Fresh Del Monte Loss Widens

NEW YORK - Feb 27/07 - SNS -- Fresh Del Monte Produce Inc. reported a net loss of U.S. $59.9 million on sales of $737.6 million for the fourth quarter ending December 29, compared to a net loss of $3.5 million on sales of $757.9 million during the same three month period one year earlier.

This lifted the fiscal year loss to $145.1 million on sales of $3,.214.3 million, compared to a net profit of $106.6 million on sales of $3,259.7 million during the previous 12-month period.

In releasing the results, the company said the "decrease in net sales for the quarter and full year was the result of continued rationalization in the Company's 'other fresh produce' business segment, primarily in the North America vegetable product line; underperformance of the Company's prepared food business, resulting from competitive pressures in the United Kingdom and lower supply of canned pineapple during the Christmas holiday in Europe; and lower sales volume and lower selling prices of bananas in Europe."

Gross profit for the 2006 fourth quarter was $56.3 million, compared with gross profit of $40.5 million in the fourth quarter of 2005. Fourth quarter 2006 gross profit includes $3.7 million for charges primarily associated with the accelerated closing of the Company's Hawaii operations and charges related to the restructuring of a juice facility in Italy. The increase in gross profit for the quarter was due to improved performance in the Company's North America and Asia fresh produce operations, offset by lower sales in the Company's prepared food business segment, along with the negative impact of higher production costs.

Gross profit for the year was $186.5 million, compared with gross profit of $311.5 million in 2005. Full year gross profit includes $43.0 million for charges associated with the closing of the Company's operations in Hawaii, the Kenya product withdrawal program and charges associated with restructuring the Company's facility in Italy. Gross profit for the full year was negatively impacted by higher costs related to fuel, raw materials, packaging, labor, transportation and product procurement as well as the impact of lower sales in the Company's "other fresh produce" and prepared food business segments.

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