SAFM had decent earnings
biz.yahoo.com
LAUREL, Miss.--(BUSINESS WIRE)--Aug. 22, 2002--Sanderson Farms, Inc. (Nasdaq/NM: SAFM - News) today reported results for the third fiscal quarter and nine months ended July 31, 2002. Net sales for the third quarter of fiscal 2002 were $202.7 million, up 10.3% compared with net sales of $183.7 million for the same period a year ago. For the quarter, the Company reported net income of $9.3 million, or $0.70 per diluted share, compared with net income of $9.6 million, or $0.70 per diluted share, for the third quarter of fiscal 2001.
For the first nine months of fiscal 2002, net sales were $542.6 million, an 8.7% increase compared with net sales of $499.4 million for the same period last year. The Company reported net income of $22.3 million, or $1.66 per diluted share, for the first nine months ended July 31, 2002, compared with net income of $15.0 million, or $1.10 per diluted share, for the same period of fiscal 2001.
"We are pleased with our sales and operating execution during the third fiscal quarter," said Joe F. Sanderson, Jr., president and chief executive officer of Sanderson Farms, Inc. "In spite of the uncertainties in the market and inconsistent prices for poultry products, we continued to see positive trends in our financial and operating performance for the first nine months of fiscal 2002 compared with the year-earlier period. We believe these results reflect our ability to fully leverage our assets, and achieve higher levels of sales from our improved product mix."
According to Sanderson, trends in market prices for poultry products during the quarter continued to be mixed. As measured by a simple average of the Georgia dock price for whole chickens, prices increased approximately 1.6% in the Company's third fiscal quarter compared with the same period in 2001. Boneless breast meat prices during the quarter also increased, averaging $1.45 per pound, or 8.8% higher than the same period a year ago. However, the most dramatic shift in market prices occurred for leg quarters and wings. Bulk leg quarters decreased during the quarter due primarily to the Russian embargo of U.S. poultry meat and the resulting increase of product in the domestic market. Market prices for bulk leg quarters during the third quarter of fiscal 2002 averaged 37.6% below the same period last year. Wing prices averaged 49.5 cents per pound, down 48% from the average of 95.2 cents during the third quarter of fiscal 2001, and down 26.7% for the year.
"The Russian embargo on United States poultry products continued to have a significant impact on our export business during the third quarter of fiscal 2002," said Sanderson. "While it is difficult to quantify exactly what the embargo cost the Company for this quarter, the interruption in access to an important market for poultry shipments has adversely affected the entire industry, creating continued pricing pressures. While shipments to Russia have resumed on a limited basis, it will be difficult to determine when volumes will return to historical levels until a new protocol governing future shipments is defined."
The Company also stated that, based on fiscal year-to-date trends and internal projections, it remains comfortable with an annual earnings estimate of $2.00 to $2.20 per share for the fiscal year 2002.
Sanderson Farms, Inc. is engaged in the production, processing, marketing and distribution of fresh and frozen chicken and other prepared food items. Its shares trade on the Nasdaq Stock Market under the symbol SAFM.
Sanderson Farms will hold a conference call to discuss this press release today (August 22) at 10:00 a.m. Central, 11:00 a.m. Eastern. Investors will have the opportunity to listen to a live Internet broadcast of the conference call through the Company's web site at www.sandersonfarms.com or through www.companyboardroom.com. To listen to the live call, please go to the web site at least 15 minutes early to register, download, and install any necessary audio software. For those who cannot listen to the live broadcast, an Internet replay will be available shortly after the call and continue through September 22, 2002.
This press release contains forward-looking statements based on management's current views and assumptions. Actual results and events may differ. For a discussion of these matters, please refer to the "Cautionary Statement Regarding Risks and Uncertainties That May Affect Future Performance" in Item 7 of the Company's 2001 Annual Report on Form 10-K and please refer to the cautionary statement found in Management's Discussion and Analysis of Financial Condition and Results of Operations under the heading "General" in Part I, Item 2 of the Quarterly Report on Form 10-Q for the Company's quarter ended July 31, 2002. |
