Del Monte Reports Solid 2Q, But Costs Expected To Rise

Fresh Del Monte Produce, Inc. (NYSE: FDP) posted 2Q EPS of $0.85, above BB&T Capital Market's estimate of $0.70 and consensus of $0.73. The upside was attributed to a sizable tax credit and asset sales.

Excluding the asset sales gains, EBIT equaled $48.5M vs. BB&T's $55.5M estimate.

Forecast includes expected higher banana segment costs due to damage in Guatemala resulting in tighter supplies, and higher bunker fuel, according to BB&T.

EPS estimates have been lowered to $2.04 from $2.13, basing the new estimate on 2Q results. BB&T maintains its "hold" rating.

Fresh Del Monte Produce, Inc. closed yesterday at $20.83.