Total Produce Half-Year Results: What The Analysts Said

By Steve Wynne-Jones
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Total Produce Half-Year Results: What The Analysts Said

Fresh produce giant Total Produce has reported a 39.6% increase in half-year revenue, boosted by its stake in Dole Food Company, however its European fresh business saw revenues decline in the period.

Commenting on its performance, Carl McCann, chairman, said that the company was "pleased to report strong results for the first half of the year".

Here's how leading industry analysts viewed its performance.

Darren McKinley, Cantor Fitzgerald

"Total Produce released their interim 2019 results [...] which beat expectations at the headline level due to a solid contribution from Dole offsetting weaker profitability within the Eurozone division.

"A possible concern for investors, which is weighing on the share price, is that group’s net debt has increased from €113m at the start of FY 2018 to €294 million at the end of interim 2019. Operating cash flow and free cash flow metrics have also trended lower. While net debt has gone up, the groups tangible assets have also gone up in value by over €100 million.


"Overall, revenue and earnings per shares trends are positive. The Dole update was also positive in our view. We have a meeting with Total Produce management today which we intend to follow up on Eurozone profitability issues, Dole profitability trends, balance sheet flexibility, and cash flow trends. We will have a clearer view on the investment case then and will review our recommendation. The decline in the share price looks overdone relative to earnings trends but we would like comfort on the cashflow trends from here."


"Total Produce issued a solid set of H119A numbers reporting a 63.1% increase in adj. EPS to 9.80p from a 103.5% increase in adj. EBITA to €92.8 million and 39.6% increase in revenue to €3.05 billion. Growth was primarily due to the contribution from the Dole business as at the regional level Europe – Eurozone reported adj. EBITA of €11.2m from €816.4 million in total revenue while Europe – Non-Eurozone generated €22.7m in adj. EBITA from €766.4 million in revenue.

"Management describes the results as 'strong' and that Dole results 'are in line with expectations', including a good recovery in the Fresh Vegetables division, which was impacted by an industry-wide recall the previous year. Non-Eurozone has come in line with expectations, while Eurozone is slightly behind against a strong comparative last year and some softness in the Benelux markets. That said, full year guidance remains unchanged."

Roland French, Davy

"Despite a sundry of sector headwinds, Total Produce has delivered a resilient H1 performance and has reiterated full-year EPS guidance. While like-for-like (LFL) revenues in the core business were down 2% – challenged by competitive markets and international trade tensions – Dole’s EBITA was ahead of our expectations.


"Dole’s Fresh Vegetable benefitted from continued recovery in packaged salads following last year’s romaine product safety notices. We will hold our full-year EPS forecast whilst recalibrating our growth assumptions towards Dole."

© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.

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