Pretax profit at Total Produce rises by 2.3%

PRETAX PROFIT at Total Produce increased by 2.3 per cent to €34.4 million last year, despite the impact of the E.coli scare in Europe.

Results for 2011 show the company posted adjusted earnings per share of 7.24 cent, ahead of guidance, while it increased its final dividend by 8.6 per cent to 1.35 cent per share.

Revenue at the fruit importer and distributor declined by 2.8 per cent to €2.53 billion, reflecting a drop both in price and the volume of produce sold.

Profitability at its core fresh produce division, particularly in continental and eastern Europe, was hit by the E.coli scare last May, with adjusted earnings before interest, tax and amortisation (ebita) down 9.5 per cent from €51.5 million to €46.6 million.

Sales at the company’s euro zone fresh produce business fell by 6 per cent to €1.2 billion, while ebita fell 29 per cent to €19.8 million from €27.9 million.

The incorrect identification of certain salad lines as the source of the E.coli outbreak by German authorities had a “significant adverse effect on both consumption and prices of salads and fresh produce in general”, the company said. “The effects lasted longer than anticipated with the market slow to recover. This had a negative impact on the group’s fresh produce business and a lowering of general average prices.”

Net debt during the year increased from €47.9 million to €75.6 million. Net debt to adjusted earnings before interest, tax, depreciation and amortisation (ebitda) was 1.3 times.

The group spent €14.8 million in capital expenditure during the year, including the expansion of facilities in Sweden.

Late last year it increased its shareholding in South African company Capespan, while earlier this week it received regulatory approval for its acquisition of a 50 per cent shareholding in Dutch company Frankort & Koning.

Total Produce is Europe’s largest fruit distributor, and has operations across central and eastern Europe and Scandinavia.

The Dundalk-headquartered company employs more than 4,000 people worldwide. It was formed in 2007 as a Fyffes spin-off.