Sanderson Farms, Inc. on Thursday reported results for the first quarter of fiscal 2017 ended January 31, 2017. Net sales for the first quarter of fiscal 2017 were $688.3 million compared with $605.2 million for the same period a year ago. The company reported net income of $23.2 million, or $1.02 per share, for the quarter compared with net income of $10.7 million, or $0.47 per share, for the first quarter of fiscal 2016.
“Our results for the first quarter reflect improved market prices for dark meat products sold from our big bird deboning plants compared with last year’s first quarter,” said Joe F. Sanderson, Jr., chairman and chief executive officer of Sanderson Farms, Inc.
“Leg quarter prices during last year’s first fiscal quarter reflected avian influenza-related bans on United States poultry products by many of our export partners, which bans, except for China, have been lifted. Poultry market prices for our tray pack products sold to retail grocery store customers were only slightly lower when compared with the same period a year ago. On the other hand, the food service market remains weak. Traffic numbers through all categories of food service continue to trend lower, and market prices for boneless breast meat reflect that weakness. Demand and prices for jumbo wings were seasonally strong during the quarter,” Sanderson said.
According to Sanderson, overall market prices for poultry products were higher during the first quarter compared with the same period last year. Compared with the first fiscal quarter of 2016, the average whole bird price used as the base of a portion of the company’s retail tray pack pricing formulas was approximately 2.7 percent lower; boneless breast meat prices were approximately 4.6 percent lower; the average market price for bulk leg quarters increased by approximately 33.1 percent; and jumbo wing prices were higher by 14.3 percent.
The company’s average feed cost per pound of poultry products processed decreased 1.3 cents per pound, or 4.9 percent, compared with the first quarter of fiscal 2016, and prices paid for corn and soybean meal, the company’s primary feed ingredients, decreased 4.9 percent and increased 1.9 percent, respectively, compared with the first quarter of fiscal 2016.
“Record corn and soybean crops harvested in the United States last fall contributed to healthy soybean and corn balance tables heading into the 2017 planting season,” added Sanderson. “Strong export demand, however, has supported higher prices for both corn and soybeans despite record harvests and ample supplies of both grains.
“Operations at our new St. Pauls, North Carolina, complex began on schedule in January 2017. We expect the plant to reach full production in the company’s first fiscal quarter of 2018, and we look forward to the opportunities the new facility will create,” added Sanderson.
