Feb 22, 2012

Chiquita releases 2011 earnings, announces plans for Fresh Express growth

Chiquita Brands plans to expand its salad offerings in 2012, including going into value-added whole head lettuce.

During a Tuesday conference call reporting its fourth quarter and full-year 2011 results, Chairman and CEO Fernando Aguirre said that while Chiquita’s salad business didn’t perform as well as expected, “we’ve taken a number of corrective actions and adapted our structure and strategy to be more successful and profitable.”

The company reported income of $38 million on net sales of $3.1 billion. While it lost money – $6 million – in fourth quarter 2011, 2010 was worse at $18 million.

On the salad and healthy snacks side, a company report said net sales in 2011 decreased 7 percent to $953 million because of a decline in retail value-added salad volume, “due to customer conversions to private label in 2010.” This was offset by growth in foodservice and healthy snacks.

Chiquita has been laying the groundwork for improved efficiency, with its strategy going forward being to increase revenue rather than focus on reducing debt and overhead, as was the case in 2011. Aguirre said the company has made “solid progress” in realigning its salad business structure. The company has also consolidated corporate structure via relocation of its headquarters from Cincinnati to Charlotte, N.C., this year.

“Going forward, we are focused on growing revenues and profitability in core banana and salads products, using our existing capacity and capabilities to enter new markets and providing a more comprehensive product offering,” he said.

In salads, that means the Fresh Express line will diversify by increasing organic salad offerings, offering a “selective level” of customized options for a strategic private label program and entering the value-added whole head lettuce category for the first time.

This past year, Chiquita conducted a pilot program with a customer Aguirre didn’t identify that combined a full conventional bagged salad program with organic salads and some “unique items specific to that customer’s shopper base.” He said the result was double-digit growth for Chiquita.

“We are making these changes to respond to customer demand,” Aguirre said, “and open up considerable growth opportunities while helping protect our core business.”