Global produce giant Fresh Del Monte has announced adjustments to its strategy following a five percent decline in net sales for the first quarter of 2026, marking a period of significant change for the company.
The company reported net sales of approximately $1 billion, primarily impacted by the divestiture of Mann Packing in late 2025 and a decrease in avocado sales.
This strategic move is part of Fresh Del Monte’s broader effort to optimize its portfolio and focus on core areas that promise higher returns.
Despite the drop in sales, Fresh Del Monte’s Chairman and CEO, Mohammad Abu-Ghazaleh, expressed satisfaction with the results, highlighting the disciplined execution across a complex operating environment.
The completion of the Del Monte Foods acquisition in March 2026 was a pivotal event, leading to the creation of a standalone “Prepared Foods” segment, which contributed $82.5 million in net sales.
- Fresh Del Monte reports a 5% decline in Q1 2026 net sales.
- Company divested Mann Packing and faced declining avocado sales.
- CEO highlights disciplined execution amid complex market challenges.
- Acquisition of Del Monte Foods created a new “Prepared Foods” segment.
- Profit drops exacerbated by higher shipping costs and asset impairment charges.
This strategic acquisition is expected to strengthen the company’s supply chain and expand its product offerings, setting the stage for future growth.
The company reported a three percent year-on-year drop in gross profits, which becomes a more significant 16 percent decrease when compared to Q4 2025.
Lower prices in the “other products and services” category, including poultry and meat, contributed to this contraction.
However, the decision to exit non-core assets, notably the divestiture of Mann Packing, has improved gross margins in the Fresh and Value-Added Products segment, achieving a segment gross margin of nearly 11 percent.
Operational challenges remain, particularly in the avocado and banana lines.
An industry-wide oversupply of avocados has led to lower per-unit selling prices, impacting the Fresh and Value-Added segment.
Additionally, higher shipping costs due to disruptions in the Strait of Hormuz and $20 million in one-time asset impairment charges related to the Del Monte Foods acquisition have further pressured the company’s financials.
Despite these challenges, Fresh Del Monte remains focused on leveraging higher per-unit prices for pineapples and bananas to stabilize its bottom line, underscoring its commitment to core product categories.
