Wednesday 20 November 2019

Deal-hungry food giant Total Produce sees sales hit €4.28bn

Carl McCann, chairman of the fruit and veg distributor
Carl McCann, chairman of the fruit and veg distributor
John Mulligan

John Mulligan

Total Produce, the Irish fruit and vegetable distribution firm that is buying an initial 45pc in Dole, saw its total reported revenue jump 13.9pc to €4.28bn last year.

Total Produce benefited from acquisitions and currency translations.

The group's adjusted earnings before interest, tax, depreciation and amortisation (ebitda) were 10.1pc higher last year at €104.4m. Excluding acquisitions, like-for-like revenue in the group rose 4pc in 2017.

Last month, stock market-listed Total Produce announced it has reached an agreement to buy its initial stake in Dole for $300m (€246m). It is entitled to immediately buy another 6pc of Dole, if it wishes, for a total of $12m.

Two years from now, Total Produce has an option to buy the outstanding 49pc for between $250m and $450m, depending on Dole's performance.

Total Produce, whose executive chairman is Carl McCann, said that 2017 had been "satisfactory". The company is one of the biggest fruit and vegetable distributors in the world.

"In the early part of 2017, unusual weather conditions in southern Europe led to temporary shortages of certain salad and vegetable lines," it noted.

But Total Produce said that due to its diversified business base, the inclement weather did not have a material impact on the group.

"Our North American division experienced relatively less favourable trading conditions in some parts of the business," added Total Produce. "While overall volumes on a like-for-like basis in this division increased, the result was held back by lower pricing due to surplus product in the market and weather conditions that negatively affected quality."

Total Produce generated €1.7bn of its revenue in the eurozone last year, €1.5bn in the rest of Europe, including the UK, and €1bn in the rest of the world.

Each operating segment is primarily involved in the procurement, marketing and distribution of hundreds of lines of fresh produce. Both European segments also include businesses involved in the marketing and distribution of health foods and consumer products.

The European market outside the eurozone is the most profitable, having generated €41.7m of the total €83.5m in adjusted earnings before interest, tax and amortisation generated by the group. Davy Stockbrokers said the group had delivered a resilient performance, despite climatic challenges during 2017.

Irish Independent

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