Fyffes shares soar with profits 54pc higher than previous year
SHARES in Fyffes surged yesterday, as the company reported strong annual results and boosted its full year dividend by more than 10pc.
The company, best known for its bananas, said it increased the full year dividend to 1.925c compared to 1.75c a year earlier, after reporting net profits from continuing operations of €11.22m. That was more than 54pc higher than the previous year, while revenue including joint ventures climbed 14.5pc to €850m.
At an operating level, the company recorded earnings of €29.6m -- 10.1pc up on the year.
Company chief executive David McCann was pleased with what he called Fyffes' "strong performance" in 2011.
"[Our results were] towards the top end of our target range, with good organic growth across each of our product categories.
"The group has had a positive start to 2012, with improving pricing in Continental Europe, and is targeting earnings before interest, tax and amortization (EBITA) for the year in the range €22m to €27m," he added.
Growth was driven in part by what Fyffes called "more normal" market conditions in the banana category, achieving "low single digit" EBITA growth in the business. It was a "satisfactory" result, Mr McCann said.
Like most businesses, Fyffes were forced to grapple with higher input costs, with the price of fuel used for shipping surging 35pc year on year.
Those costs were however offset in part by a weak dollar and price increases.
"The group grew volumes in its banana category in 2011, securing additional business with new and existing customers, as a result of its efficiency and the competitiveness of its operating structures," the company said.
Pineapple volumes climbed more than 10pc, as the company increased production on its own farms while the US melon business achieved a "satisfactory result" despite "less favourable market conditions compared to the previous year, in particular during the US production period".
The company took a €3.5m charge on losses from its 40pc holding in Balmoral International Land, the property firm run by a number of former Fyffes employees and chaired by David McCann's brother Carl.
The results were welcomed by the market, with Davy Stockbrokers' Aiden O'Donnell describing them as "a strong out-turn for the business and its third consecutive year of improving adjusted EBITA growth". Mr O'Donnell rates the stock "outperform".
In Dublin, Fyffes climbed as much as 4.88pc before closing up 2.44pc at 42c. It is up more than 15pc in the last three months.