Fyffes is optimistic on profits despite the big freeze
BANANA seller Fyffes continued its golden streak yesterday, telling the markets full-year earnings would come in at the "upper end" of the fruit plc's most recent guidance.
The announcement followed two previous profits upgrades which saw the group settle at a target of €18m to €22m in September, following better-than-expected summer trading.
Yesterday, Fyffes said that prediction had been revised to between €20m and €21m, despite "difficult" trading conditions towards the end of the year due to what it described as "exceptionally cold weather throughout Europe".
The guided 2009 result marks a significant improvement on Fyffes' €15.3m result in 2008 -- but the firm warned of potentially choppier waters lying ahead.
"The exceptional cold spell across Europe is having an adverse impact on current trading in the early weeks of the year," said yesterday's statement.
It predicted that 2010 earnings would be in the €17m to €22m range, "based on an expectation of achieving the required increases in average selling prices in all markets".
These price increases are being pursued to offset increases in input costs, a trend pointed out by Fyffes when it announced its half-year results back in September.
At that time, Fyffes chairman David McCann said key input costs over the six-month period were 20pc higher, including the negative impact of exchange rates.
The above-expectation first-half results also showed a €24m fall in net income to €10.3m, reflecting the €37m exceptional gain booked in the first half of 2007 in settlement for the DCC insider-trading case.
The group is due to report its full-year results in March.
Best known for its trademark bananas, Fyffes is also a major pineapple and melon distributor, with operations stretching all over the world. The group has a market capitalisation of about €152m.