Seaboard's net income slips in first quarter

by Keith Nunes
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SHAWNEE MISSION, KAS. — Seaboard Corp. posted net income of $49,355,000, equal to $39.13 per share on the common stock, for the first quarter of fiscal 2007, ended March 31. The result compared with net income of $51,540,000, or $40.86 per share, for the first quarter of fiscal 2006. Sales for the quarter were $729,148,000, up from $635,573,000 for the same period in 2006.

The company attributed part of its earnings decline to rising feed costs for the hogs that supply its Pork Segment, which reported an operating income of $20,911,000 for the first quarter of 2007 compared with $30,100,000 for 2006. Sales for the quarter were $241,647,000 in 2007 compared with $245,294,000 for 2006. The sales decline was the result of decreased domestic sales volumes of pork products, according to the company.

Operating income of the Commodity Trading and Milling Division rose to $10,200,000, up narrowly from $10,000,000 in the first quarter of fiscal 2006.

Seaboard said the increase reflected increased trading margins on commodities sold in existing markets, offset partially by lower sales and lower margins from certain milling operations.

Division sales totaled $246,700,000, up 39% from $177,600,000 a year ago. The sales improvement primarily reflected increased commodity trading volumes with third parties, partially offset by a decrease in sales volumes at certain African milling operations.

Net sales for Seaboard’s Sugar and Citrus Division increased to $27,333,000 in the first quarter of 2007 from $18,514,000 for the same period last year. Operating income was $4,615,000 in 2007 compared with $2,815,000 in 2006. An increase in sugar prices was cited as the reason for the sales and operating income increases.

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