December 6, 2006

Sanderson Farms posts slight profit for fourth quarter

Poultry producer Sanderson Farms Inc. said Tuesday (Dec 6) its fourth-quarter profit climbed 4 percent from last year, partly helped by insurance payments from Hurricane Katrina.

Net income for the quarter was USUS$10.5 million, or 52 cents per share, up 4 percent from US$10.1 million, or 50 cents per share, last year. Revenue totaled US$291.7 million, up 11 percent from US$262.5 million last year.

The company said its results for the latest quarter include a federal tax benefit of 2 cents per share related to Hurricane Katrina losses, and US$3.6 million, or 11 cents per share, in insurance proceeds from Hurricane Katrina, which hit August last year.

Although poultry prices have improved from the first half of the year, the average price for whole chickens was down 6.7 percent in the fourth quarter compared with the same period a year ago.

This was worsened by the fact that feed costs rose 13.6 percent due to high corn prices.

For the full year, the company posted a loss of US$11.5 million, or 57 cents per share, down from a profit of US$70.6 million, or US$3.51 per share, last year.