Rising annual revenue at US poultry group Sanderson Farms has not been enough to stem full-year losses at the company.
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The company today (4 December) booked an annual net loss of US$43.1m for the year to 31 October.
The figure compared to net income of $78.8m a year earlier and came despite a 16.9% jump in annual sales to $1.72bn.
Chairman and CEO Joe F. Sanderson Jr. said the company’s annual sales were a record for the group but said weak demand in the foodservice sector, credit problems among its customers and high feed prices had weighed on he business.
“Like others in our industry, our business was affected by a decline in demand for chicken products from foodservice and casual dining customers, resulting in very weak market prices for white meat,” Sanderson said. “Consumer demand for chicken products at the retail level has remained relatively stable but restaurant traffic has been depressed due to current economic concerns.”
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By GlobalDataSanderson added: “Our export customers have experienced difficulty obtaining the credit necessary to buy product, causing a decline in dark meat prices in October and November. While feed costs have moderated, they remain relatively high compared to historical prices and are negatively affecting profit margins.”
Net sales for the company’s fourth quarter reached $460.2m, compared to $426.9m during the corresponding period a year ago.
Sanderson reported a net loss of $51.9m for the fourth quarter, against net income of $24.1m a year ago.
