Fresh Del Monte Produce Q4 Earnings Call Highlights

Fresh Del Monte Produce (NYSE:FDP) used its fourth-quarter and full-year fiscal 2025 earnings call to highlight a strategic pivot toward a more focused portfolio and to provide an update on its pending acquisition of select assets from Del Monte Foods Corporation through a court-supervised bankruptcy process.

Management says 2025 was an “inflection point”

Chairman and CEO Mohammad Abu-Ghazaleh told investors fiscal 2025 was “not just a year of performance” but “a year of preparation,” reflecting what he described as a two-year shift away from a broad market approach and toward prioritizing core strengths. He said the company has been streamlining its portfolio, divesting non-core operations, and emphasizing financial discipline, operational efficiency, and high-return investments.

Abu-Ghazaleh said these actions helped strengthen the balance sheet, expand margins, and generate cash flow that preserves flexibility for reinvestment.

Del Monte Foods asset purchase: court approval received; closing targeted in Q1

Management said Fresh Del Monte recently received U.S. Bankruptcy Court approval to proceed as the purchaser of the global Del Monte brand and select core assets from California-based Del Monte Foods. Abu-Ghazaleh said the company expects the transaction to close before the end of the first quarter, subject to customary regulatory approvals and remaining closing conditions, including HSR antitrust clearance.

CFO Monica Vicente outlined the scope of assets under the deal, including vegetable, tomato, and refrigerated foods, as well as fruit businesses primarily under the Del Monte, S&W, and Contadina brands. The transaction also includes global ownership of the Del Monte brand and related intellectual property, subject to existing licensing agreements.

Operationally, Vicente said Fresh Del Monte expects to acquire:

• Four facilities in the United States
• Two facilities in Mexico
• One operation in Venezuela
• Related customer and supplier contracts and inventory at closing

The purchase price is $285 million, plus the assumption of certain liabilities, according to Vicente. Management said it was premature to discuss accretion, synergies, or fair value due to the court-supervised process and the carve-out nature of the acquired assets. The company said it plans to provide more details on segment reporting, expected financial contributions, and integration priorities on its first-quarter 2026 earnings call.

Abu-Ghazaleh framed the transaction as a reunification of the Del Monte brand, noting the brand has existed across separate platforms for decades. He said the acquired business would initially operate as a dedicated unit with a “light touch” integration approach, retaining autonomy while being supported by Fresh Del Monte’s logistics infrastructure and capital resources.

Fourth-quarter results: sales $1.02 billion; EPS $0.67

For the fourth quarter, Vicente reported net sales of $1.02 billion, citing higher sales in the other products and services and banana segments. She said results benefited from strong demand in the company’s third-party ocean freight business, higher per-unit banana selling prices, tariff-related price adjustments in North America, and favorable foreign exchange related to the euro. The increase was partially offset by lower net sales in the fresh and value-added segment due primarily to reduced sales volume in the fresh-cut vegetable product line following operational actions taken in late 2024.

Gross profit was $106 million and gross margin was 10.4%. Operating income was $46 million, which management said was driven by higher gross profit and partially offset by a lower gain on the sale of property, plant, and equipment compared with the prior year’s sale of the Toronto Distribution Center.

Net income attributable to Fresh Del Monte was $32 million, and diluted earnings per share were $0.67. Adjusted EBITDA was $67 million. On an adjusted basis, the company reported net sales of $968 million, adjusted operating income of $48 million, adjusted net income of $33 million, and adjusted diluted EPS of $0.70.

Full-year 2025: sales $4.3 billion; adjusted EPS $3.68; leverage below 1x

For full-year fiscal 2025, Vicente reported net sales of $4.3 billion, driven by higher net sales across all segments due to higher per-unit selling prices in fresh and value-added and banana. She also cited tariff-related price adjustments in North America and favorable foreign exchange related to the euro and British pound. These factors were partially offset by lower sales volume in fresh-cut vegetables following the company’s operational changes.

Gross profit was $399 million and gross margin was 9.2%. Operating income was $137 million, which Vicente said reflected higher asset impairment charges tied to low productivity in banana farms in the Philippines and charges related to the divestiture of Mann Packing, as well as a lower gain on disposals of property, plant, and equipment. On an adjusted basis, operating income was $222 million.

Net income attributable to Fresh Del Monte was $91 million, while adjusted net income attributable to Fresh Del Monte was $178 million. Diluted EPS was $1.88, and adjusted diluted EPS was $3.68. Adjusted EBITDA was $300 million.

Vicente also provided balance sheet and cash flow details, including net cash provided by operating activities of $245 million and long-term debt of $173 million at year-end. She said the adjusted leverage ratio remained below 1x EBITDA.

Segment commentary, capital allocation, and 2026 outlook

In segment results for the year, management said fresh and value-added net sales were $2.6 billion, driven by higher pineapple pricing and higher fresh-cut pricing and volumes, partially offset by lower fresh-cut vegetable sales. Banana segment net sales were $1.5 billion, supported by higher pricing in North America and improved volume in the Middle East compared with the prior year, which had been impacted by Red Sea shipment disruptions. However, Vicente said banana gross profit declined due to adverse weather, disease pressure (including Black Sigatoka), higher distribution costs, and an allowance recorded on a receivable from an independent grower in Asia related to low productivity.

During the quarter, the company sold three older break bulk vessels as part of a modernization effort, leaving it with six modern vessels. Vicente also noted the previously announced divestiture of Mann Packing closed in December 2025.

On capital returns, Vicente said the board declared a quarterly cash dividend of $0.30 per share payable March 27, 2026, and that the company repurchased 866,000 shares for $30 million during the year, with $120 million remaining under its authorization as of December.

Looking to 2026, management issued guidance excluding both the divested Mann Packing business and any contribution from the pending Del Monte Foods transaction. Vicente said the company expects net sales from continuing operations to be 1% to 2% higher for the year, driven by higher per-unit selling prices. Gross margin expectations by segment were:

• Fresh and value-added: 12% to 14%
• Banana: 5% to 6%
• Other products and services: 12% to 13%

Vicente said the first quarter outlook incorporates headwinds from extreme snowfall and freezing conditions in the U.S. earlier in the quarter, which disrupted domestic distribution networks, slowed throughput at northern terminals, and caused shutdowns at some fresh-cut facilities and distribution centers.

The company expects 2026 SG&A expense of $210 million to $215 million and net cash provided by operating activities of $220 million to $230 million.

In the Q&A portion of the call, management said fresh-cut demand remained strong, with the U.S. and U.K. cited as key markets. Abu-Ghazaleh also discussed pineapple supply constraints, saying the company is expanding production in Costa Rica and developing production in Brazil to support Europe, though he said the Brazil effort would take “2-3 years” to supply the market and that land availability and government approvals can limit expansion in Costa Rica.

About Fresh Del Monte Produce (NYSE:FDP)

Fresh Del Monte Produce Inc is a leading producer, marketer and distributor of fresh and fresh-cut fruits and vegetables worldwide. The company offers a wide range of products including bananas, pineapples, melons, grapes and avocados, along with value-added items such as fruit salads, vegetable trays and snack packs under the Del Monte® brand.

Founded in 1989 as a spin-off from Del Monte, Fresh Del Monte has developed a global supply chain that spans production farms, ripening facilities and packaging centers across Latin America, North America, Europe, Asia and Africa.