US chicken manufacturer Pilgrim’s Pride returned to profit in the first half of its financial year but has warned of “challenges” ahead.

In the six months ended 26 June, the company made a net profit of US$108.5m compared to a net loss last year of $248.9m as the company continued with its cost-cutting strategy.

The firm also made an operating profit in the period of $254.1m compared to a loss of $99.34m in the prior-year. Sales amounted to $3.86bn, a 1.3% improvement on last year.

However, CEO Bill Lovette said: “There will be challenges for the industry in the second half of 2012, primarily driven by volatility within the feed ingredient markets and tepid consumer spending. At Pilgrim’s, we have our focus on what we can control, and we will continue to drive that strategy.”