August 12, 2009
AgFeed Q2 profit down 69 percent, shares fall
Animal feed and pork company AgFeed Industries Inc. posted a 69-percent drop in its quarterly earnings, hurt by a fall in hog prices, and rising cost of corn, soy and fuel.
Net income attributed to AgFeed in the second quarter was US$1.2 million, or 3 cents a share, compared with US$3.9 million, or 12 cents a share, year ago.
Revenue was up about 8 percent to US$38.5 million.
According to Reuters Estimates, one analyst was expecting earnings of 10 cents a share, before special items, on revenue of US$42.9 million.
The company, however, said hog prices were generally beginning to firm.
AgFeed chairman Songyan Li is expecting to see hog prices rise about 15 percent in the short run and over 25 percent by 2010 from recent lows.
The company expects to produce about 2.5 million hogs from now through 2011.
Shares of the company were down more than 7 percent at US$5.50 Tuesday (Aug 11) morning on Nasdaq. They touched a low of US$5.25 earlier in the session.
