Fourth-quarter 2007 net sales rose by around six per cent year over year, said global banana giant Chiquita in its preliminary results, with full year net sales rising by four per cent to $4.7 billion (£2.37bn) compared to 2006.
The company expects adjusted operating income in the range of $62-72 million for the full year. “Our estimated fourth-quarter results reflect improved year-on-year operating performance in the fourth quarter, despite a rising cost environment,” said chairman and ceo Fernando Aguirre. “In addition, our business restructuring announced in October remains on track to deliver our targeted savings in 2008.
“We will remain focused on three priorities in 2008 to drive progress on our strategy to achieve sustainable, profitable growth. First, we will complete the restructuring we began implementing in October to improve profitability by consolidating our operations and simplifying our overhead structure. Second, we will seek to improve execution and market performance in our core business, while managing through a difficult cost environment. Third, we will continue to invest in long-term growth opportunities by expanding the introduction of innovative, higher-margin products that can help diversify our business by product, channel and geography.”
Chiquita expects year-on-year performance to improve in 2008, primarily due to contract and market price increases, including fuel-related surcharges and the benefits of the business restructuring, which it believes remains on track to deliver $60-80m in year-on-year cost savings in 2008.
The company is also announcing a review of its capital structure, considering options including a potential amendment or refinancing of its senior secured credit facility and a convertible note offering.
Chiquita is still exploring alternatives for its German distribution business Atlanta AG, including a possible sale, although no time-scale for a firm decision has been set.
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