CHIQUITA REPORTS SECOND QUARTER 2012 RESULTS COMPANY PRESENTS TRANSFORMATION STRATEGY AND PROVIDES OUTLOOK COMPANY ANNOUNCES CEO TRANSITION PROCESS
Second quarter results of comparable diluted EPS of $0.27; GAAP diluted EPS of $0.12
Primary goals are increasing cash flow, reducing debt, and driving shareholder value
Target operating margins introduced at 4 percent for Bananas and 7 to 8 percent for Salads
Restructuring will result in at least $60 million of annual savings and will focus Chiquita on core Banana and Salad businesses
CHARLOTTE - August 7, 2012 - Chiquita Brands (NYSE: CQB) today released financial and operating results for the second quarter of 2012 and announced restructuring activities designed to increase long-term profitability. The Company reported GAAP net income of $6 million on net sales of $833 million and comparable net income of $12 million. For the same period in 2011, the company reported GAAP net income of $78 million on net sales of $870 million and comparable net income of $34 million. The 2011 second quarter GAAP net income includes, among other items, the benefit of an $87 million income tax valuation allowance release, partially offset by a $32 million non-cash reserve for prior grower advances.
"While we do not believe that Chiquita's second quarter results reflect the sustainable earnings potential of our business, our results exceeded our expectations, in spite of the significant impact from the dramatic reduction in the value of the euro and difficult pricing comparisons to 2011. The negative euro impact alone was $26 million," said Fernando Aguirre, chairman and chief executive officer. "Our Banana business continues to be stable. Our sales volumes were at similar levels to the same period of 2011, but the product supply surcharge that was in place for 2011 in North America and the large and rapid decline in the value of the euro resulted in difficult pricing comparisons to 2011. In Salads, although we had lower retail sales volumes than the year ago quarter, the volumes were higher than previously forecasted as we experienced increasing retail sales velocity on a same store basis, and we delivered cost reductions from 2011," Aguirre added.