Chiquita has reported an unexpected $9 million (£5.9m) quarterly loss and cut its revenue forecast for the year, after cold weather and a weak economy hurt banana sales in Europe.
The global produce giant reported 2010 sales are expected to increase between one per cent and three per cent. It had previously projected a three to five per cent gain.
According to a report for the first quarter, Chiquita’s North American salad and banana businesses performed well in the period.
But European banana demand and pricing “were negatively impacted by the harshest winter weather in 30 years and depressed economic conditions” across Europe, according to chief executive Fernando Aguirre.
First quarter net sales totalled $808m, down four per cent from $842m a year earlier - a surprise to analysts who had expected a better performance.
Chiquita’s first-quarter loss, which compares with a profit of $23 million during the same quarter in 2009, illustrates the difficulties food companies face as the global economy recovers from a sharp recession.
During the first quarter, Chiquita’s banana sales fell 1.8 per cent, while salad and healthy snacks declined eight per cent. While North American banana pricing increased 3.9 per cent, prices in Europe fell 5.7 per cent in US dollar terms, Chiquita said.
Aguirre said “revitalising [our] European profitability in 2010 is our most important priority”.
The Cincinatti-based company said banana sourcing and production costs are expected to increase in 2010 compared with last year, reflecting smaller supplies and higher fuel prices.
Aguirre said: “Industry supplies in Latin America and Asia are expected to tighten as the year progresses, helping to restore the balance of supply and demand in the market.”
Chiquita reiterated a previous forecast for full-year income of $110m to $120m.
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