CORAL GABLES, Fla. - Shares of Fresh Del Monte Produce Inc. (NYSE: FDP) fell 3.81% in premarket trading following the company's fourth-quarter earnings and revenue miss.
The produce distributor reported an adjusted EPS of $0.25, which was below the analyst consensus of $0.31. Revenue for the quarter was also lower than expected, coming in at $1.01 billion against the consensus estimate of $1.03 billion.
The company's fourth-quarter results were impacted by lower net sales in its banana and other products and services segments, partially offset by higher sales in the fresh and value-added product segment.
Gross profit for the quarter was $62.5 million compared to $81.7 million in the prior-year period, reflecting a decrease due to lower net sales and higher per unit production costs affected by exchange rate fluctuations.
For the full fiscal year 2023, Fresh Del Monte reported net sales of $4.32 billion, a decline from the previous year's $4.44 billion. However, the company saw an increase in gross profit to $350.7 million from $340.2 million in the prior year, driven by higher per unit selling prices and lower distribution costs.
Chairman and Chief Executive Officer Mohammad Abu-Ghazaleh commented on the company's ability to control costs and sell underutilized assets, which contributed to the highest full-year gross profit and margin since 2016. He also noted the strategic review of North American operations, including Mann Packing, and the exploration of strategic alternatives for this business.
Despite the earnings and revenue shortfall, Fresh Del Monte highlighted its strong gross margins and cash flow, which enabled the company to reduce long-term debt by $140 million, ending the year with an adjusted leverage ratio of 1.7x, and increase its quarterly dividend by 25% for the second consecutive year.
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