Goodbody Stockbrokers has reduced its profit forecast for Fyffes for the second time this year. It is now expecting adjusted earnings per share to come in at 5.2 cents for the 12 months to the end of October 2000. This compares with a previous forecast of 8.9 cents.

Last April, Goodbody had forecast earnings per share of 18.2 cents, with the dramatic reduction in profits at the food distribution group being affected by the further weakening of the euro. This has contributed to a substantial increase in the cost of fuel and bananas for the company, while the price of bananas in Europe has not increased.

In 2001, the brokers expect to see some recovery, with earnings per share improving to around 11 cents, driven by a €20 million cost- saving programme.

Notwithstanding these difficulties, Goodbody believes the shares have been oversold, having suffered severe losses since DCC sold its stake in the company. Investors should get a better feel for how the company is trading when it issues results next February.