CINCINNATI (AP) — Produce seller Chiquita Brands International Inc. said Thursday that it returned to a first-quarter profit as banana sales rose 13 percent and its European market stabilized.
For the quarter that ended March 31, Chiquita reported net income of $24 million, or 52 cents a share. That compared with a loss of $9 million, or 20 cents a share, in the year-ago quarter.
Overall sales increased 2 percent to $824 million. The Cincinnati company credited the improved performance to a more stable European market where consumer demand grew stronger. Overall banana sales totaled $539 million. The company charged higher banana prices which offset increased supply costs due to tight supplies.
Prices in North America also reflected "force majeure" surcharges that were imposed beginning in late January to recover significantly higher sourcing costs, Chiquita said. Force majeure is a provision that frees companies from liability when an extraordinary event occurs that could significantly disrupt business.
Net sales of salads and healthy snacks fell 8 percent to $238 million due to lower volumes. The company also said costs rose because of bad winter weather during the lettuce growing season in Arizona.
For the full year, Chiquita affirmed its outlook for a 3 percent increase in net sales, excluding some discontinued product lines and a deconsolidated smoothies business in Europe.
Banana supplies remain tight, which has led to higher sourcing costs, but the company expects supplies to increase to more normal levels during the second half of the year.
Shares of Chiquita fell 22 cents to close at $15.19.