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What: Shares of Fresh Del Monte Produce Inc (NYSE:FDP) were getting tossed today, falling as much as 10% after its fourth-quarter earnings report missed the grade.
So what: The fruit-and-vegetable distributor came up short on the bottom line with an adjusted loss of $0.35 a share against expectations of negative $0.16, but revenues easily passed the consensus of $791 million, climbing 13.3% to $880 million. CEO Mohammad Abu-Ghazaleh said, "2013 was a year of contrast for us with increased sales and strong progress toward our long-term initiatives tarnished by a disappointing conclusion to the year," but said the fourth-quarter loss was due to "higher input costs and lingering issues in our European market."
Now what: Abu-Ghazaleh went on to explain that the company had made a number of changes to deal with the increased costs, including exiting underperforming businesses and making changes to its business model in Europe. The fourth quarter is generally a weak one for the produce grower, and considering the top-line growth and management's focus on driving profitability, I'm confident that today's report is just a speed bump and will not affect the stock's long-term performance. Shares had already recovered modestly by the afternoon, trading down 6%.
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Jeremy Bowman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.