Fyffes re-merger 'not on agenda'

A RE-MERGER of Fyffes and Total Produce is “not on the agenda” at the moment, the chairman of Fyffes has said.

Responding to a query from a shareholder at the Fyffes annual general meeting in Dublin yesterday, David McCann said a re-merger was something that the company thought about “from time to time” but it was not currently on the agenda.

General produce and distribution business Total Produce demerged from Fyffes in 2006.

Fyffes yesterday upgraded its guidance for the year for earnings before interest, tax and amortisation by about 12 per cent to between €25 million and €30 million, from €22 million to €27 million previously. This equates to adjusted earnings per share of between 6.8 cent and 8.3 cent, up from 6.05 cent in 2011.

Among the drivers of the upgrade was a continued focus on costsaving measures, while “necessary increases in selling prices in all markets” were also being implemented, the company said.

Tropical fruit group Fyffes, which has its headquarters in Dundalk, Co Louth, imports and sells melons, pineapples and bananas to markets across the world.

According to the company, it is now the number-one melon importer in the US, and has eclipsed Chiquita as the largest banana importer in Europe.

Turnover last year rose by 14.5 per cent to €850 million, an increase attributed to acquisitions, such as the purchase last year of 33 per cent of German distribution business vanWylick, as well as organic growth.

Earnings before interest, tax, depreciation and amortisation in 2011 was €29.6 million, a 10 per cent increase on 2010. The company wrote down the value of its investment in Balmoral, the property investment spin-off from Fyffes, by €11.9 million last year.

Total dividend for the year was €1.925, up from €1.75. It also engaged in a successful share buyback programme last year.

Fyffes finance director Tom Murphy said the group farmed 7,400 hectares in Central and South America, compared to 1,800 in 2006. Mr McCann said the decision to buy land in the region was linked to gaining a strategic position in production. Fyffes would not acquire more land “unless it’s strategically useful”, he said.

Fyffes’s performance had been “quite consistent” despite currency volatility in recent years, Mr McCann added.