Yesterday's announcement, which named newly appointed global product leaders, a chief information officer and a new president of its Fresh North America business, comes just weeks after the firm embarked on a number of debt-reducing initiatives.
"The changes announced today are part of our objective to build a high-performance organization, and are designed to help us take advantage of market growth opportunities," said Fernando Aguirre, chairman and chief executive officer in a statement yesterday.
"First, having two proven senior-level executives focusing on our key product segments across all geographies will help us apply best-practices throughout the organization, develop a sustainable pipeline of innovative products for each segment, and develop a growth platform for our key products on a global basis."
"Second, as our supply chain becomes more complex, it is critical that we focus on creating efficiency and ensuring that cold-chain management remains a core capability. We believe the changes announced today will further strengthen our business in these two critical areas and position us to achieve our goals."
The fruit supplier has been hard hit this year by the implementation of new regulations for the import of bananas into the European Union. Whereas Chiquita had previously enjoyed a European market with little competition, in January 2006 the European Commission imposed a higher tariff on bananas imported form Latin America, while allowing a duty-free annual import quota of 775,000 tons for bananas from certain African, Caribbean and Pacific countries.
Latin America is Chiquita's primary source of bananas, and the new banana tariff, which increased to €176 from €75 per ton, resulted in an increase in cost of around €1.84 ($2.20) for each box of bananas imported by Chiquita into the EU form Latin America.
The company now hopes its reorganization initiatives will help it to develop a successful growth strategy, which will allow it to extend its salad business to new markets, as well as expand its Chiquita Fresh North America business through new products. Chiquita has appointed Jeff Filliater and Scott Komar as global strategy leaders for bananas and salads.
Richard Continelli, previously of Masterfoods, Nabisco and Nestle, was appointed president of Chiquita Fresh North America. Waheed Zaman was named senior vice president for global supply chain organization and procurement, while Manjit Singh was promoted to chief information officer, responsible for the company's global commercial and innovations systems.
Chiquita's reorganization and debt-reducing efforts also involve other initiatives announced in recent weeks, including the prospective sale of its shipping fleet, the suspension of its quarterly cash dividend, and requesting a temporary waiver from its lenders.
These moves, said Chiquita, are "prudent steps" to help it resurface from a challenging market environment.
Last month, Chiquita announced interim price and volume levels for its third quarter, indicating that prices in North America have risen 10 percent in the first two months of the quarter, compared to the same period last year.
In contrast, prices in the EU, Switzerland, Norway and Iceland fell by 17 percent on a local currency basis, forced down by hot weather that resulted in depressed consumer demand, as well as an increase in market competitors.
Indeed, the "challenges" faced by Chiquita as a result of the new European banana regime resulted in the company last month reporting a sharp fall in profits. Operating income for the firm's second quarter dropped by 39 percent to a total of $45m, compared to the prior-year figure of $75m.