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Dole plc Reports Fourth Quarter and Full Year 2022 Financial Results

Dole plc (NYSE: DOLE) ("Dole" or the "Group" or the "Company") today released its financial results for the three months and year ended December 31, 2022.

Highlights for the year ended December 31, 2022:

  • First full year of Dole plc results post-acquisition
  • Good progress made on integration of legacy businesses and rebranding of European operations
  • Launch of Dole Exotics and the "BeExotic" brand
  • Released first Dole plc Sustainability Report, outlining medium to long-term sustainability goals
  • Post year end, announced the Agreement to sell our Fresh Vegetables division to Fresh Express, for gross proceeds of approximately $293.0 million
  • Satisfactory full year financial performance delivered in a challenging operating environment
  • Full year revenue of $9.2 billion and Adjusted EBITDA1 of $337.7 million, in-line with our latest guidance

Financial Highlights Unaudited

 

Three Months Ended

 

Year Ended

 

December 31,

2022

 

December 31,

2021

 

December 31,

2022

 

December 31,

2021

 

December 31,

2021

Pro-forma2

 

 

 

 

 

 

 

 

 

 

 

(U.S. Dollars in millions, except per share amounts)

Revenue

2,356

 

2,251

 

9,229

 

6,454

 

9,286

Net Income (Loss)

13.3

 

 

(24.6

)

 

111.7

 

 

16.8

 

 

177.6

 

Net Income (Loss) attributable to Dole plc

6.8

 

 

(29.3

)

 

86.5

 

 

(7.2

)

 

151.7

 

Diluted EPS

0.07

 

 

(0.31

)

 

0.91

 

 

(0.10

)

 

1.60

 

Adjusted EBITDA1

74.4

 

 

61.1

 

 

337.7

 

 

290.1

 

 

393.6

 

Adjusted Net Income1

8.9

 

 

0.0

 

 

92.0

 

 

73.1

 

 

141.2

 

Adjusted Diluted EPS1

0.09

 

 

0.00

 

 

0.97

 

 

1.01

 

 

1.49

 

 

1 Dole plc reports its financial results in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). See full GAAP financial results in the appendix. Adjusted EBIT, Adjusted EBITDA, Adjusted Net Income, Adjusted Earnings Per Share and Net Debt are non-GAAP financial measures. Refer to the appendix of this release for an explanation and reconciliation of these and other non-GAAP financial measures used in this release to comparable GAAP financial measures.

2 This press release contains pro-forma financial information. The unaudited pro-forma consolidated financial statements for Dole plc illustrate the effects of the acquisition of Dole Food Company, Inc. ("DFC" or "Legacy Dole") by Total Produce ("TP") and the effects of the IPO and refinancing as if they had occurred on January 1, 2020. This is consistent with the pro-forma financial statements presented in the Form F-1 filed with the SEC at the time of the IPO.

Commenting on the results, Carl McCann, Executive Chairman said:

“We were very pleased to have a strong final quarter. We delivered Adjusted EBITDA growth of 21.7% for the fourth quarter and our full year revenue and Adjusted EBITDA were in line with guidance.

Post year end, we announced the sale of our Fresh Vegetables business. This sale will strengthen the financial position of the Group and increase our focus on our core activities.

With our diversified product offering and wide geographic footprint, we believe our business is well positioned for growth. For the 2023 financial year, we are targeting Adjusted EBITDA of $350.0 million.

We thank all of our talented people for their dedication and significant contributions during this past year.”

Group Results Fourth Quarter

Revenue increased 4.7%, or $104.7 million, primarily due to higher pricing across the Group. On a like-for-like basis3, excluding the impact of foreign currency translation and acquisitions and divestitures, revenue increased 10.2%, or $229.0 million, with growth across all segments.

Adjusted EBITDA increased 21.7%, or $13.3 million, primarily driven by a strong quarter for the Fresh Fruit segment, partially offset by challenges in our Diversified Americas and Diversified EMEA segments and a loss in Fresh Vegetables. On a like-for-like basis, Adjusted EBITDA increased 29.0%.

Adjusted Net Income increased $8.9 million, predominantly due to the increases in Adjusted EBITDA, partially offset by a lower income tax benefit and higher interest expense. Adjusted Diluted EPS was $0.09 compared to $0.00 in the prior year.

Group Results Full Year

Revenue decreased 0.6%, or $56.8 million, on a pro-forma comparative basis; however, on a like-for-like basis, revenue increased 5.0%. The increase was driven by inflation-justified price increases across the Group.

Adjusted EBITDA decreased 14.2%, or $55.9 million, on a pro-forma comparative basis, primarily due to losses incurred by the Fresh Vegetables segment following a challenging year, as well as the negative impact of foreign currency translation. On a like-for-like basis, Adjusted EBITDA decreased 10.4%.

Adjusted Net Income decreased by 34.9%, or $49.2 million, on a pro-forma comparative basis, predominantly due to the decrease in Adjusted EBITDA and higher interest expense. Adjusted Diluted EPS decreased by 34.9% to $0.97.

Vegetables Transaction

On January 30, 2023, we entered into a Stock Purchase Agreement (the “Agreement”) with Fresh Express Acquisitions LLC (“Fresh Express”), a wholly owned subsidiary of Chiquita Holdings Limited, pursuant to which Fresh Express has agreed to acquire our Fresh Vegetables division for approximately $293.0 million in cash, subject to certain adjustments set forth in the Agreement (the “Vegetables Transaction”). The Vegetables Transaction is expected to close after regulatory approvals are obtained, subject to the satisfaction or waiver of customary closing conditions.

_________________________

3 Like-for-like basis refers to the measure excluding the impact of foreign currency translation movements and acquisitions and divestitures. Refer to the Appendix for further detail on these impacts and the calculation of like-for-like variances.

Selected Segmental Financial Information

 

Three Months Ended

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

 

 

 

 

(U.S. Dollars in thousands)

 

Revenue

 

Adjusted EBITDA

 

Revenue

 

Adjusted EBITDA

Fresh Fruit

$

740,167

 

 

$

41,233

 

 

$

680,881

 

 

$

15,694

 

Diversified Fresh Produce - EMEA

 

751,594

 

 

 

23,630

 

 

 

815,330

 

 

 

29,363

 

Diversified Fresh Produce - Americas & ROW

 

573,936

 

 

 

15,557

 

 

 

479,702

 

 

 

20,574

 

Fresh Vegetables

 

315,082

 

 

 

(6,026

)

 

 

296,848

 

 

 

(4,520

)

Intersegment

 

(24,581

)

 

 

 

 

 

(21,281

)

 

 

 

Total

$

2,356,198

 

 

$

74,394

 

 

$

2,251,480

 

 

$

61,111

 

 

Year Ended

 

December 31, 2022

 

December 31, 2021

Pro-forma

 

 

 

 

 

 

 

 

 

(U.S. Dollars in thousands)

 

Revenue

 

Adjusted EBITDA

 

Revenue

 

Adjusted EBITDA

Fresh Fruit

$

3,047,149

 

 

$

212,175

 

 

$

2,877,030

 

 

$

209,999

 

Diversified Fresh Produce - EMEA

 

3,152,561

 

 

 

114,718

 

 

 

3,438,341

 

 

 

131,126

 

Diversified Fresh Produce - Americas & ROW

 

1,965,667

 

 

 

44,277

 

 

 

1,779,065

 

 

 

53,069

 

Fresh Vegetables

 

1,205,902

 

 

 

(33,446

)

 

 

1,280,594

 

 

 

(614

)

Intersegment

 

(142,426

)

 

 

 

 

 

(89,358

)

 

 

 

Total

$

9,228,853

 

 

$

337,724

 

 

$

9,285,672

 

 

$

393,580

 

Fourth Quarter Commentary

Fresh Fruit

Revenue increased 8.7%, or $59.3 million, compared to the prior year quarter. Revenue was positively impacted by higher worldwide pricing of bananas, higher commercial cargo revenues and increases in volumes of pineapples sold in core markets, partially offset by lower volumes of bananas sold.

Adjusted EBITDA increased significantly by 162.7%, or $25.5 million. Adjusted EBITDA was positively impacted by higher revenue, partially offset by higher fruit sourcing costs and higher costs of shipping, packaging and handling.

Diversified Fresh Produce – EMEA

Revenue decreased 7.8%, or $63.7 million, primarily driven by a negative translation impact on currency of $117.3 million due to the strengthening of the U.S. dollar against the European currencies. On a like-for-like basis, revenue increased 6.9%, or $56.6 million, primarily driven by inflation-justified price increases across the segment.

Adjusted EBITDA decreased 19.5%, or $5.7 million. On a like-for-like basis, excluding the negative impact of currency translation of $4.4 million, Adjusted EBITDA decreased 4.8%, or $1.4 million. The decrease in Adjusted EBITDA was primarily a result of losses on crop yield in South Africa and a weaker quarter in our Northern European and Irish businesses, offset by a stronger performance by our Spanish, Czech and Dutch businesses.

Diversified Fresh Produce – Americas & ROW

Revenue increased 19.6%, or $94.2 million, primarily driven by higher pricing and volumes of cherries in Chile, higher pricing for potatoes and onions in North America and overall positive growth in our North American operations.

Adjusted EBITDA decreased 24.4%, or $5.0 million. The decrease in Adjusted EBITDA was primarily due to a weak season for Chilean apples and kiwis and raspberries in North America, partially offset by a strong start to the Chilean cherry season and continued positive performance of potatoes and onions in North America.

Fresh Vegetables

Revenue increased 6.1%, or $18.2 million. This increase was primarily driven by price increases realized for value-added products and continued strong pricing of fresh-packed products, partially offset by lower volumes of both value-added and fresh-packed products.

Adjusted EBITDA decreased 33.3%, or $1.5 million. The decrease in Adjusted EBITDA was primarily driven by a challenging quarter in value-added products, due to sourcing challenges which led to lower volumes and higher input costs, as well as by the continued impact of inflationary cost increases on freight, packaging materials, food ingredients and labor. These challenges in value-added products were partially offset by improved performance for fresh-packed products. The prior year quarter was adversely impacted by the packaged salads recall announced on December 24, 2021.

Full Year Commentary

Fresh Fruit

Revenue increased 5.9%, or $170.1 million, on a pro-forma comparative basis. The increase was predominantly driven by higher worldwide pricing of bananas and higher commercial cargo revenues.

Adjusted EBITDA increased 1.0%, or $2.2 million, on a pro-forma comparative basis. Adjusted EBITDA was positively impacted by higher revenue, partially offset by lower volumes of pineapples in North America and higher costs of ocean and inland freight, packaging, fertilizers and other materials.

Diversified Fresh Produce – EMEA

Revenue decreased 8.3%, or $285.8 million, on a pro-forma comparative basis, primarily driven by a negative translation impact on currency of $418.9 million and a net unfavorable impact on revenue from acquisitions and divestitures of $92.6 million. On a like-for-like basis, revenue increased 6.6%, or $225.7 million, primarily driven by inflation-justified price increases across the segment, as well as an increase in food service activity from the general easing of COVID-19 restrictions.

Adjusted EBITDA decreased 12.5%, or $16.4 million, on a pro-forma comparative basis. On a like-for-like basis, excluding the negative impact of currency translation of $16.3 million, Adjusted EBITDA was flat. Strong performance in our Spanish, U.K. and Dutch businesses and an overall increase in average selling prices was offset by logistical challenges on trading in Northern Europe and losses on crop yield in South Africa.

Diversified Fresh Produce – Americas & ROW

Revenue increased 10.5%, or $186.6 million, on a pro-forma comparative basis, primarily driven by higher pricing for potatoes and onions in North America, as well as by good performance from avocados and a strong start to the Chilean cherry season.

Adjusted EBITDA decreased 16.6%, or $8.8 million, on a pro-forma comparative basis. The decrease in Adjusted EBITDA was primarily due to a challenging end to the Chilean grape season, weaker performance for apples and kiwis in South America and lower pricing for raspberries in North America. These negative impacts were partially offset by strong performance for potatoes, onions and avocados in North America and growth for Chilean cherries.

Fresh Vegetables

Revenue decreased 5.8%, or $74.7 million, on a pro-forma comparative basis. Revenue was impacted by lower volumes following the packaged salads recall and plant suspension at the outset of 2022 and planned reduction of fresh-packed vegetables volumes.

Adjusted EBITDA decreased $32.8 million on a pro-forma comparative basis. The decrease in Adjusted EBITDA was primarily a result of lower revenue following the packaged salads recall and inflationary cost increases in freight, packaging materials, food ingredients and product sourcing. Unfavorable weather events in the second half of the year also impacted product sourcing. These challenges were partially offset by improved performance for fresh-packed products.

Capital Expenditures

Capital expenditures for the year ended December 31, 2022 were $98.0 million and included investments in farm renovations and greenhouse projects across our growing regions, the acquisition of an additional farm in Peru and ongoing investments in information technology, logistics and efficiency projects in our warehouses and processing facilities.

Net Debt

Net Debt as of December 31, 2022 was $1.0 billion.

Outlook and Strategic Priorities for Fiscal Year 2023 (forward-looking statement)

The operating environment in 2023 continues to bring both new opportunities and new challenges.

We are continuing to see improvements in global supply chains and signs of moderating inflation, which can have a positive impact on our business. However, we have also witnessed further weather events, such as colder weather in Spain and Northern Africa, which have created challenges for importers in Northern Europe at the start of the year.

Within our own business, we recently experienced a cybersecurity incident identified as ransomware. We moved quickly to contain the threat and have been working closely with leading cybersecurity experts to remediate the issue and secure our systems. We have also been cooperating with law enforcement. The incident had a limited overall impact on our operations; however, it was disruptive for our Chilean and Fresh Vegetables businesses in particular.

Overall, for full year 2023, we believe our business is well positioned for growth. While forecasting in the current environment is complex, we are targeting full year Adjusted EBITDA of $350.0 million. This target assumes no contribution from the Fresh Vegetables division.

The above outlook includes non-GAAP financial measures. Please refer to the appendix of this release for an explanation and reconciliation of our historical non-GAAP financial measures used in this release to comparable GAAP financial measures.

Dividend

On March 6, 2023, the Board of Directors of Dole plc declared a cash dividend for the fourth quarter of 2022 of $0.08 per share, payable on April 21, 2023 to shareholders of record on March 31, 2023. A cash dividend of $0.08 per share was paid on January 6, 2023 for the third quarter of 2022.

About Dole plc

A global leader in fresh produce, Dole plc produces, markets, and distributes an extensive variety of fresh fruits and vegetables sourced locally and from around the world. Dedicated and passionate in exceeding our customers’ requirements in over 75 countries, our goal is to make the world a healthier and a more sustainable place.

Webcast and Conference Call Information

Dole plc will host a conference call and simultaneous webcast at 08:00 a.m. Eastern Time today to discuss the fourth quarter and full year 2022 financial results. The webcast can be accessed at www.doleplc.com/investors.

The conference call can be accessed live by dialing (646) 307-1963 in the US or +353 (1) 582 2023 in Ireland and +44 20 3481 4247 for UK and other international participants. The conference ID is 4191785.

Forward-looking information

Certain statements made in this press release that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on management’s beliefs, assumptions, and expectations of our future economic performance, considering the information currently available to management. These statements are not statements of historical fact. The words “believe,” “may,” “could,” “will,” “should,” “would,” “anticipate,” “estimate,” “expect,” “intend,” “objective,” “seek,” “strive,” “target” or similar words, or the negative of these words, identify forward-looking statements. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future plans, estimates, or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity. Accordingly, there are, or will be, important factors that could cause our actual results to differ materially from those indicated in these statements. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made except as required by the federal securities laws.

Appendix

Consolidated Statements of Operations - Unaudited

 

 

Three Months Ended

 

Year Ended

 

December 31,

2022

 

December 31,

2021

 

December 31,

2022

 

December 31,

2021

 

December 31,

2021

 

 

 

 

 

 

 

 

 

Pro-forma

 

(U.S. Dollars and shares in thousands, except per share amounts)

Revenues, net

$

2,356,198

 

 

$

2,251,480

 

 

$

9,228,853

 

 

$

6,454,402

 

 

$

9,285,672

 

Cost of sales4

 

(2,198,911

)

 

 

(2,157,090

)

 

 

(8,634,144

)

 

 

(6,105,271

)

 

 

(8,565,685

)

Gross profit

 

157,287

 

 

94,390

 

 

594,709

 

 

349,131

 

 

719,987

 

Selling, marketing, general and administrative expenses4

 

(127,669

)

 

 

(130,873

)

 

 

(491,712

)

 

 

(349,769

)

 

 

(517,712

)

Merger, transaction and other related costs

 

 

 

 

(1,258

)

 

 

 

 

 

(30,072

)

 

 

 

(Loss) gain on disposal of businesses

 

(50

)

 

 

606

 

 

 

192

 

 

 

11

 

 

 

11

 

Impairment of property, plant and equipment

 

(397

)

 

 

 

 

 

(397

)

 

 

 

 

 

 

Gain on asset sales

 

2,559

 

 

 

319

 

 

 

11,634

 

 

 

581

 

 

 

3,323

 

Operating income (loss)

 

31,730

 

 

 

(36,816

)

 

 

114,426

 

 

 

(30,118

)

 

 

205,609

 

Other income (expense), net

 

(9,112

)

 

 

791

 

 

 

11,322

 

 

 

8,658

 

 

 

20,572

 

Interest income

 

2,046

 

 

 

2,112

 

 

 

6,642

 

 

 

3,938

 

 

 

5,321

 

Interest expense

 

(19,761

)

 

 

(12,843

)

 

 

(61,485

)

 

 

(27,030

)

 

 

(45,520

)

Income (loss) before income taxes and equity earnings

 

4,903

 

 

 

(46,756

)

 

 

70,905

 

 

 

(44,552

)

 

 

185,982

 

Income tax benefit (expense)

 

5,704

 

 

 

18,171

 

 

 

34,059

 

 

 

13,333

 

 

 

(32,089

)

Equity method earnings

 

2,698

 

 

 

4,009

 

 

 

6,726

 

 

 

48,027

 

 

 

23,658

 

Net income (loss)

 

13,305

 

 

 

(24,576

)

 

 

111,690

 

 

 

16,808

 

 

 

177,551

 

Less: Net income attributable to noncontrolling interests

 

(6,524

)

 

 

(4,675

)

 

 

(25,194

)

 

 

(24,027

)

 

 

(25,900

)

Net income (loss) attributable to Dole plc

$

6,781

 

 

$

(29,251

)

 

$

86,496

 

 

$

(7,219

)

 

$

151,651

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share attributable to Dole plc – basic

$

0.07

 

 

$

(0.31

)

 

$

0.91

 

 

$

(0.10

)

 

$

1.60

 

Net income (loss) per share attributable to Dole plc – diluted

$

0.07

 

 

$

(0.31

)

 

$

0.91

 

 

$

(0.10

)

 

$

1.60

 

Weighted average shares outstanding – basic

 

94,899

 

 

 

94,878

 

 

 

94,886

 

 

 

72,190

 

 

 

94,878

 

Weighted average shares outstanding – diluted

 

94,928

 

 

 

95,041

 

 

 

94,906

 

 

 

72,190

 

 

 

95,030

 

 

4 The consolidated statement of operations for the three months ended December 31, 2021 reflects a reclassification of $30.7 million to selling, marketing, general and administrative expenses from cost of sales in order to correct the presentation of expenses. Management does not believe such reclassification is necessary in the consolidated statement of operations for the year ended December 31, 2021.

Consolidated Balance Sheets - Unaudited
 

 

December 31,

2022

 

December 31,

2021

 

 

 

 

ASSETS

(U.S. Dollars in thousands)

Cash and cash equivalents

$

228,840

 

$

250,561

Short-term investments

 

5,367

 

 

 

6,115

 

Trade receivables, net of allowances for credit losses of $19,130 and $22,064, respectively

 

605,154

 

 

 

719,114

 

Grower advance receivables, net of allowances of $15,817 and $9,606, respectively

 

120,940

 

 

 

72,350

 

Other receivables, net of allowances of $14,810 and $14,066, respectively

 

137,575

 

 

 

125,908

 

Inventories, net of allowances of $4,410 and $7,447, respectively

 

436,878

 

 

 

410,737

 

Prepaid expenses

 

55,045

 

 

 

45,339

 

Other current assets

 

15,034

 

 

 

11,011

 

Assets held-for-sale

 

645

 

 

 

200

 

Total current assets

 

1,605,478

 

 

 

1,641,335

 

Long-term investments

 

16,498

 

 

 

23,433

 

Investments in unconsolidated affiliates

 

124,239

 

 

 

128,407

 

Actively marketed property..

 

31,007

 

 

 

50,364

 

Property, plant and equipment, net of accumulated depreciation of $404,009 and $283,677, respectively

 

1,343,307

 

 

 

1,430,850

 

Operating lease right-of-use assets

 

392,797

 

 

 

368,632

 

Goodwill

 

497,453

 

 

 

511,333

 

DOLE brand

 

306,280

 

 

 

306,280

 

Other intangible assets, net of accumulated amortization of $120,315 and $117,499 respectively

 

50,990

 

 

 

62,046

 

Other assets

 

159,681

 

 

 

98,917

 

Deferred tax assets, net

 

64,112

 

 

 

46,371

 

Total assets

$

4,591,842

 

 

$

4,667,968

 

LIABILITIES AND EQUITY

 

 

 

Accounts payable

$

729,615

 

 

$

696,766

 

Income taxes payable

 

11,558

 

 

 

10,316

 

Accrued liabilities

 

465,626

 

 

 

464,931

 

Bank overdrafts

 

8,623

 

 

 

9,395

 

Current portion of long-term debt, net

 

97,435

 

 

 

51,785

 

Current maturities of operating leases

 

81,968

 

 

 

73,046

 

Payroll and other tax

 

28,913

 

 

 

35,212

 

Contingent consideration

 

1,791

 

 

 

2,958

 

Pension and postretirement benefits

 

17,287

 

 

 

17,664

 

Dividends payable and other current liabilities

 

17,698

 

 

 

9,078

 

Total current liabilities

 

1,460,514

 

 

 

1,371,151

 

Long-term debt, net

 

1,127,321

 

 

 

1,297,808

 

Operating leases, less current maturities

 

320,272

 

 

 

305,714

 

Deferred tax liabilities, net

 

143,376

 

 

 

145,689

 

Income tax payable, less current portion

 

30,458

 

 

 

40,439

 

Contingent consideration, less current portion

 

5,022

 

 

 

4,302

 

Pension and postretirement benefits, less current portion

 

124,646

 

 

 

152,149

 

Other long-term liabilities

 

61,248

 

 

 

105,310

 

Total liabilities

$

3,272,857

 

 

$

3,422,562

 

Commitments and contingent liabilities:

 

 

 

Redeemable noncontrolling interests

 

32,311

 

 

 

32,776

 

Stockholders’ equity:

 

 

 

Common stock — $0.01 par value; 300,000,000 shares authorized and 94,899,194 shares outstanding as of December 31, 2022 and 300,000,000 shares authorized and 94,877,706 shares outstanding as of December 31, 2021

 

949

 

 

 

950

 

Additional paid-in capital

 

795,063

 

 

 

792,223

 

Retained earnings

 

469,249

 

 

 

413,335

 

Accumulated other comprehensive loss

 

(104,133

)

 

 

(125,919

)

Total equity attributable to Dole plc

 

1,161,128

 

 

 

1,080,589

 

Equity attributable to noncontrolling interests

 

125,546

 

 

 

132,041

 

Total equity

 

1,286,674

 

 

 

1,212,630

 

Total liabilities, redeemable noncontrolling interests and equity

$

4,591,842

 

 

$

4,667,968

 

 

Consolidated Statements of Cash Flows - Unaudited

 

 

Year Ended

 

December 31,

2022

 

December 31,

2021

 

 

 

 

Operating Activities

(U.S. Dollars in thousands)

Net income

$

111,690

 

 

$

16,808

 

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

 

 

 

Depreciation and amortization

 

130,997

 

 

 

72,955

 

Incremental charges on purchase accounting valuation of biological assets and inventory

 

41,145

 

 

 

65,916

 

Net (gain) on sale of assets and asset write-offs

 

(11,634

)

 

 

(581

)

Impairment of property, plant and equipment

 

397

 

 

 

 

Net (gain) loss on financial instruments

 

7,167

 

 

 

(3,910

)

Stock-based compensation expense

 

4,500

 

 

 

815

 

Equity method earnings

 

(6,726

)

 

 

(48,027

)

Net (gain) on disposal of businesses

 

(192

)

 

 

(11

)

Amortization of debt discounts and debt issuance costs

 

6,213

 

 

 

2,634

 

Deferred tax (benefit)

 

(35,044

)

 

 

(23,168

)

Pension and other postretirement benefit plan expense

 

3,151

 

 

 

2,913

 

Dividends received from equity method investees

 

9,817

 

 

 

12,137

 

Fair value movement on contingent consideration

 

(14

)

 

 

1,036

 

Other

 

(194

)

 

 

2,322

 

Changes in operating assets and liabilities:

 

 

 

Receivables, net of allowances

 

19,708

 

 

 

(20,542

)

Inventories

 

(38,252

)

 

 

(56,603

)

Accrued and other current and long-term liabilities

 

(3,837

)

 

 

(8,315

)

Cash flow provided by operating activities

 

238,892

 

 

 

16,379

 

Investing Activities

 

 

 

Sales of assets

 

36,676

 

 

 

26,308

 

Capital expenditures

 

(97,998

)

 

 

(65,438

)

Acquisitions, net of cash acquired

 

(4,886

)

 

 

103,595

 

Proceeds from sales investment in unconsolidated affiliates

 

421

 

 

 

10,607

 

Insurance proceeds

 

2,278

 

 

 

10,455

 

Purchases of investments

 

(458

)

 

 

(1,210

)

Investments in unconsolidated affiliates

 

(3,450

)

 

 

(1,833

)

Other

 

912

 

 

 

332

 

Cash flow provided by (used in) investing activities

 

(66,505

)

 

 

82,816

 

Financing Activities

 

 

 

Proceeds from borrowings and overdrafts

 

1,293,280

 

 

 

2,145,427

 

Repayments on borrowings and overdrafts

 

(1,411,467

)

 

 

(2,487,130

)

Payment of debt issuance costs

 

(304

)

 

 

(22,133

)

Dividends paid to shareholders

 

(30,364

)

 

 

(17,092

)

Dividends paid to noncontrolling interests

 

(21,632

)

 

 

(21,683

)

Other noncontrolling interest activity, net

 

 

 

 

382

 

Proceeds from exercise of stock options

 

 

 

 

7,041

 

Payments of contingent consideration

 

(2,909

)

 

 

(5,031

)

Proceeds received from issuance of common stock in initial public offering, net of issuance costs

 

 

 

 

398,876

 

Cash flow (used in) financing activities

 

(173,396

)

 

 

(1,343

)

Effect of foreign currency exchange rate changes on cash

 

(20,712

)

 

 

(7,794

)

Increase (decrease) in cash and cash equivalents

 

(21,721

)

 

 

90,058

 

Cash and cash equivalents at beginning of period

 

250,561

 

 

 

160,503

 

Cash and cash equivalents at end of period

$

228,840

 

 

$

250,561

 

 

Reconciliation from Net Income to Adjusted EBITDA - Unaudited

The following information is provided to give quantitative information related to items impacting comparability. Refer to the 'Non-GAAP Financial Measures' section of this document for additional detail on each item.

 

Three Months Ended

 

Year Ended

 

December 31,

2022

 

December 31,

2021

 

December 31,

2022

 

December 31,

2021

 

December 31,

2021

 

 

 

 

 

 

 

 

 

Pro-forma

 

(U.S. Dollars in thousands)

Net income (Reported GAAP)

$

13,305

 

 

$

(24,576

)

 

$

111,690

 

 

$

16,808

 

 

$

177,551

 

Income tax (benefit) expense

 

(5,704

)

 

 

(18,171

)

 

 

(34,059

)

 

 

(13,333

)

 

 

32,089

 

Interest expense

 

19,761

 

 

 

12,843

 

 

 

61,485

 

 

 

27,030

 

 

 

45,520

 

Merger, transaction and other related costs

 

 

 

 

1,258

 

 

 

 

 

 

30,072

 

 

 

 

Mark to market (gains) losses

 

8,868

 

 

 

(1,304

)

 

 

3,049

 

 

 

(3,160

)

 

 

(5,135

)

(Gain) on asset sales

 

(1,970

)

 

 

 

 

 

(10,316

)

 

 

 

 

 

177

 

Produce recalls

 

 

 

 

17,649

 

 

 

15,809

 

 

 

17,649

 

 

 

17,649

 

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

681

 

 

 

36,736

 

 

 

41,145

 

 

 

65,916

 

 

 

 

Other items5, 6

 

1,053

 

 

 

5,482

 

 

 

(230

)

 

 

(959

)

 

 

(9,489

)

Adjustments from equity method investments

 

2,614

 

 

 

(1,866

)

 

 

7,540

 

 

 

43,540

 

 

 

2,071

 

Adjusted EBIT (Non-GAAP)

 

38,608

 

 

 

28,051

 

 

 

196,113

 

 

 

183,563

 

 

 

260,433

 

Depreciation

 

30,525

 

 

 

27,235

 

 

 

120,104

 

 

 

61,551

 

 

 

113,276

 

Amortization of intangible assets

 

2,645

 

 

 

3,183

 

 

 

10,893

 

 

 

11,404

 

 

 

11,404

 

Depreciation and amortization adjustments from equity method investments

 

2,616

 

 

 

2,642

 

 

 

10,614

 

 

 

33,608

 

 

 

8,467

 

Adjusted EBITDA (Non-GAAP)

$

74,394

 

 

$

61,111

 

 

$

337,724

 

 

$

290,126

 

 

$

393,580

 

 

5 For the three months ended December 31, 2022, other items is primarily comprised of $0.4 million of impairment charges on property, plant and equipment, $0.5 million of net losses on equity method disposals and other immaterial items. For the three months ended December 31, 2021, other items is comprised of $2.3 million of net fair value losses on equity method investments, $3.2 million of legal and restructuring costs and $0.6 million of asset write-downs, net of insurance proceeds, partially offset by $0.6 million of net gains on disposal of businesses.

6 For the year ended December 31, 2022, other items is primarily comprised of $0.9 million of net legal and restructuring adjustments, $0.5 million of insurance proceeds, net of asset write-downs, and other immaterial items, partially offset by $0.5 million of net losses on equity method acquisitions and disposals and $0.4 million of impairment on property, plant and equipment. For the year ended December 31, 2021, other items is comprised of $3.6 million of net fair value gains on equity method investments and $1.1 million of gains on disposal of equity method investments, partially offset by $3.2 million of legal and restructuring costs and $0.6 million of asset write-downs, net of insurance proceeds; and on a pro-forma basis, for the year ended December 31, 2021, it is comprised of $18.5 million of insurance proceeds, net of asset write-downs, $7.7 million of net fair value gains on equity method investments and $1.1 million of gains on disposal of equity method investments, partially offset by $17.8 million of net restructuring and legal costs.

Reconciliation from Net Income attributable to Dole plc shareholders to Adjusted Net Income - Unaudited

The following information is provided to give quantitative information related to items impacting comparability. Refer to the 'Non-GAAP Financial Measures' section of this document for additional detail on each item. Refer to the Appendix for supplementary detail.

 

Three Months Ended

 

Year Ended

 

December 31,

2022

 

December 31,

2021

 

December 31,

2022

 

December 31,

2021

 

December 31,

2021

 

 

 

 

 

 

 

 

 

Pro-forma

 

(U.S. Dollars and shares in thousands, except per share amounts)

Net income (loss) attributable to Dole plc (Reported GAAP)

$

6,781

 

 

$

(29,251

)

 

$

86,496

 

 

$

(7,219

)

 

$

151,651

 

Adjustments:

 

 

 

 

 

 

 

 

 

Amortization of intangible assets

 

2,645

 

 

 

3,183

 

 

 

10,893

 

 

 

11,404

 

 

 

11,404

 

Merger, transaction and other related costs

 

 

 

 

1,258

 

 

 

 

 

 

30,072

 

 

 

 

Mark to market (gains) losses

 

8,868

 

 

 

(1,304

)

 

 

3,049

 

 

 

(3,160

)

 

 

(5,135

)

(Gain) loss on asset sales

 

(1,970

)

 

 

 

 

 

(10,316

)

 

 

 

 

 

177

 

Produce recalls

 

 

 

 

17,649

 

 

 

15,809

 

 

 

17,649

 

 

 

17,649

 

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

681

 

 

 

36,736

 

 

 

41,145

 

 

 

65,916

 

 

 

 

Other items7, 8

 

1,053

 

 

 

5,482

 

 

 

(230

)

 

 

(959

)

 

 

(9,489

)

Adjustments from equity method investments

 

662

 

 

 

476

 

 

 

2,580

 

 

 

1,179

 

 

 

1,038

 

Income tax on items above and discrete tax items

 

(8,894

)

 

 

(33,266

)

 

 

(54,283

)

 

 

(38,073

)

 

 

(22,360

)

NCI impact on items above

 

(898

)

 

 

(949

)

 

 

(3,187

)

 

 

(3,673

)

 

 

(3,738

)

Adjusted Net Income for Adjusted EPS calculation (Non-GAAP)

$

8,928

 

 

$

14

 

 

$

91,956

 

 

$

73,136

 

 

$

141,197

 

 

 

 

 

 

 

 

 

 

 

Adjusted earnings per share – basic (Non-GAAP)

$

0.09

 

 

$

 

 

$

0.97

 

 

$

1.01

 

 

$

1.49

 

Adjusted earnings per share – diluted (Non-GAAP)

$

0.09

 

 

$

 

 

$

0.97

 

 

$

1.01

 

 

$

1.49

 

Weighted average shares outstanding – basic

 

94,899

 

 

 

94,878

 

 

 

94,886

 

 

 

72,190

 

 

 

94,878

 

Weighted average shares outstanding – diluted

 

94,928

 

 

 

95,041

 

 

 

94,906

 

 

 

72,190

 

 

 

95,030

 

 

7 For the three months ended December 31, 2022, other items is primarily comprised of $0.4 million of impairment charges on property, plant and equipment, $0.5 million of net losses on equity method disposals and other immaterial items. For the three months ended December 31, 2021, other items is comprised of $2.3 million of net fair value losses on equity method investments, $3.2 million of legal and restructuring costs and $0.6 million of asset write-downs, net of insurance proceeds, partially offset by $0.6 million of net gains on disposal of businesses.

8 For the year ended December 31, 2022, other items is primarily comprised of $0.9 million of net legal and restructuring adjustments, $0.5 million of insurance proceeds, net of asset write-downs, and other immaterial items, partially offset by $0.5 million of net losses on equity method acquisitions and disposals and $0.4 million of impairment on property, plant and equipment. For the year ended December 31, 2021, other items is comprised of $3.6 million of net fair value gains on equity method investments and $1.1 million of gains on disposal of equity method investments, partially offset by $3.2 million of legal and restructuring costs and $0.6 million of asset write-downs, net of insurance proceeds; and on a pro-forma basis, for the year ended December 31, 2021, it is comprised of $18.5 million of insurance proceeds, net of asset write-downs, $7.7 million of net fair value gains on equity method investments and $1.1 million of gains on disposal of equity method investments, partially offset by $17.8 million of net restructuring and legal costs.

Supplemental Reconciliation of Prior Year Segment Results to Current Year Segment Results - Unaudited

 

Revenue for the Three Months Ended

 

December 31,

2021

 

Impact of

Foreign

Currency

Translation

 

Impact of

Acquisitions

and Divestitures

 

Like-for-like

Increase

(Decrease)

 

December 31,

2022

 

 

 

 

 

 

 

 

 

 

 

(U.S. Dollars in thousands)

Fresh Fruit

$

680,881

 

 

$

 

 

$

 

 

$

59,286

 

 

$

740,167

 

Diversified Fresh Produce - EMEA

 

815,330

 

 

 

(117,318

)

 

 

(2,995

)

 

 

56,577

 

 

 

751,594

 

Diversified Fresh Produce - Americas & ROW

 

479,702

 

 

 

(4,017

)

 

 

 

 

 

98,251

 

 

 

573,936

 

Fresh Vegetables

 

296,848

 

 

 

 

 

 

 

 

 

18,234

 

 

 

315,082

 

Intersegment

 

(21,281

)

 

 

 

 

 

 

 

 

(3,300

)

 

 

(24,581

)

Total

$

2,251,480

 

 

$

(121,335

)

 

$

(2,995

)

 

$

229,048

 

 

$

2,356,198

 

 

 

Adjusted EBITDA for the Three Months Ended

 

December 31,

2021

 

Impact of

Foreign

Currency

Translation

 

Impact of

Acquisitions

and Divestitures

 

Like-for-like

Increase

(Decrease)

 

December 31,

2022

 

 

 

 

 

 

 

 

 

 

 

(U.S. Dollars in thousands)

Fresh Fruit

$

15,694

 

 

$

(132

)

 

$

 

 

$

25,671

 

 

$

41,233

 

Diversified Fresh Produce - EMEA

 

29,363

 

 

 

(4,396

)

 

 

64

 

 

 

(1,401

)

 

 

23,630

 

Diversified Fresh Produce - Americas & ROW

 

20,574

 

 

 

59

 

 

 

(16

)

 

 

(5,060

)

 

 

15,557

 

Fresh Vegetables

 

(4,520

)

 

 

(29

)

 

 

 

 

 

(1,477

)

 

 

(6,026

)

Total

$

61,111

 

 

$

(4,498

)

 

$

48

 

 

$

17,733

 

 

$

74,394

 

 

 

Revenue for the Year Ended

 

December 31,

2021

Pro-forma

 

Impact of

Foreign

Currency

Translation

 

Impact of

Acquisitions

and Divestitures

 

Like-for-like

Increase

(Decrease)

 

December 31,

2022

 

 

 

 

 

 

 

 

 

 

 

(U.S. Dollars in thousands)

Fresh Fruit

$

2,877,030

 

 

$

 

 

$

 

 

$

170,119

 

 

$

3,047,149

 

Diversified Fresh Produce - EMEA

 

3,438,341

 

 

 

(418,892

)

 

 

(92,580

)

 

 

225,692

 

 

 

3,152,561

 

Diversified Fresh Produce - Americas & ROW

 

1,779,065

 

 

 

(7,688

)

 

 

 

 

 

194,290

 

 

 

1,965,667

 

Fresh Vegetables

 

1,280,594

 

 

 

 

 

 

 

 

 

(74,692

)

 

 

1,205,902

 

Intersegment

 

(89,358

)

 

 

 

 

 

 

 

 

(53,068

)

 

 

(142,426

)

Total

$

9,285,672

 

 

$

(426,580

)

 

$

(92,580

)

 

$

462,341

 

 

$

9,228,853

 

 

 

Adjusted EBITDA for the Year Ended

 

December 31,

2021

Pro-forma

 

Impact of

Foreign

Currency

Translation

 

Impact of

Acquisitions

and Divestitures

 

Like-for-like

Increase

(Decrease)

 

December 31,

2022

 

 

 

 

 

 

 

 

 

 

 

(U.S. Dollars in thousands)

Fresh Fruit

$

209,999

 

 

$

1,027

 

 

$

 

 

$

1,149

 

 

$

212,175

 

Diversified Fresh Produce - EMEA

 

131,126

 

 

 

(16,349

)

 

 

(63

)

 

 

4

 

 

 

114,718

 

Diversified Fresh Produce - Americas & ROW

 

53,069

 

 

 

326

 

 

 

(16

)

 

 

(9,102

)

 

 

44,277

 

Fresh Vegetables

 

(614

)

 

 

226

 

 

 

 

 

 

(33,058

)

 

 

(33,446

)

Total

$

393,580

 

 

$

(14,770

)

 

$

(79

)

 

$

(41,007

)

 

$

337,724

 

 

Supplemental Reconciliation from Net Income attributable to Dole plc to Adjusted Net Income - Unaudited

The following information is provided to give quantitative information related to items impacting comparability. Refer to the 'Non-GAAP Financial Measures' section of this document for additional detail on each item.

 

Three Months Ended December 31, 2022

(U.S. Dollars in thousands)

 

Revenues,

net

Cost of

sales

Gross

profit

Gross

Margin

%

Selling,

marketing,

general and

administration

expenses

Other

operating

charges9

Operating

Income

Reported (GAAP)

$

2,356,198

(2,198,911

)

157,287

6.7

%

(127,669

)

2,112

 

$

31,730

 

Amortization of intangible assets

 

 

 

 

 

2,645

 

 

 

2,645

 

Merger, transaction and other related costs

 

 

 

 

 

 

 

 

Mark to market (gains) losses

 

 

476

 

476

 

 

 

 

476

 

(Gain) loss on asset sales

 

 

 

 

 

(1,970

)

 

(1,970

)

Produce recalls

 

 

 

 

 

 

 

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

681

 

681

 

 

 

 

681

 

Other items

 

 

(452

)

(452

)

 

961

 

 

509

 

Adjustments from equity method investments

 

 

 

 

 

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

 

 

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

Adjusted (Non-GAAP)

$

2,356,198

 

(2,198,206

)

157,992

 

6.7

%

(125,024

)

1,103

 

$

34,071

 

 

Three Months Ended December 31, 2021

(U.S. Dollars in thousands)

 

Revenues,

net

Cost of

sales

Gross

profit

Gross

Margin

%

Selling,

marketing,

general and

administration

expenses

Other

operating

charges10

Operating

Income (Loss)

Reported (GAAP)

$

2,251,480

(2,157,090

)

94,390

4.2

%

(130,873

)

(333

)

$

(36,816

)

Amortization of intangible assets

 

 

 

 

 

3,183

 

 

 

3,183

 

Merger, transaction and other related costs

 

 

 

 

 

1,258

 

 

1,258

 

Mark to market (gains) losses

 

 

3,353

 

3,353

 

 

 

 

3,353

 

(Gain) loss on asset sales

 

 

 

 

 

 

 

 

Produce recalls

 

 

17,649

 

17,649

 

 

 

 

17,649

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

36,736

 

36,736

 

 

 

 

36,736

 

Other items

 

 

639

 

639

 

 

2,566

 

 

3,205

 

Adjustments from equity method investments

 

 

 

 

 

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

 

 

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

Adjusted (Non-GAAP)

$

2,251,480

 

(2,098,713

)

152,767

 

6.8

%

(127,690

)

3,491

 

$

28,568

 

 

9 Other operating charges for the three months ended December 31, 2022 is primarily comprised of a $2.6 million gain on asset sales, partially offset by a $0.4 million impairment of property, plant and equipment, as reported in the consolidated statements of operations.

10 Other operating charges for the three months ended December 31, 2021 is primarily comprised of merger, transaction and other related costs of $1.3 million, partially offset by gains from disposal of businesses of $0.6 million, as reported in the consolidated statements of operations.

Three Months Ended December 31, 2022

(U.S. Dollars in thousands)

 

Other income,

net

Interest

income

Interest

expense

Income tax

benefit

(expense)

Equity

earnings

Net Income

Net income

attributable to

noncontrolling

interests (NCI)

Reported (GAAP)

$

(9,112

)

2,046

(19,761

)

5,704

 

2,698

 

13,305

 

$

(6,524

)

Amortization of intangible assets

 

 

 

 

 

 

2,645

 

 

 

Merger, transaction and other related costs

 

 

 

 

 

 

 

 

 

Mark to market (gains) losses

 

8,392

 

 

 

 

 

8,868

 

 

 

(Gain) loss on asset sales

 

 

 

 

 

 

(1,970

)

 

 

Produce recalls

 

 

 

 

 

 

 

 

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

 

 

 

 

681

 

 

 

Other items

 

 

 

 

 

544

 

1,053

 

 

 

Adjustments from equity method investments

 

 

 

 

 

662

 

662

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

(8,795

)

(99

)

(8,894

)

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

(898

)

Adjusted (Non-GAAP)

$

(720

)

2,046

 

(19,761

)

(3,091

)

3,805

 

16,350

 

$

(7,422

)

 

Three Months Ended December 31, 2021

(U.S. Dollars in thousands)

 

Other income,

net

Interest

income

Interest

expense

Income tax

benefit

(expense)

Equity

earnings

Net Income

Net income

attributable to

noncontrolling

interests (NCI)

Reported (GAAP)

$

791

 

2,112

(12,843

)

18,171

 

4,009

 

(24,576

)

$

(4,675

)

Amortization of intangible assets

 

 

 

 

 

 

3,183

 

 

 

Merger, transaction and other related costs

 

 

 

 

 

 

1,258

 

 

 

Mark to market (gains) losses

 

(4,657

)

 

 

 

 

(1,304

)

 

 

(Gain) loss on asset sales

 

 

 

 

 

 

 

 

 

Produce recalls

 

 

 

 

 

 

17,649

 

 

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

 

 

 

 

36,736

 

 

 

Other items

 

 

 

 

 

2,277

 

5,482

 

 

 

Adjustments from equity method investments

 

 

 

 

 

476

 

476

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

(32,909

)

(357

)

(33,266

)

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

(949

)

Adjusted (Non-GAAP)

$

(3,866

)

2,112

 

(12,843

)

(14,738

)

6,405

 

5,638

 

$

(5,624

)

 

Three Months Ended

December 31, 2022

 

Three Months Ended

December 31, 2021

 

(U.S. Dollars and shares in

thousands, except per share

amounts)

 

(U.S. Dollars and shares in

thousands, except per share

amounts)

 

Net income

attributable to

Dole plc

Diluted net

income per

share

 

Net income (loss)

attributable to

Dole plc

Diluted net

income (loss)

per share

Reported (GAAP)

$

6,781

 

$

0.07

 

$

(29,251

)

$

(0.31

)

Amortization of intangible assets

 

2,645

 

 

 

 

3,183

 

 

Merger, transaction and other related costs..

 

 

 

 

1,258

 

Mark to market (gains) losses

 

8,868

 

 

 

(1,304

)

(Gain) loss on asset sales..

 

(1,970

)

 

 

 

Produce recalls..

 

 

 

 

17,649

 

Incremental charges on biological assets and inventory from the Acquisition..

 

681

 

 

 

36,736

 

Other items..

 

1,053

 

 

 

5,482

 

Adjustments from equity method investments..

 

662

 

 

 

476

 

Income tax on items above and discrete tax items..

 

(8,894

)

 

 

(33,266

)

NCI impact on items above

 

(898

)

 

 

(949

)

Adjusted (Non-GAAP)

$

8,928

 

$

0.09

 

 

$

14

 

$

 

 

 

 

 

 

 

Weighted average shares outstanding – diluted

 

94,928

 

 

 

 

95,041

 

 

 

Year Ended December 31, 2022

(U.S. Dollars in thousands)

 

Revenues,

net

Cost of

sales

Gross

profit

Gross

Margin

%

Selling,

marketing,

general and

administration

expenses

Other

operating

charges11

Operating

Income

Reported (GAAP)

$

9,228,853

(8,634,144

)

594,709

 

6.4

%

(491,712

)

11,429

 

$

114,426

 

Amortization of intangible assets

 

 

 

 

 

10,893

 

 

 

10,893

 

Merger, transaction and other related costs

 

 

 

 

 

 

 

 

Mark to market (gains) losses

 

 

2,848

 

2,848

 

 

 

 

2,848

 

(Gain) loss on asset sales

 

 

 

 

 

(10,316

)

 

(10,316

)

Produce recalls

 

 

15,809

 

15,809

 

 

 

 

15,809

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

41,145

 

41,145

 

 

 

 

41,145

 

Other items

 

 

(452

)

(452

)

(909

)

587

 

 

(774

)

Adjustments from equity method investments

 

 

 

 

 

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

 

 

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

Adjusted (Non-GAAP)

$

9,228,853

 

(8,574,794

)

654,059

 

7.1

%

(481,728

)

1,700

 

$

174,031

 

 

Year Ended December 31, 2021

(U.S. Dollars in thousands)

 

Revenues,

net

Cost of

sales

Gross

profit

Gross

Margin

%

Selling,

marketing,

general and

administration

expenses

Other

operating

charges12

Operating

Income

Reported (GAAP)

$

6,454,402

(6,105,271

)

349,131

5.4

%

(349,769

)

(29,480

)

$

(30,118

)

Amortization of intangible assets

 

 

 

 

 

11,404

 

 

 

11,404

 

Merger, transaction and other related costs..

 

 

 

 

 

30,072

 

 

30,072

 

Mark to market (gains) losses

 

 

1,257

 

1,257

 

 

 

 

1,257

 

(Gain) loss on asset sales..

 

 

 

 

 

 

 

 

Produce recalls..

 

 

17,649

 

17,649

 

 

 

 

17,649

 

Incremental charges on biological assets and inventory from the Acquisition..

 

 

65,916

 

65,916

 

 

 

 

65,916

 

Other items..

 

 

623

 

623

 

 

3,161

 

 

3,784

 

Adjustments from equity method investments..

 

 

 

 

 

 

 

 

Income tax on items above and discrete tax items..

 

 

 

 

 

 

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

Adjusted (Non-GAAP)

$

6,454,402

 

(6,019,826

)

434,576

 

6.7

%

(338,365

)

3,753

 

$

99,964

 

 

11 Other operating charges for the year ended December 31, 2022 is primarily comprised of a $11.6 million gain on asset sales, partially offset by a $0.4 million impairment of property, plant and equipment, as reported in the consolidated statements of operations.

12 Other operating charges for the year ended December 31, 2021 is primarily comprised of merger, transaction and other related costs of $30.1 million, partially offset by a gain on asset sales of $0.6 million, as reported in the consolidated statements of operations.

Year Ended December 31, 2022

(U.S. Dollars in thousands)

 

Other income,

net

Interest

income

Interest

expense

Income tax

benefit

(expense)

Equity

earnings

Net Income

Net income

attributable to

noncontrolling

interests (NCI)

Reported (GAAP)

$

11,322

6,642

(61,485

)

34,059

 

6,726

 

111,690

 

$

(25,194

)

Amortization of intangible assets

 

 

 

 

 

 

10,893

 

 

 

Merger, transaction and other related costs

 

 

 

 

 

 

 

 

 

Mark to market (gains) losses

 

201

 

 

 

 

 

3,049

 

 

 

(Gain) loss on asset sales

 

 

 

 

 

 

(10,316

)

 

 

Produce recalls

 

 

 

 

 

 

15,809

 

 

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

 

 

 

 

41,145

 

 

 

Other items

 

 

 

 

 

544

 

(230

)

 

 

Adjustments from equity method investments

 

 

 

 

 

2,580

 

2,580

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

(53,876

)

(407

)

(54,283

)

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

(3,187

)

Adjusted (Non-GAAP)

$

11,523

 

6,642

 

(61,485

)

(19,817

)

9,443

 

120,337

 

$

(28,381

)

 

Year Ended December 31, 2021

(U.S. Dollars in thousands)

 

Other income,

net

Interest

income

Interest

expense

Income tax

expense

Equity

earnings

Net Income

Net income

attributable to

noncontrolling

interests (NCI)

Reported (GAAP)

$

8,658

 

3,938

(27,030

)

13,333

 

48,027

 

16,808

 

$

(24,027

)

Amortization of intangible assets

 

 

 

 

 

 

11,404

 

 

 

Merger, transaction and other related costs

 

 

 

 

 

 

30,072

 

 

 

Mark to market (gains) losses

 

(4,417

)

 

 

 

 

(3,160

)

 

 

(Gain) loss on asset sales

 

 

 

 

 

 

 

 

 

Produce recalls

 

 

 

 

 

 

17,649

 

 

 

Incremental charges on biological assets and inventory from the Acquisition

 

 

 

 

 

 

65,916

 

 

 

Other items

 

 

 

 

 

(4,743

)

(959

)

 

 

Adjustments from equity method investments

 

 

 

 

 

1,179

 

1,179

 

 

 

Income tax on items above and discrete tax items

 

 

 

 

(39,406

)

1,333

 

(38,073

)

 

 

NCI impact on items above

 

 

 

 

 

 

 

 

(3,673

)

Adjusted (Non-GAAP)

$

4,241

 

3,938

 

(27,030

)

(26,073

)

45,796

 

100,836

 

$

(27,700

)

 

Year Ended

December 31, 2022

 

Year Ended

December 31, 2021

 

(U.S. Dollars and shares in

thousands, except per share

amounts)

 

(U.S. Dollars and shares in

thousands, except per share

amounts)

 

Net income

attributable to

Dole plc

Diluted net

income per

share

 

Net income

attributable to

Dole plc

Diluted net

income per

share

Reported (GAAP)

$

86,496

 

$

0.91

 

$

(7,219

)

$

(0.10

)

Amortization of intangible assets

 

10,893

 

 

 

 

11,404

 

 

Merger, transaction and other related costs

 

 

 

 

30,072

 

Mark to market (gains) losses

 

3,049

 

 

 

(3,160

)

(Gain) loss on asset sales

 

(10,316

)

 

 

 

Produce recalls

 

15,809

 

 

 

17,649

 

Incremental charges on biological assets and inventory from the Acquisition

 

41,145

 

 

 

65,916

 

Other items

 

(230

)

 

 

(959

)

Adjustments from equity method investments

 

2,580

 

 

 

1,179

 

Income tax on items above and discrete tax items

 

(54,283

)

 

 

(38,073

)

NCI impact on items above

 

(3,187

)

 

 

(3,673

)

Adjusted (Non-GAAP)

$

91,956

 

$

0.97

 

 

$

73,136

 

$

1.01

 

 

 

 

 

 

 

Weighted average shares outstanding – diluted

 

94,906

 

 

 

 

72,190

 

 

Net Debt Reconciliation (Unaudited)

Net Debt is the primary measure used by management to analyze the Company’s capital structure. Net Debt is a non-GAAP financial measure, calculated as cash and cash equivalents, less current and long-term debt. It also excludes debt discounts and debt issuance costs. The calculation of Net Debt as of December 31, 2022 is presented below. Net Debt as of December 31, 2022 was $1.0 billion.

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

(U.S. Dollars in thousands)

Cash and cash equivalents (Reported GAAP)

$

228,840

 

 

$

250,561

 

Debt (Reported GAAP):

 

 

 

Long-term debt, net

 

(1,127,321

)

 

 

(1,297,808

)

Current maturities

 

(97,435

)

 

 

(51,785

)

Bank overdrafts

 

(8,623

)

 

 

(9,395

)

Total debt, net

 

(1,233,379

)

 

 

(1,358,988

)

Less: Debt discounts and debt issuance costs (Reported GAAP)

 

(17,874

)

 

 

(21,063

)

Total gross debt

 

(1,251,253

)

 

 

(1,380,051

)

Net Debt (Non-GAAP)

$

(1,022,413

)

 

$

(1,129,490

)

Non-GAAP Financial Measures

Dole plc’s results are determined in accordance with U.S. GAAP.

In addition to its results under U.S. GAAP, in this Press Release we also present Dole plc’s Adjusted EBIT, Adjusted EBITDA, Adjusted Net Income, Adjusted EPS, Net Debt, pro-forma Adjusted EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted Net Income and pro-forma Adjusted Earnings per Share, which are supplemental measures of financial performance that are not required by, or presented in accordance with, U.S. GAAP (collectively, the "non-GAAP financial measures"). We present these non-GAAP financial measures because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. These non-GAAP financial measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our operating results, cash flows or any other measure prescribed by U.S. GAAP. Our presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by any of the adjusted items, or that any projections and estimates will be realized in their entirety or at all. In addition, adjustment items that are excluded from non-GAAP results can have a material impact on equivalent GAAP earnings, financial measures and cash flows.

Adjusted EBIT is calculated from GAAP net income by: (1) adding the income tax expense or subtracting the income tax benefit; (2) adding interest expense; (3) adding mark to market losses or subtracting mark to market gains related to unrealized impacts from derivative instruments and foreign currency denominated borrowings, realized impacts on noncash settled foreign currency denominated borrowings, net foreign currency impacts on liquidated entities and fair value movements on contingent consideration; (4) other items which are separately stated based on materiality, which include adding merger, transaction and other related costs, adding incremental costs for produce recalls, adding or subtracting asset write-downs, net of insurance proceeds, subtracting the gain or adding the loss on the disposal of business interests, adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole, adding impairment charges on property, plant and equipment, subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method, subtracting the gain or adding the loss on the sale of investments accounted for under the equity method, subtracting the gain or adding the loss on asset sales for assets held-for-sale and actively marketed property and adding restructuring charges and costs for legal matters not in the ordinary course of business; and (5) other adjustments from equity method investments, which includes the Company’s share of these items within equity method earnings.

Adjusted EBITDA is calculated from GAAP net income by: (1) adding the income tax expense or subtracting the income tax benefit; (2) adding interest expense; (3) adding depreciation charges; (4) adding amortization charges; (5) adding mark to market losses or subtracting mark to market gains related to unrealized impacts from derivative instruments and foreign currency denominated borrowings, realized impacts on noncash settled foreign currency denominated borrowings, net foreign currency impacts on liquidated entities and fair value movements on contingent consideration; (6) other items which are separately stated based on materiality, which include adding merger, transaction and other related costs, adding incremental costs for produce recalls, adding or subtracting asset write-downs, net of insurance proceeds, subtracting the gain or adding the loss on the disposal of business interests, adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole, adding impairment charges on property, plant and equipment, subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method, subtracting the gain or adding the loss on the sale of investments accounted for under the equity method, subtracting the gain or adding the loss on asset sales for assets held-for-sale and actively marketed property and adding restructuring charges and costs for legal matters not in the ordinary course of business; and (7) other adjustments from equity method investments, which includes the Company’s share of these items within equity method earnings.

Adjusted Net Income is calculated from GAAP net income attributable to Dole plc by: (1) adding amortization charges; (2) adding mark to market losses or subtracting mark to market gains related to unrealized impacts from derivative instruments and foreign currency denominated borrowings, realized impacts on noncash settled foreign currency denominated borrowings, net foreign currency impacts on liquidated entities and fair value movements on contingent consideration; (3) other items which are separately stated based on materiality, which include adding merger, transaction and other related costs, adding incremental costs for produce recalls, adding or subtracting asset write-downs, net of insurance proceeds, subtracting the gain or adding the loss on the disposal of business interests, adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole, adding impairment charges on property, plant and equipment, subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method, subtracting the gain or adding the loss on the sale of investments accounted for under the equity method, subtracting the gain or adding the loss on asset sales for assets held-for-sale and actively marketed property and adding restructuring charges and costs for legal matters not in the ordinary course of business; (4) other adjustments from equity method investments, which includes the Company’s share of these items within equity method earnings; (5) excluding the tax effect of these items and discrete tax adjustments; and (6) excluding the effect of these items attributable to non-controlling interests.

Adjusted Earnings per Share is calculated from Adjusted Net Income divided by diluted weighted average number of shares in the applicable period.

Net Debt is a non-GAAP financial measure, calculated as GAAP cash and cash equivalents, less GAAP current and long-term debt. It also excludes GAAP debt discounts and debt issuance costs.

Pro-forma EBIT is calculated from pro-forma net income by adding pro-forma interest expense and adding the pro-forma income tax expense or subtracting the pro-forma income tax benefit, as well as including the following pro-forma adjustments: (1) adding mark to market losses or subtracting mark to market gains related to unrealized impacts from derivative instruments and foreign currency denominated borrowings, realized impacts on noncash settled foreign currency denominated borrowings, net foreign currency impacts on liquidated entities and fair value movements on contingent consideration; (2) other items which are separately stated based on materiality, which include adding merger, transaction and other related costs, adding incremental costs for produce recalls, adding or subtracting asset write-downs, net of insurance proceeds, subtracting the gain or adding the loss on the disposal of business interests, adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole, adding impairment charges on property, plant and equipment, subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method, subtracting the gain or adding the loss on the sale of investments accounted for under the equity method, subtracting the gain or adding the loss on asset sales for assets held-for-sale and actively marketed property and adding restructuring charges and costs for legal matters not in the ordinary course of business; and (3) other adjustments from equity method investments, which includes the Company’s share of these items within equity method earnings.

Pro-forma Adjusted EBITDA is calculated from pro-forma EBIT by including the following pro-forma adjustments: (1) adding depreciation charges; and (2) adding amortization charges. It also includes the effect of the Company’s share of these listed items within investments accounted for under the equity method.

Pro-forma Adjusted Net Income is calculated from pro-forma net income attributable to Dole plc by include the following pro-forma adjustments: (1) adding amortization charges; (2) adding mark to market losses or subtracting mark to market gains related to unrealized impacts from derivative instruments and foreign currency denominated borrowings, realized impacts on noncash settled foreign currency denominated borrowings, net foreign currency impacts on liquidated entities and fair value movements on contingent consideration; (3) other items which are separately stated based on materiality, which include adding merger, transaction and other related costs, adding incremental costs for produce recalls, adding or subtracting asset write-downs, net of insurance proceeds, subtracting the gain or adding the loss on the disposal of business interests, adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole, adding impairment charges on property, plant and equipment, subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method, subtracting the gain or adding the loss on the sale of investments accounted for under the equity method, subtracting the gain or adding the loss on asset sales for assets held-for-sale and actively marketed property and adding restructuring charges and costs for legal matters not in the ordinary course of business; (4) other adjustments from equity method investments, which includes the Company’s share of these items within equity method earnings; (5) it excludes the tax effect of these items and discrete tax adjustments; and (6) excluding the effect of these items attributable to non-controlling interests.

Pro-forma Adjusted Earnings per Share is calculated from pro-forma Adjusted Net Income divided by diluted weighted average number of shares in the applicable period.

Adjusted EBIT, pro-forma EBIT, Adjusted EBITDA, pro-forma Adjusted EBITDA, Adjusted Net Income, pro-forma Adjusted Net Income, Adjusted EPS, Net Debt and pro-forma Adjusted EPS are not measurements of Dole plc financial performance under U.S. GAAP and should not be considered as alternatives to net income attributable to Dole plc, net income, income before income taxes and equity earnings or any other performance measures derived in accordance with U.S. GAAP. Additionally, pro-forma EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted Net Income and pro-forma Adjusted EPS are not intended to be liquidity measures because of certain limitations such as:

  • They do not reflect Dole plc’s cash expenditures, or future requirements, for capital expenditures or contractual commitments;
  • They do not reflect changes in, or cash requirements for, Dole plc’s working capital needs;
  • They do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on Dole plc’s debt; and
  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and these non-GAAP financial measures do not reflect cash requirements for such replacements.

Because of these limitations, pro-forma EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted Net Income, and pro-forma Adjusted EPS should not be considered as measures of discretionary cash available to Dole plc to invest in the growth of its and Dole plc’s business.

Further, pro-forma EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted Net Income, and pro-forma Adjusted EPS as used herein may not be calculated in a similar manner to, and are therefore not necessarily comparable with, similarly titled measures of other companies. However, we have included pro-forma EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted Net Income, and pro-forma Adjusted EPS herein because Dole plc’s management believes that pro-forma EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted Net Income, and pro-forma Adjusted EPS are useful performance measures.

Dole is not able to provide a reconciliation for projected FY'23 Adjusted EBITDA without undertaking unreasonable efforts.

Pro-forma Methodology

The methodology used to prepare the unaudited pro-forma consolidated financial statements for Dole plc to show the estimated effects of the acquisition of DFC by TP and the IPO and refinancing as if they had occurred on January 1, 2020 and is consistent with how the pro-forma financial statements were prepared in the F-1. The results for the three months ended December 31, 2021 are based on the Company's consolidated statutory results and therefore are not pro-forma adjusted.

1.

 

All associated transaction costs reflected on January 1, 2020. As such, no transaction costs are included within the pro-forma numbers discussed below.

2.

 

Effective tax rate of 26% for the year ended December 31, 2021.

3.

 

Applying the results of the Purchase Price Allocation (“PPA”) exercise, acquisition accounting and debt refinancing to January 1, 2020:

 

a.  

Q4 2021 year to date pro-forma results reflect a reduction in the depreciation charge of $4.0 million. This is a function of the asset values increasing as a result of the PPA exercise offset by an increase in the estimated useful lives of the assets.

 

b.  

The interest expense for Q4 2021 reflects the outcome of the refinancing.

4.

 

TP’s pickup of its 45.0% share of DFC’s net income has been eliminated.

5.

 

EPS is calculated using shares in issue following the IPO and additional share issuances.

6.

 

There is a year to date adjustment in Q4 2021 of $9.8 million to reflect estimated ongoing incremental public company costs of $14.0 million annualized.

Pro-forma Reconciliation (Unaudited) – for the year ended December 31, 2021

 

TP

 

DFC

 

Dole plc

 

FV &

Intercompany

Adjustment

 

Transaction

Costs

 

Ongoing plc

Costs

 

Debt

Adjustment

 

Tax

Adjustment

 

Pro-forma

Financial

Statements

 

(U.S. Dollars and shares in thousands, except per share amounts)

Revenues, net

$

4,548,888

 

 

4,809,173

 

 

9,358,061

 

 

(72,389

)

 

 

 

 

 

 

 

$

9,285,672

 

Cost of sales

 

(4,179,155

)

 

(4,537,683

)

 

(8,716,838

)

 

151,153

 

 

 

 

 

 

 

 

 

 

 

(8,565,685

)

Gross profit

 

369,733

 

 

271,490

 

 

641,223

 

 

78,764

 

 

 

 

 

 

 

 

 

 

 

719,987

 

Selling, marketing and general and administrative expenses

 

(290,047

)

 

(217,915

)

 

(507,962

)

 

 

 

 

 

(9,750

)

 

 

 

 

 

 

(517,712

)

Merger, transaction, and other related costs

 

(26,719

)

 

(5,214

)

 

(31,933

)

 

 

 

31,933

 

 

 

 

 

 

 

 

 

 

Gain on disposal of businesses

 

11

 

 

 

 

11

 

 

 

 

 

 

 

 

 

 

 

 

 

11

 

Gain on asset sales

 

581

 

 

7,372

 

 

7,953

 

 

(4,630

)

 

 

 

 

 

 

 

 

 

 

3,323

 

Operating income (loss)

 

53,559

 

 

55,733

 

 

109,292

 

 

74,134

 

 

31,933

 

 

(9,750

)

 

 

 

 

 

 

205,609

 

Other income, net

 

1,557

 

 

19,015

 

 

20,572

 

 

 

 

 

 

 

 

 

 

 

 

 

20,572

 

Interest income

 

2,594

 

 

2,727

 

 

5,321

 

 

 

 

 

 

 

 

 

 

 

 

 

5,321

 

Interest expense

 

(21,912

)

 

(44,790

)

 

(66,702

)

 

 

 

 

 

 

 

21,182

 

 

 

 

 

(45,520

)

Income (loss) before income taxes and equity earnings 

 

35,798

 

 

32,685

 

 

68,483

 

 

74,134

 

 

31,933

 

 

(9,750

)

 

21,182

 

 

 

 

 

185,982

 

Income tax (expense) benefit

 

(20,018

)

 

(30,787

)

 

(50,805

)

 

 

 

 

 

3,066

 

 

(6,660

)

 

22,310

 

 

 

(32,089

)

Equity in net earnings of investments accounted for under the equity method

 

46,317

 

 

1,737

 

 

48,054

 

 

(24,396

)

 

 

 

 

 

 

 

 

 

 

23,658

 

Net income (loss)

 

62,097

 

 

3,635

 

 

65,732

 

 

49,738

 

 

31,933

 

 

(6,684

)

 

14,522

 

 

22,310

 

 

 

177,551

 

Less: Net income attributable to noncontrolling interests

 

(23,004

)

 

(2,896

)

 

(25,900

)

 

 

 

 

 

 

 

 

 

 

 

 

(25,900

)

Net income (loss) attributable to Dole plc

$

39,093

 

 

739

 

 

39,832

 

 

49,738

 

 

31,933

 

 

(6,684

)

 

14,522

 

 

22,310

 

 

$

151,651

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share - basic

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

1.60

 

Net income per share - diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

1.60

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

94,878

 

Diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

95,030

 

 

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