Fyffes earnings continue strong growth in first half

Fruit distributor Fyffes said earnings continued to grow strongly in the first half of the year, and group revenue rose almost 9 per cent as it said it was still targeting the increased earnings target ranges announced earlier this year.

Adjusted pretax profit rose 9.3 per cent to €33.9 million for the first half of the year.

The company said adjusted earnings per share were up 12.2 per cent in the first half of the year, to 9.93 cent.

In June, Fyffes said it was raising its targets for the year in light of price increases in its main banana markets and a strong season for melons. It said its earnings before interest, taxes, depreciation, and amortisation (ebidta) would be in the range €44-50 million, a rise of 21 per cent from previous estimates of €36-42 million.

Chairman David McCann said it demonstrated the group’s ability to adapt to market conditions quickly, given significant adverse exchange rate movements earlier in the year, and said the company would continue to pursue increases in selling prices in this regard.

The group said performance in its tropical produce operations was driven by average selling prices, exchange rates and the costs of fruit, shipping and fuel.

Fyffes’ interim dividend rose by 15 per cent.

“Fyffes is very focused on shareholder value and is increasing its interim dividend by 15 per cent, given its strong performance in the year to date and in recent years,” Mr McCann said in the statement. “The group may also, from time to time, repurchase further Fyffes shares in the market.”

Fyffes also reported strong cash generation for the year to date, with the group reaching a net cash position of €18.6 million as of June 30th, from net debt of €11.7 million at the beginning of the year.