Dole deal boosts Total Produce earnings
FRUIT and vegetable distribution giant Total Produce has reported a 27.6pc surge in adjusted earnings before interest, tax and depreciation (ebitda) to €133.3m following its acquisition of a 45pc stake in US rival Dole last year.
Excluding the impact of the Dole deal, its adjusted ebitda was 5.7pc higher at €110.4m.
The company said that reported revenue grew 17.7pc to €5.04bn last year. Stripping out the impact of Dole, the figure was 1.6pc higher at €4.35bn.
Chairman Carl McCann said 2018 had been a challenging one for the group. He added that trading so far in 2019 has been “satisfactory”.
Total Produce agreed last year to pay $300m for its stake in Dole, a move that created one of the world’s largest fresh produce groups. Total Produce has an option exercisable from next year to acquire Dole in its entirety for between $250m and $450m – a deal the Irish company is expected to do.
Dole sold its headquarters for $50m last year and offloaded facilities in Sweden and Finland in January this year. The two factories produce washed and ready-to-eat salads. The sale of the two facilities was a condition of the European Commission’s approval of the acquisition by Total Produce of the Dole stake.
Of Total Produce’s €4.3bn revenue last year excluding Dole, €1.7bn was generated in the eurozone, €1.5bn elsewhere in Europe and €1.1bn in the rest of the world.
The non-eurozone accounted for €41.5m, or 47pc of Total Produce’s adjusted earnings before interest, tax and amortisation last year.
It said that its business within Europe as a whole last year had been negatively impacted by challenging weather conditions, which included a prolonged and cold winter and drought conditions in parts of Europe last summer.
Total Produce added that its Brexit committees are continuing to prepare for associated risks that may arise from the UK’s exit from the EU.