Fyffes earnings hit by euro currency fall against dollar

Shares in Fyffes were little changed yesterday, even as the fresh produce provider reported its earnings were hit by a slump in the value of the euro against the dollar, in the first half of the year.

Excluding its recent €99m purchase of Canadian mushroom firm Highline, adjusted earnings in the first six months were close to the performance of a year earlier, which was “a good result for the period with strong performances in the pineapple and melon categories offsetting the impact of relatively difficult market conditions experienced in the banana category”, the company said.

It also reaffirmed targets of adjusted earnings before interest, tax, depreciation and amortisation of €63m to €69m for the full year.

“The company also managed to achieve some price increases in the first half but these were not sufficient to offset the impact of foreign exchange on its dollar cost base, even with the help of significantly lower fuel costs year-on-year,” said Davy Stockbrokers analyst Declan Morrissey.

“The adverse foreign exchange movement in the first half was the main driver of a lower profit out-turn in the (banana) category”, while volumes in its pineapple and melon operations increased, the analyst said.

The companies’ shares closed little changed yesterday but are trading almost 6% higher than at the start of the year.

The shares were among a number of Irish stocks that had fallen sharply in the immediate aftermath of the UK’s June 23 vote to leave the EU, when sterling slumped against the euro and dollar.