Dole Food Company, Inc.

Unaudited Condensed Consolidated Financial Statements as of October 7, 2017 and

December 31, 2016 and for the Quarters and Three Quarters Ended October 7, 2017 and

October 8, 2016

Management’s Discussion and Analysis of Financial Condition and Results of Operations

1

DOLE FOOD COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands except per share data) Revenues, net ........................................................................ $ 1,284,578 $ 1,316,217 $ 3,444,623 $ 3,496,552

Cost of products sold ............................................................ (1,222,523) (1,244,637) (3,180,432) (3,265,629)

Gross profit .................................................................. 62,055 71,580 264,191 230,923

Selling, marketing and general and administrative expenses (62,975) (60,742) (160,154) (147,860)

Merger transaction, litigation settlement and other related

costs..................................................................................

(565)

––

6,077

––

Gain on asset sales ................................................................ 125 8,322 2,052 15,130

Operating (loss) income .............................................. (1,360) 19,160 112,166 98,193

Other (expense) income, net ................................................. (4,731) 2,616 (23,559) (923)

Interest income ...................................................................... 1,296 1,149 3,275 3,787

Interest expense ..................................................................... (22,302) (21,808) (57,145) (52,814)

Income (loss) from continuing operations before

income taxes and equity earnings (loss) .................

(27,097)

1,117

34,737

48,243

Income tax benefit (expense) ................................................ 32,321 4,950 7,739 (6,352)

Earnings (loss) from equity method investments .................. 298 (16) 821 62

Income from continuing operations, net of income

taxes ........................................................................

5,522

6,051

43,297

41,953

Income (loss) from discontinued operations, net of

income taxes ...........................................................

13

(7,043)

46

(5,960)

Net income (loss)......................................................... 5,535 (992) 43,343 35,993

Less: Net loss (income) attributable to noncontrolling

interests ...................................................................

77

(337)

(589)

(625)

Net income (loss) attributable to

Dole Food Company, Inc. ....................................... $ 5,612 $ (1,329) $ 42,754 $ 35,368

Earnings per share––Basic and Diluted:

Income (loss) from continuing operations excluding net

income attributable to noncontrolling interests ................

$ 5,599

$ 5,714

$ 42,708

$ 41,328

Net income (loss) attributable to Dole Food Company, Inc.. 5,612 (1,329) 42,754 35,368

See Notes to Unaudited Condensed Consolidated Financial Statements

2

DOLE FOOD COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands) Net income (loss) ......................................................... $ 5,535 $ (992) $ 43,343 $ 35,993

Foreign currency translation adjustment, net of income

tax of $0 for all periods presented ...........................

11,435

(1,072)

23,931

6,921

Comprehensive income (loss) ...................................... 16,970 (2,064) 67,274 42,914

Less: Comprehensive (income) loss attributable to

noncontrolling interests ...........................................

77

(337)

(589)

(625) Comprehensive income (loss) attributable to Dole

Food Company, Inc. ............................................... $ 17,047 $ (2,401) $ 66,685 $ 42,289

See Notes to Unaudited Condensed Consolidated Financial Statements

3

DOLE FOOD COMPANY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

October 7, 2017

December 31, 2016

(In thousands, except share data)

ASSETS

Cash and cash equivalents ....................................................................................... $ 166,080 $ 36,628 Restricted cash and investments .............................................................................. 5,937 7,261

Receivables, net of allowances of $29,240 and $19,369, respectively .................... 466,967 549,960

Inventories ............................................................................................................... 228,332 241,845

Prepaid expenses and other assets ........................................................................... 60,608 42,517

Assets held-for-sale ................................................................................................. 11,957 6,686

Total current assets ............................................................................................ 939,881 884,897

Investments .............................................................................................................. 24,990 24,253

Actively marketed property ..................................................................................... 108,442 126,716

Property, plant and equipment, net of accumulated depreciation of $373,694 and

$289,457, respectively ........................................................................................ 1,114,615 1,171,982

Goodwill .................................................................................................................. 339,840 345,503

Intangible assets, net ................................................................................................ 256,365 256,678

Other assets, net ....................................................................................................... 94,192 96,667

Total assets ........................................................................................................ $ 2,878,325 $ 2,906,696

LIABILITIES AND EQUITY Accounts payable .................................................................................................... $ 303,685 $ 298,827

Accrued liabilities .................................................................................................... 291,622 409,058

Notes payable and current portion of long-term debt, net ....................................... 37,156 74,005

Total current liabilities ...................................................................................... 632,463 781,890

Long-term debt, net ................................................................................................. 1,326,568 1,219,533

Deferred income tax liabilities ................................................................................ 107,815 117,613

Other long-term liabilities ....................................................................................... 267,675 310,462

Commitments and contingencies (Note 14)

Shareholder’s equity

Common stock—$0.001 par value; 1,000 shares authorized, issued and

outstanding as of October 7, 2017 and December 31, 2016 ............................... –– ––

Additional paid-in capital ........................................................................................ 796,694 796,184

Notes receivable from affiliates ............................................................................... (14,510) (14,000)

Accumulated deficit ................................................................................................ (182,218) (224,972)

Accumulated other comprehensive loss .................................................................. (64,445) (88,376)

Equity attributable to Dole Food Company, Inc. ..................................................... 535,521 468,836

Equity attributable to noncontrolling interests ........................................................ 8,283 8,362

Total equity ....................................................................................................... 543,804 477,198

Total liabilities and equity ................................................................................ $ 2,878,325 $ 2,906,696

See Notes to Unaudited Condensed Consolidated Financial Statements

4

DOLE FOOD COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Three Quarters Ended

October 7, 2017

October 8, 2016

(In thousands)

Operating Activities

Net income........................................................................................................................... $ 43,343 $ 35,993

Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization ............................................................................................. 79,099 81,841

Net unrealized loss on financial instruments ....................................................................... 34,402 12,616

Asset write-offs and net gain on sale of assets .................................................................... (785) (15,003)

Earnings from equity method investments ........................................................................... (821) (62)

Amortization of debt discounts and debt issuance costs ...................................................... 3,704 5,029

Refinancing charges............................................................................................................. 17,467 ––

Provision for deferred income taxes .................................................................................... (8,396) (8,692)

Pension and other postretirement benefit plan expense ....................................................... 5,144 4,607

Other .................................................................................................................................... 442 104

Changes in operating assets and liabilities:

Receivables, net of allowances ............................................................................................ 48,473 28,797

Inventories ........................................................................................................................... 12,787 5,839

Prepaid expenses and other assets ........................................................................................ (14,132) (20,475)

Income taxes ........................................................................................................................ (27,641) (919)

Accounts payable ................................................................................................................. (291) (1,905)

Accrued and other long-term liabilities ............................................................................... (113,162) (52,170)

Cash flow provided by operating activities .......................................................................... 79,633 75,600

Investing Activities

Cash received from sales of assets ....................................................................................... 27,398 30,189

Capital expenditures ............................................................................................................ (28,361) (139,880)

Sales of restricted investments ............................................................................................. 2,386 3,977

Purchases of restricted investments ..................................................................................... (538) (80)

Investments in non-consolidated affiliates ........................................................................... (357) (739)

Restricted cash and deposits ................................................................................................ 1,180 3,248

Related party notes .............................................................................................................. –– 20,000

Other .................................................................................................................................... 154 (1,737)

Cash flow provided by (used in) investing activities ........................................................... 1,862 (85,022)

Financing Activities

Short-term debt borrowings ................................................................................................. 16,751 2,570

Short-term debt repayments ................................................................................................. (29,362) (49,452)

Long-term debt borrowings ................................................................................................. 1,441,270 632,904

Long-term debt repayments ................................................................................................. (1,356,135) (526,794)

Payment of debt issuance costs ............................................................................................ (25,421) (3,973)

Payment of initial public offering transaction costs ............................................................. (1,555) ––

Dividends paid to noncontrolling interests .......................................................................... (668) (618)

Dividends paid to DFC Holdings, LLC ............................................................................... –– (53,936)

Cash flow provided by financing activities .......................................................................... 44,880 701

Effect of foreign currency exchange rate changes on cash .................................................. 3,077 (310)

Increase (decrease) in cash and cash equivalents ................................................................. 129,452 (9,031)

Cash and cash equivalents at beginning of period ............................................................... 36,628 83,210

Cash and cash equivalents at end of period ......................................................................... $ 166,080 $ 74,179

Supplemental cash flow information:

Accrued property, plant and equipment ............................................................................ $ 1,890 $ 834

Income tax payments, net of refunds ................................................................................ 28,298 15,961

Interest payments on borrowings ...................................................................................... 47,082 41,369

See Notes to Unaudited Condensed Consolidated Financial Statements

5

DOLE FOOD COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY

(Unaudited)

Equity Attributable to Dole Food Company, Inc.

Accumulated Other

Comprehensive Income (Loss)

Common

Shares

Outstanding

Common

Stock

Additional

Paid-In

Capital

Notes

Receivable

from

Affiliates

Accumulated

Deficit

Pension &

Other

Postretirement

Benefits

Cumulative

Translation

Adjustment

Equity

Attributable to

Noncontrolling

Interests

Total

Equity

(In thousands)

Balance at January 2, 2016 .................... 1 $ — $ 796,184 $ $ –– $ (140,993) $ (17,276) $ (55,912) $ 8,254 $ 590,257 Net income (loss) ................................... — — — — 35,368 — — 625 35,993 Notes receivable from affiliates ............. –– –– –– (14,203) –– –– –– –– (14,203)

Dividends paid ....................................... — — — — (53,936) — — (618) (54,554)

Foreign currency translation

adjustment, net of income tax of $0 .. — — — — — — 6,921 — 6,921

Balance at October 8, 2016 .................... 1 $ — $ 796,184 $ $ (14,203) $ (159,561) $ (17,276) $ (48,991) $ 8,261 $ 564,414

Balance at December 31, 2016 .............. 1 $ — $ 796,184 $ $ (14,000) $ (224,972) $ (24,052) $ (64,324) $ 8,362 $ 477,198

Net income (loss) ................................... –– –– –– –– 42,754 –– –– 589 43,343

Interest receivable from affiliates .......... –– –– 510 (510) –– –– –– –– ––

Dividends paid ....................................... –– –– –– –– –– –– –– (668) (668)

Foreign currency translation

adjustment, net of income tax of $0 .. –– –– –– –– –– –– 23,931 –– 23,931

Balance at October 7, 2017 .................... 1 $ — $ 796,694 $ $ (14,510) $ (182,218) $ (24,052) $ (40,393) $ 8,283 $ 543,804

See Notes to Unaudited Condensed Consolidated Financial Statements

6

DOLE FOOD COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 — BASIS OF PRESENTATION

In the opinion of management, the unaudited condensed consolidated financial statements of Dole Food

Company, Inc. and its consolidated subsidiaries (“Dole” or the “Company”) include all adjustments necessary, which

are of a normal recurring nature, to present fairly Dole’s financial position, results of operations and cash flows. Dole

operates under a 52/53-week year. The quarters ended October 7, 2017 and October 8, 2016 were sixteen weeks in

duration. For a summary of significant accounting policies and additional information relating to Dole’s financial

statements, refer to the notes of Dole’s consolidated financial statements for the year ended December 31, 2016.

Interim results are subject to seasonal variations and are not necessarily indicative of the results of operations

for a full year. Dole’s operations are sensitive to a number of factors including weather-related phenomena and their

effects on industry volumes, prices, product quality and costs. Operations are also sensitive to fluctuations in foreign

currency exchange rates in both sourcing and selling locations as well as economic crises and security risks.

Dole was incorporated under the laws of Delaware in 2001 and was reincorporated under the laws of North

Carolina in September 2016.

On April 24, 2017, Dole filed an S-1 registration statement with the Securities and Exchange Commission to

begin the initial public offering process.

NOTE 2 — NEW ACCOUNTING PRONOUNCEMENTS

In August 2015, the Financial Accounting Standards Board (“FASB”) issued guidance which defers the

effective date by one year of a previously issued guidance to revise the revenue recognition requirements for all

entities. The previously issued guidance was issued in May 2014, which revised revenue recognition requirements to

clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and

International Financial Reporting Standards (“IFRS”). The core principle is that revenue should be recognized to

depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which

the entity expects to be entitled in exchange for those goods or services. The accounting amendment is effective for

annual reporting periods beginning after December 15, 2017, including interim reporting periods within those

reporting periods, with provisions for earlier application. The amendment can be adopted either retrospectively in each

prior reporting period presented or using a modified retrospective approach with the cumulative effect of initially

applying the amendment recognized in retained earnings upon adoption at the date of initial application.

Dole has not yet determined what transition method it will use and is currently assessing the impact that the

future adoption of this guidance may have on its Consolidated Financial Statements. Dole is currently in the process

of analyzing its customer contracts and other arrangements to identify policy differences in applying the new guidance.

Based on Dole’s preliminary analysis of its customer contracts, Dole expects that substantially all of its revenues will

continue to be recognized at a point in time, generally upon shipment of products, consistent with Dole’s current

revenue recognition model. In certain instances, the consideration received under customer contracts includes variable

consideration related to volume discounts, rebates, and other promotional items given to customers that are currently

reflected as a reduction in revenues, and Dole is currently in the process of identifying any potential differences in

applying the new guidance to these items. With respect to certain costs incurred to acquire new contracts with

customers (i.e. selling costs), the adoption of the new requirements may result in Dole deferring additional costs on

the Consolidated Balance Sheets and subsequently amortizing these costs to the Consolidated Statement of Operations

over the expected customer life or contract period. Our evaluation of the revised revenue recognition requirements is

ongoing and not complete.

In March 2016, the FASB issued guidance which simplifies the accounting for equity method investments if an

investment becomes eligible to use the equity method of accounting as a result of increase in the level of ownership

or influence by removing the requirement for an entity to retroactively adopt the equity method of accounting. The

amendment also requires for the cost of acquiring the additional interest in the investee to be added to the equity

method investor’s current basis of its previously held interest and implement the equity method of accounting as of

the date the investment qualifies for equity method accounting. The accounting amendment is effective for annual

periods, and interim periods within those periods, beginning after December 15, 2016. The adoption of this guidance

did not have a material impact on Dole’s consolidated financial statements.

7

In October 2016, the FASB issued guidance which requires a single decision maker of a variable interest entity

(“VIE”) to consider indirect economic interests in the entity held through related parties that are under common control

on a proportionate basis when determining whether it is the primary beneficiary of that VIE. The amendment does not

change the existing characteristics of a primary beneficiary. The accounting amendment is effective for annual periods

beginning after December 15, 2016, including interim periods within those annual periods. The adoption of this

guidance did not have a material impact on Dole’s consolidated financial statements.

In March 2017, the FASB issued guidance which requires an employer to report the service cost component in

the same line item or items as other compensation costs arising from services rendered by the pertinent employees

during the period. The other components of net benefit cost are required to be presented in the income statement

separately from the service cost component and outside a subtotal of income from operations, if one is presented. The

accounting amendment is effective for fiscal years beginning after December 15, 2017, and interim periods within

those fiscal years. Earlier application of this amendment is permitted and must be applied retrospectively for the

presentation of the service cost component and the other components of net periodic pension cost and net periodic

postretirement benefit cost in the income statement. The adoption of this guidance is not expected to have a material

impact on Dole’s consolidated financial statements.

NOTE 3 — OTHER INCOME (EXPENSE), NET

Included in other income (expense), net in Dole’s unaudited condensed consolidated statements of operations

are the following items:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands) Unrealized gain (loss) on foreign

denominated intercompany borrowings . $ (8,110) $ 1,214 $ (15,500) $ (10,235)

Realized gain on foreign denominated

intercompany borrowings .......................

––

–– 634 6,479

Refinancing charges .................................... (94) –– (17,467) ––

Gain on derivative instruments.................... 2,754 –– 5,644 ––

Gain on investments .................................... 705 1,292 2,654 2,302

Other............................................................ 14 110 476 531

Other income (expense), net ........................ $ (4,731) $ 2,616 $ (23,559) $ (923)

NOTE 4 — CHARGES FOR RESTRUCTURING

In the third quarter of 2017, Dole committed to a restructuring plan for its berry operations to ensure alignment

with its growth objectives. As part of this plan, Dole will close its berry farms in the United States (“U.S.”) and reduce

its workforce. Dole will continue to sell berries in the U.S. that will be sourced elsewhere.

As a result of this restructuring plan, Dole incurred restructuring costs of $8.9 million. Of the total charges

incurred, $8.5 million is included in cost of products sold, and $0.4 million is included in selling, marketing and

general and administrative expenses in the unaudited condensed consolidated statement of operations for the quarter

ended October 7, 2017. During the same period, severance and other employee-related charges for employee

terminations involved 184 employees.

8

The following table summarizes the restructuring charges:

Charges

Incurred

During the

Quarter Ended

October 7, 2017

(In thousands)

Severance and other employee-related costs ............................................................ $ 925

Asset write-downs and accelerated depreciation ...................................................... 6,978

Lease abandonment costs ......................................................................................... 1,032 Total charges incurred .............................................................................................. $ 8,935

Of the total charges incurred, $1.4 million were included in restructuring liabilities, which are classified in

accrued liabilities in the unaudited condensed consolidated balance sheet at October 7, 2017.

In connection with this restructuring plan, Dole expects to incur an additional $15.9 million in restructuring

costs over the next year.

NOTE 5 — LONG-TERM RECEIVABLES

At October 7, 2017, Dole’s long-term financing receivables consisted of $14.7 million of grower advances, net

of $2.0 million of allowances. At December 31, 2016, Dole’s long-term financing receivables consisted of $12.9

million of grower advances, net of $2.1 million of allowances. These assets have been included in other assets, net in

the unaudited condensed consolidated balance sheets.

Dole monitors the collectability of grower advances through periodic review of financial information received

from growers. Dole’s historical losses on its long-term grower advances have been immaterial and Dole expects this

to continue.

NOTE 6 — INCOME TAXES

Dole recorded an income tax benefit of $7.7 million on $34.7 million of pretax income from continuing

operations for the three quarters ended October 7, 2017. The income tax benefit included interest income of $0.4

million related to Dole’s unrecognized tax benefits. Income tax expense of $6.4 million on $48.2 million of pretax

income from continuing operations was recorded for the three quarters ended October 8, 2016, which included interest

expense of $2.5 million related to Dole’s unrecognized tax benefits. Dole’s effective tax rate varies significantly from

period to period due to the level, mix and seasonality of earnings generated in its various U.S. and foreign jurisdictions.

For the three quarters ended October 7, 2017, Dole’s effective tax rate differs from the U.S. federal statutory rate

primarily due to a decrease in Dole’s total amount of unrecognized tax benefits which included $22 million as a result

of the expiration of the statute of limitations concerning certain transfer pricing issues. Including interest, net of tax

benefits, the total amount recorded for this item was $24.2 million. For the three quarters ended October 8, 2016,

Dole’s effective tax rate differed from the U.S. federal statutory rate primarily due to foreign earnings taxed at a lower

rate and a decrease in Dole’s total amount of unrecognized tax benefits of $6 million as a result of the expiration of

the statute of limitations concerning certain transfer pricing items.

Dole is required to adjust its effective tax rate for each quarter to be consistent with the estimated annual

effective tax rate. Jurisdictions with a projected loss where no tax benefit can be recognized are excluded from the

calculation of the estimated annual effective tax rate. This could result in a higher or lower effective tax rate during a

particular quarter based upon the mix and timing of actual earnings versus annual projections.

Dole recognizes accrued interest and penalties related to its unrecognized tax benefits as a component of income

taxes in the unaudited condensed consolidated statements of operations. Accrued interest and penalties before tax

benefits were $19.3 million and $20.5 million at October 7, 2017 and December 31, 2016, respectively. The net

decrease in accrued interest of $1.2 million for the quarter ended October 7, 2017 includes a payment of $0.8 million

relating to audit settlements in Peru. Accrued interest and penalties at the quarter ended October 7, 2017 are included

as a component of other long-term liabilities in the unaudited condensed consolidated balance sheets.

Dole Food Company, Inc. or one or more of its subsidiaries files income tax returns in the U.S. federal

jurisdiction, and various states and foreign jurisdictions. Dole is no longer subject to U.S. federal income tax

9

examinations by tax authorities for years prior to 2014. With few exceptions, Dole is no longer subject to state and

local or non-U.S. income tax examinations by tax authorities for years prior to 2011.

Income Tax Audits: Dole believes its tax positions comply with the applicable tax laws and that it has

adequately provided for all tax related matters. Matters raised upon audit may involve substantial amounts and could

result in material cash payments if resolved unfavorably. Management considers it unlikely that the resolution of these

matters will have a material adverse effect on Dole’s results of operations.

Costa Rica Tax Assessment: During the second quarter of 2011, Dole received an income tax assessment in

Costa Rica in the amount of approximately $43.0 million, including interest and penalties, relating to the audit of the

years 2006 and 2007. Dole has been challenging the assessment and believes it is without merit. In November 2016,

Dole received notice that the review by the Costa Rican Administrative Tax Tribunal confirmed the assessment of the

tax authorities. In response, on September 4, 2017 Dole filed an administrative lawsuit with the judicial branch of the

Costa Rican government together with a precautionary measure designed to prevent the tax administration from

enforcing the assessment while the lawsuit is pending. The Court has preliminarily granted our request for a

precautionary measure, pending further argument. If the precautionary measure is not granted with finality, Dole may

be required to pay a deposit for the full amount of the assessment, pay the deposit in installment payments, or post

collateral.

NOTE 7 — INVENTORIES

The major classes of inventories were as follows:

October 7, 2017

December 31, 2016

(In thousands) Finished products ............................................................................... $ 94,054 $ 95,682

Raw materials and work in progress .................................................. 69,438 66,071

Crop-growing costs ............................................................................ 43,067 59,425

Operating supplies and other.............................................................. 21,773 20,667

$ 228,332 $ 241,845

NOTE 8 — ASSETS HELD-FOR-SALE AND ACTIVELY MARKETED PROPERTY

Dole continuously reviews its assets in order to identify those assets that do not meet Dole’s future strategic

direction or internal economic return criteria. As a result of this review, Dole has identified and is in the process of

selling certain assets which are classified as either held-for-sale or actively marketed property. The assets that have

been identified are available for sale in their present condition and an active program is underway to sell the properties.

Dole is actively marketing these properties at a price that is in excess of book value, but the timing of sale is uncertain.

Assets held-for-sale were as follows:

Fresh Fruit

Fresh Vegetables

Other

Total

(In thousands)

Balance as of December 31, 2016 .................... $ 27 $ 2,747 $ 3,912 $ 6,686

Additions .......................................................... –– –– 25,213 25,213

Sales ................................................................. (27) (856) (17,168) (18,051)

Reclassifications ............................................... –– (1,891) –– (1,891)

Balance as of October 7, 2017 ......................... $ –– $ –– $ 11,957 $ 11,957

10

Liabilities held-for-sale were as follows:

Other

(In thousands) Balance as of December 31, 2016 .............................................................................. $ 1,098

Additions .................................................................................................................... 8,776

Sales ............................................................................................................................ (8,579)

Balance as of October 7, 2017 .................................................................................... $ 1,295

The major classes of assets included in assets held-for-sale in the unaudited condensed consolidated balance

sheets were as follows:

Fresh Fruit

Fresh Vegetables

Other

Total

(In thousands)

Receivables, net of allowances ......................... $ –– $ –– $ –– $ ––

Prepaid expenses .............................................. –– –– 128 128

Property, plant and equipment, net ................... –– –– 11,829 11,829

Balance as of October 7, 2017 ......................... $ –– $ –– $ 11,957 $ 11,957

At October 7, 2017, liabilities held-for-sale of $1.3 million have been included in accrued liabilities in the

unaudited condensed consolidated balance sheets.

During the second quarter of 2016, Dole approved and committed to a formal plan to divest its Swedish fresh

fruit procurement and distribution operation. During the fourth quarter of 2016, Dole entered into a definitive

agreement to sell its Swedish fresh fruit procurement and distribution operation with a book value of $7.9 million and

the transaction closed in January 2017 (see Note 17).

During the fourth quarter of 2016, Dole restructured its berries operations and planned to divest certain farms

and facilities. During the first quarter of 2017, Dole sold certain assets related to the berries operations with a book

value of $0.9 million.

In March 2017, Dole entered into an agreement to sell its Swedish flowers business. Dole sold its Swedish

flowers business with a net book value of $0.7 million during the second quarter of 2017 (see Note 17).

During the second quarter of 2017, Dole approved and committed to a formal plan to divest certain real estate

assets in Sweden with a net book value of $10.7 million, and concluded that it met the requirements to be presented

as assets and liabilities held-for-sale.

Actively marketed property was as follows:

Actively

Marketed

Property

(In thousands)

Balance as of December 31, 2016 ................................................................................ $ 126,716

Sales ............................................................................................................................. (15,524)

Reclassifications .......................................................................................................... (2,750)

Balance as of October 7, 2017 ..................................................................................... $ 108,442

At December 31, 2016, actively marketed property consisted of approximately 17,100 acres of Hawaii land,

with a net book value of $123.7 million, land in Latin America with a net book value of $0.2 million and real estate

of the former fresh-cut flowers division with a net book value of $2.8 million. During the first quarter of 2017, Dole

sold approximately 2,100 acres of land in Hawaii with net book value of $3.6 million. In addition, Dole reclassified

approximately 200 acres of Hawaii land to property, plant and equipment. During the third quarter of 2017, Dole sold

approximately 500 acres of land in Hawaii with a total net book value of $11.9 million. At October 7, 2017, actively

marketed Hawaii land consisted of approximately 14,300 acres, with a net book value of $105.5 million.

11

Gains (losses) before income taxes on assets held-for-sale and actively marketed property were as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands) Fresh fruit ..................................................... $ (485) $ 8,322 $ (685) $ 15,130 Fresh vegetables ........................................... –– –– 524 ––

Other ............................................................ 610 –– 2,213 ––

Total ............................................................. $ 125 $ 8,322 $ 2,052 $ 15,130

Net proceeds from assets held-for-sale and actively marketed property were as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands) Fresh fruit ..................................................... $ 11,436 $ 11,214 $ 14,866 $ 32,458 Fresh vegetables ........................................... –– –– 1,380 ––

Other ............................................................ –– –– 10,504 ––

Total ............................................................. $ 11,436 $ 11,214 $ 26,750 $ 32,458

NOTE 9 — GOODWILL AND INTANGIBLE ASSETS

The balance of goodwill has been allocated to Dole’s reporting segments as follows:

Fresh Fruit

Fresh Vegetables

Other

Total

(In thousands)

Balance as of December 31, 2016 ....................... $ 228,920 $ 110,920 $ 5,663 $ 345,503

Disposals ............................................................. –– –– (5,663) (5,663)

Balance as of October 7, 2017 ............................ $ 228,920 $ 110,920 $ –– $ 339,840

In January 2017, Dole sold the Swedish fresh fruit procurement and distribution operation. As a result of the

sale, $5.1 million of goodwill allocated to the operation was included in the disposal. In May 2017, Dole sold its

Swedish flowers business. As a result of the sale, $0.6 million of goodwill allocated to the flowers business was

included in the disposal.

Details of Dole’s intangible assets were as follows:

October 7, 2017

December 31, 2016

(In thousands) Amortizing intangible assets:

Gross carrying amount ................................................................... $ 4,144 $ 4,068

Accumulated amortization ............................................................. (1,979) (1,592)

Amortizing intangible assets, net ........................................................ 2,165 2,476

Indefinite-lived intangible assets:

Dole brand ...................................................................................... 250,000 250,000

Water rights .................................................................................... 4,200 4,202

Total intangible assets, net .................................................................. $ 256,365 $ 256,678

12

Amortization expense of intangible assets totaled $0.2 million and $0.2 million for the quarters ended October

7, 2017 and October 8, 2016, respectively, and $0.4 million and $0.4 million for the three quarters ended October 7,

2017 and October 8, 2016, respectively.

As of October 7, 2017, the estimated amortization expense associated with Dole’s intangible assets for each of

the next five fiscal years is as follows:

Fiscal Year

Amount

(In thousands)

2017 (remainder of year) ..................................................................... $ 123

2018 .................................................................................................... 534

2019 .................................................................................................... 534

2020 .................................................................................................... 534

2021 .................................................................................................... 417

Dole evaluates goodwill and indefinite-lived intangible assets for impairment annually during the fourth quarter,

or more frequently if an event occurs or circumstances change that would indicate that impairment may exist. As

market conditions change, Dole continues to monitor and perform updates of its impairment testing of recoverability

of goodwill and long-lived assets.

NOTE 10 — NOTES PAYABLE AND LONG-TERM DEBT

Notes payable and long-term debt consisted of the following:

October 7, 2017

December 31, 2016

(In thousands) Secured debt:

Revolving credit facility ................................................................. $ –– $ 63,100

7.25% notes due 2019 .................................................................... –– 300,000

7.25% notes due 2025 .................................................................... 300,000 ––

Term loan ....................................................................................... 944,063 781,500

Vessel financing loan facility ......................................................... 97,125 104,063

Other financing arrangements ........................................................ 41,920 42,751

Notes payable and note agreements, at a weighted average interest

rate of 6.1% in 2017 (2.4% in 2016) .............................................. 2,708 15,437

Capital lease obligations, at a weighted average interest rate of 4.6%

in 2017 (4.6% in 2016)................................................................... 1,741 2,486

1,387,557 1,309,337

Unamortized debt discounts and debt issuance costs .......................... (23,833) (15,799)

1,363,724 1,293,538

Current maturities, net of unamortized debt discounts and debt

issuance costs ................................................................................. (37,156) (74,005)

Long-term debt, net ............................................................................. $ 1,326,568 $ 1,219,533

Term Loan, ABL Revolving Credit Facility and Senior Secured Notes

On April 6, 2017, Dole entered into a new term loan credit agreement (the “new term loan”) and a new asset-

based revolving credit agreement (the “new ABL revolver “) with certain lenders (the new term loan and the new ABL

revolver, together, the “new credit facilities”).

The new credit facilities include syndicated borrowings under a new term loan of $950.0 million, that bears

interest, at Dole’s option, at either (i) LIBOR plus 2.75% to 3.00%, with a LIBOR floor of 1.00% or (ii) a base rate

plus 1.75% to 2.00%, in each case, based on Dole’s first lien net leverage ratio. Commencing on September 30, 2017,

principal payments of approximately $5.9 million are due quarterly during the first four years and principal payments

13

of approximately $11.9 million are due quarterly during the remainder of the term of the facility, plus a balloon

payment due on the maturity date of April 6, 2024. At October 7, 2017, amounts outstanding under the term loan were

$944.1 million.

The new ABL revolver, under which the participating lenders committed to lend up to the lesser of the (i) the

amount of the borrowing base available thereunder and (ii) $175.0 million, which includes a commitment to make up

to $125.0 million of loans to Dole and up to $50.0 million which may be borrowed by Solvest, Ltd., a wholly-owned

subsidiary of Dole. The annual interest rate on amounts drawn under the new ABL revolver is, at Dole’s option, either

(i) LIBOR plus 1.50% to 2.00%, with no LIBOR floor, or (ii) a base rate plus 0.50% to 1.00%, in each case, based

upon Dole’s average historical excess availability under the new ABL revolver. All amounts outstanding under the

new ABL revolver are due on April 6, 2022. At October 7, 2017, there were no borrowings under the new ABL

revolver.

Dole’s borrowings under the new credit facilities are secured by substantially all the U.S. assets of Dole and its

material domestic subsidiaries. The borrowings of Solvest, Ltd. under the new ABL revolver are secured by

substantially all the assets of Dole’s material Bermudan subsidiaries.

Additionally, on April 6, 2017, Dole completed the sale and issuance of $300.0 million aggregate principal

amount of 7.25% Senior Secured Notes due June 15, 2025 (“2025 Notes”). The 2025 Notes were sold to qualified

institutional investors pursuant to Rule 144A under the Securities Act of 1933 (“Securities Act”), and to persons

outside the U.S. in compliance with Regulation S under the Securities Act, who are exempt from the registration

requirements of the Securities Act. Interest on the 2025 Notes will be paid semi-annually in arrears on June 15 and

December 15 of each year, beginning on December 15, 2017. The 2025 Notes have a lien on substantially all of the

assets of Dole and its material U.S. subsidiaries that is junior to the liens securing the obligations under the new credit

facilities, and are senior obligations ranking equally with Dole’s existing senior debt.

The proceeds of the 2025 Notes and the new term loan were used to refinance Dole’s then outstanding

indebtedness under the existing term loan, the existing ABL revolver, and to redeem the $300.0 million aggregate

principal amount of 7.25% Notes due 2019. On April 6, 2017, in connection with the early redemption of the Notes

due 2019, Dole paid an early redemption premium of $5.4 million.

Vessel Financing Loan Facility

On December 11, 2015, Dole entered into secured loan facilities (“vessel facility”) of up to $111.0 million, in

the aggregate, to finance a portion of the acquisition costs of its three new vessels. The vessel facility consists of three

tranches, each tied to a specific vessel, allowing Dole to borrow up to 70% or $37.0 million of the contract cost of

each vessel, collateralized by the completed vessel. Principal and interest payments are due quarterly in arrears for

48 consecutive installments commencing three months after the initial drawdown date of each tranche. The vessel

facility bears interest, at a rate per annum equal to LIBOR plus 2.0% to 3.25% and will mature on December 11,

2027. At October 7, 2017, Dole’s borrowings under the vessel facility were $97.1 million.

Other Financing Arrangements

On June 23, 2016, Dole acquired approximately 1,000 gross hectares of farms in Chile for $36.0 million. In

connection with the purchase, Dole entered into a secured long-term asset financing arrangement for $28.8 million to

finance 80% of the farm purchase. The terms of the financing arrangement include a 5-year loan of $5.7 million due

in June 2021, and a 10-year loan of $23.1 million due in June 2026. The 5-year loan bears interest at a rate per annum

equal to LIBOR plus 2.60%, and the 10-year loan bears interest at a rate per annum equal to LIBOR plus 3.15%.

Principal and interest payments are due bi-annually in arrears. The long-term financing arrangement is collateralized

by the farms and related assets. At October 7, 2017, Dole’s borrowings under this arrangement were $25.9 million.

On July 1, 2016, Dole acquired approximately 837 gross hectares of pineapple farms in Costa Rica. In

connection with the purchase, Dole entered into a secured long-term asset financing arrangement for up to $16.0

million to finance the farm purchase. The term of the financing arrangement includes a 10-year loan of $16.0 million

due in July 2026. The 10-year loan bears interest at a rate per annum equal to LIBOR plus 5%, adjustable quarterly,

with a floor rate of 5.5% per annum. Interest only payments are due monthly in arrears for the first two years, after

which principal and interest installments are due monthly in arrears. The long-term financing arrangement is

collateralized by the farms and related assets. At October 7, 2017, Dole’s borrowings under this arrangement were

$16.0 million.

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Notes Payable and Note Agreements

Dole borrows funds primarily on a short-term basis to finance current operations. There were $2.7 million of

note agreements outstanding at October 7, 2017.

Capital Lease Obligations

At October 7, 2017, Dole’s capital lease obligations of $1.7 million, primarily relate to machinery and

equipment, which continue through 2019.

Covenants

Provisions under the new term loan and the new ABL revolver require Dole to comply with certain covenants.

These covenants include limitations on, among other things, indebtedness, investments, liens, loans to subsidiaries,

employees and third parties, the issuance of guarantees and the payment of dividends. If the availability under the new

ABL revolver were to fall equal to or below the greater of (i) $25.0 million and (ii) 20% of the lesser of the Line Cap

(as defined in the definitive documentation for the new ABL revolver, but which is $130.4 million as of October 7,

2017) at such time and the borrowing base at such time, then Dole would additionally be required to comply with a

minimum fixed charge coverage ratio covenant. At October 7, 2017, Dole had sufficient availability, and the additional

covenant under the new ABL revolver was not applicable.

The new term loan requires Dole to maintain compliance with a maximum first lien net leverage ratio, which

will initially be set at 6.00 to 1.00 beginning the third fiscal quarter 2017, with step-downs to (i) 5.75 to 1.00 for each

fiscal quarter of the 2019 and 2020 fiscal years and (ii) 5.50 to 1.00 for each fiscal quarter thereafter.

A breach of a covenant or other provision in any debt instrument governing Dole’s current or future indebtedness

could result in a default under that instrument and, due to customary cross-default and cross-acceleration provisions,

could result in a default under Dole’s other debt instruments. Upon the occurrence of an event of default under the

new credit facilities or other debt instruments, the lenders or holders of such debt could elect to declare all amounts

outstanding to be immediately due and payable and terminate all commitments to extend further credit. If Dole were

unable to repay those amounts, the lenders could proceed against the collateral granted to them, if any, to secure the

indebtedness. If the lenders under Dole’s indebtedness were to accelerate the payment of the indebtedness, Dole cannot

give assurance that its assets would be sufficiently liquid to repay in full its outstanding indebtedness on an accelerated

basis.

Debt Issuance Costs and Debt Discounts

Debt issuance costs and debt discounts related to the line-of-credit arrangements are capitalized as an asset and

amortized into interest expense over the term of the underlying arrangement using the effective interest rate method.

All other debt issuance costs and debt discounts are reflected as a direct reduction to the debt liability to which they

relate and are amortized into interest expense over the term of the underlying debt.

In connection with the new credit facilities and refinancing, Dole recorded expense of $17.5 million during the

three quarters ended October 7, 2017 related to the debt issuance costs, write-off of debt discount and prepayment

penalty on early retirement of debt, which is included in other income (expense), net in the accompanying unaudited

condensed consolidated statement of operations.

The amortization expense related to Dole’s deferred debt issuance costs and debt discounts were recorded in the

unaudited condensed consolidated statements of operations as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands) Interest expense ........................................... $ 1,215 $ 2,005 $ 3,704 $ 5,029

15

NOTE 11 — EMPLOYEE BENEFIT PLANS

The components of net periodic benefit cost for Dole’s U.S. and international pension plans and other

postretirement benefit (“OPRB”) plans were as follows:

U.S. Pension Plans

International

Pension Plans

OPRB Plans

Quarter Ended Quarter Ended Quarter Ended

October 7,

2017

October 8,

2016

October 7,

2017

October 8,

2016

October 7,

2017

October 8,

2016

(In thousands) Components of net periodic benefit cost:

Service cost ............................................. $ 73 $ 51 $ 1,295 $ 1,329 $ 7 $ 6 Interest cost ............................................. 2,646 2,818 1,504 1,406 316 341

Expected return on plan assets ................. (3,769) (3,995) –– –– –– ––

Amortization of: Net (gain) loss................................... 44 –– 74 (142) (14) (4)

Prior service benefit .......................... –– –– –– –– (250) (250)

Curtailments and settlements................... –– –– 359 696 –– ––

Net periodic benefit costs ....................... $ (1,006) $ (1,126) $ 3,232 $ 3,289 $ 59 $ 93

U.S. Pension Plans

International

Pension Plans

OPRB Plans

Three Quarters Ended Three Quarters Ended Three Quarters Ended

October 7,

2017

October 8,

2016

October 7,

2017

October 8,

2016

October 7,

2017

October 8,

2016

(In thousands) Components of net periodic benefit cost:

Service cost ............................................. $ 183 $ 127 $ 3,229 $ 3,332 $ 17 $ 16

Interest cost ............................................. 6,616 7,044 3,744 3,516 788 853

Expected return on plan assets ................. (9,423) (9,987) –– –– –– –– Amortization of:

Net (gain) loss................................... 110 –– 179 (356) (34) (10)

Prior service benefit .......................... –– –– –– –– (624) (624) Curtailments and settlements................... –– –– 359 696 –– ––

Net periodic benefit costs ....................... $ (2,514) $ (2,816) $ 7,511 $ 7,188 $ 147 $ 235

NOTE 12 — DERIVATIVE FINANCIAL INSTRUMENTS

Dole is exposed to foreign currency exchange rate fluctuations, bunker fuel price fluctuations and interest rate

changes in the normal course of its business. As part of the risk management strategy, Dole uses derivative instruments

to hedge some of these exposures. Dole’s objective is to offset gains and losses resulting from these exposures with

losses and gains on the derivative contracts used to hedge them, thereby reducing volatility of earnings. Dole does not

hold or issue derivative financial instruments for trading or speculative purposes.

To reduce cash flow volatility from foreign currency fluctuations, Dole may enter into foreign currency

exchange forward contracts and option contracts to hedge a portion of its forecasted revenue, cost of products sold,

operating expense, and certain intercompany borrowing transactions. Additionally, to mitigate the price uncertainty

of future purchases of bunker fuel, Dole enters into bunker fuel swap contracts. Dole’s foreign currency exchange

forward contracts, option contracts, and bunker fuel swap contracts are not designated as hedging instruments.

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Net gains (losses) on derivatives were as follows:

Classification in

Statement of Operations

Quarter Ended

October 7, 2017

October 8, 2016

(In thousands)

Foreign currency exchange contracts ............. Cost of products sold $ (7,405) $ 481 Foreign currency exchange contracts ............. Other income (expense), net 2,754 93

Bunker fuel hedges ......................................... Cost of products sold 492 331

$ (4,159) $ 905

Classification in

Statement of Operations

Three Quarters Ended

October 7, 2017

October 8, 2016

(In thousands)

Foreign currency exchange contracts ............. Cost of products sold $ (19,013) $ (4,550) Foreign currency exchange contracts ............. Other income (expense), net 5,644 93

Bunker fuel hedges ......................................... Cost of products sold (264) 1,176

$ (13,633) $ (3,281)

Settlement of Dole’s foreign currency exchange contracts and bunker fuel hedges will occur through December

2018.

NOTE 13 — FAIR VALUE MEASUREMENTS

At October 7, 2017, Dole’s financial instruments primarily consisted of cash and cash equivalents, restricted

cash and investments, short-term trade and grower receivables, trade payables, notes receivable and notes payable, as

well as long-term grower receivables, derivatives, capital lease obligations, asset-based loans, term loan, credit

facilities and notes. Cash and cash equivalents include investments in money market funds that are valued based on

the net asset value of the funds. For short-term instruments, excluding Dole’s restricted investments and derivatives

which are recorded at fair value, the carrying amount approximates fair value because of the short maturity of these

instruments. For long-term financial instruments, excluding Dole’s secured notes, term loan and long-term restricted

investments, the carrying amount approximates fair value since they bear interest at variable rates or fixed rates that

approximate market.

The inputs used to measure fair value are based on a hierarchy that prioritizes observable and unobservable

inputs used in valuation techniques. These levels, in order of highest to lowest priority, are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for

identical assets or liabilities.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by

market data.

Level 3: Unobservable inputs that are not corroborated by market data.

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The following tables provide a summary of the assets and liabilities measured at fair value on a recurring basis:

Fair Value Measurements at October 7, 2017 Using

Balance Sheet

Classification

Quoted Prices in

Active Markets for

Identical Assets

(Level 1)

Significant

Other

Observable

Inputs

(Level 2)

Significant

Unobservable

Inputs

(Level 3)

Total

(In thousands)

Money market funds: Cash equivalents $ 72,000 $ — $ — $ 72,000

Foreign currency

exchange contracts: Receivables, net — 1,118 — 1,118

Accrued liabilities — (4,868) — (4,868)

Other long-term

liabilities — (559) — (559) 72,000 (4,309) — 67,691

Bunker fuel hedges: Receivables, net — 436 –– 436

Rabbi trust investments (various mutual funds) 4,125 8,266 17,917 30,308 Total .................................................................. $ 76,125 $ 4,393 $ 17,917 $ 98,435

Fair Value Measurements at December 31, 2016 Using

Balance Sheet

Classification

Quoted Prices in

Active Markets for

Identical Assets

(Level 1)

Significant

Other

Observable

Inputs

(Level 2)

Significant

Unobservable

Inputs

(Level 3)

Total

(In thousands)

Foreign currency

exchange contracts: Receivables, net $ — $ 16,756 $ — $ 16,756

Accrued liabilities — (1,399) — (1,399) — 15,357 — 15,357

Bunker fuel hedges: Receivables, net — 1,781 –– 1,781

Rabbi trust investments (various mutual funds) 4,316 8,483 17,240 30,039 Total ................................................................... $ 4,316 $ 25,621 $ 17,240 $ 47,177

The table below sets forth a summary of changes in the fair value of the Level 3 Rabbi trust investments for the

three quarters ended October 7, 2017:

Fair Value Measurements

Using Significant Unobservable Inputs (Level 3)

(In thousands) Balance as of December 31, 2016 .................................................................... $ 17,240

Net realized and unrealized gains recognized in earnings(1) ........................ 1,641

Net purchases and sales ............................................................................... (964)

Balance as of October 7, 2017 ......................................................................... $ 17,917

(1) Net amount comprised realized gains of $0.1 million and unrealized gains of $1.5 million were recorded in

other income (expense), net in the unaudited condensed consolidated statements of operations.

For Dole, the assets and liabilities that are required to be recorded at fair value on a recurring basis are the money

market funds, derivative instruments and Rabbi trust investments. The fair values of Dole’s derivative instruments are

determined using Level 2 inputs, which are defined as “significant other observable inputs.” The fair values of the

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foreign currency exchange contracts and bunker fuel hedges were estimated using internal discounted cash flow

calculations based upon forward foreign currency exchange rates, bunker fuel futures, interest rate yield curves or

quotes obtained from brokers for contracts with similar terms, less any credit valuation adjustments.

Dole sponsors a non-qualified deferred compensation plan (Excess Savings Plan or “ESP”) and a non-qualified

pension plan (Supplemental Executive Retirement Plan or “SERP”) for executives. Trading securities are recorded at

fair value with realized and unrealized holding gains or losses included in earnings. At October 7, 2017, trading

securities totaled $30.3 million, of which $5.9 million was classified as short-term and included in restricted cash and

investments; $24.4 million was classified as long-term and included in other assets, net, in the unaudited condensed

consolidated balance sheets. Dole classified a portion of the investments held in the Rabbi trusts as long-term because

such portion approximated the liability held to satisfy the long-term SERP obligation. Dole estimates the fair values

of its Rabbi trust investments using prices provided by its custodian. In obtaining such data from its custodian, Dole

has evaluated the methodologies used to develop the estimate of fair value in order to assess whether such valuations

are representative of fair value, including net asset value. Fair values for Level 1 investments are determined based on

observable market prices. For Level 2 investments, the fair values are determined using observable inputs such as the

trading prices for similar securities traded in active markets. For Level 3 investments, fair values are determined using

a combination of discounted cash flow projections and other unobservable inputs.

In addition to assets and liabilities that are recorded at fair value on a recurring basis, Dole is required to record

assets and liabilities at fair value on a nonrecurring basis. Nonfinancial assets such as goodwill, indefinite-lived

intangible assets, equity method investments, and long-lived assets are measured at fair value when there is an

indicator of impairment and recorded at fair value only when an impairment is recognized.

The indefinite-lived intangible asset impairment analysis was performed by Dole during the fourth quarter of

2016 using a relief-from-royalty model. The discounted cash flow model used estimates and assumptions including

pricing and volume data, anticipated growth rates, profitability levels, tax rates and discount rates. The fair value of

the indefinite-lived intangible assets is highly sensitive to differences between estimates and actual cash flows and

changes in the related discount rate used to evaluate the fair value of these assets.

Credit Risk

The counterparties to the foreign currency exchange contracts consist of a number of major international

financial institutions. Dole has established counterparty guidelines and regularly monitors its positions and the

financial strength of these institutions. While counterparties to hedging contracts expose Dole to credit-related losses

in the event of a counterparty’s non-performance, the risk would be limited to the unrealized gains on such affected

contracts. Dole does not anticipate any such losses.

Fair Value of Debt

Dole estimates the fair value of its secured notes based on current quoted market prices. The term loan is traded

between institutional investors on the secondary loan market, and the fair value of the term loan is based on the last

available trading price.

The carrying values, net of debt discounts and debt issuance costs, and estimated fair values of Dole’s debt

based on Level 2 inputs in the fair value hierarchy are summarized below:

October 7, 2017

December 31, 2016

Carrying

Values

Estimated

Fair Values

Carrying

Values

Estimated

Fair Values

(In thousands) Secured notes ............................................ $ 294,624 $ 324,000 $ 295,774 $ 303,000

Term loan .................................................. $ 930,608 $ 946,423 $ 775,268 $ 786,058

NOTE 14 — COMMITMENTS AND CONTINGENCIES

Dole issues letters of credit and bank guarantees through its ABL revolver and, in addition, separately through

major banking institutions. Dole also provides bonds issued by insurance companies. These letters of credit, bank

guarantees and insurance company bonds are required by certain regulatory authorities, suppliers and other operating

agreements. As of October 7, 2017, total letters of credit, bank guarantees and bonds outstanding under these

arrangements were $70.0 million.

19

Dole also provides various guarantees, mostly to foreign banks, in the course of its normal business operations

to support the borrowings, leases and other obligations of its subsidiaries. Dole guaranteed $194.0 million of its

subsidiaries’ obligations to their suppliers and other third parties as of October 7, 2017.

Dole has change of control agreements with certain key executives, under which severance payments and

benefits would become payable in the event of specified terminations of employment in connection with a change of

control (as defined) of Dole.

Dole is involved from time to time in claims and legal actions incidental to its operations, both as plaintiff and

defendant. Dole has established what management currently believes to be adequate reserves for pending legal matters.

These reserves are established as part of an ongoing worldwide assessment of claims and legal actions that takes into

consideration such items as changes in the pending case load (including resolved and new matters), opinions of legal

counsel, individual developments in court proceedings, changes in the law, changes in business focus, changes in the

litigation environment, changes in opponent strategy and tactics, new developments as a result of ongoing discovery,

and past experience in defending and settling similar claims. In the opinion of management, after consultation with

legal counsel, the claims or actions to which Dole is a party are not expected to have a material adverse effect,

individually or in the aggregate, on Dole’s financial position or results of operations.

DBCP Cases: Dole is involved in lawsuits pending in the United States and in foreign countries alleging injury

as a result of exposure to the agricultural chemical DBCP (1,2-dibromo-3-chloropropane). Currently there are 180

lawsuits in various stages of proceedings alleging injury or seeking enforcement of Nicaragua judgments. In addition,

there are 65 labor cases pending in Costa Rica under that country’s national insurance program.

Settlements have been reached that, when fully implemented, will significantly cut DBCP litigation in Nicaragua

and the Philippines. Currently, claimed damages in DBCP cases worldwide total approximately $15.1 billion, with

lawsuits in Nicaragua representing approximately 92% of this amount. Twenty-four of the cases in Nicaragua have

resulted in judgments, although many of these are being eliminated as part of the current settlements. Dole believes

that none of the Nicaraguan judgments that are left will be enforceable against any Dole entity in the U.S. or in any

other country.

As to all the DBCP matters, Dole has denied liability and asserted substantial defenses. Dole believes there is

no reliable scientific basis for alleged injuries from the agricultural field application of DBCP. Nevertheless, Dole is

working to resolve all DBCP litigation and claims. Although no assurance can be given concerning the outcome of

the DBCP cases, in the opinion of management, after consultation with legal counsel and based on past experience

defending and settling DBCP claims, neither the pending lawsuits and claims nor their resolution are expected to have

a material adverse effect on Dole’s financial position or results of operations because the probable loss is not material.

Former Shell Site: Beginning in 2009, Shell Oil Company and Dole were sued in several cases filed in Los

Angeles Superior Court by the City of Carson and persons claiming to be current or former residents in the area of a

housing development built in the 1960s by a predecessor of what is now a Dole subsidiary, Barclay Hollander

Corporation (“BHC”), on land that had been owned and used by Shell as a crude oil storage facility for 40 years prior

to the housing development. The homeowner complaints allege property damage and personal injury, and the City of

Carson complaint alleges trespass and nuisance. Shell and these plaintiffs have settled the claims, and in September

2016, Dole and BHC similarly entered into a settlement agreement. The net amount of this settlement is not material

to Dole’s results of operations. Dole’s motion for good faith settlement was granted and the litigation has been

dismissed.

On May 6, 2013, Shell filed a complaint against Dole (which was later voluntarily dismissed), BHC, and Lomita

Development Company (“Lomita”), seeking indemnity for the costs associated with the lawsuits discussed above and

the cleanup discussed below, which as of the latest estimates from Shell totals $310 million. In addition to equitable

indemnity, Shell claimed that an early entry side agreement between Shell and an entity related to BHC contractually

requires BHC to indemnify Shell for anything related to the property. On March 15, 2017, however, the Court ruled

that neither BHC nor Lomita is an obligor under the contract. And on November 7, 2017, the Court rejected Shell’s

alter ego and successorship claims related to the contract. Trial on Shell’s equitable indemnity claims generally was

scheduled to begin on November 6, 2017, but all dates related to that trial were taken off calendar by the court and

have yet to be rescheduled.

On July 3, 2017, AIG filed a lawsuit in the Central District of California seeking a declaratory judgment that it

has no obligation to defend or indemnify BHC with regard to the Shell lawsuit. AIG has not, however, stated that it

will stop its current defense or otherwise change how it is responding to the lawsuit. Dole is in the process of analyzing

the claims made.

The California Regional Water Quality Control Board (“Water Board”) is supervising the cleanup on the former

Shell site. On March 11, 2011, the Water Board issued a Cleanup and Abatement Order (“CAO”) naming Shell as the

20

Discharger and a Responsible Party, and ordering Shell to assess, monitor, and cleanup and abate the effects of

contaminants discharged to soil and groundwater at the site. On April 30, 2015 the CAO was amended to also name

BHC as a discharger. BHC appealed this CAO revision to the California State Water Resources Control Board, which

appeal was denied by operation of law when the Board took no action. On September 30, 2015, BHC filed a writ

petition in the Superior Court challenging the CAO on several grounds. A trial was held on March 24, 2017, after

which the Court denied BHC’s petition. BHC has filed an appeal. A briefing schedule has not yet been ordered by the

court.

In the opinion of management, after consultation with legal counsel, the claims or actions related to the former

Shell site are not expected to have a material adverse effect, individually or in the aggregate, on Dole’s financial

position or results of operations because management believes the risk of loss is remote.

Springfield, Ohio Packaged Salads Recall: In late January 2016, Dole was advised by the U.S. Food and Drug

Administration (“FDA”) and the Centers for Disease Control and Prevention (“CDC”) that they suspected a multi-

state outbreak of listeria monocytogenes was linked to packaged salads produced at Dole Fresh Vegetables, Inc.’s

Springfield, Ohio facility. Dole responded by immediately ceasing all production activities at the Springfield facility

and issuing a voluntary withdrawal followed by a recall of packaged salads produced there. The Springfield facility

resumed production after extensive testing and a root cause investigation and analysis. Dole has received notice of

several claims of illness (and in two cases, death) potentially relating to this listeria outbreak, and is currently

defending against two lawsuits in Indiana state court, one in Michigan state court, one in New York state court, and

one in Ontario, Canada. Each of the pending cases is in the early stages. Dole’s insurance is participating in the defense

of the litigation and the claims. On April 29, 2016, Dole was served with a subpoena from the United States

Department of Justice (“DOJ”) seeking information for its investigation of the listeria outbreak and Dole’s Springfield

facility. Dole is in the process of responding to the DOJ subpoena. In the opinion of management, after consultation

with legal counsel, the claims or actions related to the packaged salads recall are not expected to have a material

adverse effect, individually or in the aggregate, on Dole’s financial position or results of operations because the

probable loss is not material.

NOTE 15 — RELATED PARTY TRANSACTIONS

Dole loaned to entities owned by Mr. Murdock $34.0 million in the form of interest bearing notes during the

second and third quarters of 2015. The notes bear interest at a rate of 4.75% per annum until paid in full. The

outstanding principal of the notes and unpaid interest were due and payable in full by December 31, 2015. On

December 31, 2015, Dole extended the notes such that the principal and unpaid interest were due and payable by June

30, 2016. During the second quarter of 2016, Dole’s affiliates repaid $21.6 million of the notes and interest. On July

1, 2016, Dole extended the $14.0 million notes such that the principal and unpaid interest were due and payable by

December 31, 2016. In connection with the extension, Dole reclassified the notes to shareholder’s equity due to

uncertainty related to the exact timing of the repayment. On December 31, 2016, Dole further extended the notes such

that the principal and unpaid interest are due and payable by December 31, 2017. At October 7, 2017, Dole had a

receivable of $14.5 million due from affiliates related to the notes and accrued interest, which were included in the

unaudited condensed consolidated statements of shareholder’s equity.

21

NOTE 16 — EARNINGS PER SHARE

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands, except per share data)

Income from continuing operations excluding

net income attributable to noncontrolling

interests, net of income taxes ......................... $ 5,599 $ 5,714 $ 42,708 $ 41,328 Income (loss) from discontinued operations

excluding net income attributable to

noncontrolling interests, net of income taxes 13 (7,043) 46 (5,960)

Net income (loss) attributable to shareholders

of Dole Food Company, Inc. .......................... $ 5,612 $ (1,329) $ 42,754 $ 35,368

Weighted average common shares outstanding

— Basic and Diluted: 1 1 1 1

Earnings Per Share — Basic and Diluted:

Income from continuing operations excluding

net income attributable to noncontrolling

interests, net of income taxes ......................... $ 5,599 $ 5,714 $ 42,708 $ 41,328 Income (loss) from discontinued operations

excluding net income attributable to

noncontrolling interests, net of income taxes 13 (7,043) 46 (5,960)

Net income (loss) attributable to shareholders

of Dole Food Company, Inc. .......................... $ 5,612 $ (1,329) $ 42,754 $ 35,368

NOTE 17 — BUSINESS SEGMENTS

Dole has two primary reportable segments: fresh fruit and fresh vegetables. These segments are managed

separately due to differences in geography, products, production processes, distribution channels and customer bases.

• Fresh Fruit - The fresh fruit reportable segment sells bananas, pineapples and deciduous fruit, which are

sourced from local growers or Dole-owned or leased farms primarily located in Latin America and South

Africa, with significant selling locations in North America and Western Europe.

• Fresh Vegetables - The fresh vegetables reportable segment sells packaged salads and has a line of fresh-

packed products that includes iceberg, romaine and leaf lettuces, celery, and fresh berries including

strawberries, blueberries, raspberries and blackberries. These products are sourced from North America

and Latin America and substantially all of the sales for fresh vegetables are generated in North America.

Dole also has an “Other” reportable segment that primarily procures and distributes fresh fruit in Sweden and

sells fresh cut flowers within Western Europe, and a corporate reporting segment. In January 2017, Dole sold the

Swedish fresh fruit procurement and distribution operation for 85 million Swedish krona in cash (approximately $9.5

million using the closing date exchange rate). Revenues from the Swedish fresh fruit procurement and distribution

operation were $0.7 million and $100.8 million in the quarters ended October 7, 2017 and October 8, 2016,

respectively. Revenues from the Swedish fresh fruit procurement and distribution operation were $1.8 million and

$266.3 million for the three quarters ended October 7, 2017 and October 8, 2016, respectively. EBIT from the Swedish

fresh fruit procurement and distribution operation were not material for all periods presented. During the second

quarter of 2017, Dole sold its Swedish flowers business for 9 million Swedish krona in cash (approximately $1.0

million using the closing date exchange rate). Revenues from the Swedish flowers business were $0 and $8.3 million

in the quarters ended October 7, 2017 and October 8, 2016, respectively. Revenues from the Swedish flowers business

were $17.3 million and $29.9 million for the three quarters ended October 7, 2017 and October 8, 2016, respectively.

EBIT from the Swedish flowers business were not material for all periods presented.

Dole’s management evaluates and monitors segment performance primarily through earnings before interest

expense and income taxes before discontinued operations (“EBIT”). EBIT is calculated by adding interest expense

and income taxes to income (loss) from continuing operations, net of income taxes. Management believes that segment

EBIT provide useful information for analyzing the underlying business results as well as allowing investors a means

to evaluate the financial results of each segment in relation to Dole as a whole.

22

Revenues, net were as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Fresh fruit ....................................... $ 942,101 $ 864,825 $ 2,488,479 $ 2,320,153

Fresh vegetables.............................. 341,626 342,033 936,589 879,633

Other ............................................... 662 109,168 19,086 296,284

Corporate ........................................ 189 191 469 482

$ 1,284,578 $ 1,316,217 $ 3,444,623 $ 3,496,552

Revenues, net by group of similar products and service were as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Tropical fruit ................................... $ 773,312 $ 726,001 $ 2,029,236 $ 1,924,824

Diversified fruit .............................. 139,265 110,584 379,731 319,718

Fresh packed vegetables ................. 69,895 69,244 224,972 200,222

Packaged salads .............................. 236,897 236,177 613,816 569,257

Berries ............................................. 34,834 36,612 97,801 110,154

Service revenues ............................. 29,524 28,240 79,512 75,611

Other ............................................... 851 109,359 19,555 296,766

$ 1,284,578 $ 1,316,217 $ 3,444,623 $ 3,496,552

EBIT was as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Fresh fruit EBIT ......................................................... $ 24,061 $ 30,320 $ 134,566 $ 141,626

Fresh vegetables EBIT ............................................... (14,308) (2,078) (633) (20,661)

Other EBIT ................................................................. 890 (39) 2,807 655

Total reportable segment EBIT .................................. 10,643 28,203 136,740 121,620

Corporate EBIT .......................................................... (15,140) (5,294) (44,037) (20,501)

Interest expense ......................................................... (22,302) (21,808) (57,145) (52,814)

Income taxes ............................................................. 32,321 4,950 7,739 (6,352)

Income from continuing operations, net of income

taxes .................................................................... 5,522 6,051 43,297 41,953

Income (loss) from discontinued operations, net of

income taxes........................................................ 13 (7,043) 46 (5,960)

Net income (loss) ...................................................... $ 5,535 $ (992) $ 43,343 $ 35,993

Corporate EBIT includes general and administrative costs not allocated to operating segments.

23

Financial Position:

As of

October 7, 2017

December 31, 2016

(In thousands)

Total assets: Fresh fruit ...................................................................... $ 1,886,975 $ 1,900,275

Fresh vegetables ............................................................ 486,972 525,902

Other .............................................................................. 25,912 69,807

Corporate ....................................................................... 478,466 410,712

$ 2,878,325 $ 2,906,696

NOTE 18 — SUBSEQUENT EVENT

Dole evaluated subsequent events through November 21, 2017, the date that Dole’s unaudited condensed

consolidated financial statements were issued.

24

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

General Overview

Founded in 1851, Dole Food Company is one of the world’s leading producers, marketers and distributors of

fresh fruit and fresh vegetables. We provide retail, wholesale and foodservice customers around the world with a

diverse portfolio of the highest quality fresh fruit and vegetable products bearing the DOLE brand and other brands.

Our most significant products hold leading market share positions in their respective markets. We are one of the

world’s largest producers of bananas and pineapples, and a leader in other fresh fruit, value-added and fresh-packed

vegetables, and berries. We sell and distribute our fruit and vegetable products throughout our network in North

America, Europe, Latin America, South Africa and Dubai. We believe our brand has global appeal, as we offer

products that provide value and convenience, and align strongly with the growing emphasis on maintaining a healthy,

balanced lifestyle.

Results of Operations

Selected results of operations for the quarters and three quarters ended October 7, 2017 and October 8, 2016

were as follows:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Revenues, net .............................................................. $ 1,284,578 $ 1,316,217 $ 3,444,623 $ 3,496,552

Cost of products sold .................................................. (1,222,523) (1,244,637) (3,180,432) (3,265,629)

Gross profit ................................................................. 62,055 71,580 264,191 230,923

Selling, marketing and general and administrative

expenses ................................................................. (62,975) (60,742) (160,154) (147,860)

Merger transaction, litigation settlement and other

related costs ........................................................... (565) –– 6,077 ––

Gain on asset sales ...................................................... 125 8,322 2,052 15,130

Operating (loss) income .............................................. (1,360) 19,160 112,166 98,193

Other (expense) income, net ....................................... (4,731) 2,616 (23,559) (923)

Interest income ........................................................... 1,296 1,149 3,275 3,787

Interest expense .......................................................... (22,302) (21,808) (57,145) (52,814)

Income taxes benefit (expense) .................................. 32,321 4,950 7,739 (6,352)

Earnings (loss) from equity method investments ........ 298 (16) 821 62

Income from continuing operations, net of income

taxes ....................................................................... 5,522 6,051 43,297 41,953

Income (loss) from discontinued operations, net of

income taxes .......................................................... 13 (7,043) 46 (5,960)

Net income (loss) ........................................................ 5,535 (992) 43,343 35,993

Less: Net loss (income) attributable to

noncontrolling interests .......................................... 77 (337) (589) (625)

Net income (loss) attributable to the shareholder of

Dole Food Company, Inc. ...................................... 5,612 (1,329) 42,754 35,368

Revenues

Revenues for the quarter ended October 7, 2017 decreased by $31.6 million to $1.28 billion from $1.32 billion

for the quarter ended October 8, 2016. Revenues decreased by $100.2 million due to the sale of the Swedish fresh

fruit procurement and distribution operation in January 2017, and decreased by $8.4 million due to the sale of the

Swedish flowers business during the second quarter of 2017. Fresh fruit revenues increased 9%, or $77.3 million.

Fresh fruit revenues increased due to higher worldwide volumes of bananas, higher pricing of bananas sold in North

America, higher pricing and volumes of Chilean deciduous fruit, higher volumes of South African diversified fruit,

and higher worldwide volumes of pineapples. Fresh vegetables revenues remained relatively unchanged, decreasing

25

by $0.4 million to $341.6 million, due to lower volumes in the fresh berries and fresh-packed vegetable businesses,

partially offset by higher pricing across all major product lines in the fresh-packed vegetable business and higher sales

of packaged salads.

Revenues for the three quarters ended October 7, 2017 decreased 1% to $3.44 billion from $3.50 billion for the

three quarters ended October 8, 2016. Revenues decreased by $264.6 million due to the sale of the Swedish fresh fruit

procurement and distribution operation in January 2017 and $12.6 million due to the sale of the Swedish flowers

business during the second quarter of 2017. Fresh fruit revenues increased 7%, or $168.3 million. Fresh fruit revenues

increased due to higher volumes of bananas sold in Europe and North America, higher pricing of bananas sold in

North America, higher volumes of Chilean deciduous fruit, higher volumes of South African diversified fruit, and

higher worldwide volumes of pineapple. Fresh vegetables revenues increased 6%, or $57.0 million, due to higher sales

of packaged salads and higher pricing across all major product lines in the fresh-packed vegetable business, partially

offset by lower volumes of fresh berries. In the first quarter of 2016, packaged salads revenues were impacted by the

January 2016 recall of packaged salads produced in the Springfield, Ohio facility that was temporarily shut down for

four months.

Cost of Products Sold

Cost of products sold for the quarter ended October 7, 2017 decreased 2% to $1.22 billion from $1.24 billion

for the quarter ended October 8, 2016. Cost of products sold decreased by $99.4 million due to the sale of the Swedish

fresh fruit procurement and distribution operation in January 2017. This decrease was offset by higher fresh fruit costs

due mainly to higher worldwide volumes of bananas, higher volumes of Chilean deciduous fruit, higher volumes of

South African diversified fruit, and higher worldwide volumes of pineapple. Lower purchased fruit costs resulted in

lower banana fruit costs on a per box basis. Improved yields from owned farms and lower purchased fruit costs resulted

in lower pineapple fruit costs on a per box basis. Fresh vegetables cost of products sold increased primarily due to

higher growing and labor costs in the fresh berries and fresh packed vegetables businesses. Higher volumes in the

packaged salads business also contributed to higher cost of products sold.

Cost of products sold for the three quarters ended October 7, 2017 decreased 3% to $3.18 billion from $3.27

billion for the three quarters ended October 8, 2016. Cost of products sold decreased by $262.7 million due to the

sale of the Swedish fresh fruit procurement and distribution operation in January 2017. This decrease was offset by

higher fresh fruit costs due mainly to higher volumes of Chilean deciduous fruit and South African diversified fruit,

higher volumes of bananas sold in Europe and North America, and higher worldwide volumes of pineapple. Improved

yields from owned farms and lower purchased fruit costs resulted in lower banana and pineapple fruit costs on a per

box basis. Fresh vegetables cost of products sold increased primarily due to higher growing and labor costs in the

fresh packed vegetables and fresh berries businesses. Higher volumes in the packaged salads business also contributed

to higher cost of products sold; however, costs per box decreased 4%.

Selling, Marketing and General and Administrative Expenses

Selling, marketing and general and administrative expenses for the quarter ended October 7, 2017 increased 4%

to $63.0 million from $60.7 million for the quarter ended October 8, 2016. The increase was mainly due to higher

corporate general and administrative expenses. In 2016, corporate general and administrative expenses benefited from

reversals of accruals related to incentive compensation and legal matters. Corporate general and administrative

expenses also increased in 2017 due to IPO and other transaction costs. Selling and general and administrative

expenses increased in the fresh vegetables segment, partially offset by lower marketing costs. These increases were

offset by lower general and administrative expenses due to the sale of the Swedish fresh fruit procurement and

distribution operation in January 2017.

Selling, marketing and general and administrative expenses for the three quarters ended October 7, 2017

increased 8% to $160.2 million from $147.9 million for the three quarters ended October 8, 2016. The increase was

mainly due to the same factors impacting the third quarter. In addition, marketing expenses were higher in the

packaged salads business and general and administrative expenses were higher in the fresh packed vegetables and

packaged salads businesses as a result of higher incentive compensation expense.

Merger Transaction, Litigation Settlement and Other Related Costs

Merger transaction, litigation settlement and other related costs for the quarter ended October 7, 2017 were $565

thousand.

26

Merger transaction, litigation settlement and other related costs for the three quarters ended October 7, 2017

were $6.1 million of income. During the first quarter of 2017, Dole benefitted from an insurance settlement of $7.3

million related to the Federal Securities litigation.

Gain on Asset Sales

Gain on asset sales for the quarter ended October 7, 2017 was $0.1 million compared to an $8.3 million gain for

the quarter ended October 8, 2016. The decrease was primarily due to the sale of certain assets in Germany during

the third quarter of 2016.

Gain on asset sales for the three quarters ended October 7, 2017 decreased to $2.1 million from $15.1 million

for the three quarters ended October 8, 2016. The decrease was primarily due to the sale of certain assets in Germany

and sales of actively marketed land in Hawaii, Costa Rica, and Ecuador during the three quarters ended October 8,

2016.

Operating (Loss) Income

For the quarter ended October 7, 2017, operating income decreased to a $1.4 million loss from $19.2 million

income for the quarter ended October 8, 2016.

Fresh fruit operating income decreased $5.9 million due to lower gains on asset sales of $8.8 million and net

unfavorable foreign currency exchange movements of approximately $1.9 million. This was offset by improved

pricing for bananas sold in North America and lower banana fruit costs on a per box basis. Fresh vegetables operating

income decreased $12.2 million due to lower earnings for fresh berries, packaged salads, and fresh-packed vegetables

operations due to restructuring costs in fresh berries and higher fixed and materials costs in packaged salads.

For the three quarters ended October 7, 2017, operating income increased to $112.2 million from $98.2 million

for the three quarters ended October 8, 2016.

Fresh fruit operating income decreased $6.9 million due to net unfavorable foreign currency exchange

movements of approximately $16.3 million and lower gains on asset sales of $15.8 million. This was offset by lower

fruit costs and improved pricing for bananas sold in North America. Fresh vegetables operating income increased

$20.0 million due to higher earnings for packaged salads and fresh-packed vegetables, partially offset by lower

earnings in the fresh berries operations.

Other (Expense) Income, Net

For the quarter ended October 7, 2017, other (expense) income, net was expense of $4.7 million, compared to

income of $2.6 million for the quarter ended October 8, 2016. The decrease in other income during the third quarter

of 2017 was attributable to $9.3 million of higher foreign currency exchange loss on foreign currency denominated

intercompany borrowings, and $0.6 million of lower investment gains on investment holdings held in rabbi trust for

executive benefit plans. This was offset by a $2.8 million gain on derivative instruments during the third quarter of

2017.

For the three quarters ended October 7, 2017, other (expense) income, net was expense of $23.6 million,

compared to expense of $0.9 million for the three quarters ended October 8, 2016. The decrease in other income was

primarily attributable to $17.5 million of refinancing charges in 2017, and a combined $11.1 million of higher foreign

currency exchange losses and lower gains on foreign currency denominated intercompany borrowings. This was offset

by a $5.6 million gain on derivative instruments in 2017, and $0.4 million of higher investment gains on investment

holdings held in rabbi trust for executive benefit plans.

Interest Expense

Interest expense for the quarter ended October 7, 2017 increased to $22.3 million, compared to $21.8 million

for the quarter ended October 8, 2016. Interest expense for the three quarters ended October 7, 2017 increased to $57.1

million, compared to $52.8 million for the three quarters ended October 8, 2016. Interest expense for the quarter and

three quarters ended October 7, 2017 increased due to the addition of loan facilities to finance farm purchases in Costa

Rica and Chile, and a higher term loan balance.

Income Taxes

Income taxes for the quarter ended October 7, 2017 was a benefit of $32.3 million compared to a benefit of $5.0

million for the quarter ended October 8, 2016. Income tax benefit increased $27.4 million primarily due to a decrease

27

in Dole’s total amount of unrecognized tax benefits which included $22 million as a result of the expiration of the

statute of limitations concerning certain transfer pricing issues. Including interest, net of tax benefits, the total amount

recorded for this item was $24.2 million.

Income taxes for the three quarters ended October 7, 2017 was a benefit of $7.7 million compared to an expense

of $6.4 million for the three quarters ended October 8, 2016. Income tax expense decreased $14.1 million primarily

due to a decrease in Dole’s total amount of unrecognized tax benefits which included $22 million as a result of the

expiration of the statute of limitations concerning certain transfer pricing issues. Including interest, net of tax benefits,

the total amount recorded for this item was $24.2 million. This benefit was partially offset by the larger permanent

difference for foreign earnings taxed at the U.S. rate and the write-off of non-deductible goodwill associated with the

sale of the Swedish fresh fruit procurement and distribution and flowers operations.

Earnings (loss) from Equity Method Investments

Earnings (loss) from equity method investments increased to earnings of $298 thousand for the quarter ended

October 7, 2017 compared to a loss of $16 thousand for the quarter ended October 8, 2016. The increase was primarily

due to higher earnings from Dole’s equity investment in Guatemala.

Earnings (loss) from equity method investments increased to earnings of $821 thousand for the three quarters

ended October 7, 2017 compared to earnings of $62 thousand for the three quarters ended October 8, 2016. The

increase was primarily due to higher earnings from Dole’s equity investment in Guatemala.

Discontinued Operations

For the quarter ended October 7, 2017, income from discontinued operations, net of income taxes, was $13

thousand compared to a loss of $7.0 million for the quarter ended October 8, 2016. Included in discontinued operations

are adjustments to indemnification accruals recorded primarily for tax related items. These items are directly related

to the sale of the Dole packaged foods segment and the Asia fresh business, or collectively referred to as “Dole Asia”

to ITOCHU Corporation in fiscal 2013 for $1.69 billion.

For the three quarters ended October 7, 2017, income from discontinued operations, net of income taxes, was

$46 thousand compared to a loss of $6.0 million for the three quarters ended October 8, 2016. Included in discontinued

operations are adjustments to indemnification accruals recorded primarily for tax related items. These items are

directly related to the sale of Dole Asia to ITOCHU Corporation in fiscal 2013 for $1.69 billion.

Segment Results of Operations

Selected segment results of operations for the quarters and three quarters ended October 7, 2017 and October 8,

2016 were as follows.

Revenues, net:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Fresh fruit ................................................................. $ 942,101 $ 864,825 $ 2,488,479 $ 2,320,153

Fresh vegetables........................................................ 341,626 342,033 936,589 879,633

Other ......................................................................... 662 109,168 19,086 296,284

Corporate .................................................................. 189 191 469 482

$ 1,284,578 $ 1,316,217 $ 3,444,623 $ 3,496,552

28

EBIT1:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Fresh fruit EBIT .......................................................... $ 24,061 $ 30,320 $ 134,566 $ 141,626

Fresh vegetables EBIT ................................................ (14,308) (2,078) (633) (20,661)

Other EBIT.................................................................. 890 (39) 2,807 655

Corporate EBIT ........................................................... (15,140) (5,294) (44,037) (20,501)

1 Our chief operating decision maker, or CODM, and management evaluate and monitor segment performance primarily through

earnings before interest expense and income taxes before discontinued operations, or EBIT. EBIT is calculated by adding

interest expense and income taxes to income (loss) from continuing operations, net of income taxes. Management believes that

segment EBIT provide useful information for analyzing the underlying business results as well as allowing investors a means

to evaluate the financial results of each segment in relation to Dole as a whole.

Fresh Fruit

Fresh fruit revenues for the quarter ended October 7, 2017 increased by $77.3 million to $942.1 million from

$864.8 million for the quarter ended October 8, 2016. Revenues from bananas increased due to higher volumes sold

worldwide, as well as higher pricing in North America, partially offset by lower pricing in Europe. Revenues from

pineapples increased due to higher worldwide volumes, partially offset by lower pricing. Chilean deciduous fruit

revenues increased due to higher pricing and volumes. In addition, South African diversified fruit revenues increased

due to higher volumes.

Fresh fruit revenues for the three quarters ended October 7, 2017 increased by $168.3 million to $2.49 billion

from $2.32 billion for the three quarters ended October 8, 2016. Revenues from bananas increased due to higher

volumes sold in Europe and North America, as well as higher pricing in North America, partially offset by lower

pricing in Europe. Revenues from pineapples increased due to higher worldwide volumes, partially offset by lower

pricing. Chilean deciduous fruit sales also increased due to higher volumes of grapes, apples and pears. In addition,

South African diversified fruit revenues increased due to higher volumes.

Favorable foreign currency exchange movements mainly from the Euro and Swedish krona impacted revenues

by approximately $10.4 million during the third quarter of 2017, and unfavorable foreign currency exchange

movements mainly from the Euro and Swedish krona impacted revenues by approximately $2.6 million for the three

quarters ended October 7, 2017.

Fresh fruit EBIT for the quarter ended October 7, 2017 decreased to $24.1 million from $30.3 million for the

quarter ended October 8, 2016. Fresh fruit EBIT decreased mainly due to an $8.8 million unfavorable impact of lower

gain on asset sales. This factor was partially offset by improved pricing for bananas sold in North America, lower

banana fruit costs per box, and favorable foreign currency exchange movements of approximately $2.0 million.

Fresh fruit EBIT for the three quarters ended October 7, 2017 decreased to $134.6 million from $141.6 million

for the three quarters ended October 8, 2016. Fresh fruit EBIT decreased mainly due to a $15.8 million unfavorable

impact of lower gain on asset sales and unfavorable foreign currency exchange movements of approximately $11.5

million. These factors were partially offset by lower fruit costs and improved pricing for bananas sold in North

America.

Fresh Vegetables

Fresh vegetables revenues for the quarter ended October 7, 2017 decreased by $0.4 million to $341.6 million

from $342.0 million for the quarter ended October 8, 2016, due to lower volumes of blueberries and strawberries. This

decrease was partially offset by higher pricing of all major product lines in the fresh-packed vegetables operations and

higher sales of packaged salads.

Fresh vegetables revenues for the three quarters ended October 7, 2017 increased by $57.0 million to $936.6

million from $879.6 million for the three quarters ended October 8, 2016, due to higher sales of packaged salads and

higher pricing of all major product lines in the fresh-packed vegetables operations. In the first quarter of 2016,

packaged salads revenues were impacted by the January 2016 recall of packaged salads produced in the Springfield,

Ohio facility that was temporarily shut down for four months. This increase was partially offset by lower sales of

blueberries.

29

Beginning in January 2016, Dole temporarily suspended operations at its Springfield, Ohio production facility

for a four month period, and voluntarily recalled all Dole-branded and private label packaged salads processed at that

location. The voluntary product recall was a result of a suspected link of the products to a listeria outbreak.

Fresh vegetables EBIT for the quarter ended October 7, 2017 decreased to $14.3 million loss from $2.1 million

loss for the quarter ended October 8, 2016. The decrease is primarily due to restructuring costs in fresh berries, and

higher fixed and materials costs in packaged salads.

Fresh vegetables EBIT for the three quarters ended October 7, 2017 increased to $0.6 million loss from $20.7

million loss for the three quarters ended October 8, 2016. The improvement is primarily due to higher EBIT from

packaged salads due to higher pricing and lower freight and fixed costs, partially offset by higher marketing and

general and administrative expenses. Fresh-packed vegetables earnings increased due to higher pricing, partially offset

by higher growing, labor, and G&A costs. Fresh berries earnings decreased due to restructuring costs, and higher

growing and labor costs, partially offset by higher pricing. Fresh vegetables segment EBIT for the three quarters ended

October 8, 2016 were also impacted by the packaged salads recall costs, which totaled $24.9 million.

Other

Other revenues for the quarter ended October 7, 2017 decreased by $108.5 million to $0.7 million from $109.2

million for the quarter ended October 8, 2016. The decrease was due to the sale of our Swedish fresh fruit procurement

and distribution operation in January 2017 for 85 million Swedish krona in cash (approximately $9.5 million) and our

Swedish flowers business for 9 million Swedish krona in cash (approximately $1.0 million) during the second quarter

of 2017. Revenues from the Swedish fresh fruit procurement and distribution operation were $0.7 million and $100.8

million for the quarters ended October 7, 2017 and October 8, 2016, respectively. Revenues from the Swedish flowers

business were $0 and $8.3 million in the quarters ended October 7, 2017 and October 8, 2016, respectively.

Other revenues for the three quarters ended October 7, 2017 decreased by $277.2 million to $19.1 million from

$296.3 million for the three quarters ended October 8, 2016. The decrease was due to the sale of our Swedish fresh

fruit procurement and distribution operation in January 2017, and the sale of our Swedish flowers business during the

second quarter of 2017. Revenues from the Swedish fresh fruit procurement and distribution operation were $1.8

million and $266.3 million for the three quarters ended October 7, 2017 and October 8, 2016, respectively. Revenues

from the Swedish flowers business were $17.3 million and $29.9 million for the three quarters ended October 7, 2017

and October 8, 2016, respectively.

EBIT from the Swedish fresh fruit procurement and distribution operation and Swedish flowers business were

not material for the quarters and three quarters ended October 7, 2017 and October 8, 2016.

Corporate

Corporate EBIT include general and administrative costs not allocated to the operating segments. Corporate

EBIT for the quarter ended October 7, 2017 were a loss of $15.1 million, compared to a loss of $5.3 million for the

quarter ended October 8, 2016. Corporate EBIT decreased due to $8.7 million of higher foreign currency exchange

losses on foreign currency denominated intercompany borrowings, and higher levels of corporate expenses including

IPO and other transaction costs in 2017.

Corporate EBIT for the three quarters ended October 7, 2017 were a loss of $44.0 million, compared to a loss

of $20.5 million for the three quarters ended October 8, 2016. Corporate EBIT decreased due to debt refinancing costs

of $17.5 million, a combined $10.3 million of higher foreign currency exchange losses as well as lower gains on

foreign currency denominated intercompany borrowings, and IPO and other transaction costs incurred in 2017. This

was partially offset by insurance settlement income of $7.3 million recorded in the first quarter of 2017 related to the

Federal Securities litigation.

Liquidity and Capital Resources

As of October 7, 2017, Dole had cash and cash equivalents of $166.1 million, excluding restricted cash and

investments of $5.9 million, and an asset-based lending senior secured revolving credit facility (“ABL revolver”) of

up to $175.0 million. The ABL revolver is subject to a borrowing base consisting of the trade receivables and inventory

of domestic subsidiaries. At October 7, 2017, the amount available to be borrowed was $130.4 million, which was the

lower of the borrowing base or the revolver cap. At October 7, 2017, there were no cash borrowings under the ABL

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revolver. After taking into account approximately $18.0 million of outstanding letters of credit issued under the

facility, Dole had $112.0 million available for cash borrowings.

At October 7, 2017, Dole had total outstanding debt borrowings of $1.36 billion (consisting primarily of asset-

based loans, notes, and the term loan). Amounts outstanding under the term loan were $944.1 million at October 7,

2017.

Dole’s borrowings under the new credit facilities are secured by substantially all the United States (“U.S.”)

assets of Dole and its material domestic subsidiaries. The borrowings of Solvest, Ltd. under the new ABL revolver

are secured by substantially all the assets of Dole’s material Bermudan subsidiaries.

Management believes that Dole’s available borrowing capacity under the new revolving credit facilities and

subsidiaries’ uncommitted lines of credit, together with its existing cash balances and future cash flow from operations

will enable Dole to meet its working capital, capital expenditure, debt maturity, the Costa Rican tax payment, and

other commitments and funding requirements over the next 12 months and the foreseeable future. In addition,

management believes that proceeds from planned asset sales and potential reductions in capital expenditures are also

available to Dole to the extent further funding requirements are needed. Management’s plan is dependent upon the

occurrence of future events that will be impacted by a number of factors including the general economic environment

in which Dole operates, Dole’s ability to generate cash flow from its operations, its ability to attract buyers for assets

being marketed for sale, and the willingness of capital markets to participate in debt or equity transactions. Factors

impacting Dole’s ability to generate cash flow from operations include, but are not limited to, product pricing,

commodity and fuel costs, interest rates and foreign currency exchange rates.

We have both domestic and foreign debt. As of October 7, 2017, we had approximately $1.25 billion and $142.0

million of domestic and foreign debt, respectively. In addition, we had domestic and foreign cash of $11.3 million and

$154.8 million, respectively. As of October 7, 2017, management believes that cash generated by our U.S. operations

will be sufficient to fund U.S. cash flow requirements, and as such, we are not projecting any impact on liquidity for

the cash taxes associated with the repatriation of offshore cash. However, if these funds are repatriated to the U.S., we

will be subject to additional cash taxes including withholding taxes applied by the country of origin and U.S. federal

income tax, after utilization of any net operating loss carryforwards and net of any allowable foreign tax credits.

Sources and Uses of Cash:

Three Quarters Ended

October 7, 2017

October 8, 2016

(In thousands)

Cash flow provided by (used in):

Operating activities ......................................... $ 79,633 $ 75,600 Investing activities .......................................... 1,862 (85,022)

Financing activities ......................................... 44,880 701

Foreign currency impact ................................. 3,077 (310)

Increase (decrease) in cash .................................. $ 129,452 $ (9,031)

Cash flow provided by operating activities was $79.6 million for the three quarters ended October 7, 2017,

compared to $75.6 million for the three quarters ended October 8, 2016. The increase in cash flow was mainly due to

improved earnings as well as lower levels of receivables due to timing of receipts, partially offset by lower levels of

accrued and other long-term liabilities due to payments made for the merger related litigation and grower payables.

Cash flow provided by investing activities was $1.9 million for the three quarters ended October 7, 2017,

compared to $85.0 million of cash flow used in investing activities for the three quarters ended October 8, 2016. The

increase in cash flow was primarily due to lower capital expenditures. Capital expenditures in the prior year were

mainly related to the final installment payment for the three West Coast Vessels, farm purchases in Chile and Costa

Rica, and infrastructure improvement and renovation of the Springfield, Ohio production facility.

Cash flow provided by financing activities was $44.9 million for the three quarters ended October 7, 2017,

compared to $0.7 million for the three quarters ended October 8, 2016. The increase in cash flow was attributable to

higher debt borrowings, net of repayments in 2017, and dividend payments made in 2016.

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On April 6, 2017, Dole entered into a new term loan credit agreement (the “new term loan”) and a new asset-

based revolving credit agreement (the “new ABL revolver“) with certain lenders (the new term loan and the new ABL

revolver, together, the “new credit facilities”).

The new credit facilities include syndicated borrowings under a new term loan of $950.0 million, that bears

interest, at Dole’s option, at either (i) LIBOR plus 2.75% to 3.00%, with a LIBOR floor of 1.00% or (ii) a base rate

plus 1.75% to 2.00%, in each case, based on Dole’s first lien net leverage ratio. Commencing on September 30, 2017,

principal payments of approximately $5.9 million are due quarterly during the first four years and principal payments

of approximately $11.9 million are due quarterly during the remainder of the term of the facility, plus a balloon

payment due on the maturity date of April 6, 2024. At October 7, 2017, amounts outstanding under the term loan were

$944.1 million.

The new ABL revolver, under which the participating lenders committed to lend up to the lesser of the (i) the

amount of the borrowing base available thereunder and (ii) $175.0 million, which includes a commitment to make up

to $125.0 million of loans to Dole and up to $50.0 million which may be borrowed by Solvest, Ltd., a wholly-owned

subsidiary of Dole. The annual interest rate on amounts drawn under the new ABL revolver is, at Dole’s option, either

(i) LIBOR plus 1.50% to 2.00%, with no LIBOR floor, or (ii) a base rate plus 0.50% to 1.00%, in each case, based

upon Dole’s average historical excess availability under the new ABL revolver. All amounts outstanding under the

new ABL revolver are due on April 6, 2022. At October 7, 2017, there were no borrowings under the new ABL

revolver.

Dole’s borrowings under the new credit facilities are secured by substantially all the U.S. assets of Dole and its

material domestic subsidiaries. The borrowings of Solvest, Ltd. under the new ABL revolver are secured by

substantially all the assets of Dole’s material Bermudan subsidiaries.

Additionally, on April 6, 2017, Dole completed the sale and issuance of $300.0 million aggregate principal

amount of 7.25% Senior Secured Notes due June 15, 2025 (“2025 Notes”). The 2025 Notes were sold to qualified

institutional investors pursuant to Rule 144A under the Securities Act of 1933 (“Securities Act”), and to persons

outside the U.S. in compliance with Regulation S under the Securities Act, who are exempt from the registration

requirements of the Securities Act. Interest on the 2025 Notes will be paid semi-annually in arrears on June 15 and

December 15 of each year, beginning on December 15, 2017. The 2025 Notes have a lien on substantially all of the

assets of Dole and its material U.S. subsidiaries that is junior to the liens securing the obligations under the new credit

facilities, and are senior obligations ranking equally with Dole’s existing senior debt.

The proceeds of the 2025 Notes and the new term loan were used to refinance Dole’s then outstanding

indebtedness under the existing term loan, the existing ABL revolver, and to redeem the $300.0 million aggregate

principal amount of 7.25% Notes due 2019. On April 6, 2017, in connection with the early redemption of the Notes

due 2019, Dole paid an early redemption premium of $5.4 million.

Initial Public Offering

On April 24, 2017, Dole filed an S-1 registration statement with the Securities and Exchange Commission to

begin the initial public offering (“IPO”) process. Dole expects to use the proceeds from the offering to pay down

indebtedness, with the remaining proceeds used for general corporate purposes.

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Non-GAAP Financial Measures

The following is a reconciliation of earnings before interest expense, income taxes and discontinued operations

(“EBIT before discontinued operations”) and adjusted earnings before interest expense, income taxes, discontinued

operations and depreciation and amortization (“Adjusted EBITDA”) to the most directly comparable U.S. Generally

Accepted Accounting Principles (“U.S. GAAP”) financial measure:

Quarter Ended

Three Quarters Ended

October 7, 2017

October 8, 2016

October 7, 2017

October 8, 2016

(In thousands)

Net income (loss) ....................................................... $ 5,535 $ (992) $ 43,343 $ 35,993

(Income) loss from discontinued operations, net of

income taxes…. .................................................... (13) 7,043 (46) 5,960

Interest expense from continuing operations ............. 22,302 21,808 57,145 52,814

Income taxes from continuing operations .................. (32,321) (4,950) (7,739) 6,352

EBIT before discontinued operations ........................ (4,497) 22,909 92,703 101,119

Depreciation and amortization ................................... 31,612 33,618 79,099 81,841

Net unrealized loss (gain) on derivative instruments . 3,765 (200) 21,018 4,604

Net unrealized loss (gain) on foreign currency

denominated intercompany borrowings ................ 8,110 (1,214) 15,500 10,235

Charges for restructuring ........................................... 8,420 738 8,420 2,306

Gain on asset sales ..................................................... (125) (8,322) (2,052) (15,130)

Merger transaction, litigation settlement and other

related costs .......................................................... 565 –– (6,077) ––

Packaged salads recall costs ...................................... 275 315 275 24,919

Refinancing charges .................................................. 94 –– 17,467 ––

IPO and other transaction costs ................................. 1,869 –– 3,014 ––

Asset write-downs ..................................................... –– –– 1,958 ––

Adjusted EBITDA ..................................................... $ 50,088 $ 47,844 $ 231,325 $ 209,894

EBIT before discontinued operations and Adjusted EBITDA are measures commonly used by financial analysts

in evaluating the performance of companies. EBIT before discontinued operations is calculated from net income (loss)

by subtracting the income or adding the loss from discontinued operations, net of income taxes, adding interest expense

from continuing operations, subtracting the income tax benefit or adding the income tax expense from continuing

operations. Adjusted EBITDA is calculated from EBIT before discontinued operations by: (1) adding depreciation

and amortization; (2) adding the net unrealized loss or subtracting the net unrealized gain on derivative instruments;

(3) adding the net unrealized loss or subtracting the net unrealized gain on foreign currency denominated intercompany

borrowings; (4) adding charges for restructuring; (5) adding the loss or subtracting the gain on asset sales; (6) adding

or subtracting merger transaction, litigation settlement and other related costs; (7) adding packaged salads recall costs;

(8) adding refinancing charges; (9) adding IPO and other transaction costs; and (10) adding asset writedowns. These

adjustments, as well as adjustments from net loss to EBIT before discontinued operations, have been made because

management excludes these amounts when evaluating the performance of Dole.

EBIT before discontinued operations and Adjusted EBITDA are not calculated or presented in accordance with

U.S. GAAP, and EBIT before discontinued operations and Adjusted EBITDA are not a substitute for net income

attributable to Dole Food Company, Inc., net income, income from continuing operations, cash flows from operating

activities or any other measure prescribed by U.S. GAAP. Further, EBIT before discontinued operations and Adjusted

EBITDA as used herein are not necessarily comparable to similarly titled measures of other companies.