Sanderson Farms earnings improve in quarter

by Eric Schroeder
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LAUREL, MISS. — Positive momentum in chicken demand led to improved earnings for Sanderson Farms, Inc. For the second quarter ended April 30, the company earned $35,087,000, equal to $1.62 per share on the common stock, up from $26,216,000, or $1.25 per share, in the same period a year ago.

Sales for the quarter were $487,101,000, a slight increase compared with second-quarter sales of $426,759,000 in fiscal 2009.

“Demand for chicken at retail grocery stores remains strong and the ongoing issues we and our industry face in export markets have not yet significantly disrupted the markets,” said Joe F. Sanderson Jr., chairman and chief executive officer. “As has been the case for two years, demand from some food service customers continues to be adversely affected by the economic downturn as demand for protein consumed away from home remains soft.”

For the first half of fiscal 2010, the company posted earnings of $50,904,000, or $2.39 per share, an improvement over the previous year when its net income was $19,467,000, or 93c per share. Sales for the first half of the fiscal year were $907,224,000 compared with $815,643,000 the previous year.

“We are cautiously optimistic as we head into the summer months and what is typically a period of better demand for chicken,” Mr. Sanderson said. “Broiler egg sets continue to indicate manageable supplies over the short term, while breeder placements point to reasonable supplies for the next few months. Progress continues on our new Kinston, North Carolina, complex, and we placed our first breeder flock in April. The plant is on schedule to begin processing chickens in January of next year.”

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