Egg Industry News and Commentary

  —  Mar 1

 
Sanderson Farms Reports on Q1 of FY 2017

    

In a press release dated February 23rd Sanderson Farms (SAFM) announced results for the 1st Quarter of Fiscal 2016 ending January 31st 2017.           

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as $ x 1,000 except EPS)

  

 

 1st Quarter Ending December 31st

2017

2016

Difference (%)

Sales:

$688,346

$605,166

+13.7

Gross profit:

$81,955

$50,105

+63.6

Operating income:             

$35,885

$19,811

+81.1

Net Income

           $23,173

$10,681

 

+116.7

Diluted earnings per share:

$1.02

$0.47

+117.0

Gross Margin (%)

11.9

8.3

+43.4

Operating Margin (%)

5.2

3.3

+57.5

Profit Margin (%)

3.4

1.8

+88.9

Long-term Debt:

$0

                $0

            -

12 Months Trailing:

 

 

 

                                  %Return on Assets

14.3

 

 

                                  %Return on Equity

17.9

 

 

                                  %Operating Margin

10.7

 

 

                                  %Profit Margin

7.0

 

 

Total Assets

$1,451,538

  $1,422,700

 

Market Capitalization

$2,150,000

                          

          

 

52-Week Range in Share Price:          $74.07         to             $99.40

Market Open 24th Feb., post release   $90.41; Close 24th $94.30

Forward PE: 11.6

 

In commenting on results, Joe F. Sanderson, Jr., Chairman and CEO of Sanderson Farms stated “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. 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 added “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.

In reference to expansion Sanderson stated “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."