February 17, 2012

Sanderson Farms reports record losses for 2011

Sanderson Farms announced record losses of US$135 million for the fiscal year ended on October 31, even as sales nearly topped US$1.98 billion.

At an annual stockholders meeting on Thursday (Feb 16), CEO Joe F. Sanderson, Jr. said an increase in grain prices of about US$335 million contributed to those record losses.

Sanderson was, however, upbeat about the company for fiscal year 2012. "While we will still have high grain prices, we believe that the poultry markets will be higher," he said.

"Our debt/capitalisation on October 31 was 36%. We had plenty of credit left on our bank revolver and we're optimistic about the future.

"These results reflect the solid execution of our growth strategy to steadily increase our production capacity and expand our customer base," he added.

Consumer demand for chicken products at retail grocery stores was steady throughout the year and supported our sales growth. However, we continued to experience reduced demand from our food service customers, reflecting the considerable slowdown in restaurant traffic across the country".