US: Smithfield stock slides after CEO sells shares

By just-food.com | 2 October 2009

Shares in Smithfield Foods slid by more than 8% yesterday (1 October) after the US meat giant's boss revealed he had sold 100,000 shares in the company.

Smithfield stock closed the day down 8.6% at US$12.62 on the New York Stock Exchange, with the company forced to issue a statement insisting president and CEO Larry Pope was "confident" about the future of the business.

Smithfield said the share sale was to meet Pope's "personal financial obligations" after he did not take a bonus in the company's last fiscal year.

However, news of Pope's move came just two weeks after Smithfield launched a $250m share offer to strengthen its balance sheet.

Not everyone on Smithfield's board supported that share offer, with director Paul Fribourg tendering his resignation in protest.

At the start of September, Smithfield reported an increase in quarterly losses as a weak performance at its hog unit offset "record" earnings from packaged meats.

However, Pope maintained he was "very optimistic" about Smithfield's "potential earnings power".

He said: "Smithfield's packaged meats business is performing at record levels and profitability is already benefiting from the restructuring plan. In addition, hog production results will improve as herd reductions accelerate and supply is reduced."

Sectors: Meat & poultry, Seafood

Companies: Smithfield Foods