December 15, 2010

Sanderson Farms profit shows substantial increase

Sanderson Farms Inc.'s fiscal fourth-quarter earnings more than doubled as average market prices rose 3.2%.

Sanderson Farms is in the midst of a large expansion in North Carolina that will increase production capacity by 30%. The first plant, in Kinston, N.C., is scheduled to open in January.

For the quarter ended October 31, Sanderson reported a profit of US$47.8 million, or US$2.08 a share, up from US$19.8 million, or US$0.96 a share, a year earlier. Revenue increased 13% to US$529.1 million.

Prices paid for corn and soymeal - the company's primary feed ingredients - increased 9.1% and decreased 17%, respectively. Boneless breast meat prices saw the largest price increase - at 26% - though they have weakened since Labour Day.