Economic issues in Venezuela and fruit supply constraints affected Del Monte’s consumer business for the first quarter ended July 28. The company’s pet business, however, offset volume declines and helped net sales increase 0.3% to $823.9 million from $821.1 million for the prior-year quarter.
While consumer products net sales were $342.9 million, a decrease of 5.5% from $362.8 million in the prior year period, pet product net sales were $481 million, an increase of 5% $458.3 million in the prior year period. The increase in pet products was driven, in part, by the acquisition of Natural Balance.
“The company delivered a solid increase in profitability during the quarter,” said Dave West, CEO of Del Monte Foods. “In pet, the business continues to grow amidst a tough competitive environment. In consumer, we faced challenges driven by fruit supply constraints and the continued economic issues in Venezuela. We remain focused on generating long-term growth by investing behind our brands, as well as driving strong innovation and new go-to-market capabilities. We completed the Natural Balance acquisition and are excited to further expand in the pet independent and specialty channels, consistent with our long-term growth strategy. We also successfully launched Fruit Burst Squeezers, our first consumer products platform innovation since we restaged the Del Monte brand.”
The acquisition of Natural Balance, which operates in high growth channels in which Del Monte is currently underrepresented, complements the company’s current pet products portfolio. The company appointed Giannella Alvarez as the company’s EVP and general manager of the pet business unit in July 2013, after finalizing its acquisition of Natural Balance. She has more than 25 years of U.S. and international consumer products goods experience with premier brands and companies. Most recently, Alvarez was group president and CEO of Barilla Americas. Prior to Barilla, Alvarez held several senior positions at The Coca-Cola Company, Kimberly-Clark and Procter & Gamble.