US poultry processor Sanderson Farms has reported a sharp rise in quarterly net income, driven by strong consumer demand for poultry products and higher market prices.
The company posted net income of US$33.4m, or $1.67 per share, for the second quarter to 30 April 2004, compared with net income of $12.8m, or 65 cents per share, for the second quarter of fiscal 2003. Net sales for the second quarter were $272.7m compared with $201.2m for the same period a year ago.
“Sanderson Farms had another strong financial and operating performance in the second quarter of fiscal 2004,” said Joe F. Sanderson, Jr., president and chief executive officer of Sanderson Farms. “Our results reflect solid execution throughout our operations and a favourable market environment. We have continued to benefit from stronger consumer demand and improved market prices for poultry products compared with the same period last year.”
“While we are pleased with our overall sales and marketing performance and our strong competitive position, we remain focused on pursuing additional opportunities to leverage the strength of our operations,” added Sanderson.
The poultry industry has been experiencing increased demand in recent months due to the popularity of low-carbohydrate, high protein diets. Sanderson Farms said it believes it is well positioned to benefit from the strong market environment and favourable demand trends in the coming months. In light of current and expected market conditions, and considering higher grain costs for the balance of the fiscal year, Sanderson Farms said it is “comfortable” with estimated earnings for the fiscal year in the range of $5.35 to $5.85 per share.
The company also announced that sites in Colquitt and Cook Counties, Georgia, have been selected for the construction of a new poultry processing complex. Sites near Adel in Cook County, Georgia, have been selected for a new feed mill and hatchery, while a site near Moultrie in Colquitt County, Georgia, has been selected for the construction of a new poultry processing plant and wastewater treatment facility.
These facilities will comprise a state-of-the-art poultry complex with capacity to process 1.2 million birds per week. At full capacity, the $96m complex will employ approximately 1,700 people.