DOLE'S EARNINGS PLUNGE 54% : LOW BANANA PRICES IN EUROPE BLAMED.Byline: Will Edwards Bloomberg News Dole Food Co., the world's largest producer and marketer of fresh fruit, said second-quarter earnings fell 54 percent and warned that depressed banana prices in Europe will push profit lower in the third quarter. Profit from operations fell to $37.5 million, or 66 cents a share, from $82.1 million, or $1.35, a year ago. The company was expected to earn 64 cents, the average estimate of four analysts surveyed by First Call Corp. Individual estimates ranged from 60 cents to 75 cents. Westlake Village-based Dole warned for the second time in three months that profits are being squeezed by an unexpected increase in the number of banana-import licenses from the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community , which are causing a surplus of bananas ba·nan·as adj. Slang Crazy: "That's the horrible thing when you're bananas in EU countries and depressing prices. The EU's licensing decision came after the U.S. imposed trade sanctions Trade sanctions are trade penalties imposed by one or more countries on one or more other countries. Typically the sanctions take the form of import tariffs (duties), licensing schemes or other administrative hurdles. against it, citing unfair import rules for bananas. ``If you were cynical, you'd say the EU was trying to punish pun·ish v. pun·ished, pun·ish·ing, pun·ish·es v.tr. 1. To subject to a penalty for an offense, sin, or fault. 2. To inflict a penalty for (an offense). 3. U.S. banana companies,'' said analyst Timothy Ramey at Deutsche Banc Alex Brown Alex Brown may refer to:
Banana prices in Europe should rebound somewhat in the fourth quarter, as only about 15 percent of the EU's annual banana import licenses will be left to grant and supplies will decline, Ramey said. Dole shares fell 25 cents to $29.375. They've fallen about 41 percent in the past year. In May, Dole warned that a surplus of bananas tied to the glut glut pronounced as rut, slut Vox populi An excess of a service or skilled labor in a particular area. See Physician glut. of import licenses would push down second-quarter profits along with prices for the fruit. Today, Dole said those lower prices will drop third-quarter profit below the 26 cents a share it earned in the 1998 third quarter. It was expected to earn 39 cents, the average estimate of the analysts surveyed by First Call. |
|
||||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion