On November 1, 2023, Fresh Del Monte Produce Inc (FDP, Financial) released its financial results for the third quarter and the nine months ended September 29, 2023. The company reported solid results for the first nine months of 2023, driven by higher gross margins, strong adjusted EBITDA, and adjusted earnings per share growth compared with the same period last year. The company also continued to return shareholder value by reducing its debt, improving efficiencies, and continuing to deliver innovation-led, new-to-market products.
Financial Highlights for the Third Quarter 2023
Net sales for the third quarter of 2023 were $1,003.1 million compared with $1,053.5 million in the prior-year period. The net sales variance was primarily driven by lower sales volume in the fresh and value-added product segment and a decrease in sales in the other products and services segment due to softened global demand in our third-party ocean freight business. Gross profit for the third quarter of 2023 was $74.4 million compared with $88.0 million in the prior-year period. Operating income for the third quarter of 2023 was $25.4 million compared with $51.0 million in the prior-year period.
Business Segment Performance
The Fresh and Value-Added Products segment reported net sales of $574.0 million for the third quarter of 2023, compared with $599.8 million in the prior-year period. The Banana segment reported net sales of $384.7 million for the third quarter of 2023, compared with $388.4 million in the prior-year period. The Other Products and Services segment reported net sales of $44.4 million for the third quarter of 2023, compared with $65.3 million in the prior-year period.
Cash Flows and Long-Term Debt
Net cash provided by operating activities for the first nine months of 2023 was $180.1 million compared with $105.7 million in the prior-year period. The increase was primarily attributable to lower working capital, mainly related to lower levels of raw materials and packaging supplies inventory combined with higher net income. Total long-term debt remained sequentially relatively flat at $401.0 million at the end of the third quarter of 2023 from $400.5 million at the end of the second quarter of 2023 and decreased by approximately 26% from $539.8 million at the end of fiscal year 2022.
Dividend Announcement
On October 31, 2023, the Company's Board of Directors declared a quarterly cash dividend of $0.20 per share, payable on December 8, 2023 to shareholders of record on November 15, 2023.
Conclusion
Fresh Del Monte Produce Inc (FDP, Financial) has demonstrated a strong performance in the third quarter and first nine months of 2023, with significant growth in its Banana and Avocados segments, a reduction in long-term debt, and an increase in diluted earnings per share. The company's commitment to innovation and efficiency has contributed to its solid results and shareholder value.
Explore the complete 8-K earnings release (here) from Fresh Del Monte Produce Inc for further details.
