Dole plc

Welcome to the Dole PLC fourth quarter and full year 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, John. Welcome, everybody, and thank you for taking the time to join our latest earnings call. Joining me 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'll be referring to presentation slides and supplemental 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 Securities Safe Harbor Law. These reflect circumstances at 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. Information regarding the use of non-GAAP financial measures may be found in our press release which also includes a reconciliation to the most comparable gas 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 fourth quarter and full year 2024. So turning firstly to slide four and your recap of key developments in 2024. Well, 2024 was another year of great progress and development for Dole PLC, with the business growing its position as the leading provider of fresh produce in the world. From a financial perspective, we delivered a strong financial performance, exceeding our most recent adjusted EBITDA guidance by some $12 million and continuing our solid growth trend over the last number of years. We've grown organically this year with group revenue and adjusted EBITDA increasing on a like-for-like basis, driven by growth across our core business areas and categories. Throughout the year, we continue to place a high priority on capital allocation and managing our invested capital. We do take a disciplined but also strategic and flexible approach to our investments. In the first quarter, we took the decision to capitalize on an opportunity to realize an excellent return on an investment at the disposal of our 65% equity share in progressive produce for net cash proceeds of the $100 billion, which we used entirely to repay debt. Then in the third quarter, we agreed to deal to expand our shipping fleet with the addition of two vessels to service our East Coast operation and provide a pathway for additional growth. This approach, combined with our strong operating performance, allowed us to deliver significant cash generation in 2024, driving a reduction in our net debt of over $180 million. Now, looking more closely at the full year figures for 2024 in slide 5, on a like-for-like basis, group revenue increased for the full year by 6.7% to $8.5 billion, and adjusted EBITDA increased 6.7% to $392 million. This was driven by a very strong performance in diversified fresh produce in America, as well as growth in our fresh fruit segment, offsetting a very small decline in diversified fresh produce in May, which had been our strongest performing segment in 2023. On an adjusted basis, net income was $120.9 million, and adjusted diluted EPS was $1.27 per share, and an increase of 2.4%. Finally, following another year of robust cash generation, we ended 2024 with net debt of $637 million and net leverage of 1.6 times, putting us in a very strong financial position for 2025 and beyond. Turning now to slide 7 for our operational highlights and starting with the fresh fruit segment. A strong close to the year, delivering $31.9 million of adjusted EBITDA in the fourth quarter, to finish with a full year of $214.8 million. This was an increase of $5.9 million compared to 23, and a result that was ahead of our own expectations. In North America, our business delivered good volume growth in bananas and plantains, in particular in the fourth quarter, continuing a very positive year-long trend and obviously supported by the increase in our shipping capacity from our recent investments. Additionally, in the European market, we continued our positive momentum and concluded an excellent year, driven by the high volumes of bananas as well as by lower shipping costs. While we formed well in the marketplace in 2024, we were also faced with higher shipping costs into the US due to the planned dry dockings of two of our vessels, as well as logistical issues of ports, both in Latin America and the US, and some continuing price pressure in the commercial cargo space. On the supply side, our route remained in a relatively good supply-demand balance throughout 2024. The relative tightness of the route has continued to put upward pressure on sourcing costs. This was accentuated for us at the end of the year by the impact of Tropical Storm Sarah, which affected an important acreage within our Honduran operations, and which we do anticipate having a notable short-term financial impact on our operations in the first part of 2025. As we look out into 2025, while the underlying fundamentals of the division continue to be in excellent shape, we will face some headwinds in the year to come. Very active competition, as well as sourcing issues, supply chain and foreign exchange movements. As always, our very experienced and knowledgeable management team are keenly focused on dealing with all of these challenges, while also working to capitalise on further growth opportunities as they arise. So moving on to the Diversified EMEA segment. This segment had a stable final quarter, ultimately delivering adjusted EBITDA of $131.5 million for the full year, a robust performance which was in line with their expectations and consolidating the excellent growth achieved in 2023. Diversified EMEA delivered good like-for-like revenue growth at 24.4%. However, over the course of the year, the segment did also face some headwinds due to supply challenges, weather events and some entity-specific issues that mitigated growth at the margin level. More positively, as we look forward into 2025, we anticipate continued revenue growth and, coupled with targeted investments and the benefit of ongoing integration within this segment, we will We believe we're well positioned to increase profitability again on a like-for-like basis going into 2025. Turning to our diversified America segment, this segment delivered a stable find of water, consolidating a very strong year growth on a like-for-like basis. Including the impact of the progressive produce disposal in the first quarter of 2024, this segment delivered a $22.3 million increase in adjusted EBITDA for the full year. A fantastic performance. Early in 2024, the segment had seasonal timing benefits within the Southern Hemisphere's summer export season, and particularly in the important Chilean cherry business. However, as the year progressed, this segment consistently outperformed as our export business in particular continued to perform very well across a wide range of product. And as I note, American businesses continue to deliver strong growth, especially in some of the important growth categories such as avocados. Looking ahead, as I heard, the turn of the year in the diverse Latin America segment coincides with the high point in activity in the southern hemisphere, summer export season. And so far, while the very strong profitability seen in the Chilean cherries in recent seasons may not persist at the same levels this season, it's also clear that the business remains in a good position to deliver on our expectations. As we look further out into the year, both for our exports and North American businesses, we believe we can further consolidate the strong revenue growth we had in 2024 and build our base for further growth in the years to come. So turning to the the fresh vegetables business. As we have noted on our most recent earnings calls, we are continuing to work on delivering the best strategic alternative for our vegetables business and that process remains ongoing. On the operational side, the improved results we've consistently seen in 24 continued in the fourth quarter. While we recorded an accounting adjustment carrying value of discontinued operations at year end. On an underlying basis, our vegetable business concluded an encouraging turnaround year in 2024, delivering positive cash flow on a full year basis. Overall, as we head into 2025, We are pleased that our corporate and divisional management teams have been successful in reestablishing an improved foundation for this business, and in doing so allows us to continue with the patient approach to ultimately deliver the best long-term outcome for all our stakeholders. With that, I hand you over to Jacinta to give the financial review for the fourth quarter and full year.