Sanderson Farms, Inc. reported results for the fourth quarter and fiscal year ended October 31, 2010. Net sales for the fourth quarter of fiscal 2010 were $529.1 million compared with $469.0 million for the same period a year ago.
For the quarter, the it reported net income of $47.8 million, or $2.08 per share, compared with $19.8 million, or $0.95 per share for the fourth quarter of fiscal 2009.
Net sales for fiscal 2010 were $1.9 billion compared with $1.8 billion for fiscal 2009. Net income for the year totaled $134.8 million, or $6.07 per share, compared with $82.3 million, or $3.94 per share, for last year.
"The fourth quarter of fiscal 2010 marked a strong finish to a successful year for Sanderson Farms," said Joe F. Sanderson, Jr., chairman and chief executive officer of Sanderson Farms, Inc. "We had record annual sales of $1.9 billion, a 7.6 percent increase over fiscal 2009. We also rewarded our shareholders with record net income of $134.8 million, or $6.07 per share. These results reflect the solid execution of our growth strategy and solid performance in our operations. For the year we processed 2.57 billion pounds of dressed poultry, another record, compared with 2.45 billion pounds in fiscal 2009."
Poultry product prices
According to Sanderson, market prices for poultry products improved in the fourth quarter of fiscal 2010 compared with prices a year ago. As measured by a simple average of the Georgia dock price for whole chickens, prices were higher by approximately 3.2 percent in the Company's fourth fiscal quarter compared with the same period in fiscal 2009, but were lower by 1.3 percent for the fiscal year compared with the prior year. While boneless breast meat prices have softened since Labor Day, they averaged 26.0 percent higher in the fourth quarter than the prior-year period.
For fiscal 2010, boneless prices were 12.3 percent higher when compared with fiscal 2009. Jumbo wing prices averaged $1.27 per pound during the fiscal year, down 3.2 percent from the average of $1.32 per pound for fiscal 2009. The average market price for bulk leg quarters increased approximately 2.3 percent for the quarter, but decreased approximately 4.2 percent for fiscal 2010. Prices paid for corn and soybean meal, the Company's primary feed ingredients, increased 9.1 percent and decreased 17.0 percent, respectively, compared with the fourth quarter a year ago. For the year, total feed costs in flocks sold were 3.6 percent lower than fiscal 2009.
Poultry complex completion
"Another important milestone for Sanderson Farms in fiscal 2010 was the completion of our new Kinston, North Carolina, poultry complex," Sanderson continued. "This project was completed on time and on budget, and we will begin processing chickens in Kinston in January. We look forward to the new marketing opportunities the Kinston plant will provide for Sanderson Farms as we embark on our next phase of growth in fiscal 2011.
"In addition to the Kinston facility, we will continue work during fiscal 2011 developing the second North Carolina complex. Together, the two North Carolina facilities will support our growth strategy with approximately 30 percent more processing capacity, and will further enhance our ability to drive revenue and earnings for our shareholders."
Sanderson concluded, "We are pleased that our strong balance sheet and financial performance have put us in the position to continue to grow our Company. As of October 31, 2010, our balance sheet reflected $841.6 million in assets, stockholders' equity of $645.7 million and net working capital of $238.2 million. Our total long-term debt at year-end was $62.1 million. We believe a strong balance sheet is an important advantage in today's economic environment and provides us with the financial strength to support our growth strategy. We deeply appreciate the hard work and dedication to excellence of everyone associated with our Company, including our employees and growers."
Source: Sanderson Farms