Fresh produce firm Fresh Del Monte has reported net sales of $989.7 million in the third quarter of its financial year, down from $1.07 billion in the same period last year.
The company attributed this decline to lower net sales across all divisions due to the COVID-19 pandemic.
It estimated an impact of $73.0 million in net sales during the third quarter in its fresh and value-added products and banana business segments.
The overall gross profit for the period declined to $67.3 million from $76.2 million in the third quarter of 2019 due to lower gross profit in the company's banana and other products and services divisions.
However, it was partially offset by higher gross profit in the company's fresh and value-added products segment, the company added.
Gross profit in the division increased to $54.2 million from $53.3 million in the third quarter of 2019.
'Pleased To See An Improvement'
Chairman and chief executive of Fresh Del Monte, Mohammad Abu-Ghazaleh, said, “We were especially pleased to see an improvement in our fresh and value-added products business segment through rapid adjustments to all aspects of our business, from farm to customer to meet the challenges caused by the pandemic disruption, particularly to adapt to the restaurant and foodservice markets during the third quarter.”
The company’s operating income declined to $26.6 million from $27.1 million in the third quarter of 2019.
Net income attributable to Fresh Del Monte Produce Inc. for the quarter amounted to $17.4 million, down from $18.1 million in the same period last year.
The company saw an improvement in cash flow during the quarter and achieved a long-term debt reduction of $76.0 million since the end of 2019.
The company announced a quarterly cash dividend of $0.10 per share, payable on 4 December 2020 to shareholders of record on 11 November 2020. It paid a cash dividend of $0.05 per share in the previous quarter.
Abu-Ghazaleh, added, “Swift implementation of working capital measures led to improved cash flow and our ability to reduce our debt. As a result, we will double our dividends in the fourth quarter of 2020."
Asset Sales Programme
The company announced a $100 million asset sales programme after a comprehensive review of all aspects of the business during the quarter.
“We made the decision to sell non-strategic and under-utilised assets for a total anticipated cash amount of approximately $100 million, which we expect to achieve over the next 12 to 18 months,” Abu-Ghazaleh explained.
“These assets consist primarily of under-utilised facilities and land across multiple regions. In the meantime, we remain aggressively focused on optimising our current cost structure, improving our profitability, and prioritising our capital investments.”