CORAL GABLES, Fla.- Fresh Del Monte Produce Inc. (NYSE: FDP), ('Fresh Del Monte' or the 'Company') today reported financial results for the second quarter ended June 26, 2020. The Company reported net income per diluted share of $0.38 for the second quarter of 2020, compared with net income per diluted share of $0.78 in the second quarter of 2019. Adjusted net income per diluted share was $0.54 in the second quarter of 2020, compared with adjusted net income per diluted share of $0.72 in the second quarter of 2019.

The Company's Board of Directors declared an interim cash dividend of five cents ($0.05) per share, payable on September 4, 2020 to shareholders of record on August 12, 2020.

'As a result of significant global disruptions, including lockdowns, closures and quarantines due to the COVID-19 pandemic, Fresh Del Monte Produce went through an unprecedented, turbulent period during the quarter,' said Mohammad Abu-Ghazaleh, Chairman and Chief Executive Officer. 'Even with these challenges and the nature of our perishable business, we remained focused on protecting the health and safety of our global team members, and we maintained our business continuity. Our liquidity and ability to generate positive cash-flows remained strong during the quarter. Our transformation is expected to continue in the quarters ahead as we look to improve our asset utilization around the globe, create efficiencies in our operations and position our Company to deliver stronger long-term performance.'

Net sales for the second quarter of 2020 were $1,092.3 million, compared with $1,239.4 million in the second quarter of 2019. The decrease in net sales of $147.1 million was attributable to lower net sales in all of the Company's business segments. The COVID-19 pandemic impacted net sales during the second quarter by an estimated $132.0 million, in its fresh and value-added products and banana segments, as compared to the Company's original expectations for these segments which were developed prior to the pandemic.

Gross profit for the second quarter of 2020 was $78.7 million, compared with $97.6 million in the second quarter of 2019. Adjusted gross profit in the second quarter of 2020 was $89.3 million, compared with $98.2 million in the second quarter of 2019. The decrease in gross profit was principally due to lower gross profit in the Company's fresh and value-added products segment, partially offset by higher gross profit in the Company's banana segment. Gross profit was also impacted by incremental costs, mainly related to other product-related charges of $10.6 million, primarily as a result of reduced demand in the Company's foodservice business and shifting demand at retail, as a result of government imposed mandatory restrictions and social distancing initiatives associated with the COVID-19 pandemic, and volatile supply and demand conditions, along with higher ocean freight costs, partially offset by lower production and procurement costs.

Operating income for the second quarter of 2020 was $33.1 million, compared with operating income of $57.2 million in the second quarter of 2019. Adjusted operating income was $43.7 million in the second quarter of 2020, compared with adjusted operating income of $52.9 million in the second quarter of 2019. The decrease in operating income was due to lower gross profit, lower gains on disposal of property, plant and equipment, net, and higher asset impairment and other charges (credits), net.

Net income attributable to Fresh Del Monte Produce Inc. for the second quarter of 2020 was $17.9 million, compared with net income attributable to Fresh Del Monte Produce Inc. of $38.1 million in the second quarter of 2019. Adjusted net income was $25.7 million in the second quarter of 2020, compared with adjusted net income of $35.0 million in the second quarter of 2019. The decrease was primarily the result of lower operating income and the decrease in other (expense) income net, partially offset by lower provision for income taxes.

More disclosures related to the COVID-19 pandemic are available in the Company's Securities and Exchange Commission filings.

Fresh Del Monte Produce Inc. and Subsidiaries

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(1)

Other product-related charges for the quarter and six months ended June 26, 2020 primarily related to inventory write-offs resulting from lower demand for certain of the Company's products due to the COVID-19 pandemic. The COVID-19 pandemic led to volatile supply and demand conditions across the Company's key global markets in the six months ended June 26, 2020 which negatively affected the pricing and demand for its products, including higher price point products such as pineapples, avocados and fresh-cut fruit and vegetables. The inventory write-offs are also related to reduced demand in the Company's foodservice distribution channel and shifting demand at retail as the result of government imposed mandatory closures and social distancing initiatives. Other product-related charges for the six months ended June 26, 2020 also included $0.2 million of estimated trade receivable credit losses relating to the Company's foodservice customer base as a direct result of the COVID-19 pandemic. Other product-related charges for the quarter and six months ended June 28, 2019 related to inclement weather in Central America.

(2)

Asset impairment and other charges (credits), net for the six months ended June 26, 2020 primarily related to (1) a $6.0 million insurance recovery related to a voluntary recall of vegetable products which was announced in the fourth quarter of 2019, (2) a $2.0 million reserve relating to a potential liability arising from the Company's third-party shipping logistics operation, (3) $2.1 million in impairments of property, plant, and equipment associated with production facilities in North America and Europe, (4) $0.7 million in severance expense related to the reorganization of the North America sales and marketing function, and (5) $0.7 million in asset impairment charges associated with low-yielding banana plants in the Philippines. Asset impairment and other charges (credits), net for the six months ended June 28, 2019 related to impairments of an equity investment and underutilized assets in South America, and contract termination charges in the Philippines related to a previously announced restructuring.

(3)

Gain on disposal of property, plant and equipment, net for the quarter and six months ended June 26, 2020 primarily related to gains on the sale of surplus land in Chile and marine equipment. Gain on disposal of property, plant and equipment, net for the quarter and six months ended June 28, 2019 primarily related to gains on the sale of underutilized tomato assets in North America and vessels.

(4)

Gain on settlement of litigation for the six months ended June 28, 2019 was $16.7 million consisting of proceeds of $17.0 million, net of expenses of $0.3 million.

(5)

Tax effects are calculated in accordance with ASC 740, Income Taxes, using the same methodology as the GAAP provision of income taxes. Income tax effects of non-GAAP adjustments are calculated based on the applicable statutory tax rate for each jurisdiction in which such charges were incurred, except for those items which are non-taxable for which the tax provision (benefit) was calculated at 0%. Certain non-GAAP adjustments were subject to valuation allowances and therefore were calculated at 0%. The tax effects of all adjustments were not included in the prior presentation for the quarter and six months ended June 28, 2019. We reevaluated the presentation of non-GAAP adjusted net income and adjusted net income per share and made these changes to facilitate the evaluation of the Company's current operating performance and the comparability of the Company's current operating performance to past performance. Non-GAAP adjusted net income and adjusted net income per share have been recast for the quarter and six months ended June 28, 2019 to conform to the current presentation. The six months ended June 26, 2020 also included a $1.7 million tax benefit associated with the Coronavirus Aid, Relief, and Economic Security ('CARES') Act.

Conference Call and Webcast Data

Fresh Del Monte will host a conference call and simultaneous webcast at 10:00 a.m. Eastern Time today to discuss the second quarter 2020 financial results and to review the Company's progress and outlook. The webcast can be accessed on the Company's Investor Relations home page at www.freshdelmonte.com. The call will be available for re-broadcast on the Company's website approximately two hours after the conclusion of the call for a period of one year.

About Fresh Del Monte Produce Inc.

Fresh Del Monte is one of the world's leading vertically integrated producers, marketers and distributors of high-quality fresh and fresh-cut fruit and vegetables, as well as a leading producer and distributor of prepared food in Europe, Africa and the Middle East. Fresh Del Monte markets its products worldwide under the DEL MONTE brand (under license from Del Monte Foods, Inc.), a symbol of product innovation, quality, freshness and reliability for over 125 years. The Company also markets its products under the MANNTM brand and other related trademarks. Fresh Del Monte Produce Inc. is not affiliated with certain other Del Monte companies around the world, including Del Monte Foods, Inc., the U.S. subsidiary of Del Monte Pacific Limited, Del Monte Canada, or Del Monte Asia Pte. Ltd.

Forward-looking Information

This press release contains certain forward-looking statements regarding the intent, beliefs or current expectations of the Company or its officers with respect to the Company's plans and future performance, including the Company's expectations (i) that its transformation will continue in the quarters ahead and (ii) to improve its asset utilization around the globe, create efficiencies in its operations and position the Company to deliver stronger long-term performance. In this press release, these statements are preceded by, followed by or include the words 'believes', 'expects', 'anticipates' or similar expressions with respect to various matters. It is important to note that these forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Fresh Del Monte's actual plans and performance may differ materially from those in the forward-looking statements as a result of various factors, including (i) the impact of the COVID-19 outbreak on our business, suppliers, customers, consumers, employees, and communities, (ii) disruptions or inefficiencies in our operations or supply chain, including any impact of the COVID-19 outbreak, (iii) the duration and spread of the pandemic and related government restrictions and our ability to maintain the safety of our workforce, (iv) our ability to successfully execute our plan to stabilize our core business, diversify our business and transform our business to a value-added business, particularly in light of COVID-19, (v) the impact of governmental trade restrictions, including adverse governmental regulation that may impact our ability to access certain markets such as uncertainty surrounding the withdrawal of the United Kingdom from the European Union (often referred as Brexit), including spillover effects to other Eurozone countries, (vi) our anticipated cash needs in light of our liquidity and the impact of COVID-19 on our liquidity, (vii) the continued ability of our distributors and suppliers to have access to sufficient liquidity to fund their operations, (viii) trends and other factors affecting our financial condition or results of operations from period to period, including changes in product mix, consumer preferences or consumer demand for branded products such as ours; anticipated price and expense levels; the impact of crop disease, such as vascular diseases, one of which is known as Tropical Race 4, or TR4 (also known as Panama Disease), which can destroy banana crops and was recently discovered in Latin America banana plantations, severe weather conditions, such as flooding, or natural disasters, such as earthquakes, on crop quality and yields and on our ability to grow, procure or export our products; our ability to improve our existing quarantine policies and other prevention strategies, as well as find contingency plans, to protect our and our suppliers' banana crops from vascular diseases; disruptions or issues that impact our production facilities or complex logistics network; the impact of prices for petroleum-based products and packaging materials; and the availability of sufficient labor during peak growing and harvesting seasons, (ix) the impact of pricing and other actions by our competitors, particularly during periods of low consumer confidence and spending levels, (x) the impact of foreign currency fluctuations, (xi) our plans for expansion of our business (including through acquisitions) and cost savings, (xii) our ability to successfully integrate acquisitions into our operations, (xiii) the impact of impairment or other charges associated with exit activities, crop or facility damage or otherwise, (xiv) the timing and cost of resolution of pending and future legal and environmental proceedings or investigations, (xv) the impact of changes in tax accounting or tax laws (or interpretations thereof), and the impact of settlements of adjustments proposed by the Internal Revenue Service or other taxing authorities in connection with our tax audits, (xvi) the cost and other implications of changes in regulations applicable to our business, including potential legislative or regulatory initiatives in the United States or elsewhere directed at mitigating the effects of climate change, (xvii) damage to our reputation or brand names or negative publicity about our products, (xviii) exposure to product liability claims and associated regulatory and legal actions, product recalls, including the continuing impact of the 2019 Mann packing recall, or other legal proceedings relating to our business and (xix) our ability to successfully manage the risks associated with international operations. All forward-looking statements in this press release are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements. The Company's plans and performance may also be affected by the factors described in Item 1A. - 'Risk Factors' in Fresh Del Monte Produce Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 26, 2020 and its Annual Report on Form 10-K for the year ended December 27, 2019, along with other reports that the Company has on file with the Securities and Exchange Commission.

Christine Cannella

Vice President, Investor Relations

305-520-8433

Source: Fresh Del Monte Produce Inc.

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Investor Contact

Christine Cannella

Fresh Del Monte Produce Inc.

U.S. Executive Offices

241 Sevilla Avenue, 12th Floor

Coral Gables, FL 33134 Phone: 305-520-8433

Fax: 305-567-0320

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