• Revenue: Increased by 1% reported, 5.8% on a like-for-like basis.
• Adjusted EBITDA: $82 million, 2.3% increase on a like-for-like basis.
• Net Income: $21.5 million, $32.5 million lower than Q3 '23.
• Adjusted Net Income: $18 million.
• Adjusted Diluted EPS: $0.19 per share.
• Fresh Fruit Segment Revenue: Increased 6.6%.
• Fresh Fruit Segment Adjusted EBITDA: $42.9 million.
• Leverage: Reduced to 1.86 times.
• Net Debt Reduction: $36 million decrease compared to Q2.
• Net Cash from Operating Activities: $106.2 million year to date.
• Cash Capital Expenditure: $21.1 million in Q3.
• Dividend: $0.08 for the third quarter.
• Full-Year Adjusted EBITDA Target: Raised to at least $380 million for 2024.

• Warning! GuruFocus has detected 1 Warning Sign with ICLTF.

Release Date: November 13, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Dole PLC (NYSE:DOLE) reported a 1% increase in group revenue, with a 5.8% increase on a like-for-like basis.
• Adjusted EBITDA of $82 million was in line with market expectations and 2.3% ahead of the prior year on a like-for-like basis.
• The diversified Americas segment showed strong performance, particularly in North American operations with good volume and price growth.
• Dole PLC (NYSE:DOLE) successfully reduced leverage, with a $36 million decrease in absolute debt levels.
• The company announced plans to expand its shipping fleet, enhancing operational flexibility and growth potential.

Negative Points

• Adjusted EBITDA decreased by 3.7% due to declines in the fresh fruit and diversified EMEA segments.
• Net income of $21.5 million was $32.5 million lower than the previous year, primarily due to the absence of a prior exceptional gain.
• The diversified EMEA segment faced challenges from seasonal timing differences, one-off IT costs, and supply shortages.
• Higher shipping costs impacted the fresh fruit segment due to ongoing dry docking processes.
• The fresh vegetables business is still exploring strategic alternatives following the termination of a sale agreement.

Q & A Highlights

Q: Can you explain the factors affecting the full-year EBITDA guidance of at least $380 million, especially considering the potential 18% decrease in Q4? A: Rory Byrne, CEO, explained that the guidance reflects a more typical year with a heavier first-half weighting. The sale of Progressive Produce impacts Q4, and higher shipping costs due to dry docking are expected. Despite these factors, the company is comfortable with the $380 million target, having raised it from previous estimates.

Q: How much of the diversified Americas business improvement is due to underlying strength versus seasonal timing shifts? A: Rory Byrne, CEO, noted that the diversified Americas segment has benefited from improved supply chain conditions and management processes. While the segment has had an exceptionally strong year, some volatility is expected due to production variability, particularly in Chile.

Q: Should we expect a more normalized cherry season in Q4 and a return to typical profitability for diversified Americas in Q1 next year? A: Johan Linden, COO, indicated that Q1 might see normalization with some cherry volume falling into this year due to the earlier Chinese New Year. The diversified Americas segment is expected to stabilize as well.

Q: What supply and demand factors are driving fresh fruit outperformance, and should we expect consistency in Q4? A: Johan Linden, COO, highlighted strong demand for bananas and tight supply due to weather conditions. This has created a favorable supply-demand balance, which is expected to continue into Q4, albeit with higher shipping costs and some cost increases in fruit.

Q: What growth potential do the two vessels being brought under ownership in early 2025 offer? A: Rory Byrne, CEO, explained that owning the vessels provides capacity flexibility and supports growth, particularly in avocados from Colombia. It ensures compliance with service level requirements and offers a strategic advantage in managing freight rate volatility.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.