Q2 2025 Dole PLC Earnings Call
Speaker #3: Welcome to Dole plc's second quarter 2025 earnings conference call and webcast. Today's conference is being broadcast live over the internet and is also being recorded for playback purposes.
Speaker #3: Currently, all participants are in listen-only mode. After the speakers' presentations, there will be a question-and-answer session. For opening remarks and introductions, I would like to turn the call over to the head of investor relations with Dole plc, James O'Regan.
Speaker #4: Thank you. Welcome, everybody, and thank you for taking the time to join our second quarter 2025 earnings conference call and webcast. Joining me on the call today are our Chief Executive Officer, Rory Byrne; our Chief Operating Officer, Johan Linden; and our Chief Financial Officer, Jacinta Devine.
Speaker #4: During this call, we'll be referring to presentation slides to supplement remarks. These, along with our earnings release and other related materials, are available on the investor relations section of the Dole plc website.
Speaker #4: Please note our marks today will include certain forward-looking statements within the provisions of the Federal Securities Safe Harbor Law. These are to reflect circumstances at the time they are made, and the company expressly disclaims any obligation to update or revise any forward-looking statements.
Speaker #4: Actual results or outcomes may differ materially from those that may be expressed or implied due to a wide range of factors, including those set forth in our SEC filings and press releases.
Speaker #4: Information regarding the use of non-GAAP financial measures may be found in our press release, which also includes the reconciliation to the most comparable GAAP measures.
Speaker #4: With that, I'm pleased to turn today's call over to Rory.
Speaker #5: Thank you, James. Welcome, everybody, and thank you for joining us today as we discuss our second quarter results for 2025. So, time for us to do the highlights for the second quarter on slide four.
Speaker #5: Well, we're very pleased to report another strong performance in the second quarter of 2025 and to have achieved an important step forward in our strategic evolution.
Speaker #5: Group revenue increased 14.3% to $2.4 billion, and adjusted EBITDA increased 9.3% to $137 million. The quarter saw very strong growth in our two diversified fresh produce segments, as well as good growth in fresh fruit, despite some of the expected short-term challenges that we continue to face.
Speaker #5: Adjusted net income came in at $53 million, and adjusted diluted EPS was $0.55, reflecting a growth of 12% compared to the prior year. On August 5th, we were delighted to announce that we completed the sale of our fresh vegetable division to Arrowell Capital Partners.
Speaker #5: The sale of this business has been a strategic priority for us since 2023, and its completion will now enable us to concentrate our efforts and investments on our core business activities.
Speaker #5: I would like to take this opportunity to thank the dedicated management and employees of the Dole Fresh Vegetables business for their valuable contributions and commitment, particularly during what has been a complex transaction process over the last several years.
Speaker #5: We believe the deal is a great outcome for all stakeholders in this division. So, turning now to the operational review and starting with fresh fruit on slide six.
Speaker #5: Fresh fruit delivered a strong performance in the second quarter, with adjusted EBITDA of $72.7 million. The result exceeded our expectations, taking into account anticipated operational challenges.
Speaker #5: In North America, our underlying operations once again performed well, with strong volume growth in bananas and pineapples, as well as higher pricing. Growth in adjusted EBITDA was constrained by the anticipated higher sourcing costs following the impact of Tropical Storm Sarah and due to the generally tight sourcing market that has developed.
Speaker #5: In addition, we experienced higher shipping costs in the quarter as we managed the additional logistical complexities of the current sourcing environment, while also addressing the temporary vessel operational issue that we flagged on our last earnings call.
Speaker #5: Turning to the European market, we had a long quarter with higher volumes in both bananas and pineapples, as well as higher pricing across our products. This was supported by the impact of tight sourcing on the open market price, as well as a strengthening of the euro.
Speaker #5: In both our core markets, we continue to see very robust demand for our products and expect this to continue over the course of the full year.
Speaker #5: As noted earlier, industry supply was tighter throughout the second quarter than was previously anticipated, and that dynamic has continued into the third quarter. In addition to our own impacts from Tropical Storm Sarah, some other industry-specific challenges and less favorable weather conditions in much of Central America, as well as strong market demand, have all put pressure on industry supply and sourcing costs.
Speaker #5: Our sourcing teams are continuing to do an excellent job mitigating these challenges, but we do expect to have some higher costs in the second half as we work to continue to meet the strong demand that we're seeing from our customers.
Speaker #5: Turning now to the diversified EMEA segment. This segment had a very strong start to the year; adjusted EBITDA increased by approximately 15% in the second quarter to $49 million.
Speaker #5: Driven by strong revenue growth in key markets including the Nordics, Ireland, the UK, Spain, and the Netherlands, the segment benefited from the strengthening of the euro in the second quarter. However, on an underlying basis, the performance has also been strong with a like-for-like adjusted EBITDA growth of 8.7% in the quarter.
Speaker #5: In the second quarter, we continue to see similar operational trends to those of the first quarter. In particular, we continue to see sales into retail outperforming food service and wholesale channels in most markets.
Speaker #5: Overall, we see the segment moving in a very positive direction while still having a range of internal and external investment opportunities to drive further growth in the future.
Speaker #5: Turning now to Diversified Americas, on slide eight, this segment delivered an excellent second quarter, building on the strong momentum we saw in the first quarter.
Speaker #5: While the good growth we saw in the North American market continued in the second quarter, it was also supported by a very good performance on the southern hemisphere export side due to a stronger than anticipated conclusion for the season for certain categories, as well as a strong start in some of our winter products.
Speaker #5: Although we expect the rate of growth in the first half of the year to stabilize in the second half, we are confident in the long-term prospects of our businesses within this segment.
Speaker #5: We believe they're well positioned and will look for further opportunities to continue the strong momentum established this year in the years ahead. With that, I'll hand you over to Jacinta Devine to give the review of the second quarter.
Speaker #6: Thank you, Rory, and good day, everyone. Turning firstly to group results on slide 10. We are very pleased to report a strong result for the second quarter of this financial year.
Speaker #6: Revenue of $2.4 billion was 14.3% higher on a reported basis, with good growth in our three segments. On a like-for-like basis, revenue increased 12.1%, demonstrating the strong underlying growth and momentum within the group.
Speaker #6: Operating income increased 20% to $103 million, driven by higher revenue and gross profit, as well as a higher gain on asset sales, partially offset by higher SMG&A expense.
Speaker #6: Net income for the second quarter was $18 million and was impacted by a loss of $35 million in discontinued operations, primarily due to a non-cash adjustment to the carrying value of the fresh vegetable division.
Speaker #6: We also booked an unrealized foreign currency loss of $19.1 million, which has been offset by gains in other comprehensive income. In the quarter, we achieved further asset sales and realized a gain on assets of $9.3 million.
Speaker #6: Looking now at the non-GAAP performance measures, adjusted EBITDA increased by 9.3%, with strong growth delivered across the group. On a like-for-like basis, predominantly excluding a positive impact from foreign currency translation of $2.2 million, the increase was $9 million or 7.2%.
Speaker #6: Adjusted net income increased by $6.1 million, or 13%, predominantly due to the increase in adjusted EBITDA as well as lower interest expense. Adjusted diluted EPS was $0.55.
Speaker #6: An increase of 12.2% compared to the prior year. Turning now to the division updates for our continuing operations, starting with fresh fruit. Revenue increased 14.2%, primarily due to higher worldwide volumes of bananas and pineapples sold, as well as higher worldwide pricing of bananas, pineapples, and plantains.
Speaker #6: Partially offset by lower worldwide volumes of plantains sold. Adjusted EBITDA increased 3%, primarily driven by an improved performance in pineapples on a worldwide basis, as well as strong growth in banana volumes.
Speaker #6: These improvements were partially offset by higher fruit costs following Tropical Storm Sarah, as well as higher shipping costs due to a short-term operational disruption that has since been resolved.
Speaker #6: The diversified EMEA segment delivered another very strong result in the second quarter. Reported revenue increased 16.5% or $155.9 million, primarily due to strong performance in the UK, Spain, Scandinavia, and the Netherlands, as well as a $57.7 million favorable impact from FX.
Speaker #6: Partially offset by a negative impact from M&A of $9.6 million. Excluding these impacts, on a like-for-like basis, revenue increased by 11.4% or $107.8 million. Adjusted EBITDA increased by 14.7% or $6.3 million.
Speaker #6: Primarily driven by increases in the UK, Spain, and the Netherlands, as well as a $2.5 million favorable FX impact. These increases were partially offset by lower earnings from South Africa.
Speaker #6: On a like-for-like basis, adjusted EBITDA increased 8.7%, or $3.7 million. Diversified Americas had an excellent second quarter. Reported revenue increased 8.5%, or $30.3 million.
Speaker #6: Driving this increase was revenue growth in most commodities sold in the North American market, primarily due to volume growth, as well as higher revenues in apples exported from South America.
Speaker #6: On a like-for-like basis, revenue increased 8.8%. Adjusted EBITDA increased $3.3 million, or 27%, primarily driven by strong performance in the Southern Hemisphere export business.
Speaker #6: Particularly in apples and citrus, as well as continued good performance in the North American markets in kiwi, citrus, and avocados. On a like-for-like basis, adjusted EBITDA increased 26.6%.
Speaker #6: Now, turning to capital allocation and our balance sheet. Cash capital expenditure from continuing operations was $19.4 million in the second quarter. Additionally, $14 million of assets were acquired by way of finance lease.
Speaker #6: The combined total includes the Honduras Farms Rehabilitation, which is supported by insurance proceeds. Logistics and warehouse investments, primarily in EMEA, and ongoing reinvestments in farming and transport infrastructure.
Speaker #6: In line with our typical seasonal working capital trend, we continue to build investments in working capital through the end of Q2. However, the trend was accentuated this year by the strong volume and revenue growth being seen across the business, and in particular, in the fresh fruit segment.
Speaker #6: As of recent years, we expect to see this unwind as the year progresses, while noting that we do expect to see a working capital outflow on a full-year basis in 2025 to support the revenue increase we are seeing across the business.
Speaker #6: The combination of these factors results in a free cash flow from continuing operations being an outflow of $1 million for the quarter and an increase in net debt to $789 million.
Speaker #6: We generated cash proceeds from asset sales of $5.3 million in the second quarter. This was primarily related to water infrastructure assets in Hawaii. We have continued to benefit from a downward trend in interest costs, and under the assumption that base rates will remain broadly stable for the remainder of 2025.
Speaker #6: And having factored in the benefit of our debt refinancing and the additional fresh vegetable profits, we expect interest expense to be approximately $67 million.
Speaker #6: Finally, we are pleased to declare an $0.085 dividend for the second quarter, which will be paid on October 6th to shareholders on record as of September 15th.
Speaker #6: Now, I will hand you back to Rory, who will give an update on our full-year outlook.
Speaker #7: Well, we're very pleased with our performance in the second quarter, continuing our positive momentum and putting us in a good place to achieve our full-year targets. We will continue to operate in a dynamic macroeconomic environment.
Speaker #7: Overall, we're happy with how our business, industry, customers, and suppliers have adapted to the additional complexity being seen in international trade and the macroeconomic environment.
Speaker #7: While short-term disruptions may persist, we remain confident in the resilience of our diversified business model and in the resilience of the international fresh produce industry.
Speaker #7: Forecasting in this dynamic environment remains complex, so we are pleased to tweak our guidance upwards and are now targeting a full year adjusted EBITDA in the range of $380 million to $390 million.
Speaker #7: Turning to investments, we expect, as a baseline, to have maintenance CapEx from continuing operations broadly in line with our depreciation expense of approximately $100 million.
Speaker #7: Additionally, we will have some increased CapEx spend to rehabilitate our farms in Honduras, damaged by Tropical Storm Sarah last year, albeit significantly supported by insurance proceeds.
Speaker #7: Circling back to the disposal of the Fresh Vegetables division, this was a key strategic priority for the group, and its completion provides us with enhanced strategic clarity as we move into the remainder of ’25 and start to look further ahead.
Speaker #7: Our core operations are performing well, with good momentum and important opportunities for both internal and external development. We are excited to refocus our efforts as we look to further grow our business and create value for our stakeholders.
Speaker #7: I want to conclude by once again thanking all our outstanding people across the group for their ongoing commitment and dedication to driving our group forward.
Speaker #7: Additionally, I would like to give a special mention to our former colleagues in the fresh vegetables business, who have worked tirelessly to support our corporate team in bringing this transaction to its successful conclusion.
Speaker #7: As always, we really appreciate all our essential partners, including suppliers, customers, and all our stakeholders, for their continued support. With that, I'll hand the call back to the operator to open the line for questions.
Speaker #3: Turning the floor for the question-and-answer session. If you'd like to ask a question, please press star followed by one on your telephone keypad.
Speaker #3: That's star followed by one on your telephone keypad. Your first question comes from the line of Christopher Barnes of Deutsche Bank. Your line is now open.
Speaker #8: Good morning, good afternoon. A very strong quarter across divisions and regions. But Rory, to start, could you just help us reconcile the updated outlook on EBITDA?
Speaker #8: I understand your commentary about the dynamics and complexity of forecasting in this environment, but you also noted that tight supply conditions and fresh fruit are expected to continue and have continued into the third quarter.
Speaker #8: And your position on the diversified businesses is well understood. I’m just trying to reconcile that with the implied decline from 12% to 6% in EBITDA for the back half.
Speaker #8: So if any additional color would be helpful. Thanks.
Speaker #7: Yeah, thanks, Christopher. Yeah, I mean, obviously, I see the first thing to say is we had a really strong 2024, and we finished, in particular, the latter part of '24 in a very strong way.
Speaker #7: And you know, we started out the year with the impact of Storm Sarah in Honduras. There's been a fair bit of evolution in terms of weather issues in Central America, in particular, and that's switched a lot of sourcing for the, I suppose, the safety valve volume.
Speaker #7: You know, Chiquita had an issue in Panama, and they've had to source more. What that has done is driven up the price in Ecuador, with the export price out of Ecuador for spot purchasing having gone up extremely.
Speaker #7: Highly. And that impacts the sourcing cost for under disruption from your traditional sources if you've lower volumes. So it does have a negative impact on your EBITDA.
Speaker #7: I think, you know, forecasting is just very, very difficult. There is, you know, until we get greater, I suppose, transparency or a greater settling of the U.S.'s international trade relationships with so many trading partners, the world will continue to be volatile.
Speaker #7: It's very difficult and challenging to manage against that backdrop with, you know, tariff rates changing up and down. So, you know, I think with that, we probably have taken a conservative view to our guidance.
Speaker #7: We'll do our best as ever to beat expectations, but putting all the factors into the mix, in particular, we do think we're going to have a weaker Q3, taking account of those tighter supply issues and the disruption that that's causing to our own sourcing platform.
Speaker #7: So, I hope that gives you some color on it, Christopher. I mean, we're feeling good about life, but you know we need to be a little bit cautious in the context of those supply issues in the fresh fruit division.
Speaker #8: No, that is helpful. And I guess maybe just to follow up around that, I mean, you mentioned tariffs moving up and down, and like pricing in the quarter was very strong.
Speaker #8: Like, is there any way to disaggregate how much of that pricing is tariff-driven or tariff-related? If we do get relief on tariffs in the future, given the lack of commercially available cultivation of pineapples and bananas domestically, how do we unwind some of that pricing? But then we also have to consider how to marry that with the fact that sourcing costs are just higher.
Speaker #8: Like I know you mentioned the Chiquita issue in Panama, and Del Monte last week or two weeks ago called out Costa Rican volumes and black sigatoka.
Speaker #8: So I'm just trying marry all of that. Like are you able to are you able to push through incremental pricing given the strength of volumes you've en or just any any any additional thoughts there would be helpful?
Speaker #8: Thanks.
Speaker #6: Yeah, I am obviously, you know we live in a very happy operation, a very dynamic world, Christopher. So, you know, it's not just a mathematical case of taking one variable and being able to adjust the pricing.
Speaker #6: So, you know yields can go down. You know there's Siga Toca issues in Central America. Production inputs can go up. Weather can have an input.
Speaker #6: We've seen great volatility in the foreign exchange. We've had some disruption in shipping flows. You know, duties and tariffs are just another barrier to cope with in that equation.
Speaker #6: And you know it goes into the mix of trying to determine our ultimate pricing. So there are a lot of variables at play. As ever, and at the moment, you know, luckily we've got a very experienced team who have been able to successfully manage their way through all of those variables with the ups and downs that all those can bring at any given point in time.
Speaker #8: Got it. That's helpful, Rory. And then one final one for me, if I may. Just on the fresh vegetables—congratulations on completing the transaction.
Speaker #8: I know it's been discontinued for a while, but now that it's officially changed hands, how quickly can you start to eliminate some of the stranded overheads and associated costs now that that business is no longer part of your organization?
Speaker #8: And of the $90 million of cash proceeds that you received, is your thinking still to utilize the majority of that for debt paydown or?
Speaker #8: Or has that thinking changed?
Speaker #7: Yeah, I mean, obviously in the short term, the $90 million will be used to pay down debt. And I think what it does is it gives us a, you know, a clearer picture and a clearer strategic focus.
Speaker #7: So, you know, in terms of capital allocation and what we do now that we've got certainty around the outcome of the vegetable division, I think it allows us to refocus.
Speaker #7: You know there's been a long process, a complex process, and I believe it was completed, you know, with a lot of uncertainty until we got there, and it dragged on a long time.
Speaker #7: And you know we did have to have, you know, a plan B in place in the event that we weren't going to be able to get it over the line.
Speaker #7: So, I think all of the issues that you raised there in terms of capital allocation, and obviously it does give us a clearer path now to measure what the appropriate cost structure is for the business that we currently operate.
Speaker #7: And we will do that as quickly as we can.
Speaker #8: Great, very helpful. I'll pass it on.
Speaker #7: Thank you, Christopher.
Speaker #3: Your next question comes from the line of Peter Galbo of Bank of America. Your line is now open.
Speaker #9: Hi, good evening. Thanks for the question. Maybe just a couple of follow-ups to Chris's questioning. I think you are on the tight industry supply carrying into the third quarter; it makes sense, at least on the pineapple and banana side.
Speaker #9: I'm just curious if you have line of sight kind of beyond the third quarter at this point. You know, do you do you have a a a point in time where you're kind of back to bright at least on the supply side?
Speaker #9: Is that Q4, or is it early next year? Just any additional comments there would be helpful.
Speaker #7: Yeah. I mean, I suppose one of the key things that I have said to our investors and our analysts is we actually don't look at this business on a quarter-by-quarter basis.
Speaker #7: You know, the minimum period we would look at is over the course of a year. And just as an aside, I suppose the overall outcome for our fresh fruit division over the course of the year we think will be more than satisfactory.
Speaker #7: I think the current supply disruptions are real and having an impact on Q3. We believe they'll extend into Q4. But it's amazing how this industry writes itself very quickly.
Speaker #7: So we're hopeful going into next year. The contract price negotiation and other things will have a big impact, but we'll be able to adjust all of the right variables to continue the underlying financial performance in this division.
Speaker #9: Okay, helpful. And and then on the tariff front, I know that you know we we talked a little bit about the the rates moving around a bit, but just have you had any more discussions?
Speaker #9: Whether with local governments, administration, or anybody who will frankly listen to you on exclusions, you know, for items that obviously can't be grown in the U.S.?
Speaker #9: I mean, seemingly, I think you've had some peers that have maybe had that conversation progress a bit. But just curious if there's anything new on your front.
Speaker #9: Thanks very much.
Speaker #7: Yeah, I mean, obviously we've been saying from the outset that we think our industry is actually a very good example of the huge positives of international trade.
Speaker #7: You know, a year-round supply of healthy products really goes into the concept of making America healthy again, or indeed, making the world healthy again.
Speaker #7: So we really don't believe that the tariffs are focused on our sector. You know, we have heard in public statements, whether from the U.S. administration where they've confirmed that products like tropical produce that can't actually be produced in the U.S. will ultimately get exempted.
Speaker #7: I think there's a process whereby it hopefully will form part of the individual trade deals that ultimately are concluded with the source countries that we operate with.
Speaker #7: So, it'll be some short-term disruption. We'll work our way through it in a satisfactory way, and then hopefully over time it settles down in a constructive and positive way for everybody.
Speaker #9: Thank you.
Speaker #3: Your next question comes from the line of Gary Martin of Davie. Your line is now open.
Speaker #10: Hi, Rory, Jacinta, and Johan. Congrats on another strong set of results and the recent sale of fresh veg. Just a few questions on my side.
Speaker #10: I'll start on the fresh veg disposal. It'd just be good to get a bit more color on the deal overall. Potentially just maybe getting some color on the timeline of the sellers of the seller note repayment and the earnout.
Speaker #10: And also maybe just a bit of background on the retention of the two facilities. Is there a plan there? Is it a leaseback?
Speaker #10: Is it going to be a is there potential there to for a further sale? It'd just be good to get a bit of color around that.
Speaker #10: Just start with.
Speaker #7: Yeah, the note is a $50 million pick note with a quoted interest accruing at 5%. And it's payable at a fixed maturity date in five years' time.
Speaker #7: On the facilities, yeah, it just evolved as part of, you know, it was a complex negotiation in a very complex transaction, you know, where Arrowell and Organic Girl had to acquire Bragga, and then once that was done, simultaneously acquire our business.
Speaker #7: So, as you can imagine, with those kinds of complexities, it was a complex transaction. We have agreed to a five-year rent-free usage of Yuma and Heron, and thereafter.
Speaker #7: We'll negotiate either a commercial rent, or we will be able to crystallize the value of those assets. The current valuations we've got are something of the order of $40 million.
Speaker #10: That's really helpful. And then just as a kind of second-order question, just around the future internal and external development opportunities off the back of it.
Speaker #10: I know that you've talked about internal projects within Dole before. But I mean, it'd just be good to get maybe a bit of incremental color on, you know, with regard to the kind of additional balance sheet freedom.
Speaker #10: And also on top of that, I think you'd mentioned in our prepared remarks that you were seeing additional investment opportunities across fresh produce diversified EMEA.
Speaker #10: Is there anything that you'd like to go into and color in extra detail? Is there any color that you'd potentially provide on the M&A market as a whole?
Speaker #10: Has it slightly recovered versus where it was previously? Thanks.
Speaker #7: Yeah, I mean, we do keep, as you know, Gary, we keep a very close eye and we look at lots of acquisition opportunities. That’s, I mean, we’ve seen quite a few.
Speaker #7: We've had quite a lot of approaches, you know, particularly from the private equity sector looking for exits. There is certainly an evaluation gap for interesting companies compared to the public market valuation.
Speaker #7: So it's taken a little bit longer than I would have liked for perhaps our share price to move up a little bit to narrow that gap.
Speaker #7: So, we'll, you know, we will only do acquisitions if they, you know, fit or fill the criteria that the, you know, they give and add value to our shareholder base.
Speaker #7: So I think the whole question of capital allocation is a good opportunity for us to refresh, you know, now that we have the Veg deal out of the way, and with a clearer strategic path.
Speaker #7: And we're in the middle of studying a number of interesting projects in Scandinavia, a few bold and interesting developments to our existing facilities in Spain and Ireland.
Speaker #7: You know, we're looking at a couple of, you know, add-on projects in Chile, Peru. Our fresh fruit business, you know, we're always looking at add-ons, whether it's in plantains or limes or maybe even some sourcing in bananas.
Speaker #7: And we're developing in France. We may upgrade our facilities in France. So, you know, lots of projects spread across different elements of the group.
Speaker #7: And, you know, obviously the smaller projects that make sense to continue our core organic growth will, you know, pretty much always support. And then we keep a close eye on all of the other capital allocation opportunities that are out there as well.
Speaker #10: Perfect. Maybe just to pivot towards trading more generally, and I don't want to labor on the issue, but just on the tariff side of things.
Speaker #10: It's challenging to distinguish how much has actually been passed through at the minute. But, I mean, it would just be good to get any degree of color on any perceived elasticity to date.
Speaker #7: Yeah, I think the good thing about most of our products is that, you know, certainly bananas are very cheap on a per kilo or a per pound basis compared to pretty much any other fruit.
Speaker #7: So we think there's plenty of scope with the price needs to move either through tariffs or either through short sourcing or complex sourcing issues or foreign exchange or other issues that arise in it.
Speaker #7: And, you know, the price could go up, I believe, by a reasonable percentage and have no impact on consumption. You know, other products, you know, import products, be it grapes or, yeah, apples, pears, kiwis, you know, they're depending on supply, and over a long period of time, there's been quite a bit of volatility on the price.
Speaker #7: So I ink consumers are, you ow, in seasonal sourcing. So that's, you know, European source versus South Africa or Chile source, there can be quite a difference in price.
Speaker #7: So I think, you know, we're not seeing any any impacts that are having an unduly negative impact on the demand for our products.
Speaker #10: That's really, really helpful. And perhaps just one final point, just on Diversified Fresh Produce Americas and the rest of the business. It was a strong like-for-like performance, but it was particularly robust adjusted EBITDA performance.
Speaker #10: I ink the differential there is almost 20% in s of the performance. It'd just be good to get a bit of color on what drove that additional, you know, that 27% increase in adjusted EBITDA in that particular division.
Speaker #10: Was it mixed benefit? What's the best way to think about it?
Speaker #7: Yeah, I think, you ow, most of the individual underlying businesses within that division performed very well. You know, we've a strong footing through our 65% ownership of RP and great management team there.
Speaker #7: Have really managed to develop into that business very well. Performed very solidly in the first half the year. Our South American business, as we called out, you ow, I think we managed significantly really well.
Speaker #7: You know, how we closed out our cherry season, how we closed out our grape season. We've done well on apples. We've done well on kiwis.
Speaker #7: We added in a few new pieces on the avocado front. They've also performed strongly. Our import activity was a little weaker, and we're working on a solution to try and improve that going forward.
Speaker #7: So, I mean, just one of those periods where, you know, good management focuses on all aspects of business from South America to North America.
Speaker #7: You know, a leadership team there have done well at bringing together in a good synergistic way all the activities within that division and we're seeing the benefits coming through on the bers.
Speaker #10: That's really, really helpful. And I just sent him one final one. One final one. I promise. Just around the just color on the on the CapEx guide.
Speaker #10: I see that you've held maintenance at $100 million. But it would just be good to kind of parse just the additional CapEx from the development following Storm Sarah in Honduras.
Speaker #10: Versus where we were in Q1, has there been too much change in terms of the expected additional CapEx required there?
Speaker #7: Yeah, no material change. Gary on that from the Q1 outlook on us.
Speaker #10: Perfect. Excellent. I'll pass it on. Thanks so much.
Speaker #7: Thanks, Gary.
Speaker #3: Thank you. I'd now like to hand the call back to Rory Byrne for a final remarks.
Speaker #7: Thank you. Well, thanks everybody for joining us today. So, you know, we're pleased with the second quarter and the full first half of the year.
Speaker #7: I think it's a great outcome. Against the backdrop of a very complex macroeconomic environment, we've not pushed up the dividend to six and a half percent.
Speaker #7: We've pushed up our guidance a little bit. We've made some really strong strategic project progress in terms of getting tariffs year-round and a good outcome for the vegetable business.
Speaker #7: So thank you all. And we believe we're well positioned for continuing further growth. Thank you.
Speaker #3: Thank you for attending today's call. You may now disconnect. Goodbye.