Dole Moves to LossTuesday, March 12, 2013
Dole Food Co. Inc. shares dropped in after-hours trading Tuesday after the fresh food company reported a worse-than-expected loss in the fourth quarter.
The Westlake Village producer and marketer of fresh fruit and fresh vegetables expects to complete the $1.6 billion sale of its worldwide packaged foods and Asia fresh produce businesses to Itochu Corp. by April 1. Net proceeds mostly will be used to pay down debt.
After Tuesday’s market close, Dole reported adjusted earnings for its remaining operations, the fresh vegetables business and fresh fruit businesses in North America, Latin America, Europe and Africa. The loss from continuing operations was $88 million (-99 cents a share) for the quarter ended Dec. 29, compared with net income of $6 million (6 cents) in the same period a year earlier. Revenue from continuing operations fell nearly 8 percent to $888 million.
Adjusted for one-time items, the quarter’s comparable loss was $52 million (-59 cents), compared with comparable income of $4 million (5 cents) in the same period a year earlier. Analysts surveyed by Thomson Reuters on average expected the company to report an adjusted loss of 2 cents a share on revenue of $1.3 billion.
Dole is considered the largest banana brand in North America and Japan, and second largest in Europe and profits fell in the banana market.
“While the current environment in the banana market remains challenging, we are optimistic that this transformative sale transaction will leave the new Dole with the financial and operational flexibility to grow in this competitive environment,” said C. Michael Carter, Dole president and chief operating officer, said in a statement.
Dole shares earlier closed up 7 cents, or less than 1 percent, to $11.73 on the New York Stock Exchange, and fell as much as 7 percent in after-hours trading.