Net sales for the second quarter of fiscal 2014 were
Net sales for the first six months of fiscal 2014 were
“The results for our second quarter of fiscal 2014 reflect lower grain costs and continued favorable demand for poultry products," said Joe F. Sanderson, Jr., chairman and chief executive officer of
“Our profitability for the second quarter continued to benefit from lower feed costs,” added Sanderson. “Feed costs in flocks processed decreased 19.1 percent compared with last year’s second fiscal quarter. Because of the tight supply of soybeans and the USDA’s lower ending stock estimates for corn, market prices for grain have moved higher since our first quarter. We expect grain prices to remain volatile at least until markets get some visibility on the quantity and quality of this year’s corn and soybean crops, as tight soy supplies and the lowered corn estimates place a premium on favorable growing conditions this summer.”
According to Sanderson, market prices for poultry products were mixed during the second quarter of fiscal 2014 compared with the same quarter a year ago. The simple average of the
“We continue to make progress on our new facilities in
“Looking ahead, we are reasonably optimistic as we head into the summer months and what is typically the peak demand period for chicken. Total grain costs have moved higher but remain below last year’s prices, and demand for chicken products is expected to remain strong. Weekly broiler egg sets continue to run slightly above last year’s numbers, but breeder placements remain constrained. It appears the reduced size of the breeder flock will constrain production over the short term despite higher industry returns. While macroeconomic conditions continue to affect consumer behavior, market prices for boneless breast meat sold to our food service customers improved through April and May, and market prices for retail grocery store products have also moved higher. Regardless of market conditions, however, we will maintain our focus on maximizing our operating performance and sales execution,” Sanderson concluded.
This press release includes forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended.Forward-looking statements are based on a number of assumptions about future events and are subject to various risks, uncertainties and other factors that may cause actual results to differ materially from the views, beliefs, projections and estimates expressed in such statements.These risks, uncertainties and other factors include, but are not limited to, those discussed under “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the quarter ended April 30, 2014, and the following:
(1) Changes in the market price for the Company’s finished products and feed grains, both of which may fluctuate substantially and exhibit cyclical characteristics typically associated with commodity markets.
(2) Changes in economic and business conditions, monetary and fiscal policies or the amount of growth, stagnation or recession in the global or U.S. economies, any of which may affect the value of inventories, the collectability of accounts receivable or the financial integrity of customers, and the ability of the end user or consumer to afford protein.
(3) Changes in the political or economic climate, trade policies, laws and regulations or the domestic poultry industry of countries to which the Company or other companies in the poultry industry ship product, and other changes that might limit the Company’s or the industry’s access to foreign markets.
(4) Changes in laws, regulations, and other activities in government agencies and similar organizations applicable to the Company and the poultry industry and changes in laws, regulations and other activities in government agencies and similar organizations related to food safety.
(5) Various inventory risks due to changes in market conditions, including, but not limited to, the risk that market values of live and processed poultry inventories might be lower than the cost of such inventories, requiring a downward adjustment to record the value of such inventories at the lower of cost or market as required by generally accepted accounting principles.
(6) Changes in and effects of competition, which is significant in all markets in which the Company competes, and the effectiveness of marketing and advertising programs. The Company competes with regional and national firms, some of which have greater financial and marketing resources than the Company.
(7) Changes in accounting policies and practices adopted voluntarily by the Company or required to be adopted by accounting principles generally accepted in
(8) Disease outbreaks affecting the production performance and/or marketability of the Company’s poultry products, or the contamination of its products.
(9) Changes in the availability and cost of labor and growers.
(10) The loss of any of the Company’s major customers.
(11) Inclement weather that could hurt Company flocks or otherwise adversely affect its operations, or changes in global weather patterns that could impact the supply of feed grains.
(12) Failure to respond to changing consumer preferences.
(13) Failure to successfully and efficiently start up and run a new plant or integrate any business the Company might acquire.
Readers are cautioned not to place undue reliance on forward-looking statements made by or on behalf of
Three Months Ended
Six Months Ended
|Costs and expenses:|
|Cost of sales||552,311||562,233||1,068,396||1,147,100|
|Selling, general and administrative||29,915||19,832||53,514||40,397|
|Other income (expense):|
|Income before income taxes||77,792||37,207||122,108||25,904|
|Income tax expense||26,804||12,836||42,249||8,476|
|Basic earnings per share||$||2.21||$||1.06||$||3.46||$||0.76|
|Diluted earnings per share||$||2.21||$||1.06||$||3.46||$||0.76|
|Dividends per share||$||0.20||$||0.17||$||0.40||$||0.34|
|Cash and cash equivalents||$||84,412||$||85,563|
|Accounts receivable, net||108,585||108,980|
|Deferred income taxes||603||478|
|Prepaid expenses and other current assets||31,068||29,867|
|Total current assets||443,685||430,743|
|Property, plant and equipment||1,084,317||1,035,044|
|Less accumulated depreciation||(559,627||)||(546,578||)|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Accounts payable and accrued expenses||$||135,673||$||150,744|
|Current maturities of long-term debt||19,819||10,799|
|Total current liabilities||155,492||161,543|
|Long-term debt, less current maturities||10,000||29,414|
|Deferred income taxes||49,453||53,089|
|Commitments and contingencies|
|Total stockholders’ equity||748,180||671,599|
Treasurer & Chief Financial Officer