Smithfield Foods, Inc. (NYSE: SFD) announced yesterday that earnings in the fourth quarter of fiscal 2001, which will end April 29, are expected to exceed $.85 per share, prior to unusual items, which is well above investor expectations. The company reported earnings of $.51 per share in the fourth quarter last year. In the fourth quarter the company will record unusual gains of about five cents per share on the sale of a processing plant in Canada and about three cents per share on the sale of IBP, inc. stock.

"Our vertical integration strategy that we began to put into place nearly 15 years ago continues to succeed," said Joseph W. Luter, III, chairman, president and chief executive officer. "While relatively high hog prices have produced strong results in the hog production group, we are most gratified with the meat processing group performance, as earnings are expected to more than double those of the prior year," Mr. Luter said.

The company expects to report fourth quarter earnings on June 6.

Smithfield Foods also said that its board of directors agreed to recommend to shareholders at the annual shareholder meeting August 29 that they approve an increase in the authorized shares of the company. Subject to approval of this increase in authorized shares, the board currently intends to declare a two-for-one stock split subsequent to the annual meeting. The company currently has 52.5 million shares outstanding.

Smithfield Foods also announced that it had signed an agreement in principle to acquire 100 percent of the outstanding capital stock of Moyer Packing Company, a closely-held beef processor based in Souderton, Pa., with annual sales of almost $600 million. Moyer Packing is the ninth largest beef processor in the U.S. and the largest in the Eastern United States. Operations include beef processing, fabricating and further processing, as well as hide processing. In addition to beef processing, the company has significant rendering operations in Pennsylvania, Delaware and Virginia. The company has a 120-year history of marketing superior beef products on the East Coast with a strong presence in the Connecticut, Maryland, Massachusetts, New Jersey, New York and Pennsylvania markets, as well as exporting to Japan.

"The combination of the strong MOPAC name and a respected management team represents a foundation for growth for Smithfield as we enter the beef sector for the first time," said Mr. Luter. "We look forward to working with Lee Delp, president and chief executive officer of Moyer, and the rest of his management team to develop the beef business as a complement to our pork operations. We are the leader in providing case-ready pork to food retailers and the addition of Moyer will be the first step in becoming a significant case-ready beef provider to our customers, as well."

Terms of the transaction were not disclosed. The transaction is subject to regulatory approval and is expected to close in the first quarter of fiscal 2002.

Smithfield Foods was ranked the number two Fortune 500 food stock in total return to investors and placed in the top quartile in total return to investors among all Fortune 500 companies over the past 10 years. With annual sales of $5.2 billion, Smithfield Foods is the leading processor and marketer of fresh pork and processed meats in the United States, as well as the largest producer of hogs. For more information, please visit .

This news release may contain "forward-looking" information within the meaning of the federal securities laws. The forward-looking information may include statements concerning the Company's outlook for the future, as well as other statements of beliefs, future plans and strategies or anticipated events, and similar expressions concerning matters that are not historical facts. The forward-looking information and statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the statements. These risks and uncertainties include availability and prices of live hogs, raw materials and supplies, live hog production costs, product pricing, the competitive environment and related market conditions, operating efficiencies, access to capital, the cost of compliance with environmental and health standards, adverse results from ongoing litigation and actions of domestic and foreign governments.