SUGAR LAND, TEXAS — Strong industrial and branded consumer volumes helped lift second-quarter earnings at Imperial Sugar Co. Net income for the second quarter ended March 31 totaled $8,702,000, equal to 76c per share on the common stock, up 22% from $7,132,000 in the second quarter of last year.
Net sales for the period fell 4% to $212,610,000, compared with net sales of $221,264,000 in the same period last year.
For the six months ended March 31, net income was $24,402,000, or $2.16 per share, up 28% from $19,118,000, or $1.78 per share. Sales for the six months totaled $439,608,000, down 8% from $475,250,000.
During the quarter, domestic sugar volumes fell 4.5% while domestic prices eased 3% behind high volume and price levels experienced last year due to the severe effects of hurricanes on competitors’ operations in Louisiana and Florida in 2005.
Consumer prices increased 1%, driven by higher mix of branded sales. Food service prices finished approximately 13% lower than the prior year, while industrial prices were 1% lower, as new contract pricing became a larger portion of the overall mix of business.
"We are pleased with the results for our second fiscal quarter, and particularly the strong industrial and branded consumer volumes in the face of current domestic supply conditions," said Robert A. Peiser, president and chief executive officer of Imperial Sugar. "We have been able to sustain margins and operating profits at above average levels in spite of weaker market pricing. While the nature of the industrial contract cycle is expected to produce further reductions in our average prices, we are encouraged by continuing lower raw sugar and energy costs."
During the quarter, Imperial Sugar realized a $3.7 million gain on its seats on the New York Board of Trade, which was acquired by the Intercontinental Commodity Exchange in January. In addition, the company sold a former refinery site in Florida during the second quarter for a $600,000 gain.
Looking ahead, the company said it expects prices of refined sugar to continue to fall throughout the remainder of fiscal 2007, but energy and raw sugar costs are expected to remain lower than the prior year levels.