Fyffes raises earnings expectations

Tropical fruits firm Fyffes today gave a lift to earnings forecasts after benefiting from higher selling prices and favourable exchange rates.

The Dublin-based distributor said it was on course for underlying earnings of €17m in 2007, an improvement on its downgraded guidance of €15m flagged at half-year results in September.

Fyffes, which employs more than 3,600 people across Ireland, the UK and countries such as Costa Rica, had also warned in May that price pressures were impacting performance.

However, it said today that it had offset fuel prices through currency fluctuations and higher average selling prices in the second half of the year.

And despite further significant inflation in shipping and fuel, Fyffes said it anticipated a mid-single digit increase in underlying earnings for 2008.

It is also sticking by its medium-term strategy to double the size of its business in the five years ending 2011, with 75% of this growth coming from acquisitions.

Fyffes also reported progress towards its organic growth target during 2007, following a 15% increase in core European banana volumes in the year.

In March the fruit firm revealed that pre-tax profits had almost halved to €58.4m after changes to European Union banana import regulations and lower banana prices.

Fyffes demerged in 2006, splitting its general produce arm, Total Produce, from its tropical fruit business Fyffes, which imports bananas, melons and pineapples.

The group is the world’s oldest fruit brand, having started trading in the 1880s.

The first commercial delivery of bananas was made from the Canary Islands to the then E.W Fyffe Son & Co in London.