Sanderson Farms Has Profitable 2012

By CnAgri Print

Poultry processor Sanderson Farms has reported net sales for the fourth quarter of the 2012 financial year of $648.4 million compared with $559.8 million for the same period a year ago. For the quarter, the Company reported net income of $9.3 million compared with a net loss of $21.6 million for the fourth quarter of fiscal 2011.

Net sales for fiscal 2012 were $2.386 billion compared with $1.978 billion for fiscal 2011. Net income for the year totaled $53.9 million, compared with a net loss of $127.1 million for last year.

"The fourth quarter of fiscal 2012 marked the end of another challenging year for Sanderson Farms and the poultry industry," said Joe F. Sanderson, Jr., chairman and chief executive officer of Sanderson Farms, Inc. "We reported record annual sales of $2.386 billion, a 20.6 percent increase over fiscal 2011. However, while poultry markets improved compared to fiscal 2011, grain prices surged to record levels during August as a result of drought conditions across much of the corn belt. As a result, the improvement in poultry market prices was offset in part by higher feed costs. Our increased sales and return to profitability during the year reflect higher production as we completed the ramp up to near full production at our Kinston, North Carolina, facility."

According to Sanderson, overall market prices for poultry products were higher in the fourth quarter of fiscal 2012 compared with prices a year ago.

As measured by a simple average of the Georgia dock price for whole chickens, prices were higher by approximately 7.7 percent in the Company's fourth fiscal quarter compared with the same period in fiscal 2011, and were higher by 7.3 percent for the fiscal year compared with the prior year.

The relatively strong dark meat prices reflect good export demand during the year. Prices paid for corn and soybean meal, the Company's primary feed ingredients, increased during the year and were up 11.6 percent and 39.7 percent, respectively, during the fourth fiscal quarter when compared with the fourth quarter a year ago. For the year, total feed costs in broiler flocks processed were 1.4 percent higher than fiscal 2011.