LAUREL — Sanderson Farms Inc., for the first fiscal quarter ended Jan. 31, 2011, saw net sales of $427.7 million, compared with $420.1 million for the same period a year ago.
The company had a net loss of $33.6 million, or $1.52 per share, compared with net income of $15.8 million, or $0.75 per share, for the first quarter of fiscal 2010.
The company’s results for the first quarter of fiscal 2011 include a charge of $22.3 million, before income taxes, to reduce the value of live inventory from cost to market. Excluding this adjustment, the net loss for the first quarter of fiscal 2011 was $19.2 million, or $0.87 per share.
“The results for the first quarter of fiscal 2011 were influenced by a number of factors,” said Joe F. Sanderson Jr., chairman and CEO of Sanderson Farms. “Overall, we experienced lower poultry market prices than the same period a year ago, primarily due to an oversupply of chicken during the first quarter of fiscal 2011. While retail demand for chicken has remained steady, we have continued to see weak foodservice demand, and we expect this trend will remain until the national unemployment rate improves. Consumers are simply not dining out as frequently and restaurant traffic has remained under pressure. We also experienced a significant increase in feed costs during the quarter, compared with a year ago, and this affected our profitability.
“We believe fiscal 2011 will be a challenging year for Sanderson Farms and our industry. We are already experiencing escalating grain prices, especially for corn, which are at near-record levels. The U.S. Department of Agriculture (USDA) recently reported that corn supplies are at their tightest levels in 15 years.”