US integrators impacted by export decline
All four of the US publicly-quoted broiler integrators
showed declines in their share prices on Thursday, 2nd March, following an
adverse announcement by Sanderson Farms. By Simon
All four of the US publicly-quoted broiler integrators showed declines in
their share prices on Thursday, 2nd March, following an adverse announcement by
The company posted a loss of $8.5 million on
revenue of $221 million for the first quarter of the current fiscal year ending
January 31st, 2006. The comparable figure for the first quarter of 2004 was a
$10 million profit. Sanderson shares fell by 1%.
Pilgrim's Pride retracted guidance for the current quarter,
announcing a loss of $15 million through February of the current quarter with
respect to US operations. Pilgrim's Pride lost 0.7% in share value.
Gold Kist reported a decline in profit for the quarter
ended December 31st, generating a net income of $2.5 million on sales of $545
million. The comparable figures for the previous financial year were $4.5
million and $552 million respectively.
spokespersons of each of the companies indicated that declining unit revenue was
responsible for the depression in profitability. The Chairman of Sanderson Farms
noted that unit revenue for whole birds had decreased by 3.2% during the current
quarter and that boneless breasts were down by 21%. This resulted from a marked
decline in exports associated with a decrease in consumption in importing
countries where domestic flocks were affected by avian influenza.
John Tyson, Chairman of Tyson
Foods, expressed confidence that consumption would soon be restored to normal
levels and that projected export volume from the US, comprising essentially leg
quarters, would resume, thereby restoring price-volume equilibrium in the
By: Simon Shane
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