Dole plc (NYSE:DOLE) shares fell more than 4% in premarket trading on Monday after the fresh produce group reported first-quarter earnings below analyst expectations, even as revenue came in ahead of forecasts.
The stock declined 4.17% before the opening bell following the release of the results.
Higher Sourcing Costs Pressure Profitability
For the quarter ended March 31, Dole posted adjusted earnings per share of $0.33, missing consensus estimates of $0.35 per share.
Revenue increased 11.6% year-over-year to $2.34 billion, exceeding analyst expectations of $2.23 billion.
The company said sales growth was supported by strong operational performance across all business segments, higher global pricing within its Fresh Fruit division and favourable foreign exchange movements, which contributed approximately $96.2 million.
Adjusted EBITDA declined 4.3% to $100.3 million from $104.8 million a year earlier, primarily due to increased fruit sourcing expenses within the Fresh Fruit segment.
Dole’s Fresh Fruit business reported adjusted EBITDA of $52.6 million, down 17.0% from the prior-year period, as rising banana and pineapple sourcing costs outweighed the benefit of stronger pricing.
“We are pleased with our solid start to the year,” said Carl McCann, Executive Chairman. “Robust consumer demand in our key markets is driving revenue growth and contributing to positive momentum across the Group.”
Diversified Produce Segments Deliver Stronger Results
The company’s Diversified Fresh Produce – Americas & Rest of World division posted strong growth, with adjusted EBITDA rising 28.7% to $17.8 million.
Meanwhile, the EMEA segment recorded adjusted EBITDA growth of 8.3%, reaching $30.0 million during the quarter.
Full-Year Guidance Maintained
Dole reaffirmed its full-year 2026 adjusted EBITDA target of at least $400 million.
The company also lowered its projected annual interest expense guidance by $2 million, now expecting costs of approximately $58 million for the year.
Management said it anticipates higher shipping and fuel costs during the second quarter but expects pricing adjustments within customer contracts to help offset those pressures as the year progresses.