December 5, 2007

Sanderson Farms doubles profit on higher prices

Sanderson Farms reported that its quarterly profit more than doubled as strong chicken prices offset higher feed costs, sending its shares up by 10 percent.

Chicken producer, Sanderson, like its larger rivals Pilgrim's Pride Corp. and Tyson Foods Inc., has been able to raise chicken prices amid strong domestic and export demand.

The price increases compensated for higher costs of corn and soymeal.

Sanderson reported earnings for its fiscal fourth quarter ended October 31 of US$24.1 million, or US$1.18 per share, compared with US$10.5 million, or US$0.52 cents, a year earlier.

Four Wall Street earnings estimates averaged US$1.33 per share and ranged from US$0.94 cents to US$1.77.

Joe Sanderson, chairman and chief executive officer, said that the results reflect improved market conditions this year, which offset the higher grain costs.

Revenue increased to US$426.9 million from US$291.7 million a year earlier. Wall Street estimates averaged US$419.47 million.