Market conditions boost Sanderson earnings
December 14, 2010
by Keith Nunes
LAUREL, MISS. — The poultry processor Sanderson Farms, Inc. saw its net income rise significantly during fiscal year 2010, ended Oct. 31. For the year the company earned $134,820,000, equal to $6.07 per share on the common stock, which compared with net income of $82,319,000, or $3.94 per share, during the previous fiscal year.
Sales during fiscal 2010 increased to $1,925,445,000 from $1,789,508,000 during fiscal 2009.
“The fourth quarter of fiscal 2010 marked a strong finish to a successful year for Sanderson Farms,” said Joe F. Sanderson Jr., chairman and chief executive officer. “We had record annual sales of $1.9 billion, a 7.6% increase over fiscal 2009. We also rewarded our shareholders with record net income of $134.8 million, or $6.07 per share. These results reflect the solid execution of our growth strategy and solid performance in our operations. For the year we processed 2.57 billion lbs of dressed poultry, another record, compared with 2.45 billion pounds in fiscal 2009.”
Mr. Sanderson said market prices for poultry products improved in the fourth quarter of fiscal 2010 compared with prices a year ago. As measured by the average of the Georgia dock price for whole chickens, prices were higher by approximately 3.2% in the company’s fourth fiscal quarter compared with the same period in fiscal 2009, but were lower by 1.3% for the fiscal year compared with the prior year. While boneless breast meat prices have softened since Labor Day, they averaged 26% higher in the fourth quarter than the prior-year period.
“Another important milestone for Sanderson Farms in fiscal 2010 was the completion of our new Kinston, North Carolina, poultry complex,” Mr. Sanderson said. “This project was completed on time and on budget, and we will begin processing chickens in Kinston in January.
“In addition to the Kinston facility, we will continue work during fiscal 2011 developing the second North Carolina complex. Together, the two North Carolina facilities will support our growth strategy with approximately 30% more processing capacity, and will further enhance our ability to drive revenue and earnings for our shareholders.”
For the fourth quarter, Sanderson Farms recorded a net income of $47,800,000, or $2.08 per share. During the same period during fiscal 2009, net income was $19,804,000, or 95c per share.
Sales for the quarter were $529,125,000, which compared with $469,019,000 during the previous year.