of were $818.2 million, compared with $578.7 million for the same period in 2003. “The 41% sales increase was due to the inclusion of Del Monte Foods Europe sales of $89 million, higher sales and volumes of tomatoes, gold pineapple, fresh-cut produce and non-tropical fruit, as well as strong banana pricing,” the company said. Net sales for the year rose to $2.9 billion from $2.5 billion in 2003. “The improvement in net sales was attributed to stronger demand for fresh-cut produce, higher volumes in our non-tropical fruit and tomato product lines and the acquisition of Del Monte Foods Europe” it said.
“We faced several challenges throughout the year, including higher costs for purchased fruit and vegetables, fuel, petroleum based products, packaging, and fertilizer,” said Mohammad Abu-Ghazaleh, chairman and chief executive officer.