FRESH DEL MONTE PRODUCE INC Q1 FY2025 earnings call

• Began Q1 2025 with momentum, strong starts in key categories, optimized product mix, and focus on operational efficiency.
• Fresh and Value-Added segment showed meaningful Y/Y improvements in gross profit and margin. Pineapples performed well with demand exceeding supply. Avocados and fresh-cut fruit have strong consumer interest.
• Vertically integrated supply chain provided resilience amidst global shipping disruptions.
• Acquired majority stake in Avolio, Uganda’s leading avocado oil producer, to convert sub-standard avocados to premium oil, reducing waste and creating value.
• Vision for 2025-2027: Lead in Fresh and Value-Added Products, focus on quality, innovation, sustainability, maximizing fruit residues, and creating Value-Added solutions.

Fresh and Value-Added Product segment: Net sales were $683 million in Q1 2025, compared with $677 million in the prior year. Gross profit was $69 million, compared with $56 million in the prior year. Gross margin increased to 10.1%. Banana segment: Net sales were $364 million, compared with $380 million in the prior year. Gross profit was $17 million, compared with $22 million in the prior year. Gross margin decreased to 4.6%. Other Products and Services segment: Net sales were $51 million, in line with the prior year. Gross profit was $6 million, compared with $5 million last year. Gross margin increased to 11.9%.

• Full year 2025 net sales expected to grow 2% Y/Y.
• Fresh and Value-Added segment gross margin expected 10%-11%, Banana segment 5%-7%, Other Products and Services 12%-14%.
• Selling, general and administrative expenses expected $205M-$210M.
• CapEx expected $80M-$90M.
• Net cash provided by operating activities expected $180M-$190M.

• Evolving tariff situation, with current monitoring of developments.
• Geopolitical uncertainties and logistical uncertainties impacting operations.

Q: Talk about produce category demand, especially with consumer pressure.

A: Solid demand in fresh produce sector, no reduction in consumption expected; disruptions may create opportunities.

Q: Logistic issues and how company is taking advantage.

A: Small/medium players at disadvantage due to disruptions; company's integrated supply chain provides flexibility and ability to fulfill customer requirements on time.

Q: Tariffs, passing through to consumer.

A: Mitigating tariffs with buyers to avoid negatively impacting consumers.

Q: Avocado performance.

A: Avocado business is growing, sourcing diversified from Peru, Colombia, etc.

Q: Pineapple supply and normalization.

A: Demand for pineapple increasing due to favorable price compared to other fruits and health benefits; consumption growth driven by price and health aspects.