Del Monte Corporation

Good day everyone and welcome to Fresh Del Monte Produce's first quarter 2024 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 the star key followed by the number one on your telephone keypad. If you would like to withdraw your question press star one again. For opening remarks and introductions, I would like to turn today's call over to the Vice President, Corporate Communications with Fresh Del Monte Produce, Claudia Poe. Please go ahead, Ms. Poe.

Thank you, Audra. Good afternoon, everyone, and thank you for joining our first quarter 2024 conference call. I am Claudia Poe, Vice President, Corporate Communications with Fresh Del Monte Produce. Joining me in today's discussion are Muhammad Bugazali, Chairman and Chief Executive Officer, and Monica Vicentes, Senior Vice President and Chief Financial Officer. I hope that you've had a chance to review the press release that was issued earlier via Business Wire. You may also visit the company's IR website at investorrelations.freshdelmonte.com to access today's earnings materials and to register for future distributions. 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 press release 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 safe harbor provisions of the federal securities laws. In today's press release and in our SEC filings, we detail risks that may cause our future results to differ materially from these forward-looking statements. Our statements are as of today, May 2nd, and we have no obligation to update any forward-looking statement we may make. During the call, we will provide a business update along with an overview of our first quarter 2024 financial results, followed by a question and answer session. With that, I'm pleased to turn today's call over to Mr. Ruggazale.

Thank you, Claudia, and thank you for joining us for first quarter 2024 ending results. We continue to see strong momentum in our higher-margin fresh and value-added product segments, which is a key driver of our long-term growth strategy. Revenue in this segment grew by 5% year-over-year, fueled by strong sales of our pineapples and avocados, as well as our prepared foods. Segment adjusted gross margins also expanded by 50 basis points as we realize production efficiencies and cost savings from our tightly integrated supply chain. Our strong cash flow allowed us to simultaneously reinvest in the business, increase our dividend while paying down our debt. During the quarter, we reduced total debt by 15% when compared to the prior year period, further demonstrating our commitment to maximizing shareholder value through the split capital allocation. We believe we will unlock further shareholder value by focusing on our strengths in pineapple, fresh cut, and value-added projects, which is exactly what we did in this first quarter. Taking a closer look at some of the drivers behind our fresh and value-added segment growth, we saw particularly strong demand for our pineapples. As a leading grower and distributor of this fruit, we continue to look for new and different ways to lead in the pineapple category. In the first quarter of 2024, we launched two pineapple innovations. The ruby glow pineapple, our red shell pineapple, which is being produced in a limited volume at a very high price point. Due to high demand and interest in North America, ruby glow pineapples are now available to consumers in the United States. Our other newly released pineapple innovation this quarter is the precious honey glow pineapple, a personal size fresh pineapple out of our popular line of honey glow pineapples. Our previously launched pin glow and honey glow pineapple innovations continue to perform very well. In quarter one, net sales for the pin glow pineapples were up 62% compared with the same period last year. while net sales for the honey glow pineapples was approximately 13% higher compared with the same period last year. Pineapples represent just one growth driver within our fresh and value-added product segments. We also see tremendous opportunity in fresh cut category. We're pleased to share this We are pleased to share that this quarter we further expanded our fresh-cut product distribution in North America, cementing our position as the market leader in fresh-cut products for the convenience store channel. Also on the horizon within our fresh-cut program are new premium fruit trays featuring specialty fruits not seen before in our program. This year, we will continue to take advantage of our robust U.S. footprints of company-owned Fresh Cup facilities to further grow in market share and release new value-added products to our consumers, driving shareholders' value. Our Fresh Cup growth strategy extends into our other regions outside of North America. In our European region, we recently completed the expansion of our primary fresh cut production facility in the UK, which will allow us for a significant increase in capacity. And in Asia, we saw a 36% increase in sales in quarter one from our fresh cut operations in Korea compared with the same quarter last year. Shifting to our avocado category, the category performed well this quarter with revenue up 23% year over year. One of our newest innovations is our fresh guacamole product. Our fresh guacamole made without preservatives and with Del Monte avocado is a new product for us and is growing rapidly. In quarter one, guacamole distribution expanded to two major retailers in the southeast and northeast regions of the U.S. We plan to continue this expansion throughout the course of the year. Looking toward the remainder of 2024, we plan to continue our investments in value-added products and in expanding our pineapple and fresh-cut operations, as well as maximizing our fruit residuals utilization. As one of the world's largest producers of fruits, we see tremendous untapped potential in this space and have identified several profitable use cases of our residues, including biofertilizers. These ventures leverage our strengths as a business and allow us to be at the forefront of the fresh produce industry. With that, I would like to turn the call over to Monica.