Sunkist Growers sees good results in difficult 2009

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February 17, 2010

February 17, 2010, Visalia, California …..

“Sunkist’s experience in managing through difficult times helped turn what could have been a very bad year, into a relatively good one,” Sunkist’s Board Chairman Nick Bozick told the growers and guests at Sunkist Growers 116th annual meeting in Visalia. He credited hard work, strategic planning, and discipline with rewarding Sunkist growers with some of the highest returns per acre generated in the industry this past year.

“The marketplace in which we operate today,” said Sunkist President and CEO Russ Hanlin “is far different than that of even a decade ago. However, despite the dramatic changes – the consolidation of buyers and the growing amount of competition – the challenges that citrus growers faced are very similar to those that prompted the creation of Sunkist in 1893. By consolidating marketing strength, we are able to secure the best returns possible. That was true in 1893 and it is true in 2010.

“Sunkist’s success, and the success we help our growers achieve, comes from our proven ability to adapt. Over the past 116 years we have been constantly evolving in response to changing market conditions. Our adaptability is possible, in large part, because of the depth of knowledge and experience in our work force.” And the industry is noticing, he added. Over the past two years, Sunkist added close to 5,000 acres to its membership base.

Hanlin discussed the recent redesign of Sunkist’s sales program, which uses technology to create a mobile sales force anchored by operations centers, which are focused on customer service and daily transactions. “We offer our customers a bundle of services that others don’t,” he said, “including the comfort of a name that consumers trust.” And while having the right model is important, he noted that success comes down to the day-to-day execution in the marketplace.

In addition to enhancing its sales strategy, Hanlin said, Sunkist also refined its marketing to an individual approach focused on each customer’s market and needs. Not only is this approach a more effective use of marketing dollars, it is also building stronger relationships with customers.

Hanlin briefly recapped last years’ fresh citrus sales results noting that the dramatic downturn in the global economy presented major challenges. Returns per acre were good, he said, but varied as always, by fruit quality and size, as well as on the percentage of domestic and export shipments.

Adverse circumstances combined to make 2009 a very difficult year for Sunkist’s Citrus Juice and Oil Division, Hanlin said. Processing volumes for oranges, particularly Valencias, were substantially below forecasts. There is good news ahead, he added, “as we are seeing a slight reversal in the downward trend of juice consumption, and sales are on the increase.”

Despite the recession, Sunkist’s global licensing business continued to grow with 73 new Sunkist-branded products introduced in 2009. Sunkist also added a record nine new licensees, including two outside the food and beverage categories.

“The 2009-10 season is looking brighter than the season just past. Already, overall volumes, FOBs and revenues are higher. Economic improvement, however – particularly in foodservice – has been very slow and spotty. Until global markets recover and unemployment numbers come down dramatically, our industry will continue to face substantial challenges,” Hanlin predicted.

“Our ability to provide a balanced global sales and marketing program gives Sunkist growers a major advantage,” he concluded. “New and expanding markets in India, Russia and the Middle East are being explored. New varieties of citrus, along with adding to our portfolio, increase the value of our offerings to key customers around the world.

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