It has been an encouraging start to 2011 for Chiquita Brands International, which has revealed that net income bounced back through the first quarter of the year, up to US$24m (€17.6m) from a loss of US$9m (€6.1m) last year.
Net sales climbed to US$824m (€558m) through the opening quarter, up from US$808m (€547m) last year, the result of a stronger performance in the group's banana sector – although this was partially offset by weaker results in Salads and healthy snacks and increased income tax costs.
'We delivered a turn-around in profitability in the first quarter by executing well and overcoming increased industry costs,' said Fernando Aguirre, chairman and CEO at Chiquita. 'I am particularly pleased with the progress we are making in Europe, and am confident that we can regain prior levels of profitability in the medium and the long-term and maximise our premium brand position.
'In North America, our banana business continues to perform well and we are very focused on attracting new customers to increase our salad distribution as the year progresses,' he added. 'Importantly, we are off to a good start for the year in terms of profitability ad although second quarter comparisons may be more challenging, we continue to expect to deliver significant operating profit improvement in 2011 versus 2010.'
Net sales for the banana segment increased 13 per cent to US$539m (€365m), as the company achieved higher local pricing to overcome increased supplier costs associated with tight supply conditions.
According to Chiquita, European market prices for bananas reflected improved consumer demand, while North American pricing included force majeure surcharges that began in late January to recover higher sourcing costs that have continued since late 2010.
In salads and healthy snacks, net sales dropped 8 per cent to US$238m (€161m) with comparable operating income down to US$6m (€4.1m), primarily the result of lower retail value-added salad volume from customer conversions to private label in 2010, and increased costs from adverse weather conditions during the winter lettuce sourcing season in Arizona.
For the full year of 2011, the group is anticipating a 3 per cent increase in net sales, while it 'expects to significantly improve its full-year operating profitability'.
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