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Sanderson reports quarterly results

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LAUREL, Miss. — Sanderson Farms Inc. has reported results for the fourth quarter and fiscal year ended Oct. 31, 2015.

Net sales for the fourth quarter of fiscal year 2015 were $679.6 million compared with $760.9 million for the same period a year ago. For the quarter, the company reported net income of $27.4 million, or $1.22 per share, compared with net income of $93.1 million, or $4.04 per share, for the fourth quarter of fiscal 2014.

Net sales for fiscal 2015 were $2.803 billion compared with $2.775 billion for fiscal 2014. Net income for the year totaled $216 million, or $9.52 per share, compared with net income of $249 million, or $10.80 per share, for last year.

“While conditions during the fourth quarter of fiscal 2015 deteriorated in the big bird deboning market, the quarter marked the end of another successful year for Sanderson Farms,” said Joe F. Sanderson Jr., chairman and CEO of Sanderson Farms Inc. “We reported record annual sales of $2.803 billion, a 1.0 percent increase over fiscal 2014. While overall poultry market prices declined compared with fiscal 2014, grain prices were significantly lower during the year when compared with fiscal 2014. For the year, we sold 3.418 billion pounds of dressed poultry, another record, compared with 3.045 billion pounds in fiscal 2014.”

According to Sanderson, overall market prices for poultry products were significantly lower in the fourth quarter of fiscal 2015 compared with prices a year ago. As measured by an average of the Georgia dock price for whole chickens, prices were higher by approximately 1.2 percent in the company’s fourth fiscal quarter compared with the same period in fiscal 2014, and were higher by 5.6 percent for the fiscal year compared with the prior year. The Georgia Dock whole bird price remained in record territory during fiscal 2015 and reflected strong demand for the company’s retail chill pack product during this fiscal year.

Boneless breast meat prices averaged 29.5 percent lower in the fourth quarter than the prior-year period. For fiscal 2015, boneless prices were 15.4 percent lower when compared with fiscal 2014. Jumbo wing prices averaged $1.48 per pound during the fourth quarter of fiscal 2015, down 1.3 percent from the average of $1.50 per pound during the prior-year period. Jumbo wing prices averaged $1.52 per pound during the fiscal year, up 26.9 percent from the average of $1.20 per pound for fiscal 2014.

The average market price for bulk leg quarters decreased approximately 53.3 percent for the quarter, and decreased approximately 31.5 percent for fiscal 2015. Lower dark meat prices reflect the significant decline in industry export volumes during the second half of fiscal 2015. Cash prices for corn during the fourth fiscal quarter increased slightly by 0.4 percent, while soybean meal cash prices were down 21.2 percent.

“We are pleased that our profitability during fiscal 2015 allowed us to fund our planned expansion in Palestine, Texas, further reduce outstanding debt, strengthen our balance sheet, and reward our shareholders with a special dividend,” Sanderson added. “We are well positioned to continue our growth strategy as we continue to move our new poultry complex in Palestine, Texas, to full production and continue construction of our newest complex in St. Pauls, N.C. The pounds produced in Palestine and St. Pauls, at full production, will represent a 32 percent increase in our capacity.”

“As of October 31, 2015, our balance sheet reflected $1.251 billion in assets, stockholders’ equity of $1.030 billion and net working capital of $401.5 million,” he said. “We had no long-term debt at year-end. A strong balance sheet is an important advantage in our industry and provides us with the financial strength to not only support our growth strategy, but also to manage our operations through cycles that characterize our industry.

“We deeply appreciate the hard work and dedication to excellence of our employees, growers and everyone associated with our company.”

More information can be obtained at www.sandersonfarms.com.

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