Dole reports Q1 loss after spinning off packaged food business
Dole Food Co. reported a first-quarter loss of $65.6 million, largely due to its packaged foods operations, which have since been discontinued and sold to a Japanese firm for $1.7 billion in cash.
The Westlake Village-based produce giant sold its global packaged foods and Asia fresh produce businesses to Itochu Corp. in a deal that closed on April 1, a week after the first quarter closed on March 23. Dole is now about half the size it was before the sale, and it will focus on its fresh fruit and fresh vegetable businesses as it moves forward.
The food company’s loss, which is equal to 12 cents a share, is out of line with analyst estimates. Analysts polled by Reuters projected earnings of 11 cents a share.
In the first quarter of last year, Dole reported earnings of $17.2 million.
Revenue for the quarter decreased 3 percent to $1.05 billion. Analysts had predicted revenue of $1.03 billion.
“The new Dole is off to an extraordinary start in 2013, with the record-setting early approval from China’s Ministry of Commerce resulting in the timely completion of the sale of our worldwide packaged foods and Asia fresh businesses to ITOCHU Corporation,” Michael Carter, Dole’s president and CEO, said in an earnings release. “We are very excited and very optimistic about the long-term future of the new Dole and its prospects.”
The produce firm also introduced a $775 million refinancing initiative, and said it would use the proceeds to pay down debt. “This new capital structure allows us to resolve long-standing legacy exposures … while also providing needed financial flexibility to enhance shareholder value,” Carter said in the earnings report.
Dole shares were down 2.4 percent to $10.45 on May 2, and the food company’s stock is down 6.6 percent this year.