Inflation Overview - Inflation has increased to 2.9% in August from 2.7% in June and July, indicating a rising trend in consumer prices [1][2] - Core inflation, excluding food and energy, rose 0.4% in August, marking the largest monthly gain since January, and is up 3.1% year-over-year [2] Impact of Tariffs - The average tariff rate for Americans has reached 17.4%, the highest since 1935, potentially costing households an additional $2,300 by 2025 [6] - Tariffs have a significant impact on prices across various sectors, with businesses reporting increased costs being passed on to consumers [5][3] Sector-Specific Price Increases - **Coffee**: Prices surged 9.8% from April to August, exacerbated by poor harvests and new import tariffs, particularly affecting imports from Vietnam and Indonesia [8][9] - **Jewelry and Watches**: Prices increased by 5.5% in August, significantly above the historical average, driven by a 10% tariff and subsequent increases on Swiss imports to 39% [10][11][12] - **Bananas**: Prices rose 4.9% from April to August, influenced by a 10% tariff, marking a notable increase for a typically stable category [4][13] - **Televisions**: Prices increased by 2.5% in August and 3.1% since April, contrasting with a long-term trend of declining prices due to manufacturing efficiencies [15][16]

Q2'25 Financial Highlights - Revenue reached $2.4 billion, a 14% increase LFL(Like-for-like) [10] - Adjusted EBITDA was $137 million, up 12% LFL [10] - Adjusted Diluted EPS stood at $0.55, reflecting a 9% increase [10] Segment Performance - Fresh Fruit revenue increased by 14.2% to $972 million [32, 35], with Adjusted EBITDA up by 3% to $72.7 million [32, 35] - Diversified Fresh Produce – EMEA saw a revenue increase of 16.5% to $1.101 billion [37, 40], with Adjusted EBITDA up 14.7% to $49 million [37, 40] - Diversified Fresh Produce – Americas & ROW experienced an 8.5% increase in revenue to $386 million [42, 45], and Adjusted EBITDA increased by 27% to $15.4 million [42, 45] Capital Allocation and Debt - Cash CAPEX for continuing operations was $(19.4) million in Q2'25 and $(72.2) million in H1'25 [46] - Free Cash Flow from continuing operations was $(1.0) million in Q2'25 and $(132.6) million in H1'25 [46] - Net Debt stood at $(788.8) million with a Net Leverage of 2.0x as of June 30, 2025 [47] FY'25 Outlook - The company anticipates Adjusted EBITDA for continuing operations to be approximately $380 - $390 million [51] - Maintenance CAPEX for continuing operations is projected to be around $100 million [51] - Interest expense is expected to be approximately $67 million [51]

Financial Data and Key Metrics Changes - Net sales increased by 4% to $1.183 billion compared to $1.14 billion in the prior year [14] - Gross profit rose by 6% to $120 million from $113 million in the prior year, with gross margin expanding to 10.2% from 9.9% [6][15] - Net income attributable to Fresh Del Monte was $57 million, up from $54 million in the prior year, with adjusted diluted earnings per share increasing to $1.23 from $1.16 [18] Business Segment Data and Key Metrics Changes - Fresh and value-added products segment net sales increased by 4% to $723 million, driven by higher selling prices in the pineapple product line [19] - Banana segment net sales also rose by 4% to $410 million, primarily due to higher selling prices across regions [21] - Other products and services segment saw a slight decrease in net sales to $50 million from $51 million, attributed to lower selling prices in poultry and meats [22] Market Data and Key Metrics Changes - Consumer spending on tropical fruit has risen by 58% since February 2017, indicating a growing market relevance [8] - The company launched PingGlow in the UAE, marking its first sustained market entry for a variety in the Middle East [8] Company Strategy and Development Direction - The company is transitioning from legacy break box shipping vessels to container vessels in the Asia Pacific region to enhance operational efficiency [27] - There is a focus on expanding production capacity in Costa Rica and other regions, including Brazil and Africa, to meet growing demand [36][38] Management Comments on Operating Environment and Future Outlook - Management anticipates a continued shortage of pineapple supply into 2026, with strong market dynamics expected to persist [35][36] - The company remains confident in its ability to deliver on full-year objectives, expecting net sales growth of 2% year-over-year [28] Other Important Information - The company declared a quarterly cash dividend of $0.30 per share, equating to an annualized yield of 3.3% based on current share price [26] - The effective tax rate for the second quarter was 20%, reflecting increased earnings in higher tax jurisdictions [23] Q&A Session Summary Question: Update on pineapple supply and growth expectations - Management expects a continued shortage of supply through the end of the year and into next year, with strong market conditions for premium varieties [35][36] Question: Distribution growth for Pink Glow - Supply is currently constrained due to regulatory issues, but management anticipates increased acreage and supply in about 18 months [40][41] Question: Demand sources for fresh cut fruit - Demand is primarily coming from retail and convenience stores, with growth observed globally, not just in North America [45][46] Question: Impact of black sigatoka on banana supply - Costa Rica's export volume is down over 20% due to black sigatoka disease, which is expected to worsen [52] Question: Foreign exchange impact on revenue - The strengthening of the euro, British pound, and Japanese yen positively impacted net sales, while the Costa Rican colon presented headwinds [62][65]

Group 1 - President Trump urged Walmart to absorb the costs of tariffs instead of passing them onto consumers, stating that the retailer should "EAT THE TARIFFS" [1][4] - Walmart's CFO, John David Rainey, expressed concerns that the increase in tariffs is too high for suppliers to absorb, leading to potential price increases for consumers by late May and more significantly in June [2] - Walmart CEO Doug McMillon indicated that tariffs on imports from countries like Colombia, Peru, and Costa Rica are affecting prices of certain products, including bananas, avocados, and coffee, but assured that food prices would not be pressured by tariff-related costs on general merchandise [3] Group 2 - Other companies, such as Foxconn and Toyota, have also warned about the impacts of tariffs, with Foxconn downgrading its growth outlook and Toyota estimating a $1.25 billion profit loss due to U.S. tariffs [4] - Tariffs are essentially taxes on imported goods, which increase costs for importing companies, leading them to raise retail prices to maintain margins [5] - The uncertainty surrounding tariffs has been exacerbated by President Trump's fluctuating tariff policies, which have included rates as high as 145% on Chinese goods, contributing to market volatility and inflation concerns [7]

Core Viewpoint - President Trump criticized Walmart for not absorbing the costs associated with his tariffs, suggesting that the retail giant should not pass these costs onto consumers [1][5][16] Group 1: Impact of Tariffs on Walmart - Walmart warned that prices for various products, including bananas and children's car seats, could increase due to tariffs [2][8] - Walmart's CFO indicated that a $350 car seat made in China could see a price increase of $100, representing a 29% rise [11] - The company has reported strong first-quarter sales but emphasized the limits to which it can keep prices low amidst rising costs [12] Group 2: Economic Context and Consumer Sentiment - Economic analyses suggest that tariffs could worsen inflation, with a recent consumer sentiment survey indicating that approximately 75% of respondents mentioned tariffs as a concern [2][8] - The tariffs have contributed to a decline in consumer sentiment, marking the second-lowest measure on record [8] - Trump's tariffs have created uncertainty in the U.S. economy, affecting major companies and their supply chains [11][14] Group 3: Trump's Economic Agenda - Trump insists that his economic agenda will lead to more domestic manufacturing jobs, urging Walmart to sacrifice profits for this cause [4][16] - The administration has reduced tariffs from 145% to 30% for a 90-day period, but has maintained high tariffs on various imports, including autos and steel [12][14] - Trump has called for the Federal Reserve to cut benchmark rates, despite concerns that this could accelerate inflation [16][17]

Core Viewpoint - Walmart plans to increase prices due to the impact of tariffs on goods, indicating that the magnitude and speed of these price hikes could be unprecedented in history [1][2]. Price Increases - The company has already begun raising prices on certain items, such as bananas, which increased from 50 cents to 54 cents per pound [1]. - Walmart's Chief Financial Officer, John David Rainey, warned that consumers will see higher prices "towards the tail end of this month, and then certainly much more in June" due to the tariffs [3]. Financial Performance - Despite the challenging environment, Walmart reported strong sales, with US same-store sales increasing by 4.5% and Sam's Club by 6.7% for the three months ending May 2 [7]. - E-commerce sales in the US rose by 21%, marking the 12th consecutive double-digit gain, while global online sales increased by 22% year-over-year [7]. - However, net income fell to $4.49 billion, or 56 cents per share, down from $5.10 billion, or 63 cents per share, in the same period last year, and revenue rose about 2.5% to $161.5 billion, missing expectations of $165.84 billion [9]. Market Positioning - The company plans to absorb some tariff costs to maintain competitive pricing against rivals [4][8]. - Walmart has not canceled any orders but has reduced the size of some purchases in anticipation of customer pullback due to tariffs [11]. - The retailer expects to gain market share during the trade war, as more high-income households chose Walmart for groceries in the previous quarter [10].

Q1 2025 Financial Highlights - Revenue reached $2.1 billion, a decrease of 1% year-over-year[10,33] - Adjusted EBITDA was $105 million, a decrease of 5% year-over-year[10,33] - Adjusted Diluted EPS was $0.35, a decrease of 18% year-over-year[10,33] - Revenue increased by 4% on a Like-For-Like (LFL) basis[10,14] Segment Performance - Fresh Fruit revenue increased by 6.5% year-over-year to $878 million, but Adjusted EBITDA decreased by 8.8% to $63.3 million[35,37,39] - Diversified Fresh Produce – EMEA revenue increased by 4.5% year-over-year to $892 million, with Adjusted EBITDA increasing by 6.6% to $27.7 million[35,44] - Diversified Fresh Produce – Americas & ROW revenue decreased by 23.8% year-over-year to $363 million, with Adjusted EBITDA decreasing by 5.9% to $13.8 million[35,49] Capital Allocation and Outlook - Free Cash Flow from Continuing Operations was $(52.8) million[53] - Net Debt stood at $(742) million, with Net Leverage at 1.9x[54] - The company expects Adjusted EBITDA from Continuing Operations to be at least $380 million for FY'25[60]

Financial Data and Key Metrics Changes - Net sales for Q1 2025 were $1.098 billion, down from $1.108 billion in the prior year, primarily due to lower sales in the banana segment and negative exchange rate fluctuations, partially offset by higher sales in fresh and value-added products [15] - Gross profit increased to $92 million from $82 million year-over-year, driven by higher sales in fresh and value-added segments, despite increased production and distribution costs [15][16] - Gross margin improved to 8.4% from 7.4% in the prior year, reflecting a sequential increase from 6.8% in Q4 2024 [16] - Net income attributable to Fresh Del Monte was $31 million, compared to $26 million in the prior year, with diluted EPS rising to $0.64 from $0.55 [18] Business Line Data and Key Metrics Changes - Fresh and value-added products segment net sales were $683 million, up from $677 million, driven by higher selling prices in avocados and fresh cut fruits [19] - Banana segment net sales decreased to $364 million from $380 million, impacted by lower sales volume and prices in Asia and North America [21] - Other products and services segment net sales remained stable at $51 million, with gross profit increasing to $6 million from $5 million due to higher selling prices in poultry and meats [22] Market Data and Key Metrics Changes - Strong consumer interest in avocados and fresh cut fruits continues, with these categories central to the company's long-term growth strategy [8] - Pineapples are experiencing demand exceeding supply, indicating strong market positioning [7][8] Company Strategy and Development Direction - The company aims to lead in fresh and value-added products, focusing on quality, innovation, and sustainability [12] - Strategic acquisition of a majority stake in Abolio, a leading avocado oil producer in Uganda, aims to reduce waste and enhance value in a high-margin category [11] - The company is committed to operational efficiency and leveraging its vertically integrated supply chain to navigate global shipping disruptions [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued solid demand for fresh produce, despite consumer pressures [34] - The company is closely monitoring tariff impacts and is working collaboratively with buyers to mitigate negative effects [38] - Expectations for full-year 2025 include a 2% growth in net sales and targeted gross margins across segments [28][29] Other Important Information - The company declared a quarterly cash dividend of $0.30 per share, representing a 3.5% yield based on current share price [25] - Long-term debt decreased by 5% from the previous fiscal year-end, reflecting improved financial health [25] Q&A Session Summary Question: Demand in the produce category - Management noted continuous solid demand in fresh produce, with no expected reductions in consumption [34] Question: Logistic issues in the industry - Management indicated that smaller operators are at a disadvantage due to logistical disruptions, while the company remains agile and capable of fulfilling customer demands [36][37] Question: Impact of tariffs on pricing - Management is working with buyers to mitigate tariff impacts without negatively affecting consumers [38] Question: Performance of avocado segment - The avocado segment is performing well, with diversification in sourcing contributing to growth [40] Question: Fresh cut fruit margins - Management believes fresh cut fruit operations are strengthening, with increased efficiency leading to stable margins [44] Question: Pineapple supply and demand - Management highlighted that increasing consumption is driving demand for pineapples, which are still competitively priced compared to other fruits [46][47]

Financial Data and Key Metrics Changes - Net sales for Q1 2025 were $1.098 billion, down from $1.108 billion in the prior year, primarily due to lower sales in the banana segment and negative exchange rate fluctuations, partially offset by higher sales in fresh and value-added products [15] - Gross profit increased to $92 million from $82 million year-over-year, driven by higher sales in fresh and value-added segments, despite increased production and distribution costs [15] - Gross margin improved to 8.4% from 7.4% in the prior year and 6.8% in Q4 2024 [16] - Net income attributable to Fresh Del Monte was $31 million, up from $26 million in the prior year, with adjusted net income at $30 million compared to $16 million last year [17] Business Line Data and Key Metrics Changes - Fresh and value-added products segment net sales were $683 million, slightly up from $677 million, driven by higher avocado prices and fresh cut fruit sales in North America [19] - Banana segment net sales decreased to $364 million from $380 million, impacted by lower sales volume and prices in Asia and North America due to market demand and supply issues [21] - Other products and services segment net sales remained stable at $51 million, with gross profit increasing to $6 million from $5 million due to higher poultry and meat prices [22] Market Data and Key Metrics Changes - Strong consumer interest in avocados and fresh cut fruit continues, with the avocado segment expected to grow as sourcing diversifies from Peru and Colombia [39] - Pineapple demand exceeds supply, attributed to increasing consumption and favorable pricing compared to other fruits [44] Company Strategy and Development Direction - The company aims to lead in fresh and value-added products, focusing on quality, innovation, and sustainability, with a vision extending through 2025 to 2027 [12] - Strategic acquisition of a majority stake in Abolio, an avocado oil producer, aims to reduce waste and enhance value in a high-margin category [11] - The company is committed to operational excellence, resource efficiency, and global expansion while reducing reliance on any single market [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued solid demand for fresh produce despite consumer pressures, indicating resilience in the face of logistical disruptions [33] - The company is closely monitoring tariff impacts and working collaboratively with buyers to mitigate costs without negatively affecting consumers [37] - Expectations for full-year 2025 include a 2% growth in net sales and gross margins of 10-11% in fresh and value-added products, 5-7% in bananas, and 12-14% in other products [27][29] Other Important Information - The company declared a quarterly cash dividend of $0.30 per share, representing a 3.5% yield based on current share price [25] - Long-term debt decreased to $233 million, a 5% reduction from the previous fiscal year-end [25] Q&A Session Summary Question: Demand in the produce category - Management noted solid demand in fresh produce, with no expected reductions in consumption, viewing market disruptions as potential opportunities [33] Question: Logistic issues in the industry - Management confirmed that smaller operators face challenges due to logistics disruptions, while the company’s integrated supply chain allows for uninterrupted operations [34][36] Question: Impact of tariffs on pricing - The company is working with buyers to mitigate tariff impacts cooperatively, aiming to avoid negative effects on consumer prices [37] Question: Performance of avocado segment - The avocado segment is performing well, with growth expected as sourcing diversifies [39] Question: Fresh cut fruit margins - Management expressed confidence in maintaining strong margins in fresh cut fruit operations due to increased efficiency and demand [42] Question: Pineapple supply and demand - Management indicated that increasing consumption is driving demand for pineapples, which are still competitively priced compared to other fruits [44]

Core Insights - The Kroger Co. is promoting National Nutrition Month by encouraging customers to incorporate fresh, in-season fruits and vegetables into their meals and snacks [1][2] - The company emphasizes the availability of nutritious options and the ease of meal preparation using fresh produce [2][3] Group 1: Fresh Produce Promotion - Kroger highlights the benefits of using fresh, seasonal produce for healthy meals, stating that it offers limitless options for families as spring and summer approach [2] - The company provides recipes through its The Fresh Lane blog to inspire customers to explore the health impacts of fresh foods [2][3] Group 2: Nutrition Programs - Kroger's OptUP program allows customers to find nutrition options and check the FoodHealth Score of products, enhancing their shopping experience [3] - Kroger Plus loyalty customers can access a free 30-minute dietitian visit for personalized meal planning and product recommendations [3] Group 3: Accessibility of Healthy Choices - Many fresh foods can be purchased using food and over-the-counter benefit cards, making healthy options accessible to eligible individuals, including Medicare Advantage and some Medicaid members [4] - Kroger aims to provide value and healthy choices for all customers, supporting various supplemental benefits programs [4] Group 4: Shopping Options - Customers can shop for fresh ingredients in-store or through Kroger Pickup and Delivery, ensuring consistent low prices across all shopping methods [5] - The Boost by Kroger Plus membership offers potential savings of up to $1,100 per year on fuel and grocery delivery [5][7] Group 5: Featured Fresh Ingredients - The article lists various in-season fruits and vegetables, including strawberries, apples, asparagus, and spinach, highlighting their health benefits [6] - Specific recipes are provided, such as Grilled Steak Strawberry Salad and Green Pea Hummus, showcasing how to incorporate these fresh ingredients into meals [6] Group 6: Company Overview - Kroger operates with a purpose to "Feed the Human Spirit" and serves over 11 million customers daily through a seamless digital shopping experience [8] - The company employs nearly 420,000 associates and is committed to creating ZeroHungerZeroWaste communities [8]