US poultry processor Sanderson Farms has reported lower fourth-quarter earnings, as higher feed costs added to the impact of lower poultry prices.

The company reported net income of US$5.1m, or 25 cents per share, for the fourth quarter to 31 October, compared to $20.5m, or $1.04 per share, for the fourth quarter of fiscal 2003. Net sales for the fourth quarter were $259.2m, compared with $254.7m for the same period a year ago.

Net sales for fiscal 2004 were $1.05bn compared with $872.2m for fiscal 2003. Net income for the year totalled $91.4m, or $4.57 per share, compared with net income of $54.1m, or $2.75 per share, for last year.

"Fiscal 2004 was another successful year for Sanderson Farms by every measure," said Joe F. Sanderson, Jr, chairman and chief executive officer of Sanderson Farms.

"These results reflect our focus on operational execution and ability to capitalise on strong market conditions through most of the fiscal year," he added.

The company said overall market prices for poultry products were less favourable during the fourth quarter than during the first three quarters of fiscal 2004. Costs for corn and soybean meal, the company's primary feed ingredients, increased 16.4% and 74.2%, respectively, compared with the fourth quarter a year ago.

"Looking ahead, we enter fiscal 2005 with confidence that we will continue to build on our momentum. The outlook appears promising for continued strong consumer demand for chicken and improvement in exports, which should produce a favourable market environment next year. We also will realize a significant reduction in our operating costs with materially lower prices projected for corn and soybean meal," Sanderson added.