Del Monte Corporation

Good day everyone and welcome to Fresh Del Monte Produce's second quarter 2022 earnings conference call. Today's conference call is being broadcast live over the internet and is also being recorded for playback purposes. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. For opening remarks and introductions, I would like to turn today's call over to the Vice President, Global FP&A and Investor Relations with Fresh Del Monte Produce, Anna Miranda. Please go ahead, Ms. Miranda.

Thank you, Rob. Good morning, everyone. And thank you for joining our second quarter 2022 conference call. As Rob mentioned, I am Ana Miranda, Vice President, Global FP&A, and Investor Relations with Fresh Del Monte Produce. Joining me in today's discussion are Mohamed Abugazali, Chairman and Chief Executive Officer, and Monica Vicente, Senior Vice President and Chief Financial Officer. I hope you've had a chance to review the press release that was issued earlier this morning via BusinessWire. You may also visit the company's IR website at to access today's earnings materials and to register for future distribution. This conference call is being webcast live on our website and will be available for replay after this call. Please note that our press release and our call today include non-GAAP measures Reconciliations of these non-GAAP financial measures are set forth in the Fresh Risks and Earnings presentation, which is available on our website. I would like to remind you that much of the information we'll be speaking to today, including the answers we give in response to your questions, may include forward-looking statements within the provisions of the federal security clause, State Harbor. In today's press release and in our FTC filings, we detail material risks that may cause our future results to differ from these forward-looking statements. Our statements are as of today, August 3rd, and we have no obligation to update any forward-looking statements we may make. During the call, we will provide a business update along with an overview of our second quarter 2022 financial results, followed by a question and answer session. With that, I'm pleased to turn today's call over to Mohamed.

Thank you, Anna. Good morning, everyone. As you have seen today, we delivered an excellent robust second quarter. Our net sales increased by $70 million compared with the prior year period. And we saw a continuation of our robust top-line trend comprised of five consecutive quarters of growth versus the previous year's periods, demonstrating the resilience of our iconic brands. During the quarter, we continued to operate in one of the most volatile and uncertain operating environments in recent history. As a result, the cost of products sold increased by $100 million. driven by broad-based inflationary supply chain and logistical headwinds. Despite these headwinds, we generated positive earnings, all while maintaining our debt balance in line with last year's generating strong cash flow from operations and continuing our dividend payout. During the quarter, our adjusted EBITDA margin was 4.6%. We lowered our debt by $91 million, generated $95 million in cash flow from operations, and invested $12 million in capital expenditure. Our results are representative of our commitment to grow our brand by revisiting everything we do, highlighting our dedication to our platform in an environment where many are not. On the product innovation front, I'm pleased about our pipeline and the team's focus on the development of our products aligned with consumer trends. We recently launched Fairtrade Organic Banana and Good Avocado, featuring avocados that naturally range from small to large. The Good Avocado packs allow consumers to customize their use of avocados. We recently announced a collaboration with Stored, a leading cloud supply chain provider. Their services include warehousing, freight, and fulfillment. Stored will leverage 22 of our best-in-class cold storage facilities across the U.S. We also expanded our logistics services in the U.S. with Happy Egg, whereby we provide the egg producers access to our temperature control warehouses and fleet of trucks These collaborations are part of our efforts to look for additional ways to improve the productivity of our assets. In keeping with our asset optimization focus, we announced our raw crop expansion project with Whitehorn in Guatemala, grown in our resting lands between core crop seasons. A strategy we are looking to expand into other areas with other crops. This is an excellent way to leverage our idle lands And as a win-win proposition, we play a bigger part of the global food shortage solution by also improving our grounds for upcoming seasons. Along the same lines, we are also continuing with the expansion of our commercial cargo services via our 13 vessels, offering tailored shipping solutions to a broader customer base amid continuous logistical pressures. This is reflected in our robust other product and services segment net sales, which are up $36 million year-to-date compared with the prior year period with a strong double-digit gross margins. On ESG, the team is actively working on our 21 reports due to be released in the fall. We are excited to share the great progress we have made in reducing greenhouse gas emissions, and how we are on track to achieve our science-based targets ahead of 2030. In the wake of record-breaking temperatures this summer, climate action is more urgent than ever. We strongly believe our business success depends on the meaningful and effective management of our ESG work and understanding we have held for years. As we move to the back half of the year, fluctuations in exchange rates are expected to work against us in key selling markets due to a forecasted stronger US dollar. We are partially hedged against movement in the euro and Japanese yen through the end of the year, helping us mitigate a portion of the impact. We continue to focus on efficiencies in our operations. and are confident in our product offerings and vertical integration, which uniquely positions us to drive incremental profits. Despite the softening consumer outlook, demand for our products remains strong, which we believe put us in a distinctive recession-resistant category. I am confident in our team's dedication to drive profitable sales by concentrating on all aspects of our business. We plan to do that by focusing our sustainable growth strategy and delivering against its key elements, organic expansion, product innovation, investments in technology, best-in-class customer relationship, and sustainability. Now I will turn the call to Monica to talk about the second quarter financials. Monica, please.