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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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The Cayman Islands
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N/A
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S Employer
Identification No.)
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c/o Intertrust Corporate Services (Cayman) Limited
190 Elgin Avenue
George Town, Grand Cayman, KY1-9005
Cayman Islands
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N/A
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(Address of Registrant’s Principal Executive Office)
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(Zip Code)
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Large accelerated filer
x
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Accelerated filer
¨
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Non-accelerated filer
¨
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(Do not check if a smaller reporting company)
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Smaller reporting company
¨
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Emerging growth company
¨
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Page
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PART I: FINANCIAL INFORMATION
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Item 1. Financial Statements
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PART II. OTHER INFORMATION
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June 29,
2018 |
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December 29,
2017 |
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Assets
|
|
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|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
39.8
|
|
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$
|
25.1
|
|
Trade accounts receivable, net of allowance of
$17.6 and $12.8, respectively
|
421.1
|
|
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358.8
|
|
||
Other accounts receivable, net of allowance of
$10.1 and $8.8, respectively
|
72.2
|
|
|
73.6
|
|
||
Inventories, net
|
513.1
|
|
|
541.8
|
|
||
Prepaid expenses and other current assets
|
37.3
|
|
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20.5
|
|
||
Total current assets
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1,083.5
|
|
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1,019.8
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||||
Investments in and advances to unconsolidated companies
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6.1
|
|
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2.0
|
|
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Property, plant and equipment, net
|
1,414.7
|
|
|
1,328.3
|
|
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Goodwill
|
590.4
|
|
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261.9
|
|
||
Deferred income taxes
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56.8
|
|
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59.1
|
|
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Other noncurrent assets
|
109.0
|
|
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95.8
|
|
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Total assets
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$
|
3,260.5
|
|
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$
|
2,766.9
|
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Liabilities and shareholders' equity
|
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Current liabilities:
|
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Accounts payable and accrued expenses
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$
|
479.3
|
|
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$
|
382.4
|
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Current portion of long-term debt and capital lease obligations
|
0.5
|
|
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0.6
|
|
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Income taxes and other taxes payable
|
12.7
|
|
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10.8
|
|
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Total current liabilities
|
492.5
|
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393.8
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Long-term debt and capital lease obligations
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689.1
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357.0
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|
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Retirement benefits
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96.6
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96.2
|
|
||
Other noncurrent liabilities
|
46.0
|
|
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42.4
|
|
||
Deferred income taxes
|
85.7
|
|
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86.3
|
|
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Total liabilities
|
1,409.9
|
|
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975.7
|
|
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Commitments and contingencies (See note 13)
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|
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Redeemable noncontrolling interests
|
40.8
|
|
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—
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Shareholders' equity:
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Preferred shares, $0.01 par value; 50,000,000 shares
authorized; none issued or outstanding
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—
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—
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Ordinary shares, $0.01 par value; 200,000,000 shares
authorized; 48,779,307 and 48,759,481 issued and
outstanding, respectively
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0.5
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0.5
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Paid-in capital
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528.1
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522.5
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Retained earnings
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1,286.8
|
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1,275.0
|
|
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Accumulated other comprehensive loss
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(32.0
|
)
|
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(30.6
|
)
|
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Total Fresh Del Monte Produce Inc. shareholders' equity
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1,783.4
|
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1,767.4
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Noncontrolling interests
|
26.4
|
|
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23.8
|
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Total shareholders' equity
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1,809.8
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1,791.2
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Total liabilities, redeemable noncontrolling interests and shareholders' equity
|
$
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3,260.5
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$
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2,766.9
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Quarter ended
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Six months ended
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||||||||||||
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June 29,
2018 |
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June 30,
2017 |
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June 29,
2018 |
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June 30,
2017 |
||||||||
Net sales
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$
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1,272.4
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$
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1,147.1
|
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$
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2,378.5
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$
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2,179.5
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Cost of products sold
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1,194.1
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1,023.9
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2,193.7
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1,957.2
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Gross profit
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78.3
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123.2
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184.8
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222.3
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Selling, general and administrative expenses
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49.9
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41.9
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98.5
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89.8
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Gain on disposal of property, plant and
equipment, net
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(5.7
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)
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(0.1
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)
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(5.9
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)
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(0.9
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)
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Asset impairment and other charges, net
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20.3
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1.9
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21.9
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—
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Operating income
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13.8
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|
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79.5
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70.3
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133.4
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|
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Interest expense
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6.1
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1.6
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9.8
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3.0
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|
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Interest income
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(0.4
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)
|
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(0.2
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)
|
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(0.5
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)
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(0.3
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)
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||||
Other expense, net
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7.3
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0.5
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10.7
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0.6
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|
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Income before income taxes
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0.8
|
|
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77.6
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50.3
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130.1
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|
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Provision for income taxes
|
6.4
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7.8
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12.7
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14.7
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|
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Net (loss) income
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$
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(5.6
|
)
|
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$
|
69.8
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$
|
37.6
|
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$
|
115.4
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Less: Net income (loss) attributable to redeemable and noncontrolling interests
|
2.3
|
|
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0.6
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4.0
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(0.2
|
)
|
||||
Net (loss) income attributable to Fresh Del Monte Produce Inc.
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$
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(7.9
|
)
|
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$
|
69.2
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$
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33.6
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$
|
115.6
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Net (loss) income per ordinary share attributable to Fresh Del Monte Produce Inc. - Basic
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$
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(0.16
|
)
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$
|
1.37
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$
|
0.69
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$
|
2.27
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Net (loss) income per ordinary share attributable to Fresh Del Monte Produce Inc. - Diluted
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$
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(0.16
|
)
|
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$
|
1.36
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$
|
0.69
|
|
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$
|
2.25
|
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Dividends declared per ordinary share
|
$
|
0.15
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$
|
0.15
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$
|
0.30
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$
|
0.30
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Weighted average number of ordinary shares:
|
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|
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|
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|
||||||
Basic
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48,753,227
|
|
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50,572,056
|
|
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48,767,411
|
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50,895,738
|
|
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Diluted
|
48,753,227
|
|
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50,932,365
|
|
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49,012,397
|
|
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51,300,697
|
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Quarter ended
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Six months ended
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||||||||||||
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June 29,
2018 |
|
June 30,
2017 |
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Net (loss) income
|
$
|
(5.6
|
)
|
|
$
|
69.8
|
|
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$
|
37.6
|
|
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$
|
115.4
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Net unrealized gain (loss) on derivatives
|
4.7
|
|
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(3.8
|
)
|
|
2.9
|
|
|
(6.4
|
)
|
||||
Net unrealized foreign currency translation (loss) gain
|
(9.1
|
)
|
|
7.1
|
|
|
(4.8
|
)
|
|
11.1
|
|
||||
Net change in retirement benefit adjustment, net of tax
|
0.4
|
|
|
0.2
|
|
|
0.5
|
|
|
0.3
|
|
||||
Comprehensive (loss) income
|
$
|
(9.6
|
)
|
|
$
|
73.3
|
|
|
$
|
36.2
|
|
|
$
|
120.4
|
|
Less: Comprehensive income (loss) attributable to redeemable and noncontrolling interests
|
2.3
|
|
|
0.6
|
|
|
4.0
|
|
|
(0.2
|
)
|
||||
Comprehensive (loss) income attributable to Fresh Del
Monte Produce Inc.
|
$
|
(11.9
|
)
|
|
$
|
72.7
|
|
|
$
|
32.2
|
|
|
$
|
120.6
|
|
|
Six months ended
|
||||||
|
June 29,
2018 |
|
June 30,
2017 |
||||
Operating activities:
|
|
|
|
||||
Net income
|
$
|
37.6
|
|
|
$
|
115.4
|
|
Adjustments to reconcile net income to net cash
|
|
|
|
|
|
||
provided by operating activities:
|
|
|
|
|
|
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Depreciation and amortization
|
44.3
|
|
|
40.0
|
|
||
Amortization of debt issuance costs
|
0.3
|
|
|
0.2
|
|
||
Share-based compensation expense
|
7.0
|
|
|
6.5
|
|
||
Asset impairment, net
|
18.3
|
|
|
2.2
|
|
||
Change in uncertain tax positions
|
0.1
|
|
|
0.2
|
|
||
Gain on disposal of property, plant and equipment
|
(5.9
|
)
|
|
(0.9
|
)
|
||
Deferred income taxes
|
1.6
|
|
|
0.2
|
|
||
Foreign currency translation adjustment
|
(1.8
|
)
|
|
6.2
|
|
||
Changes in operating assets and liabilities; net of the effect of acquisitions
|
|
|
|
|
|
||
Receivables
|
(22.3
|
)
|
|
(28.2
|
)
|
||
Inventories
|
51.6
|
|
|
34.4
|
|
||
Prepaid expenses and other current assets
|
(11.4
|
)
|
|
(4.2
|
)
|
||
Accounts payable and accrued expenses
|
53.1
|
|
|
12.5
|
|
||
Other noncurrent assets and liabilities
|
(10.2
|
)
|
|
(10.6
|
)
|
||
Net cash provided by operating activities
|
162.3
|
|
|
173.9
|
|
||
Investing activities:
|
|
|
|
|
|
||
Capital expenditures
|
(81.8
|
)
|
|
(71.9
|
)
|
||
Investments in unconsolidated companies
|
(4.2
|
)
|
|
—
|
|
||
Proceeds from sales of property, plant and equipment
|
8.2
|
|
|
2.9
|
|
||
Purchase of businesses, net of cash acquired
|
(373.3
|
)
|
|
—
|
|
||
Net cash used in investing activities
|
(451.1
|
)
|
|
(69.0
|
)
|
||
Financing activities:
|
|
|
|
|
|
||
Proceeds from long-term debt
|
636.4
|
|
|
330.9
|
|
||
Payments on long-term debt
|
(307.0
|
)
|
|
(337.3
|
)
|
||
Distributions to noncontrolling interests, net
|
(1.8
|
)
|
|
(3.6
|
)
|
||
Proceeds from stock options exercised
|
0.8
|
|
|
0.1
|
|
||
Share-based awards settled in cash for taxes
|
(0.4
|
)
|
|
(3.8
|
)
|
||
Dividends paid
|
(14.6
|
)
|
|
(15.2
|
)
|
||
Repurchase and retirement of ordinary shares
|
(9.8
|
)
|
|
(71.6
|
)
|
||
Net cash provided by (used in) financing activities
|
303.6
|
|
|
(100.5
|
)
|
||
Effect of exchange rate changes on cash
|
(0.1
|
)
|
|
(0.1
|
)
|
||
Net increase in cash and cash equivalents
|
14.7
|
|
|
4.3
|
|
||
Cash and cash equivalents, beginning
|
25.1
|
|
|
20.1
|
|
||
Cash and cash equivalents, ending
|
$
|
39.8
|
|
|
$
|
24.4
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||
Cash paid for interest
|
$
|
8.7
|
|
|
$
|
2.6
|
|
Cash paid for income taxes
|
$
|
14.7
|
|
|
$
|
5.9
|
|
Non-cash financing and investing activities:
|
|
|
|
|
|
||
Retirement of ordinary shares
|
$
|
9.8
|
|
|
$
|
71.6
|
|
Dividends on restricted stock units
|
$
|
0.2
|
|
|
$
|
0.3
|
|
Purchase of a business
|
$
|
1.2
|
|
|
$
|
—
|
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||||||||||||
|
June 29, 2018
|
|
June 29, 2018
|
||||||||||||||||||||||
|
Long-lived
and other asset impairment |
|
Exit activity and other charges |
|
Total
|
|
Long-lived
and other asset impairment |
|
Exit activity and other charges/(credits) |
|
Total
|
||||||||||||||
Banana segment:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Philippine exit activities of certain low-yield areas
|
$
|
18.3
|
|
|
$
|
—
|
|
|
$
|
18.3
|
|
|
$
|
18.3
|
|
|
$
|
—
|
|
|
$
|
18.3
|
|
||
Other fresh produce segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Chile severance due to restructuring as a result of cost reduction initiatives
|
—
|
|
|
1.6
|
|
|
1.6
|
|
|
—
|
|
|
1.6
|
|
|
1.6
|
|
||||||||
Acquisition costs related to
Mann Packing |
—
|
|
|
0.1
|
|
(1
|
)
|
0.1
|
|
|
—
|
|
|
2.6
|
|
(1
|
)
|
2.6
|
|
||||||
Sanger insurance recoveries due to inclement weather conditions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
(0.9
|
)
|
||||||||
Other fresh produce segment charges
|
—
|
|
|
0.3
|
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
0.3
|
|
||||||||
Total asset impairment and
other charges, net
|
$
|
18.3
|
|
|
$
|
2.0
|
|
|
$
|
20.3
|
|
|
$
|
18.3
|
|
|
$
|
3.6
|
|
|
$
|
21.9
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Quarter ended
|
|
Six months ended
|
||||||||||||||||||||||
|
June 30, 2017
|
|
June 30, 2017
|
||||||||||||||||||||||
|
Long-lived
and other asset impairment |
|
Exit activity and other charges |
|
Total
|
|
Long-lived
and other asset impairment |
|
Exit activity and other charges/(credits) |
|
Total
|
||||||||||||||
Banana segment:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Philippines floods
|
$
|
0.5
|
|
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
0.8
|
|
|
$
|
—
|
|
|
$
|
0.8
|
|
||
Chile floods
|
0.8
|
|
|
—
|
|
|
0.8
|
|
|
0.8
|
|
|
—
|
|
|
0.8
|
|
||||||||
Underutilized assets in Central America
|
0.6
|
|
|
—
|
|
|
0.6
|
|
|
0.6
|
|
|
—
|
|
|
0.6
|
|
||||||||
Other fresh produce segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Chile insurance proceeds on floods
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
(2.2
|
)
|
|
(2.2
|
)
|
|||||||||
Total asset impairment and
other charges (credits), net
|
$
|
1.9
|
|
|
$
|
—
|
|
|
$
|
1.9
|
|
|
$
|
2.2
|
|
|
$
|
(2.2
|
)
|
|
$
|
—
|
|
|
Exit activity and
other reserve balance at December 29, 2017 |
|
Impact to
earnings |
|
Cash paid
|
|
Foreign exchange impact
|
|
Exit activity and
other reserve balance at June 29, 2018 |
||||||||||
Termination benefits
|
$
|
—
|
|
|
$
|
1.6
|
|
|
$
|
(1.6
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Contract termination and other exit activity charges
|
0.3
|
|
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|||||
|
$
|
0.3
|
|
|
$
|
1.6
|
|
|
$
|
(1.9
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Assets acquired
|
|
||
Current assets:
|
|
||
Cash and cash equivalents
|
$
|
0.1
|
|
Trade accounts receivable, net of allowance
|
39.4
|
|
|
Other accounts receivable, net of allowance
|
1.2
|
|
|
Inventories, net
|
21.1
|
|
|
Prepaid expenses and other current assets
|
2.1
|
|
|
Total current assets
|
63.9
|
|
|
|
|
||
Property, plant and equipment, net
|
70.2
|
|
|
Goodwill
|
328.8
|
|
|
Total assets acquired
|
$
|
462.9
|
|
Liabilities assumed
|
|
|
|
Current liabilities:
|
|
|
|
Accounts payable and accrued expenses
|
$
|
50.9
|
|
Total liabilities assumed
|
$
|
50.9
|
|
|
|
||
Less: Redeemable noncontrolling interest
|
39.1
|
|
|
|
|
||
Net assets acquired
|
$
|
372.9
|
|
|
Quarter ended June 29, 2018
|
|
Period from February 27, 2018 to June 29, 2018
|
||||
Net sales
|
$
|
146.2
|
|
|
$
|
197.5
|
|
Net income attributable to
Fresh Del Monte Produce, Inc. |
$
|
3.0
|
|
|
$
|
14.5
|
|
|
Quarter ended
|
|
Six months ended
|
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
June 29,
2018 |
|
June 30,
2017 |
|
||||||||
Net sales
|
$
|
1,272.4
|
|
|
$
|
1,292.5
|
|
|
$
|
2,457.7
|
|
|
$
|
2,450.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income attributable to
Fresh Del Monte Produce, Inc. |
$
|
(8.0
|
)
|
(1)
|
$
|
79.0
|
|
(3)
|
$
|
38.2
|
|
(2)
|
$
|
129.8
|
|
(4)
|
|
Six months ended
|
||||||
|
June 29,
2018 |
|
June 30,
2017 |
||||
Noncontrolling interests, beginning
|
$
|
23.8
|
|
|
$
|
24.6
|
|
Net income (loss) attributable to noncontrolling interests
|
2.2
|
|
|
(0.2
|
)
|
||
Distributions (to) from noncontrolling interests
|
(0.4
|
)
|
|
0.4
|
|
||
Capital contributions from noncontrolling interests
|
0.8
|
|
|
—
|
|
||
Noncontrolling interests, ending
|
$
|
26.4
|
|
|
$
|
24.8
|
|
|
Six months ended
|
||
|
June 29,
2018 |
||
Redeemable noncontrolling interests, beginning
|
$
|
—
|
|
Initial measurement of redeemable noncontrolling interest due to Mann Packing acquisition
|
39.1
|
|
|
Net income attributable to redeemable noncontrolling
interests |
1.7
|
|
|
Redeemable noncontrolling interests, ending
|
$
|
40.8
|
|
|
June 29, 2018
|
|
December 29, 2017
|
||||||||||||
|
Short-term
|
|
Long-term
|
|
Short-term
|
|
Long-term
|
||||||||
Gross advances to growers and suppliers
|
$
|
29.5
|
|
|
$
|
3.8
|
|
|
$
|
38.9
|
|
|
$
|
1.6
|
|
Allowance for advances to growers and suppliers (past due)
|
(2.2
|
)
|
|
(0.6
|
)
|
|
(2.8
|
)
|
|
(0.1
|
)
|
||||
Net advances to growers and suppliers
|
$
|
27.3
|
|
|
$
|
3.2
|
|
|
$
|
36.1
|
|
|
$
|
1.5
|
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Allowance for advances to growers and suppliers:
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
2.3
|
|
|
$
|
1.5
|
|
|
$
|
2.9
|
|
|
$
|
1.5
|
|
Provision for uncollectible amounts
|
0.5
|
|
|
1.1
|
|
|
0.8
|
|
|
1.1
|
|
||||
Deductions to allowance related to write-offs
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
||||
Balance, end of period
|
$
|
2.8
|
|
|
$
|
2.6
|
|
|
$
|
2.8
|
|
|
$
|
2.6
|
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Stock options
|
$
|
—
|
|
|
$
|
0.2
|
|
|
$
|
0.1
|
|
|
$
|
0.3
|
|
RSUs/PSUs
|
2.3
|
|
|
2.7
|
|
|
5.9
|
|
|
5.3
|
|
||||
RSAs
|
—
|
|
|
—
|
|
|
1.0
|
|
|
0.9
|
|
||||
Total
|
$
|
2.3
|
|
|
$
|
2.9
|
|
|
$
|
7.0
|
|
|
$
|
6.5
|
|
Date of award
|
|
Shares of
restricted stock awarded |
|
Price per share
|
||
January 2, 2018
|
|
21,304
|
|
$
|
46.93
|
|
January 3, 2017
|
|
14,294
|
|
61.21
|
|
Date of award
|
|
Type of award
|
|
Units awarded
|
|
Price per share
|
||
June 25, 2018
|
|
RSU
|
|
2,000
|
|
$
|
44.78
|
|
February 21, 2018
|
|
PSU
|
|
85,000
|
|
46.35
|
|
|
February 21, 2018
|
|
RSU
|
|
125,000
|
|
46.35
|
|
|
February 22, 2017
|
|
PSU
|
|
100,000
|
|
56.52
|
|
|
February 22, 2017
|
|
RSU
|
|
50,000
|
|
56.52
|
|
|
June 29,
2018 |
|
December 29, 2017
|
||||
Finished goods
|
$
|
193.7
|
|
|
$
|
210.1
|
|
Raw materials and packaging supplies
|
168.8
|
|
|
165.4
|
|
||
Growing crops
|
150.6
|
|
|
166.3
|
|
||
Total inventories
|
$
|
513.1
|
|
|
$
|
541.8
|
|
|
June 29,
2018 |
|
December 29,
2017 |
||||
Senior unsecured revolving credit facility (see Credit Facility below)
|
$
|
688.5
|
|
|
$
|
356.2
|
|
Capital lease obligations
|
1.1
|
|
|
1.4
|
|
||
Total long-term debt and capital lease obligations
|
689.6
|
|
|
357.6
|
|
||
Less: Current portion
|
(0.5
|
)
|
|
(0.6
|
)
|
||
Long-term debt and capital lease obligations
|
$
|
689.1
|
|
|
$
|
357.0
|
|
|
Term
|
|
Maturity
date |
|
Interest rate
|
|
Borrowing
limit |
|
Available
borrowings |
||||
Bank of America credit facility
|
5 years
|
|
April 15, 2020
|
|
3.50%
|
|
$
|
1,100.0
|
|
|
$
|
406.5
|
|
Rabobank letter of credit facility
|
364 days
|
|
June 18, 2019
|
|
Varies
|
|
25.0
|
|
|
19.5
|
|
||
Other working capital facilities
|
Varies
|
|
Varies
|
|
Varies
|
|
23.4
|
|
|
13.2
|
|
||
|
|
|
|
|
|
|
$
|
1,148.4
|
|
|
$
|
439.2
|
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net (loss) income attributable to Fresh Del Monte
Produce Inc.
|
$
|
(7.9
|
)
|
|
$
|
69.2
|
|
|
$
|
33.6
|
|
|
$
|
115.6
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
|
|
||||||
Weighted average number of ordinary shares -
Basic
|
48,753,227
|
|
|
50,572,056
|
|
|
48,767,411
|
|
|
50,895,738
|
|
||||
Effect of dilutive securities - share-based
employee options and awards
|
—
|
|
|
360,309
|
|
|
244,986
|
|
|
404,959
|
|
||||
Weighted average number of ordinary shares -
Diluted
|
48,753,227
|
|
|
50,932,365
|
|
|
49,012,397
|
|
|
51,300,697
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Antidilutive awards
(1)
|
739,106
|
|
|
96,526
|
|
|
30,562
|
|
|
96,526
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net (loss) income per ordinary share attributable to Fresh Del Monte Produce Inc.:
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
$
|
(0.16
|
)
|
|
$
|
1.37
|
|
|
$
|
0.69
|
|
|
$
|
2.27
|
|
Diluted
|
$
|
(0.16
|
)
|
|
$
|
1.36
|
|
|
$
|
0.69
|
|
|
$
|
2.25
|
|
(1)
|
Certain unvested RSUs are not included in the calculation of net income per ordinary share because the effect would have been antidilutive.
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Service cost
|
$
|
1.5
|
|
|
$
|
1.4
|
|
|
$
|
3.0
|
|
|
$
|
2.8
|
|
Interest cost
|
1.6
|
|
|
1.5
|
|
|
3.2
|
|
|
3.1
|
|
||||
Expected return on assets
|
(0.9
|
)
|
|
(0.9
|
)
|
|
(1.8
|
)
|
|
(1.7
|
)
|
||||
Amortization of net actuarial loss
|
0.2
|
|
|
0.3
|
|
|
0.4
|
|
|
0.6
|
|
||||
Net periodic benefit costs
|
$
|
2.4
|
|
|
$
|
2.3
|
|
|
$
|
4.8
|
|
|
$
|
4.8
|
|
|
Quarter ended
|
||||||||||||||
|
June 29, 2018
|
|
June 30, 2017
|
||||||||||||
Segments:
|
Net Sales
|
|
Gross Profit
|
|
Net Sales
|
|
Gross Profit
|
||||||||
Other fresh produce
|
$
|
721.0
|
|
|
$
|
46.9
|
|
|
$
|
568.1
|
|
|
$
|
55.0
|
|
Banana
|
457.8
|
|
|
23.8
|
|
|
499.5
|
|
|
58.1
|
|
||||
Prepared food
|
93.6
|
|
|
7.6
|
|
|
79.5
|
|
|
10.1
|
|
||||
Totals
|
$
|
1,272.4
|
|
|
$
|
78.3
|
|
|
$
|
1,147.1
|
|
|
$
|
123.2
|
|
|
|
|
|
|
|
|
|
||||||||
|
Six months ended
|
||||||||||||||
|
June 29, 2018
|
|
June 30, 2017
|
||||||||||||
Segments:
|
Net Sales
|
|
Gross Profit
|
|
Net Sales
|
|
Gross Profit
|
||||||||
Other fresh produce
|
$
|
1,295.0
|
|
|
$
|
93.6
|
|
|
$
|
1,074.3
|
|
|
$
|
103.4
|
|
Banana
|
910.9
|
|
|
75.9
|
|
|
944.6
|
|
|
93.1
|
|
||||
Prepared food
|
172.6
|
|
|
15.3
|
|
|
160.6
|
|
|
25.8
|
|
||||
Totals
|
$
|
2,378.5
|
|
|
$
|
184.8
|
|
|
$
|
2,179.5
|
|
|
$
|
222.3
|
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||
Net Sales by geographic region:
|
June 29, 2018
|
June 30, 2017
|
|
June 29, 2018
|
|
June 30, 2017
|
|||||||||
North America
|
$
|
814.8
|
|
|
$
|
655.5
|
|
|
$
|
1,478.3
|
|
|
$
|
1,256.9
|
|
Europe
|
175.8
|
|
|
192.7
|
|
|
369.9
|
|
|
367.2
|
|
||||
Middle East
|
126.0
|
|
|
147.8
|
|
|
241.9
|
|
|
270.7
|
|
||||
Asia
|
135.8
|
|
|
138.5
|
|
|
248.4
|
|
|
251.7
|
|
||||
Other
|
20.0
|
|
|
12.6
|
|
|
40.0
|
|
|
33.0
|
|
||||
Totals
|
$
|
1,272.4
|
|
|
$
|
1,147.1
|
|
|
$
|
2,378.5
|
|
|
$
|
2,179.5
|
|
|
Quarter ended
|
|
Period from February 27, 2018 to June 29, 2018
|
||||||||||||
|
June 29, 2018
|
||||||||||||||
Segments:
|
Net Sales
|
|
Gross Profit
|
|
Net Sales
|
|
Gross Profit
|
||||||||
Other fresh produce
|
$
|
132.4
|
|
|
$
|
10.7
|
|
|
$
|
178.7
|
|
|
$
|
14.3
|
|
Prepared foods
|
13.8
|
|
|
2.2
|
|
|
18.8
|
|
|
3.6
|
|
||||
Totals
|
$
|
146.2
|
|
|
$
|
12.9
|
|
|
$
|
197.5
|
|
|
$
|
17.9
|
|
Foreign currency contracts qualifying as cash flow hedges:
|
|
Notional amount
|
|||
Euro
|
|
EUR
|
|
69.1
|
|
British pound
|
|
GBP
|
|
3.4
|
|
Japanese yen
|
|
JPY
|
|
599.7
|
|
Philippine peso
|
|
PHP
|
|
3.2
|
|
Korean won
|
|
KRW
|
|
13,183.7
|
|
Derivatives designated as hedging instruments
(1)
|
|||||||||||||||||||||||
|
Foreign exchange contracts
|
|
Interest rate swaps
|
|
Total
|
||||||||||||||||||
Balance Sheet location:
|
June 29, 2018
(2)
|
|
December 29,
2017 |
|
June 29, 2018
|
|
December 29,
2017 |
|
June 29, 2018
|
|
December 29,
2017 |
||||||||||||
Asset derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Prepaid expenses and other current assets
|
$
|
3.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3.5
|
|
|
$
|
—
|
|
Other long-term receivables
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
||||||
Total asset derivatives
|
$
|
3.5
|
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
3.8
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liability derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Accounts payable and accrued expenses
|
$
|
—
|
|
|
$
|
1.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.4
|
|
Other long-term liabilities
|
—
|
|
|
—
|
|
|
2.3
|
|
|
—
|
|
|
2.3
|
|
|
—
|
|
||||||
Total liability derivatives
|
$
|
—
|
|
|
$
|
1.4
|
|
|
$
|
2.3
|
|
|
$
|
—
|
|
|
$
|
2.3
|
|
|
$
|
1.4
|
|
Derivatives in effective cash flow
hedging relationships
|
Amount of (loss) gain recognized in other
comprehensive income on derivatives (effective portion) |
|
Location of (loss) income
reclassified from AOCI into income (effective portion) |
Amount of (loss) income reclassified from
AOCI into income (effective portion) |
||||||||||||
|
Quarter ended
|
|
|
Quarter ended
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Foreign exchange
contracts |
$
|
6.0
|
|
|
$
|
(4.1
|
)
|
|
Net sales
|
$
|
0.9
|
|
|
$
|
0.5
|
|
Foreign exchange
contracts |
0.7
|
|
|
0.3
|
|
|
Cost of products sold
|
0.1
|
|
|
0.1
|
|
||||
Interest rate swaps
|
(2.0
|
)
|
|
—
|
|
|
Interest expense
|
(0.1
|
)
|
|
—
|
|
||||
Total
|
$
|
4.7
|
|
|
$
|
(3.8
|
)
|
|
|
$
|
0.9
|
|
|
$
|
0.6
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Six months ended
|
|
|
Six months ended
|
||||||||||||
|
June 29,
2018 |
|
June 30,
2017 |
|
|
June 29,
2018 |
|
June 30,
2017 |
||||||||
Foreign exchange
contracts |
$
|
4.2
|
|
|
$
|
(5.9
|
)
|
|
Net sales
|
$
|
0.2
|
|
|
$
|
1.6
|
|
Foreign exchange
contracts |
0.7
|
|
|
(0.5
|
)
|
|
Cost of products sold
|
0.3
|
|
|
0.3
|
|
||||
Interest rate swaps
|
(2.0
|
)
|
|
—
|
|
|
Interest expense
|
(0.1
|
)
|
|
—
|
|
||||
Total
|
$
|
2.9
|
|
|
$
|
(6.4
|
)
|
|
|
$
|
0.4
|
|
|
$
|
1.9
|
|
|
Fair value measurements
|
||||||||||||||
|
Foreign currency forward contracts, net asset (liability)
|
|
Interest rate contracts, net liability
|
||||||||||||
|
June 29,
2018 |
|
December 29,
2017 |
|
June 29, 2018
|
|
December 29,
2017 |
||||||||
Quoted prices in active markets for identical assets (Level 1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Significant observable inputs (Level 2)
|
3.5
|
|
|
(1.4
|
)
|
|
(2.0
|
)
|
|
—
|
|
||||
Significant unobservable inputs (Level 3)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Changes in accumulated other comprehensive (loss) income by component
(1)
|
||||||||||||||
|
Six months ended June 29, 2018
|
||||||||||||||
|
Changes in fair value of effective cash flow hedges
|
|
Foreign currency translation adjustment
|
|
Retirement benefit adjustment
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Balance at December 29, 2017
|
$
|
(1.4
|
)
|
|
$
|
(6.7
|
)
|
|
$
|
(22.5
|
)
|
|
$
|
(30.6
|
)
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
||||||||
before reclassifications
|
3.3
|
|
|
(4.8
|
)
|
(2)
|
0.1
|
|
|
(1.4
|
)
|
||||
Amounts reclassified from accumulated
|
|
|
|
|
|
|
|
||||||||
other comprehensive (loss) income
|
(0.4
|
)
|
|
—
|
|
|
0.4
|
|
|
—
|
|
||||
Net current period other comprehensive
|
|
|
|
|
|
|
|
||||||||
income (loss)
|
2.9
|
|
|
(4.8
|
)
|
|
0.5
|
|
|
(1.4
|
)
|
||||
Balance at June 29, 2018
|
$
|
1.5
|
|
|
$
|
(11.5
|
)
|
|
$
|
(22.0
|
)
|
|
$
|
(32.0
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
Six months ended June 30, 2017
|
||||||||||||||
Balance at December 30, 2016
|
$
|
5.4
|
|
|
$
|
(25.4
|
)
|
|
$
|
(24.2
|
)
|
|
$
|
(44.2
|
)
|
Other comprehensive (loss) income
|
|
|
|
|
|
|
|
||||||||
before reclassifications
|
(4.5
|
)
|
|
11.1
|
|
(2)
|
(0.3
|
)
|
|
6.3
|
|
||||
Amounts reclassified from accumulated
|
|
|
|
|
|
|
|
||||||||
other comprehensive (loss) income
|
(1.9
|
)
|
|
—
|
|
|
0.6
|
|
|
(1.3
|
)
|
||||
Net current period other comprehensive
|
|
|
|
|
|
|
|
||||||||
(loss) income
|
(6.4
|
)
|
|
11.1
|
|
|
0.3
|
|
|
5.0
|
|
||||
Balance at June 30, 2017
|
$
|
(1.0
|
)
|
|
$
|
(14.3
|
)
|
|
$
|
(23.9
|
)
|
|
$
|
(39.2
|
)
|
|
|
Amount reclassified from accumulated other comprehensive (loss) income
|
|
|
||||||||||||||
|
|
June 29, 2018
|
|
June 30, 2017
|
|
|
||||||||||||
Details about accumulated other comprehensive (loss) income components
|
|
Quarter ended
|
|
Six months ended
|
|
Quarter ended
|
|
Six months ended
|
|
Affected line item in the statement where net income is present
|
||||||||
Changes in fair value of effective cash flow hedges:
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency cash flow hedges
|
|
$
|
(0.9
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
(0.5
|
)
|
|
$
|
(1.6
|
)
|
|
Sales
|
Foreign currency cash flow hedges
|
|
(0.1
|
)
|
|
(0.3
|
)
|
|
(0.1
|
)
|
|
(0.3
|
)
|
|
Cost of sales
|
||||
Interest rate swaps
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
Interest expense
|
||||
Total
|
|
$
|
(0.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(0.6
|
)
|
|
$
|
(1.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of retirement benefits:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Actuarial losses
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
$
|
0.4
|
|
|
Cost of sales
|
Actuarial losses
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
0.2
|
|
|
Selling, general and administrative expenses
|
||||
Actuarial losses
|
|
0.2
|
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|
Other expenses
|
||||
Total
|
|
$
|
0.2
|
|
|
$
|
0.4
|
|
|
$
|
0.3
|
|
|
$
|
0.6
|
|
|
|
|
Six months ended
|
||||
|
June 29,
2018 |
|
June 30,
2017 |
||
Ordinary shares issued (retired) as a result of:
|
|
|
|
||
Stock option exercises
|
36,500
|
|
|
6,500
|
|
Restricted stock grants
|
21,304
|
|
|
14,294
|
|
Restricted and performance
stock units |
180,254
|
|
|
137,287
|
|
Ordinary shares
repurchased and retired |
(218,232
|
)
|
|
(1,310,900
|
)
|
Six months ended
|
||||||||||
June 29, 2018
|
|
June 30, 2017
|
||||||||
Dividend Date
|
|
Cash Dividend Declared, per Ordinary Share
|
|
Dividend Date
|
|
Cash Dividend Declared, per Ordinary Share
|
||||
June 1, 2018
|
|
$
|
0.150
|
|
|
June 2, 2017
|
|
$
|
0.150
|
|
March 30, 2018
|
|
$
|
0.150
|
|
|
March 31, 2017
|
|
$
|
0.150
|
|
|
Quarter ended
|
|
Six months ended
|
||||||||||||||||||||||||
|
June 29, 2018
|
|
June 30, 2017
|
|
June 29, 2018
|
|
June 30, 2017
|
||||||||||||||||||||
North America
|
$
|
814.8
|
|
|
64
|
%
|
|
$
|
655.5
|
|
|
57
|
%
|
|
$
|
1,478.3
|
|
|
62
|
%
|
|
$
|
1,256.9
|
|
|
58
|
%
|
Europe
|
175.8
|
|
|
14
|
%
|
|
192.7
|
|
|
17
|
%
|
|
369.9
|
|
|
16
|
%
|
|
367.2
|
|
|
17
|
%
|
||||
Middle East
|
126.0
|
|
|
10
|
%
|
|
147.8
|
|
|
13
|
%
|
|
241.9
|
|
|
10
|
%
|
|
270.7
|
|
|
12
|
%
|
||||
Asia
|
135.8
|
|
|
11
|
%
|
|
138.5
|
|
|
12
|
%
|
|
248.4
|
|
|
10
|
%
|
|
251.7
|
|
|
12
|
%
|
||||
Other
|
20.0
|
|
|
1
|
%
|
|
12.6
|
|
|
1
|
%
|
|
40.0
|
|
|
2
|
%
|
|
33.0
|
|
|
1
|
%
|
||||
Totals
|
$
|
1,272.4
|
|
|
100
|
%
|
|
$
|
1,147.1
|
|
|
100
|
%
|
|
$
|
2,378.5
|
|
|
100
|
%
|
|
$
|
2,179.5
|
|
|
100
|
%
|
|
Quarter ended
|
||||||||||||||||||||||||||
|
June 29, 2018
|
|
June 30, 2017
|
||||||||||||||||||||||||
|
Net Sales
|
|
Gross Profit
|
|
Net Sales
|
|
Gross Profit
|
||||||||||||||||||||
Other fresh produce
|
$
|
721.0
|
|
|
57
|
%
|
|
$
|
46.9
|
|
|
60
|
%
|
|
$
|
568.1
|
|
|
49
|
%
|
|
$
|
55.0
|
|
|
45
|
%
|
Banana
|
457.8
|
|
|
36
|
%
|
|
23.8
|
|
|
30
|
%
|
|
499.5
|
|
|
44
|
%
|
|
58.1
|
|
|
47
|
%
|
||||
Prepared food
|
93.6
|
|
|
7
|
%
|
|
7.6
|
|
|
10
|
%
|
|
79.5
|
|
|
7
|
%
|
|
10.1
|
|
|
8
|
%
|
||||
Totals
|
$
|
1,272.4
|
|
|
100
|
%
|
|
$
|
78.3
|
|
|
100
|
%
|
|
$
|
1,147.1
|
|
|
100
|
%
|
|
$
|
123.2
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Six months ended
|
||||||||||||||||||||||||||
|
June 29, 2018
|
|
June 30, 2017
|
||||||||||||||||||||||||
|
Net Sales
|
|
Gross Profit
|
|
Net Sales
|
|
Gross Profit
|
||||||||||||||||||||
Other fresh produce
|
$
|
1,295.0
|
|
|
54
|
%
|
|
$
|
93.6
|
|
|
51
|
%
|
|
$
|
1,074.3
|
|
|
49
|
%
|
|
$
|
103.4
|
|
|
46
|
%
|
Banana
|
910.9
|
|
|
38
|
%
|
|
75.9
|
|
|
41
|
%
|
|
944.6
|
|
|
43
|
%
|
|
93.1
|
|
|
42
|
%
|
||||
Prepared food
|
172.6
|
|
|
8
|
%
|
|
15.3
|
|
|
8
|
%
|
|
160.6
|
|
|
8
|
%
|
|
25.8
|
|
|
12
|
%
|
||||
Totals
|
$
|
2,378.5
|
|
|
100
|
%
|
|
$
|
184.8
|
|
|
100
|
%
|
|
$
|
2,179.5
|
|
|
100
|
%
|
|
$
|
222.3
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
Net sales in the other fresh produce segment increased
$152.9 million
, principally as a result of higher net sales of fresh-cut products, vegetables, avocados, non-tropical fruit and pineapples, partially offset by lower net sales of tomatoes. The acquisition of Mann Packing contributed $132.4 million of the increase in net sales of other fresh produce during the second quarter of 2018.
|
◦
|
Net sales of fresh-cut products increased principally due to the sales of Mann Packing products in North America. Also contributing to the increase were higher sale prices and volumes in Europe and Asia, primarily attributable to favorable exchange rates and strong customer demand.
|
◦
|
Net sales of vegetables increased due to the sale of Mann Packing vegetable products in North America.
|
◦
|
Net sales of avocados increased due to higher sales volumes in North America principally as a result of higher customer demand, partially offset by lower per unit sales price.
|
◦
|
Net sales of non-tropical fruit increased principally due to higher sales volumes and per unit sales prices of apples in the Middle East and Europe. Also contributing to the increase in non-tropical fruit were higher local sales in Chile.
|
◦
|
Net sales of pineapples increased primarily due to higher sales volumes in Europe, partially offset by lower per unit sales prices and sales volumes in the Middle East. Worldwide pineapple sales volume increased 12%.
|
◦
|
Net sales of tomatoes decreased due to lower per unit sales prices in North America principally due to high industry volumes combined with lower production from our Florida growing operations as a result of inclement weather.
|
•
|
Net sales in the prepared food segment increased
$14.1 million
principally due to sales of Mann Packing prepared food products in North America combined with higher net sales of beverage products in the Middle East and canned deciduous products in Europe. Partially offsetting these increases were lower net sales of canned pineapple products in Europe as a result of high industry volumes sourced from Asia.
|
•
|
Net sales of bananas decreased by
$41.7 million
principally due to lower net sales in the Middle East, Europe and Asia, partially offset by higher net sales in North America. Worldwide banana sales volume decreased 6%.
|
◦
|
Middle East banana net sales decreased due to lower sales volumes as a result of reduced supplies from the Philippines combined with reduced sales to Iran and Iraq due to the political situation in those markets. Partially offsetting these decreases were higher per unit sales price.
|
◦
|
Europe banana net sales decreased due to lower per unit sales prices principally as a result of high industry volumes. Shipping delays during the quarter disrupted the supply chain to the markets and aggravated the oversupply situation in certain weeks further reducing per unit sale prices.
|
◦
|
Asia banana net sales decreased due to lower supplies from the Philippines, partially offset by higher per unit sales price.
|
◦
|
North America banana net sales increased as a result of a slight increase in sales volumes and per unit selling prices.
|
•
|
Gross profit in the banana segment decreased
$34.3 million
primarily due to lower per unit selling price in Europe; higher distribution costs in all regions; higher ocean freight in North America, the Middle East and Asia; and lower sales volumes in the Middle East and Asia. Worldwide banana per unit sale prices decreased 3% and per unit costs increased 4%.
|
•
|
Gross profit in the other fresh produce segment decreased
$8.1 million
principally due to lower gross profit on pineapples and non-tropical fruit, partially offset by higher gross profit on fresh-cut products.
|
◦
|
Gross profit on pineapples decreased principally due to lower per unit sales prices in North America primarily as a result of higher industry volumes. Also contributing to the decrease in gross profit were higher distribution costs in all regions and ocean freight costs in North America, the Middle East and Asia. Worldwide pineapple per unit sale prices decreased 8% and per unit costs increased 6%.
|
◦
|
Gross profit on non-tropical fruit decreased principally due to lower per unit sales prices of grapes in North America as a result of higher volumes combined with higher fruit cost.
|
◦
|
Gross profit on fresh-cut products increased principally as the result of the Mann Packing acquisition and higher selling prices and sales volumes in Asia and Europe. Partially offsetting this increase were lower selling prices in the Middle East.
|
•
|
Gross profit in the prepared food segment decreased by
$2.5 million
principally due to higher cost on pineapple products, lower sales prices on industrial pineapple products as a result of excess industry supply and lower sales volumes of canned pineapple products primarily due to lower demand. Partially offsetting these decreases was the gross profit from Mann Packing prepared food products and higher gross profit on our Jordanian poultry business.
|
•
|
$18.3 million
in asset impairment charges related to our decision to abandon certain low-yield areas in our banana operations in the Philippines;
|
•
|
$1.6 million in severance expense related to restructuring as a result of cost reduction initiatives in our Chilean non-tropical fruit operation; and
|
•
|
$0.4 million in acquisition-related expenses.
|
•
|
$0.8 million in charges due to flood damage in our Chilean non-tropical fruit operation;
|
•
|
$0.6 million in asset impairment related to underutilized assets in Central America in the banana segment; and
|
•
|
$0.5 million in charges due to flood damage incurred in our Philippines banana operations.
|
•
|
Net sales in the other fresh produce segment increased
$220.7 million
principally as a result of higher net sales of fresh-cut products, vegetables, avocados and pineapples, partially offset by lower net sales of tomatoes.
|
◦
|
Net sales of fresh-cut products increased primarily due to the sales of Mann Packing products in North America. Also contributing to the increase were higher sale prices and volumes in Europe and Asia, which were mostly attributable to favorable exchange rates and improved customer demand. Worldwide fresh-cut products sales volume increased 68%.
|
◦
|
Net sales of vegetables increased due to the sale of Mann Packing vegetable products in North America.
|
◦
|
Net sales of avocados increased due to higher sales volumes in North America principally as a result of higher customer demand.
|
◦
|
Net sales of pineapples increased primarily due to higher sales volumes in North America and higher sales volumes and per unit sale price in Europe. Favorable euro and British pound exchange rates had a positive impact on sales prices. Partially offsetting this increase were high industry volumes which resulted in lower per unit sales prices in North America and lower sale prices in the Middle East principally due to unfavorable market conditions. Worldwide pineapple sales volume increased 14%.
|
•
|
Net sales in the prepared food segment increased
$12.0 million
principally due to sales of Mann Packing prepared food products in North America combined with higher net sales of canned deciduous products in Europe and of beverage products in the Middle East and Europe, primarily the result of improved customer demand and favorable exchange rates.
|
•
|
Net sales of bananas decreased by
$33.7 million
principally due to lower net sales in the Middle East, Asia and Europe, partially offset by higher net sales in North America. Worldwide banana sales volume decreased 7%.
|
◦
|
Middle East banana net sales decreased due to lower sales volumes as a result of reduced supplies from the Philippines combined with reduced sales to Iran and Iraq due to the political situation in those markets. Partially offsetting these decreases were higher per unit sales price.
|
◦
|
Asia banana net sales decreased due to lower supplies from the Philippines, partially offset by higher per unit sales price.
|
◦
|
Europe banana net sales decreased due to lower sales volumes, partially offset by higher per unit sales prices principally the result of favorable exchange rates.
|
◦
|
North America banana net sales increased as a result of a slight increase in per unit selling prices.
|
•
|
Gross profit in the banana segment decreased by
$17.2 million
principally due to higher distribution costs in all regions and lower sales volumes in all markets, partially offset by higher per unit sales price. Worldwide banana per unit sales prices increased 4% and per unit cost increased 5%.
|
•
|
Gross profit in the prepared food segment decreased by
$10.5 million
due to lower pricing on industrial products and lower sales volumes on canned pineapples primarily as a result of industry oversupply and low demand. Partially offsetting these decreases were higher gross profit in our Jordanian poultry business and on beverage products in Europe and the Middle East.
|
•
|
Gross profit in the other fresh produce segment decreased
$9.8 million
principally due to lower gross profit on pineapples, tomatoes and melons, partially offset by higher gross profit on fresh-cut products.
|
◦
|
Gross profit on pineapples decreased principally due to lower per unit sales prices in North America and the Middle East primarily as a result of higher industry volumes. Also contributing to the decrease in gross profit were higher distribution costs in all regions and ocean freight costs in North America, the Middle East and Asia. Worldwide pineapple per unit sale prices decreased 7% and per unit costs increased 5%.
|
◦
|
Gross profit on tomatoes decreased principally due to lower sales volumes as a result of lower production in our U.S. growing operations combined with higher costs.
|
◦
|
Gross profit on melons decreased primarily due to higher fruit and distribution cost.
|
◦
|
Gross profit on fresh-cut products increased due to the Mann Packing acquisition combined with higher sales volumes and sales prices in Asia and Europe principally as a result of strong customer demand and favorable exchange rates.
|
•
|
$18.3 million
in asset impairment charges related to our decision to abandon certain low-yield areas in our banana operations in the Philippines;
|
•
|
$2.9 million in acquisition-related expenses:
|
•
|
$1.6 million in severance expense related to restructuring as a result of cost reduction initiatives in our Chilean non-tropical fruit operation;
|
•
|
a credit of $(0.9) million related to insurance proceeds due to damage from inclement weather in one of our California facilities related to the other fresh produce segment.
|
•
|
$0.8 million related to flood damage in our Philippines banana operation;
|
•
|
$0.6 million related to underutilized assets in Central America related to the banana segment;
|
•
|
$0.8 million related to flood damage in our Chilean non-tropical fruit operation; and
|
•
|
a credit of $(2.2) million of insurance proceeds related to previously announced flood damage in our Chile non-tropical fruit operation.
|
Period
|
Total Number of
Shares Purchased (1) |
Average Price
Paid per Share |
Total Number of
Shares Purchased as Part of Publicly Announced Plans or Programs |
Maximum Dollar
Value of Shares that May Yet Be Purchased Under the Program (2)(3) |
||||||
April 1 through April 30, 2018
|
36,219
|
|
$
|
44.96
|
|
36,219
|
|
$
|
349,836,948
|
|
May 1, 2018 through May 31, 2018
|
—
|
|
$
|
—
|
|
—
|
|
$
|
349,836,948
|
|
June 1, 2018 through June 30, 2018
|
—
|
|
$
|
—
|
|
—
|
|
$
|
349,836,948
|
|
Total
|
36,219
|
|
$
|
44.96
|
|
36,219
|
|
$
|
349,836,948
|
|
(1)
|
For the quarter ended
June 29, 2018
, we purchased and retired
36,219
of our ordinary shares.
|
(2)
|
On July 29, 2015, our Board of Directors approved a three-year stock repurchase program of up to
$300 million
of our ordinary shares.
|
(3)
|
On February 21, 2018, our Board of Directors approved a three-year stock repurchase program of up to
$300 million
of our ordinary shares.
|
|
|
10.1**
|
|
|
|
31.1**
|
|
|
|
31.2**
|
|
|
|
32**
|
|
|
|
|
|
101.INS***
|
XBRL Instance Document.
|
|
|
101.SCH***
|
XBRL Taxonomy Extension Schema Document.
|
|
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
**
|
Filed herewith.
|
***
|
Attached as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets as of
June 29, 2018
and
December 29, 2017
, (ii) Consolidated Statements of Income for the quarters and six months ended
June 29, 2018
and
June 30, 2017
, (iii) Consolidated Statements of Comprehensive Income for the quarters and six months ended
June 29, 2018
and
June 30, 2017
, (iv) Consolidated Statement of Cash Flows for the six months ended
June 29, 2018
and
June 30, 2017
and (iv) Notes to Consolidated Financial Statements.
|
|
|
Fresh Del Monte Produce Inc.
|
|
|
|
|
|
Date:
|
July 31, 2018
|
By:
|
/s/
Youssef Zakharia
|
|
|
|
Youssef Zakharia
|
|
|
|
President & Chief Operating Officer
|
|
|
|
|
|
|
By:
|
/s/
Richard Contreras
|
|
|
|
Richard Contreras
|
|
|
|
Senior Vice President & Chief Financial Officer
|
Notices to FDM
|
Notices to DMFI
|
Notices to DMPL
|
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square New York, NY 10036 Attn: Lauren Aguiar Anthony Dreyer Fax: 212-735-2000
with a copy to:
Fresh Del Monte Produce Inc.
c/o Del Monte Fresh Produce Company 241 Sevilla Avenue Coral Gables, Florida 33134 Attn: President and Chief Operating Officer Fax: +305-520-1059 With copy to: General Counsel Fax: +305-448-6647 |
O'Melveny & Meyers LLP
Seven Times Square
New York, NY 10036
Attn: Abby F. Rudzin
Fax: 212-326-2061
with a copy to:
Del Monte Foods, Inc.
3003 Oak Road Walnut Creek, CA 94597
Attn: Chief Executive Officer
Fax: +415-344-4077
With copy to: General Counsel
Fax: +415-344-4077
|
Kramer Levin Naftalis & Frankel LLP
1177 Avenue of the Americas New York, NY 10036 Attn: Jonathan Wagner
Fax: 212-715-8393
with a copy to:
Del Monte Pacific Limited
17 Bukit Pasoh Road Singapore 089831 Republic of Singapore Attn: Managing Director and Chief Executive Officer Fax: +65 6221 9477 With copy to: Chief Legal Counsel Fax: +632-856-2628 |
1.
|
Agreement dated May 4, 1990 in which the LICENSED TERRITORY (as defined therein) includes the countries identified as located within Eastern Europe, the Middle East and Africa as more particularly set forth in Exhibit C thereto
|
2.
|
Agreement dated May 9, 1990 in which the LICENSED TERRITORY (as defined therein) includes the countries identified as located within non-United Kingdom Western Europe as more particularly set forth in Exhibit C thereto
|
3.
|
Agreement dated May 9, 1990 in which the LICENSED TERRITORY (as defined therein) includes the countries identified as located within the United Kingdom as more particularly set forth in Exhibit C thereto
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Fresh Del Monte Produce Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by this quarterly report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
July 31, 2018
|
|
|
|
|
Signature:
|
/s/
Mohammad Abu-Ghazaleh
|
|
Title:
|
Chairman and Chief Executive Officer
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Fresh Del Monte Produce Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by this quarterly report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
July 31, 2018
|
|
|
|
|
Signature:
|
/s/
Richard Contreras
|
|
Title:
|
Senior Vice President
and Chief Financial Officer
|
|
(1)
|
the accompanying Quarterly Report on Form 10-Q for the period ending
June 29, 2018
, as filed with the U.S. Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
July 31, 2018
|
By:
|
/s/ Mohammad Abu-Ghazaleh
|
|
|
Name:
|
Mohammad Abu-Ghazaleh
|
|
|
Title:
|
Chairman and Chief Executive Officer
|
|
|
|
|
|
|
|
|
Date:
|
July 31, 2018
|
By:
|
/s/
Richard Contreras
|
|
|
Name:
|
Richard Contreras
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|