Alliance One Profit Plunges On Weak Sales; Stock Down 5%

(RTTNews) - Alliance One International Inc (AOI), a distributor of leaf tobacco, on Monday reported fourth-quarter net earnings of $1.4 million or $0.02 per share compared with $13.3 million or $0.14 per share last year.

Revenues for the quarter were down 25.3% at $488.9 million compared with $654.6 million in the prior year.

Sales were hurt mainly by a 21.9% drop in full service volumes.

The company said sales were impacted this year by deconsolidation of a Brazilian subsidiary following completion of the joint venture in March 2014, delayed shipment timing from Africa and the U.S. that is planned to ship in the fourth quarter, less favorable weather conditions in some sourcing markets and the impact of global tobacco oversupply.

The company said that based in part on expected shipments, fiscal year 2015 revenue will be below the prior year .

Pieter Sikkel, Chief Executive Officer, said, "Our volume and sales are being impacted by delayed shipment timing from Africa and the U.S. that is anticipated to ship in the fourth quarter and an oversupply in global tobacco leaf markets."

"Some customers have been reducing inventory durations faster than initially anticipated at the end of the last fiscal year, based on reduced consumer demand for their products in certain markets."

Alliance One purchases, processes, packs, stores, and ships leaf tobacco for manufacturers of cigarettes and other consumer tobacco products.