Dole plc

Welcome to the Dole PLC first quarter 2024 earnings conference call and webcast. Today's conference is being broadcast live over the internet and is also being recorded for playback purposes. Currently, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. For opening remarks and introductions, I would like to turn the call over to the Head of Investor Relations with Dole PLC, James O. Regan.

Thank you, Pam. Welcome, everybody, and thank you for taking the time to join our first quarter 2024 earnings conference call and webcast. Joining me on the call today is our Chief Executive Officer, Rory Byrne, our Chief Operating Officer, Johan Linden, and our Chief Financial Officer, Jacinta Devine. During this call, we will be referring to presentation slides to supplement our remarks, and these, along with our earnings release and other related materials, are available on the investor relations section of the Dole PLC website. Please note our remarks today will include certain forward-looking statements within the provisions of the Federal Security State Harbor Law. These reflect circumstances of the time they are made, and the company expressly disclaims any obligation to update or revise any forward-looking statements. Actual results or outcomes may differ materially from those that may be expressed or implied due to a wide range of factors, including those set forth in our SEC filings and press releases. Information regarding the use of non-GAAP financial measures may be found in our press release, which also includes a reconciliation of the most comparable GAAP measures. With that, I'm pleased to turn today's call over to Rory.

Thank you, James. Welcome, everybody, and thank you for joining us today as we discuss our results for the first quarter of 2024. So turning first into slide four and the financial highlights for Q1. Well, following the strong results in 2023, we're very pleased to report another good performance in the first quarter of 2024. Group revenue increased by 6.6% to $2.1 billion, and adjusted EBITDA increased 9.7% to $110 million. On a like-for-like basis, adjusted EBITDA increased 10.8%, including the impact of foreign exchange and M&A. The growth in adjusted EBITDA was driven by a strong performance in our diversified fresh produce America segment, continued growth in our diversified fresh produce EMEA segment, and a stable, consistent performance in our fresh fruit segment. Adjusted net income increased $8.3 million to $40.6 million, and adjusted diluted EPS increased 26% to $0.43 per share. Efficient management and allocation of our capital is a key strategic priority for the group. In this regard, we were pleased to complete the opportunistic sale of our 65% interest in progressive projects in March, realizing after-tax net proceeds of approximately $100 million. The proceeds from this sale have been used to repay debt, and at the end of the quarter, our net leverage stood at two times. During the quarter, we were disappointed to have to announce the termination of the agreement to sell our fresh vegetable division to Fresh Express. The decision to terminate was due to the DOJ's decision to pursue litigation if we had moved to close the transaction. We strongly disagree with this decision and continue to believe that the transaction was pro-competitive and would have unlocked ongoing benefits to customers and consumers. In any event, we are moving onwards and we are actively exploring alternatives that are in the best interests of all the division stakeholders, employees, customers, partners, and indeed the DOE PLC shareholders. Turning now to slide six for our operational highlights and starting with our fresh food segment. This segment delivered another robust performance in the first quarter when adjusted EBITDA of $69.4 million in line with Q1 2023. Firstly, looking at Europe, we continue to build on an excellent turnaround year in 2023 in the first quarter of 2024, driven in particular by higher volumes in bananas and pineapples and lower sourcing and shipping costs. In North America, our operations are continuing to perform well with good customer progress and benefiting from lower food costs to offset some lower pricing, reduce commercial cargo profitability, and as anticipated, some higher shipping costs. While our shipping remains a consistent source of competitiveness and reliability for our operations, this is an area where we are anticipating higher costs in 2024, due in part to regulatory changes, but also to periodic dry docking related costs. Looking ahead on the market side, we continue to see a competitive environment in both North America and Europe for the remainder of the year. However, we believe we are managing this well and have been able to win some new business due to our own competitiveness, as well as our continued efforts to expand our offering with additional products and varieties. On the sourcing side, we continue to face challenges such as currency appreciation in some key sourcing regions and lower yields due to weather-related impacts. And while forecasting is complex, we continue to focus on managing these challenges to maintain our competitiveness. As ever, our strong and experienced management team in this division are keenly focused on risk management and driving operation efficiencies, and together with our diverse sourcing infrastructure and customer base, we are confident in delivering another strong and consistent performance in 2024. Moving on to the diversified EMEA segment, Our diversified EMEA segment has continued its momentum from the end of 2023 into the start of 2024, delivering a strong first quarter result. Revenue growth remained strong, and while this was mostly driven by higher pricing, we did see an improved balance on the volume side, with growth being seen in several markets. Adjusted EBITDA growth in the quarter was driven by higher revenue, margin expansion, and good contributions across most regions, in particular Northern Europe and South Africa. On the margin side, we saw the benefit of the continued investments we were making coming through to drive growth. As ever, the diversified EMEA segment will continue to be attentive to opportunities to drive synergies, opportunities to invest internally, and opportunities through bolt-on acquisitions that will further drive our expansion across the European marketplace. Overall, we are targeting good performance for this segment of 2024 as we continue to leverage our strong market positions, operational integration and investment opportunities. Our diversified America segment delivered an excellent first quarter result driven by positive underlying performance and by the benefit of some seasonal variations pushing more volume into the quarter than in prior years. As noted on our last call, the El Niño weather patterns have notable impacts on both the timing and volumes of products being exported out of South America in the fourth quarter of 2023 and indeed in the first quarter of 2024. This was apparent in particular for our Chilean cherry business, which saw much higher volumes in the first quarter of 2024 than in the prior year. While this was also an important factor in blueberries, grapes, which saw variations in volumes as well as different windows for marketing the fruit from different sources. Excluding some of the seasonal timing factors, the quarter was also very positive on an underlying basis, with healthy volume growth and strong prices across most of our North American business, particularly in avocados. While on the South American export side, we benefited from a good Chilean cherry season and continued to supply supply chain improvements across all commodities. As we look further into 2024, we are targeting a strong performance from our South American export businesses, as well as healthy dynamics across most of our North American operations. The remaining challenge is to accelerate the turnaround in the berry category to maximise performance in this sub-segment for the full year. Moving on to our fresh vegetables division. Rory McGreal, R&D, Operational we're very pleased that the performance of a veg vegetables business has improved substantially in the first quarter, due in no small part to the continued dedication of the businesses management and employees. Rory McGreal, R&D, The positive operating result was driven by an improved performance in value added products, as well as higher pricing and volumes in fresh packed products and with that i'll hand you over to Jacinta to give the financial review for the first quarter.