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Chiquita Brands International s CEO Discusses Q2 2012 Results Good day and welcome to the Chiquita Brands Second Quarter 2012 Earnings Call. As a reminder today s conference is being recorded. (Operator Instructions) At this time, seahawks jerseys for opening remarks and introductions, I ll like to turn the conference over to Mr. Steve Himes, Director of Investor Relations. Please go ahead, Sir. Thank you, Kevin. Welcome everyone to Chiquita Brands International s Second Quarter 2012 Earnings Conference Call. On the call today are Fernando Aguirre, Chairman and Chief Executive Officer and Brian Kocher, Chief Financial Officer. After today s prepared remarks we will take questions as time allows. GAAP of any non GAAP financial measures that we mention today. This call contains forward looking statements, regarding operating performance or industry developments, and any such statements are intended to fall within the Safe Harbor provided under the security laws. Factors that could cause the results to differ materially are described in the forward looking statements section of today s press release and in Chiquita s SEC filings, including its annual report on Form 10 K, and quarterly reports on Form10 Q. And now, I ll turn the call over to Fernando. moncler jumpers men Thank you, Steve, and good afternoon and thank you for joining us today. We several items which we would like to cover this afternoon. First, we will review, Chiquita s second quarter performance. Second, formally launch our transformation strategy, which we began laying out on the year end call in February and is intended to increase shareholder value by singularly focusing on driving profitability in our men moncler core businesses of bananas and salads. Third, we will frame the earnings power of Chiquita going forward, quantify our long term financial goals, and provide additional detail on the actions we are taking to support the achievement of these long term financial goals. Last, I will also discuss my future plans with the company. To put this in context, the actions we are announcing today are a series of initiatives, which began with the move to Charlotte, and the decision to expand our salads business by offering, private label salads, and will result in a continued restructuring of our current organization. The move together with the changes we are announcing will lower our fixed cost base and are expected to increase Chiquita s profitability in the next six months by reducing expenses and allowing also focus in our core businesses bananas and salads. I m going to ask Brian to take us through our second quarter results and expand on the plans to improve our profitability short term. Brian? Thank you, Fernando. Now regarding second quarter, you ll remember that on the last couple of calls we indicated that 2012 would be a challenging year for Chiquita. Although manning of the external factors impacting our business moncler jackets montreal have not changed, our results reflect improvements and in some instances even exceed our expectations particularly with regard to many of the controllable aspects of our business. The second quarter 2012 net income on a comparable basis was $12 million or $0.27 per diluted share, versus $34 million or $0.73 per diluted share in 2011. GAAP results for Q2, 2012 were net income of $6 million or $0.12 per diluted share versus net income of $78 million or $1.68 per diluted share in 2011. The adjustments between comparable results and GAAP results are included in the table in the press release. Looking at bananas, sales were 4% lower at $533 million, comparable operating income was $29 million or 5.5% of sales and was impacted by the absence of a product supply surcharge in North America, the weakening euro in European markets and slightly higher delivered fruit cost. Local pricing gains in Europe partially offset these impact. Our North American banana business faced difficult comparisons the last year because of the product supply surcharge that was in affect through the end of the second quarter 2011. Banana pricing was 8% lower on essentially the same unit volumes. In Europe, other local prices were 5% moncler official site higher than in 2011. The increase was not enough to offset the large and rapid decline in the value of the euro. The euro decline alone negatively impacted our year over year quarterly comparisons by $26 million. In fact, excluding the impact of currency, our European operating income approximately doubled year over year. In our core European market, dollar equivalent pricing prices were 6% lower and volumes were 5% lower as we rationalized volume in areas where we could not generate a profit. Despite difficult market conditions in some of variables that we could not control, our banana business underlying performance exceeded our internal forecasts, as we effectively managed the parts of the business that we could control. Without the unprecedented move in the euro, which we just discussed, comparable income in bananas was essentially flat. It s not for the 2011 surcharge in North America, comparable income for bananas would have increased year over year. Disciplined marketing spends, shipping savings, maximizing utilization of our fix infrastructure and the allocation of banana volume for the most efficient markets help drive the underlying business performance. In our salads and healthy snacks segment, second quarter Moncler rousseau Men down jackets blue brown net sales were steady at $252 million. On our first quarter call, we indicated that retail salad volume comparisons could be as much as 15% below the second quarter of 2011. Salad volumes were better than expected this quarter and the quarter ended about 8% below 2011 levels. Increasing retail sales velocity on a same store basis, the benefits of improved Salad quality and more effective promotion planning strategies led to the velocity increase. Average pricing of retail Salads was up slightly from the second quarter of 2011. Increased sales volume in both our food service and healthy snacking business offset the revenue effect of lower retail Salad volumes. For the quarter, the Salad segment delivered $11 million in operating income on a comparable basis, versus income of $4 million a year ago. The improved results reflect manufacturing cost improvements, which eliminated certain salad quality related costs incurred in 2011. We also benefited from improved pricing and reduced marketing spend in the salad segment. I want to comment on two important highlights related to the second quarter, which will provide us important flexibility in executing our transformation strategy. First, in June you saw the announcement that we successfully received the amendment to our credit agreement. In our current environment, the amendment provides the company with more operating flexibility to execute its strategy and to manage the volatility inherent in these businesses. The amendment period extends to the September of 2013, at which point the terms of the credit agreement largely revert to the original agreement. This support from our lending group highlights their confidence in our business and their understanding that results from this year, uniquely reflect some unprecedented issues such as the weak Euro. Secondly, the relocation of our corporate high quarters and consolidation of our other corporate administrative functions in Charlotte, North Carolina is ongoing. We recognize $7 million of cost related to the relocation, $4 million net of tax in the second quarter of 2012, primarily related to severance and we expect to record an additional $8 million of relocation costs during the second half of 2012. Recall that the cost of the move is essentially offset with the local incentive. Separately and in addition, Chiquita will realize ongoing operating cost savings of more than $4 million annually, from more efficient staffing, consolidation of locations, lower rent, and reduce travel costs. I would like to provide a little color on the balance of 2012 during which Chiquita will continue to face challenges from storm of the headwinds that we ve seen in the first half of the year. In our Banana business, we continue to expect that supply will outpace demand. The euro will continue to negatively impact Chiquita with comparisons to 2011 in particular. In the third and fourth quarters of 2011, Chiquita realize revenues at levels of $1.41/euro and $1.40/euro respectively. These levels are comparison to the spot price today of approximately $1.24/euro. In June and July, however we entered into very hedging instruments in order to protect from the downside risk of further devaluation of the euro. Our hedges cover 85% of Chiquita s expected euro cash flow below $1.23/euro for the balance of 2012. In 2013 our hedges cover 50% of the expected euro cash flow below $1.20 and 35% of the Chiquita s expected euro exposure at a rate below $1.23. Lastly, in terms of our salad business, we expect to see our volumes slightly down in the third quarter and improving in Q4 with the launch of several new items, continued quality improvement and potential new branded and private label customer contracts that may add to existing volumes. By the end of the year, volumes should be down only slightly to 2011 volume. Now, let me turn to laying out how we are looking at the business over the next few years starting with specific profit targets. We do not believe the company s recent performance is indicative of the earnings potential of our business. We are implementing a strategy to enable Chiquita to adapt and compete in the current and future marketplace. For clarity, we are thoroughly focused on increasing shareholder value. Our number one financial goal is to increase cash flow and pay down debt, which in turn increases shareholder value. While we mentioned earlier in the year, that we would at least like to explore alternative uses of cash that maybe more accretive than debt reduction, given the current need to adjust our cost structure and changed to our strategic model, we ve decided to focus on increasing cash flow to reduce debt and maximize our asset utilization on our core banana and salads businesses. In other words, we are not looking to acquire any business in the foreseeable future. Even macro economic conditions changes in our own industry and to quantify the impact of our new strategy, we wanted to take this opportunity to provide our stakeholders with an understanding on Chiquita s earnings potential. To do this, we ve today announced long term operating margin targets Moncler WoMen's Down Coat Black for each of our business unit. These operating margins are EBIT margins; earnings before interest and taxes and excludes certain unallocated corporate costs that are separately disclosed in our corporate segment. While these targets are announced today and depending upon executing our transformation strategy to drive increased profitability in our core markets, we are focusing on a 2 to 3 year time horizon to achieve these results. In terms of specific targets, for our global banana business, our goal is to average approximately 4% operating income or EBIT margin. While we cannot control the euro, our long term financial goal is based on a euro at the current $1.24 euro rate. We believe that a 4% target EBIT margin is achievable by focusing on things that we can control. Additionally a 4% EBIT margin would rank favorably with our normalized performance over the last four years. To put this in context, on $2 billion of annual banana sales, we re targeting approximately $80 million of operating income in this segment. For salads, we believe we can achieve 7% to 8% operating margins in the next 24 to 36 months. Similarly put, on $1 billion of salad sales, we are targeting $70 million to $80 million of operating income. After subtracting the corporate MONCLER pantalon ski noir baby Pants black segment, based on today s revenue and assuming no movement in the euro that would equate to approximately $110 million of consolidated comparable operating income and approximately $175 million of consolidated EBITDA on an annual basis. The changes we have outlined will result in sustainable cost reductions beginning immediately of at least $60 million after one time charge of approximately $15 million in the second half of 2012, primarily related to severance. The restructuring plan that we re announcing today should is going to effect immediately and we should start seeing at least $8 million in savings as early as the fourth quarter of 2012 and $60 million on an annualized base. More than half of the savings come from streamlining Chiquita s operating and overhead structure, including the elimination of more than 300 positions and related reductions in overhead and newly gained efficiencies. Eliminated positions include current vacancies and extend the senior management of the company. We are reducing staff levels not just to save money, but we re doing so to strategically change our operating model. Again, we must continue to streamline our overhead and operating functions to meet or exceed the ways our competitors operate, we employee many functions and moncler outlet store usa positions, which they do not

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Chiquita Brands International s CEO Discusses Q3 2012 Results Good day and welcome to the Chiquita Brands Third Quarter Earnings Conference Call. Today s conference is being recorded. At this time, miami heat jerseys I would like to turn the conference over to Mr. Steve Himes, Director of Investor Relations. Please go ahead, sir.Thank you, Amber, and welcome everyone to Chiquita Brands International s third quarter 2012 earnings conference call. On the call today are Ed Lonergan, President and Chief Executive Officer and Brian Kocher, Chief Financial Officer.After today s prepared remarks we will take questions as time allows. GAAP of any non GAAP financial measures that we mention today.The call contains forward looking statements, regarding operating performance or industry developments, and any such statements are intended to fall within the Safe Harbor provided under the securities laws. Factors that could cause the results to differ materially are described in the forward looking statements section of today s press release and in Chiquita s SEC filings, including its annual report on Form 10 K, and quarterly reports on Form10 Q.And now, I d like to turn the call over to Ed.Ed Lonergan President and Chief Executive OfficerThank you, Steve. Good afternoon and thank you all for joining us today. I d like to begin my first earnings call with Chiquita by sharing some of the reasons why I am excited to join the company and about our future as a leading player in this industry.Chiquita serves a noble purpose in this world. Consumers enjoy our fresh fruits and salad products, and importantly, those products are good for them as well. In a world, where consumer products companies are scrambling to develop products that taste good and are healthy, we already possessed those attributes in our core. Additionally, Chiquita has a culture of corporate responsibility and a commitment to sustainability that is motivating to our customers and to our employees.The opportunity is even more attractive when these products and this employee group are associated with one of the world s most recognizable brands with more than 100 years of history. As for Chiquita today, I like where the company is heading. We have made some difficult, but necessary decisions this year to better position our core portfolio to winning a Moncler Down Jacket Grey BRANSON competitive marketplace. I firmly believe that company s core businesses of fresh fruits and salads possess strong earnings potential and as well that the recent SG and efficiency choices are the right path to unlock this value. This decision to focus on our core enables us to allocate resources to cost reduction and innovation on our valuable scale businesses and to eliminate projects and initiatives that are less likely to deliver shareholder value in the near term.The strategic decisions in the restructuring activities described on the second quarter call will improve the competitiveness of our core and allow the company to increase revenues and reduce costs, which in turn will enhance margins and improve cash flow. It s important for you to know that I fully support the company s announced intention to use increased cash flow to reduce our debt. In short, I joined the company, because I am passionate about the opportunities to deliver healthy products to consumers and drive an undervalued company to achieve its potential.Now, let s take a few minutes to review the strategy shared on our last call and the progress we have made toward our vision. The company s performance in 2012 is not indicative of the earnings potential of our business. As discussed, we have implemented a strategy that we believe will create a sustainable enterprise and enhance shareholder value. As we said on the last call, you can expect our business to make strategic decisions to accomplish the following.First and foremost, we ve planned to increase revenue and profitability in our core bananas and salads business with particular focus on creating value for consumers and our retail partners. Second, we will drive our costs in our value chain drive out costs in our value chain so as to be more competitive in our core markets. Third, we will align our overhead structure to industry benchmarks. Fourth, we will continue to evaluate and address non core unprofitable businesses and minimize investment and diversification and innovation outside the core. And lastly, we will limit toddler moncler our consumer marketing investments to those portfolio products, vehicles, and geographies, where we can demonstrate a verifiable business return.We are confident this strategy will enable Chiquita over the next two to three years to achieve the target operating margins discussed on our last earnings call. That is 4% operating margin in bananas and 7% to 8% operating margin in salads. It s also worth repeating that while we will certainly continue to refine the strategy as we move forward, I completely support the decisions that have been made in the recent past and believe our choices create a vibrant future for Chiquita brands.So, now let me provide a brief update of the progress made since our last earnings call. Where to play decisions aligned to our new strategy have been made, and a difficult restructuring has been executed with speed. Most importantly, our new strategy is already paying commercial dividends. In our North American bananas business, we have won new business we have won 2013 contracts equivalent to high single digit volume gains versus our 2012 base. Much of this distribution is earned from returning customers that value our brand and appreciate our new strategic Moncler voile Womens jackets sale zip rose red direction. The new volumes in light of our value chain efficiency actions are at accretive terms that will ultimately help Chiquita to achieve our target margin for bananas. We view these wins as validation of our banana strategy.In salads our decision to play in a broader market space including private label is also beginning to pay off. With the recent signature customer win and opportunities to come, we will begin delivering significant private label salad volume in Q1. This new signature win alone is equivalent to low single digit volume growth on our 2012 salads base. Volume growth is the most important driver of margin expansion in our Salad segment and as with bananas the value chain efficiencies we deliver will translate to progress versus our operating margin goals.The restructuring itself is mostly completed. We ve already taken actions that will enable us to realize over 75% of the annual savings that were announced in August. These savings will total at least $60 million annually and specifically to date all major employee related SG decisions have been implemented. Many value chain efficiency actions have been deployed and will begin to deliver in Q1 2013. And we are in process of reviewing every portfolio, spend area and innovation stream with an eye toward ensuring resources are properly allocated to deliver gains on those businesses and activities most likely to create sustainable shareholder value for Chiquita.We have announced the exit of unprofitable businesses, moncler spring such as our North American deciduous business, primarily comprised of grapes. And we have eliminated the costs associated with managing these businesses. While these businesses accounted for $40 million of net sales, they represented a negative contribution of $2 million for the bottom line and there was no clear path to profitability in the foreseeable future. In sum, the strategic choices are clear and sensible. The required actions to get the industry competitive SG and efficiency levels have been implemented with speed and our team is excited to be playing to win in the marketplace. I should also say that having talked to most key customers and suppliers in my first month with the company they also are excited to see Chiquita refocusing on our core and driving efficiencies in our business. They clearly value our team and our brands and they are excited to work with us to grow revenue.Now, let me turn it over to Brian to review the quarter.Brian Kocher Chief Financial OfficerThank you, Ed. And on behalf of Chiquita employees worldwide, we are happy to have you on board. Our third quarter result actually exceeded our expectations and excluding certain Moncler k2 Multiple logo Women Vest Pink unique items would have demonstrated even further progress against our long term earnings profile. After a recap of the reported results, I will discuss a number of those unique items.Third quarter 2012 net income on a comparable basis was a loss of $22 million or $0.47 per diluted share versus a loss of $16 million or $0.35 per diluted share in 2011. GAAP results for the third quarter 2012 were a net loss of $67 million or $1.45 per diluted share versus a net loss of $29 million or $0.63 per diluted share in 2011. The adjustments between our comparable results and GAAP results are included in the table in the press release and I will touch on some of the larger ones in a few minutes.Looking at the Bananas segment, sales were 1.6% lower at $446 million. The comparable operating loss of $2 million was impacted by the weakening euro, lower pricing in North America banana and slightly higher delivered fruit cost. Local pricing gains in Europe partially offset these impacts. Remember as a note when comparing year over year financial performance that Chiquita reconfigured its European shipping operations in September of 2011. As a result accounting practices required moncler jackets cheap us to accelerate approximately $12 million of what otherwise would have been 2012 and 2013 fuel hedging gains into the third quarter of 2011.North American banana pricing was 2% lower on essentially the same unit volumes. In Europe local prices were 8% higher than in 2011. However, similar to the second quarter of this year the increase was not enough to offset the large decline in the value of the euro. The euro decline alone negatively impacted our year over year operating income comparisons by some $10 million. Volumes in Europe were 8% lower as we chose to forego sales, where we could not achieve our targeted returns.Lastly, in order to complete the picture on our Bananas segment, our third quarter banana results were dampened by a $7 million reserve for bad debts against the Middle Eastern customer receivable. Excluding this reserve and the year over year impact of the euro, Chiquita s banana results would have actually doubled versus the comparable results of the third quarter of 2011.In our Salads and Healthy Snacks segment, second quarter net sales were steady at $240 million. Retail sales volume for the quarter were about 4% below 2011 levels, however, increased sales Moncler jackets Women fox fur zip style black volume in both our food service and healthy snack businesses offset the revenue effect of lower salad volume. As another key indicator, salad volumes at existing customers or continuous customers continue to benefit from increasing retail sales velocities driven by improved product quality. Again, considering the private label contract business that will start shipping in 2013 and all other things remaining equal, retail sales volumes for next quarter would grow around 4%. Average pricing of retail sales for the quarter decreased approximately 3% from the third quarter of 2011.For the quarter, the Salads and Healthy Snacks segment delivered $1 million in operating income on a comparable basis versus the loss of $3 million a year ago. The results of operations for the quarter would have increased more, but we experienced approximately $5 million of cost associated with precautionary product recalls and related expenses. Certain one time items have been excluded from comparable results, but are worth mentioning as they have had an impact on our third quarter GAAP results.As we have previously described, both Chiquita s relocation to Charlotte and the restructuring that Ed just mentioned Moncler himalaya Down Men Jackets Blue earlier in the call are mostly complete. In the third quarter, we incurred $6 million in charges, $4 million net of tax, related to the relocation from Cincinnati. We anticipate the remaining $2 million of costs related to the relocation will be recognized in immaterial amounts at various times through 2013. Related to the restructuring, our third quarter GAAP results include $16 million of charges, $12 million net of tax related to the restructuring activities

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