x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
The Cayman Islands
|
N/A
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
(I.R.S Employer
Identification No.)
|
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman, KY1-9002
Cayman Islands
|
N/A
|
(Address of Registrant’s Principal Executive Office)
|
(Zip Code)
|
Large accelerated filer
x
|
Accelerated filer
¨
|
Non-accelerated filer
¨
|
Smaller reporting company
¨
|
Page
|
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1
|
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2
|
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3
|
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4
|
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21
|
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27
|
|||
27
|
|||
28
|
|||
28
|
|||
28
|
|||
29
|
|||
30
|
Item 1.
|
July 2,
|
January 1,
|
|||||||
2010
|
2010
|
|||||||
Assets
|
(Unaudited)
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 26.5 | $ | 34.5 | ||||
Trade accounts receivable, net of allowance of $10.2 and $11.9, respectively
|
331.6 | 309.8 | ||||||
Other accounts receivable, net of allowance of $13.5 and $14.1, respectively
|
56.8 | 65.2 | ||||||
Inventories
|
381.4 | 436.9 | ||||||
Deferred income taxes
|
7.8 | 7.8 | ||||||
Prepaid expenses and other current assets
|
64.3 | 46.2 | ||||||
Total current assets
|
868.4 | 900.4 | ||||||
Investments in and advances to unconsolidated companies
|
4.7 | 10.4 | ||||||
Property, plant and equipment, net
|
1,039.7 | 1,068.5 | ||||||
Deferred income taxes
|
64.3 | 68.9 | ||||||
Other noncurrent assets
|
143.7 | 138.8 | ||||||
Goodwill
|
404.1 | 409.0 | ||||||
Total assets
|
$ | 2,524.9 | $ | 2,596.0 | ||||
Liabilities and shareholders' equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable and accrued expenses
|
$ | 347.8 | $ | 316.9 | ||||
Current portion of long-term debt and capital lease obligations
|
5.1 | 4.9 | ||||||
Deferred income taxes
|
23.4 | 25.8 | ||||||
Income taxes and other taxes payable
|
8.7 | 9.7 | ||||||
Total current liabilities
|
385.0 | 357.3 | ||||||
Long-term debt and capital lease obligations
|
210.9 | 320.3 | ||||||
Retirement benefits
|
77.1 | 78.0 | ||||||
Other noncurrent liabilities
|
62.4 | 60.1 | ||||||
Deferred income taxes
|
83.6 | 85.1 | ||||||
Total liabilities
|
819.0 | 900.8 | ||||||
Commitments and contingencies
|
||||||||
Shareholders' equity:
|
||||||||
Preferred shares, $0.01 par value; 50,000,000 shares authorized; none issued or outstanding
|
- | - | ||||||
Ordinary shares, $0.01 par value; 200,000,000 shares authorized; 61,296,160 issued and outstanding
|
||||||||
and 63,615,411 issued and outstanding, respectively
|
0.6 | 0.6 | ||||||
Paid-in capital
|
516.2 | 561.2 | ||||||
Retained earnings
|
1,165.8 | 1,108.5 | ||||||
Accumulated other comprehensive income
|
(0.8 | ) | 2.8 | |||||
Total Fresh Del Monte Produce Inc. shareholders' equity
|
1,681.8 | 1,673.1 | ||||||
Noncontrolling interests
|
24.1 | 22.1 | ||||||
Total shareholders' equity
|
1,705.9 | 1,695.2 | ||||||
Total liabilities and shareholders' equity
|
$ | 2,524.9 | $ | 2,596.0 |
Quarter ended
|
Six months ended
|
|||||||||||||||
July 2,
|
June 26,
|
July 2,
|
June 26,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net sales
|
$ | 1,000.0 | $ | 978.4 | $ | 1,943.1 | $ | 1,858.1 | ||||||||
Cost of products sold
|
917.0 | 887.4 | 1,762.3 | 1,683.3 | ||||||||||||
Gross profit
|
83.0 | 91.0 | 180.8 | 174.8 | ||||||||||||
Selling, general and administrative expenses
|
43.0 | 42.4 | 85.0 | 79.3 | ||||||||||||
Gain on sales of property, plant and equipment
|
3.1 | 1.8 | 3.4 | 1.9 | ||||||||||||
Asset impairment and other charges, net
|
23.0 | 1.1 | 24.0 | 1.5 | ||||||||||||
Operating income
|
20.1 | 49.3 | 75.2 | 95.9 | ||||||||||||
Interest expense
|
3.0 | 3.5 | 6.4 | 6.1 | ||||||||||||
Interest income
|
0.2 | 0.3 | 0.4 | 0.4 | ||||||||||||
Other (expense) income, net
|
(0.6 | ) | 3.2 | (9.6 | ) | (2.8 | ) | |||||||||
Income before income taxes
|
16.7 | 49.3 | 59.6 | 87.4 | ||||||||||||
Provision for (benefit from) income taxes
|
(4.5 | ) | (3.6 | ) | 1.5 | (1.0 | ) | |||||||||
Net income
|
$ | 21.2 | $ | 52.9 | $ | 58.1 | $ | 88.4 | ||||||||
Less: net income attributable to noncontrolling interests
|
0.1 | 0.7 | 0.8 | 1.3 | ||||||||||||
Net income attributable to Fresh Del Monte Produce Inc.
|
$ | 21.1 | $ | 52.2 | $ | 57.3 | $ | 87.1 | ||||||||
Net income per ordinary share attributable to
Fresh Del Monte Produce Inc. - Basic
|
$ | 0.34 | $ | 0.82 | $ | 0.91 | $ | 1.37 | ||||||||
Net income per ordinary share attributable to
Fresh Del Monte Produce Inc. - Diluted
|
$ | 0.34 | $ | 0.82 | $ | 0.91 | $ | 1.37 | ||||||||
Weighted average number of ordinary shares:
|
||||||||||||||||
Basic
|
61,880,666 | 63,553,211 | 62,727,426 | 63,553,211 | ||||||||||||
Diluted
|
62,048,263 | 63,559,309 | 62,883,663 | 63,603,524 |
Six months ended
|
||||||||
July 2,
|
June 26,
|
|||||||
2010
|
2009
|
|||||||
Operating activities:
|
||||||||
Net income
|
$ | 58.1 | $ | 88.4 | ||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
39.7 | 42.1 | ||||||
Amortization of debt issuance costs
|
1.1 | 2.1 | ||||||
Stock-based compensation expense
|
4.5 | 3.8 | ||||||
Asset impairment charges
|
23.4 | 2.8 | ||||||
Change in uncertain tax positions
|
(0.9 | ) | (3.9 | ) | ||||
Gain on sales of property, plant and equipment
|
(3.4 | ) | (1.9 | ) | ||||
Equity in income of unconsolidated companies
|
(0.1 | ) | (0.5 | ) | ||||
Deferred income taxes
|
(2.6 | ) | 0.1 | |||||
Foreign currency translation adjustment
|
(8.8 | ) | 4.5 | |||||
Changes in operating assets and liabilities:
|
||||||||
Receivables
|
(13.4 | ) | 24.0 | |||||
Inventories
|
55.3 | 47.2 | ||||||
Prepaid expenses and other current assets
|
(6.4 | ) | 0.4 | |||||
Accounts payable and accrued expenses
|
22.5 | (2.4 | ) | |||||
Other noncurrent assets and liabilities
|
(10.0 | ) | 4.3 | |||||
Net cash provided by operating activities
|
159.0 | 211.0 | ||||||
Investing activities:
|
||||||||
Capital expenditures
|
(28.8 | ) | (44.1 | ) | ||||
Proceeds from sales of property, plant and equipment
|
5.9 | 7.3 | ||||||
Return of investment by unconsolidated company
|
4.2 | - | ||||||
Net cash used in investing activities
|
(18.7 | ) | (36.8 | ) | ||||
Financing activities:
|
||||||||
Proceeds from long-term debt
|
281.2 | 124.9 | ||||||
Payments on long-term debt
|
(388.2 | ) | (310.9 | ) | ||||
Contributions from noncontrolling interests, net
|
1.5 | 8.5 | ||||||
Proceeds from stock options exercised
|
0.2 | - | ||||||
Repurchase of shares
|
(49.7 | ) | - | |||||
Net cash used in financing activities
|
(155.0 | ) | (177.5 | ) | ||||
Effect of exchange rate changes on cash
|
6.7 | 2.4 | ||||||
Net decrease in cash and cash equivalents
|
(8.0 | ) | (0.9 | ) | ||||
Cash and cash equivalents, beginning
|
34.5 | 27.6 | ||||||
Cash and cash equivalents, ending
|
$ | 26.5 | $ | 26.7 | ||||
Supplemental cash flow information:
|
||||||||
Cash paid for interest
|
$ | 5.5 | $ | 4.2 | ||||
Cash paid for income taxes
|
$ | 3.1 | $ | 2.5 | ||||
Non-cash financing and investing activities:
|
||||||||
Purchase of assets under capital lease obligations
|
$ | 0.4 | $ | 0.1 | ||||
Retirement of treasury shares
|
$ | 49.7 | $ | - |
Quarter ended
|
Six months ended
|
|||||||||||||||
July 2,
|
June 26,
|
July 2,
|
June 26,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Charges related to asset impairments, net
|
$ | 5.3 | $ | - | $ | 6.3 | $ | 2.0 | ||||||||
Asset impairment and other charges (credits) related to exit activities, net
|
17.7 | 1.1 | 17.7 | (0.5 | ) | |||||||||||
Total asset impairment and other charges, net
|
$ | 23.0 | $ | 1.1 | $ | 24.0 | $ | 1.5 |
Exit activity
|
Exit activity
|
|||||||||||||||
reserve balance at
|
Impact to
|
Cash
|
reserve balance at
|
|||||||||||||
January 1, 2010
|
earnings
|
paid
|
July 2, 2010
|
|||||||||||||
Termination benefits
|
$ | 1.7 | $ | 1.1 | $ | (1.4 | ) | $ | 1.4 | |||||||
Contract termination and other
|
||||||||||||||||
exit activity charges
|
1.4 | - | (0.1 | ) | 1.3 | |||||||||||
$ | 3.1 | $ | 1.1 | $ | (1.5 | ) | $ | 2.7 |
Six months ended
|
||||||||
July 2,
|
June 26,
|
|||||||
2010
|
2009
|
|||||||
Noncontrolling interests, beginning
|
$ | 22.1 | $ | 17.0 | ||||
Net income attributable to the noncontrolling interests
|
0.8 | 1.3 | ||||||
Translation adjustments
|
0.4 | (0.2 | ) | |||||
Capital contributions
|
0.8 | 2.4 | ||||||
Noncontrolling interests, ending
|
$ | 24.1 | $ | 20.5 |
Quarter ended
|
Six months ended
|
|||||||||||||||
July 2,
|
June 26,
|
July 2,
|
June 26,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Stock-based compensation expense
|
$ | 2.5 | $ | 1.5 | $ | 4.5 | $ | 3.8 | ||||||||
Stock-based compensation expense per diluted share
|
$ | 0.04 | $ | 0.02 | $ | 0.07 | $ | 0.06 |
July 2,
|
January 1,
|
|||||||
2010
|
2010
|
|||||||
Finished goods
|
$ | 155.1 | $ | 178.0 | ||||
Raw materials and packaging supplies
|
114.1 | 120.5 | ||||||
Growing crops
|
112.2 | 138.4 | ||||||
Total inventories
|
$ | 381.4 | $ | 436.9 |
Quarter ended
|
Six months ended
|
|||||||||||||||
July 2,
|
June 26,
|
July 2,
|
June 26,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Comprehensive income:
|
||||||||||||||||
Net income
|
$ | 21.2 | $ | 52.9 | $ | 58.1 | $ | 88.4 | ||||||||
Net unrealized (loss) gain on derivatives
|
(7.9 | ) | (15.0 | ) | 1.9 | (0.2 | ) | |||||||||
Net unrealized foreign currency
|
||||||||||||||||
translation gain (loss)
|
5.1 | 25.2 | (5.1 | ) | 16.2 | |||||||||||
Net change in retirement benefit
|
||||||||||||||||
adjustment, net of tax
|
0.3 | 1.0 | - | 0.9 | ||||||||||||
Comprehensive income
|
18.7 | 64.1 | 54.9 | 105.3 | ||||||||||||
Less: comprehensive income attributable to
noncontrolling interests
|
0.3 | 0.6 | 1.2 | 1.1 | ||||||||||||
Comprehensive income attributable to Fresh Del
Monte Produce Inc.
|
$ | 18.4 | $ | 63.5 | $ | 53.7 | $ | 104.2 |
Quarter ended
|
Six months ended
|
|||||||||||||||
July 2,
|
June 26,
|
July 2,
|
June 26,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Numerator:
|
||||||||||||||||
Net income attributable to Fresh Del Monte Produce Inc.
|
$ | 21.1 | $ | 52.2 | $ | 57.3 | $ | 87.1 | ||||||||
Denominator:
|
||||||||||||||||
Weighted average ordinary shares - Basic
|
61,880,666 | 63,553,211 | 62,727,426 | 63,553,211 | ||||||||||||
Effect of dilutive securities - stock options
|
167,597 | 6,098 | 156,237 | 50,313 | ||||||||||||
Weighted average ordinary shares - Diluted
|
62,048,263 | 63,559,309 | 62,883,663 | 63,603,524 | ||||||||||||
Net income per ordinary share attributable
|
||||||||||||||||
to Fresh Del Monte Produce Inc.:
|
||||||||||||||||
Basic
|
$ | 0.34 | $ | 0.82 | $ | 0.91 | $ | 1.37 | ||||||||
Diluted
|
$ | 0.34 | $ | 0.82 | $ | 0.91 | $ | 1.37 |
Quarter ended
|
Six months ended
|
|||||||||||||||
July 2,
|
June 26,
|
July 2,
|
June 26,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Service cost
|
$ | 0.8 | $ | 0.4 | $ | 1.6 | $ | 0.9 | ||||||||
Interest cost
|
1.8 | 1.6 | 3.7 | 3.3 | ||||||||||||
Expected return on assets
|
(0.8 | ) | (0.6 | ) | (1.7 | ) | (1.1 | ) | ||||||||
Net amortization
|
0.2 | - | 0.5 | 0.1 | ||||||||||||
Net periodic costs
|
$ | 2.0 | $ | 1.4 | $ | 4.1 | $ | 3.2 |
Quarter ended | ||||||||||||||||
July 2, 2010
|
June 26, 2009
|
|||||||||||||||
Product net sales and gross profit:
|
Net Sales
|
Gross Profit (Loss)
|
Net Sales
|
Gross Profit (Loss)
|
||||||||||||
Banana
|
$ | 452.1 | $ | 30.4 | $ | 413.1 | $ | 47.4 | ||||||||
Other fresh produce
|
447.8 | 43.2 | 445.9 | 27.3 | ||||||||||||
Prepared foods
|
89.8 | 10.9 | 85.7 | 16.9 | ||||||||||||
Other products and services
|
10.3 | (1.5 | ) | 33.7 | (0.6 | ) | ||||||||||
Total
|
$ | 1,000.0 | $ | 83.0 | $ | 978.4 | $ | 91.0 | ||||||||
Six months ended | ||||||||||||||||
July 2, 2010
|
June 26, 2009
|
|||||||||||||||
Net Sales
|
Gross Profit
|
Net Sales
|
Gross Profit
|
|||||||||||||
Banana
|
$ | 854.9 | $ | 48.9 | $ | 774.6 | $ | 91.0 | ||||||||
Other fresh produce
|
887.3 | 107.9 | 865.1 | 54.9 | ||||||||||||
Prepared food
|
172.7 | 23.6 | 162.5 | 27.9 | ||||||||||||
Other products and services
|
28.2 | 0.4 | 55.9 | 1.0 | ||||||||||||
Total
|
$ | 1,943.1 | $ | 180.8 | $ | 1,858.1 | $ | 174.8 |
Foreign Currency Hedges:
|
Notional Amount
|
||||
Euro
|
€ | 212.4 |
million
|
||
British pound
|
£ | 18.7 |
million
|
||
Japanese yen
|
JPY |
21,522.0
|
million
|
||
Polish zloty
|
PLN |
6.0
|
million
|
||
Bunker Fuel Hedges:
|
|||||
3% U.S. Gulf Coast
|
81,280 |
barrels
|
|||
3% U.S. Gulf Coast
|
5,800 |
metric tons
|
|||
3.5% Rotterdam Barge
|
22,200 |
metric tons
|
|||
Singapore 380
|
12,100 |
metric tons
|
|||
Derivatives Designated as Hedging Instruments
(1)(2)
|
||||||||||||||||
Foreign exchange contracts
|
Bunker fuel swap agreements
|
|||||||||||||||
Balance Sheet Location:
|
July 2, 2010
|
January 1, 2010
|
July 2, 2010
|
January 1, 2010
|
||||||||||||
Asset derivatives:
|
||||||||||||||||
Prepaid expenses and other current assets
|
$ | 25.5 | $ | 12.0 | $ | - | $ | 4.3 | ||||||||
Other noncurrent assets
|
5.6 | 3.3 | - | - | ||||||||||||
Total asset derivatives
|
$ | 31.1 | $ | 15.3 | $ | - | $ | 4.3 | ||||||||
Liability derivatives:
|
||||||||||||||||
Accounts payable and accrued expenses
|
4.1 | - | 0.2 | - | ||||||||||||
Other noncurrent liabilities
|
4.4 | - | - | - | ||||||||||||
Total liability derivatives
|
$ | 8.5 | $ | - | $ | 0.2 | $ | - |
(1)
We expect that $21.2 million of the net fair value of hedges recognized as a net gain in accumulated other comprehensive income
("AOCI") will be transferred to earnings during the next 12 months and $1.2 million will be transferred to earnings during 2011 and 2012,
along with the effect of the related forecasted transaction.
|
||||||||||
(2)
See Note 16, "
Fair Value Measurements
", for fair value disclosures.
|
Derivatives in Cash Flow Hedging Relationships
|
Amount of Gain (Loss) Recognized in
Other Comprehensive Income on
Derivatives (Effective Portion)
|
Location of Gain
(Loss) Reclassified
from AOCI into
Income (Effective Portion)
|
Amount of Gain (Loss) Reclassified
from AOCI into Income
(Effective Portion)
|
||||||||||||||
Quarter ended
|
Quarter ended
|
||||||||||||||||
July 2, 2010
|
June 26, 2009
|
July 2, 2010
|
June 26, 2009
|
||||||||||||||
Foreign exchange contracts
|
$ | (4.2 | ) | $ | (17.4 | ) |
Net sales
|
$ | 11.4 | $ | 6.4 | ||||||
Foreign exchange contracts
|
(0.2 | ) | 2.4 |
Cost of products sold
|
0.3 | 0.2 | |||||||||||
Bunker fuel swap agreements
(1)
|
(3.4 | ) | - |
Cost of products sold
|
0.7 | - | |||||||||||
Total
|
$ | (7.8 | ) | $ | (15.0 | ) | $ | 12.4 | $ | 6.6 | |||||||
Six months ended
|
Six months ended
|
||||||||||||||||
July 2, 2010
|
June 26, 2009
|
July 2, 2010
|
June 26, 2009
|
||||||||||||||
Foreign exchange contracts
|
$ | 7.3 | $ | (5.3 | ) |
Net sales
|
$ | 16.0 | $ | 17.3 | |||||||
Foreign exchange contracts
|
(0.9 | ) | 5.1 |
Cost of products sold
|
0.9 | (0.9 | ) | ||||||||||
Bunker fuel swap agreements
(1)
|
(4.5 | ) | - |
Cost of products sold
|
1.6 | - | |||||||||||
Total
|
$ | 1.9 | $ | (0.2 | ) | $ | 18.5 | $ | 16.4 | ||||||||
(1)
The bunker fuel swap agreements had an inneffective portion of less than $0.1 million for the quarter ended July 2, 2010.
|
Fair Value Measurements
|
||||||||||||||||
Foreign currency hedges,
net asset
|
Bunker fuel hedges,
asset (liability)
|
|||||||||||||||
July 2,
2010
|
January 1,
2010
|
July 2,
2010
|
January 1,
2010
|
|||||||||||||
Quoted Prices in Active
|
||||||||||||||||
Markets for Identical
|
||||||||||||||||
Assets (Level 1)
|
$ | - | $ | - | $ | - | $ | - | ||||||||
Observable Inputs (Level 2)
|
22.6 | 15.3 | (0.2 | ) | 4.3 | |||||||||||
Significant Unobservable
|
||||||||||||||||
Inputs (Level 3)
|
- | - | - | - |
Fair Value Measurements
|
||||||||||||||||
Total
|
Quoted Prices in
Active Markets for Identical Assets
(Level 1)
|
Significant Other Observable
Inputs
(Level 2)
|
Significant Unobservable
Inputs
(Level 3)
|
|||||||||||||
Investment in subsidiary
|
$ | 7.8 | $ | - | $ | 7.8 | $ | - | ||||||||
$ | 7.8 | $ | - | $ | 7.8 | $ | - | |||||||||
Net sales by geographic region:
|
||||||||||||||||||||||||||||||||
Quarter ended
|
Six months ended
|
|||||||||||||||||||||||||||||||
July 2, 2010
|
June 26, 2009
|
July 2, 2010
|
June 26, 2009
|
|||||||||||||||||||||||||||||
North America
|
$ | 475.9 | 48 | % | $ | 464.5 | 48 | % | $ | 974.9 | 50 | % | $ | 913.4 | 49 | % | ||||||||||||||||
Europe
|
262.3 | 26 | % | 283.2 | 29 | % | 505.5 | 26 | % | 518.3 | 28 | % | ||||||||||||||||||||
Asia
|
132.5 | 13 | % | 135.3 | 14 | % | 225.5 | 12 | % | 240.2 | 13 | % | ||||||||||||||||||||
Middle East
|
113.3 | 11 | % | 72.6 | 7 | % | 199.6 | 10 | % | 133.8 | 7 | % | ||||||||||||||||||||
Other
|
16.0 | 2 | % | 22.8 | 2 | % | 37.6 | 2 | % | 52.4 | 3 | % | ||||||||||||||||||||
Total
|
$ | 1,000.0 | 100 | % | $ | 978.4 | 100 | % | $ | 1,943.1 | 100 | % | $ | 1,858.1 | 100 | % |
·
|
Net sales of bananas increased by $39.0 million principally due to higher sales volume in the Middle East and North America, partially offset by lower sales volume in Asia and lower per unit sales prices in Europe, Asia and the Middle East. Worldwide banana sales volume increased by 14%.
|
o
|
Europe banana sales volume remained flat. Per unit sales prices decreased as compared with the prior year as a result of oversupply and lower demand, combined with unfavorable exchange rates.
|
o
|
North America banana sales volume increased as a result of increased supplies. Per unit sales were higher as compared with the prior year.
|
o
|
Asia banana sales volume decreased as a result of unfavorable growing conditions in the Philippines. The decrease in per unit sales prices as compared with the prior year was partially offset by favorable exchange rates.
|
o
|
Middle East banana sales volume increased as a result of entering into new markets in this region. Per unit sales prices decreased as compared with the prior year.
|
·
|
Net sales in the prepared food segment increased $4.1 million principally as the result of increased sales in our Jordanian poultry and prepared meat business, combined with higher net sales of canned pineapples and beverage product lines, partially offset by lower sales volume of canned deciduous fruit due to the weak economic condition in Europe.
|
·
|
Net sales in the other fresh produce segment increased $1.9 million principally as a result of higher net sales of pineapples, vegetables and strawberries, partially offset by lower net sales of melons, tomatoes, potatoes and non-tropical fruit.
|
o
|
Net sales of pineapples increased principally as a result of a 20% increase in sales volume as a result of higher production in Costa Rica, partially offset by lower per unit sales prices.
|
o
|
Net sales of vegetables and strawberries increased principally as a result of higher sales volume in North America.
|
o
|
Net sales of melons decreased principally as a result of planned sales volume reductions, partially offset by an increase in per unit sales prices in North America.
|
o
|
Net sales of tomatoes decreased primarily as a result of lower volumes due to cold weather and crop delay in North America.
|
o
|
Net sales of non-tropical fruit decreased principally due to lower sales volumes of avocados in North America, partially offset by higher sales of apples and citrus in the Middle East.
|
·
|
Net sales in the other products and services segment decreased $23.4 million principally as a result of lower third-party freight revenue due to the elimination of freight services from Northern Europe to the Caribbean and lower net sales in our Argentine grain operations.
|
·
|
Gross profit in the banana segment decreased $17.0 million primarily due to lower per unit sales prices in Europe, Asia and the Middle East, combined with higher worldwide ocean freight costs as a result of higher fuel costs along with inventory write-offs in Guatemala. These decreases were partially offset by higher per unit sales prices in North America. On a worldwide basis, banana per unit sales prices decreased 4% and total per unit costs increased 1%.
|
·
|
Gross profit in the prepared food segment decreased $6.0 million principally as a result of higher production costs, combined with lower sales volume of canned deciduous fruit.
|
·
|
Gross profit in the other products and services segment decreased $0.9 million as a result of reduced sales in the third-party freight business.
|
·
|
Gross profit in the other fresh produce segment increased $15.9 million principally due to higher gross profit on pineapples and non-tropical fruit, partially offset by lower gross profit on melons.
|
o
|
Gross profit on pineapples increased principally due to the absence of the $17.1 million charge recorded during the second quarter of 2009 related to our decision to discontinue pineapple planting in Brazil, combined with higher sales volumes. These increases in gross profit were partially offset by a 7% decrease in per unit sale prices and a 3% increase in per unit cost.
|
o
|
Gross profit on non-tropical fruit increased principally due to lower per unit costs and higher per unit sales prices of grapes.
|
o
|
Gross profit on melons decreased principally as the result of a charge of $5.0 million for the discontinuation of our Brazil melon growing operations combined with higher per unit costs.
|
·
|
Net sales of bananas increased by $80.3 million principally due to higher sales volume in the Middle East, Europe and North America, partially offset by lower sales volume in Asia and lower per unit sales prices in Europe, the Middle East and Asia.
|
o
|
North America banana sales volume increased as a result of increased supplies. Per unit sales prices remained relatively flat as compared with the prior year.
|
o
|
Europe banana sales volume increased as a result of increased supplies from Central and South America, resulting in lower per unit sales prices. Also contributing to the decrease in per unit sales prices were unfavorable exchange rates.
|
o
|
Asia banana sales volume decreased as a result of unfavorable growing conditions in the Philippines. The decrease in per unit sales prices as compared with prior year were partially offset by favorable exchange rates.
|
o
|
Middle East banana sales volume increased as a result of shipments to new markets in this region. Per unit sales prices decreased as compared with the prior year.
|
·
|
Net sales in the other fresh produce segment increased $22.2 million principally as a result of higher net sales of pineapples, fresh-cut products and vegetables, partially offset by lower net sales of melons and potatoes.
|
o
|
Net sales of pineapples increased principally due to a 17% increase in sales volume as a result of increased production in Costa Rica, partially offset by a 2% overall reduction in per unit sales prices.
|
o
|
Net sales of fresh-cut products increased principally due to higher sales volumes in North America and the Middle East that resulted from expansion of our customer base along with increased business with our current retail and foodservice customers in addition to higher per unit sales prices in North America and Europe, partially offset by lower sales volume in Europe.
|
o
|
Net sales of vegetables increased principally as a result of higher sales volume of onions and bell peppers in North America.
|
o
|
Net sales of melons decreased principally as a result of planned sales volume reductions, partially offset by higher per unit sales prices in North America.
|
o
|
Net sales of potatoes decreased primarily as a result of continued product rationalization.
|
·
|
Net sales in the prepared food segment increased $10.2 million principally as the result of increased sales in our Jordanian poultry and processed meat business, industrial juice concentrate and beverage product lines.
|
·
|
Net sales in the other products and services segment decreased $27.7 million principally as a result of lower third-party freight revenue due to the elimination of freight services from Northern Europe to the Caribbean and lower net sales in our Argentine grain operations.
|
·
|
Gross profit in the other fresh produce segment increased $53.0 million principally due to higher gross profit on pineapples, non-tropical fruit, melons and fresh-cut products.
|
o
|
Gross profit on pineapples principally reflected a charge of $17.1 million that was recorded in the second quarter 2009 related to the write-off of growing crop inventory as a result of our decision to discontinue pineapple planting in Brazil. Also contributing to the increase in gross profit on pineapples during the first six months of 2010 were lower per unit costs and higher sales volume in North America, the Middle East and Asia.
|
o
|
Gross profit on non-tropical fruit increased principally due to higher per unit sales prices as a result of industry shortages of grapes, combined with improved quality and a 5% reduction in per unit costs.
|
o
|
Gross profit on melons increased principally as the result of improvements in per unit sales prices in North America, partially offset by lower per unit sales prices in Europe, higher fruit production and procurement and ocean freight costs, combined with the charge of $5.0 million for the discontinuation of our Brazil melon growing operations.
|
o
|
Gross profit on fresh-cut fruit increased as a result of higher sales that resulted from expansion of our customer base and improved product mix.
|
·
|
Gross profit in the banana segment decreased $42.1 million primarily due to lower per unit sales prices in Europe that resulted from increased supply in the market, combined with higher worldwide freight costs as a result of higher fuel prices and unfavorable exchange rates. On a worldwide basis, banana per unit sales prices decreased 4% and total per unit costs increased 2%.
|
·
|
Gross profit in the prepared food segment decreased $4.3 million principally as a result of higher per unit costs of canned deciduous fruit and canned pineapple.
|
·
|
Gross profit in the other products and services segment decreased $0.6 million primarily as a result of lower third-party freight revenues.
|
Item 4.
|
Item 1.
|
Item 1A.
|
Item 6.
|
Exhibits |
10.1*
|
Fresh Del Monte Produce Inc. 2010 Non-Employee Directors Equity Plan, effective as of May 5, 2010.
|
10.2*
|
Amended and Restated Fresh Del Monte Produce Inc. Performance Incentive Plan for Senior Executives, effective May 5, 2010.
|
10.3*
|
Fresh Del Monte Produce Inc. Long-Term Incentive Plan, effective January 1, 2008 (as Amended May 5, 2010).
|
31.1*
|
Certification of Chief Executive Officer filed pursuant to 17 CFR 240.13a-14(a).
|
31.2*
|
Certification of Chief Financial Officer filed pursuant to 17 CFR 240.13a-14(a).
|
32*
|
Certification of Chief Executive Officer and Chief Financial Officer furnished pursuant to 17 CFR 240.13a-14(b) and 18 U.S.C. Section 1350.
|
101.INS**
|
XBRL Instance Document (furnished herewith).
|
101.SCH**
|
XBRL Taxonomy Extension Schema Document Linkbase Document (furnished herewith).
|
101.CAL**
|
XBRL Taxonomy Extension Calculation Linkbase Document (furnished herewith).
|
101.DEF**
|
XBRL Taxonomy Extension Definition Linkbase Document (furnished herewith).
|
101.LAB**
|
XBRL Taxonomy Extension Label Linkbase Document (furnished herewith).
|
101.PRE**
|
XBRL Taxonomy Extension Presentation Linkbase Document (furnished herewith).
|
*
|
Filed herewith
|
**
|
In accordance with Rule 406T of Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
|
Fresh Del Monte Produce Inc.
|
||
Date: August 3, 2010
|
By:
|
/s/
Hani El-Naffy
|
Hani El-Naffy
|
||
President & Chief Operating Officer
|
||
By:
|
/s/
Richard Contreras
|
|
Richard Contreras
|
||
Senior Vice President & Chief Financial Officer
|
Exhibit No. | Description | |
10.1
|
Fresh Del Monte Produce Inc. 2010 Non-Employee Directors Equity Plan, effective as of May 5, 2010.
|
|
10.2
|
Amended and Restated Fresh Del Monte Produce Inc. Performance Incentive Plan for Senior Executives, effective May 5, 2010.
|
|
10.3
|
Fresh Del Monte Produce Inc. Long-Term Incentive Plan, effective January 1, 2008 (as Amended May 5, 2010).
|
|
31.1
|
Certification of Chief Executive Officer filed pursuant to 17 CFR 240.13a-14(a).
|
|
31.2
|
Certification of Chief Financial Officer filed pursuant to 17 CFR 240.13a-14(a).
|
|
32
|
Certification of Chief Executive Officer and Chief Financial Officer furnished pursuant to 17 CFR 240.13a-14(b) and 18 U.S.C. Section 1350.
|
|
101.INS*
|
XBRL Instance Document (furnished herewith).
|
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document Linkbase Document (furnished herewith).
|
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document (furnished herewith).
|
|
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document (furnished herewith).
|
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document (furnished herewith).
|
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document (furnished herewith).
|
|
*
|
In accordance with Rule 406T of Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
|
Date: August 3, 2010
|
|
Signature:
|
/s/
Mohammad Abu-Ghazaleh
|
Title:
|
Chairman and Chief Executive Officer
|
Date: August 3, 2010
|
|
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 July 2, 2010, 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: August 3, 2010
|
By:
|
/s/
Mohammad Abu-Ghazaleh
|
Name:
|
Mohammad Abu-Ghazaleh
|
|
Title:
|
Chairman and Chief Executive Officer
|
|
Date: August 3, 2010
|
By:
|
/s/
Richard Contreras
|
Name:
|
Richard Contreras
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|