Posted on: Friday, December 3, 2004

Del Monte cuts profit forecast for 2005

By Mark Clothier
Bloomberg News Service

Del Monte Foods Co., the largest U.S. maker of canned fruits and vegetables, cut its 2005 profit forecast range by 5 cents to 76 cents to 81 cents a share because energy and shipping costs remain high.

It previously had expected profit of 81 cents to 86 cents a share in fiscal 2005, San Francisco-based Del Monte said yesterday in a statement. The company earned 76 cents in fiscal 2004.

Diesel fuel prices, trucking rates, and other costs of delivering products such as Star-Kist tuna and Del Monte green beans are rising higher than the company anticipated, Chief Executive Officer Richard G. Wolford said in a conference call with analysts and investors to discuss second-quarter earnings. Sales in the quarter rose 6.9 percent to $846.6 million.

Net income in the quarter ended Oct. 31 rose 3.5 percent to $41.6 million, or 20 cents. That compares with $40.2 million, or 19 cents, a year earlier. Del Monte was expected to earn 21 cents, the average estimate of eight analysts surveyed by Thomson Financial.

Del Monte shares fell 24 cents to $10.43 at 4:02 p.m. in New York Stock Exchange composite trading.