Houston-based American Rice Inc (ARI), one of the largest rice millers and marketers of branded rice products in the US, has posted a net profit of US$2.2m or US$0.46 per share on sales of US$93m during the nine months ended 30 June.

This is a substantial improvement from the loss of US$1.2m (US$0.25 per share) on sales of US$114.6m for the nine months ended 30 June 2001. Gross profits as a percent of sales has increased from 12.5% to 19.1%.

In the Q3, American Rice recorded a net loss of US$1.3m (US$0.28 per share) on sales of US$22.3m. During the Q3 last year, ARI lost US$2.5m (US$0.49 per share) on sales of US$25.2m.

Steven Weinreb, president and CEO since ARI emerged from bankruptcy, commented: "While sales dollars are down nearly 12%, it is significant to note that sales volume, in hundredweights, is up, particularly in the important domestic market." The hundredweight volume in the domestic market for the Q3 was up 14% year on year.

Weinreb added: "The programmes that management have undertaken to improve efficiency and quality, while reducing costs, are now bearing fruit." The company has significantly reduced the cost of transportation, energy and overheads.

Meanwhile, ARI has responded to news that the Securities and Exchange Commission (SEC) has filed a lawsuit against Douglas A. Murphy, David Kay, and Lawrence H. Theriot alleging that they violated the Foreign Corrupt Practices Act while employed by ARI.

ARI said that the lawsuit relates to events that occurred prior to its emergence from bankruptcy in October 1999, at which point ARI's ownership and board of directors completely changed.

Weinreb explained: "The SEC's complaint concerns events that took place under prior management before ARI emerged from bankruptcy. By not suing ARI, I believe that the SEC has recognised that these are historical events that do not reflect negatively on the company's current ownership, management, or practices."