Penford swings to loss in year

by FoodBusinessNews.net Staff
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CENTENNIAL, COLO. — For the year ended Aug. 31, Penford Corp. suffered a loss in part due to suspended production as a result of flooding at the company’s Industrial Ingredients facility in Cedar Rapids, Iowa.

For fiscal year 2008, Penford had a loss of $12,700,000, which compared with income of $13,517,000, equal to $1.46 per share on the common stock, during the previous year. Sales for the year were $345,576,000, down 5% from $362,364,000 during fiscal 2007.
While the company had strong nine-month results in the Industrial Ingredients business and record annual revenue in the North American Food Ingredients and Australian business segments, it was not enough to overcome the suspended production in Iowa.

"The Industrial business successfully commissioned the largest facility expansion in many years, only weeks before catastrophic floodwaters engulfed the entire site," said Tom Malkoski, president and chief executive officer. "The immediate and determined response resulted in an extraordinary achievement — the safe restart of operations in 10 weeks. Our Australia/New Zealand business faced the continuing challenge caused by two major droughts over the past four years by improving efficiencies and working with customers to recover high input costs while developing innovative product platforms that will establish strong opportunities for the future. Our food business in North America continues to strengthen, and we remain confident in its growth prospects."

For the year, the Industrial Ingredients segment sustained a loss of $16,541,000, which compared with operating income of $19,251,000 during the previous year. Sales for the year were $173,320,000, down 11% from $194,957,000 during the previous year.

The Food Ingredients – North America segment had operating income of $10,178,000, down 5% from $10,684,000 during the previous year. Sales for the segment were $66,261,000, up 5% from $62,987,000 during the previous year.

The Australia/New Zealand segment had a loss of $4,556,000 for the year compared with operating income of $3,269,000 during the previous year. Sales for the segment were $107,532,000, up 2% from $105,244,000 during the previous year.

For the fourth quarter, the company as a whole sustained a loss of $20,883,000, which compared with income of $4,283,000, equal to 45c per share, during the same quarter of the previous year. Sales for the quarter were $60,026,000, down 38% from $96,217,000 during the same quarter of the previous year.

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