Rising Hog, Beef Sales Help Smithfield Profits

US - Meat producer Smithfield Foods Inc., which operates the world’s largest hog slaughterhouse, in southeastern North Carolina, said yesterday that its fourth-quarter profit rose sharply, as rising pork and beef sales offset the higher cost of grain to feed its hogs.
calendar icon 8 June 2007
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In the pork segment, packaged-meats volume grew 31 percent, Smithfield Foods Inc. said.

Profit totaled $37 million, or 33 cents a share, for the quarter ended April 29, compared with $1.1 million, or a penny a share in the same period last year.

Results include a 4-cent charge on the value of some beef segment assets and a gain of 5 cents from a lower tax rate. The 2006 quarter included a 5-cent charge for restructuring East Coast pork-processing operations.

Sales rose 14 percent to $3.06 billion, from $2.68 billion a year ago.

Analysts polled by Thomson Financial had expected profit of 36 cents a share on revenue of $3.16 billion.

Shares of Smithfield fell 53 cents, or 1.6 percent, to close at $31.88.

Pork sales grew 19 percent to $2.06 billion; beef and hog-production sales also increased. However, hog-production operating profit fell, because of higher costs and the impact of circovirus, a hog sickness that dampened sales.

“Our hog-production business has been carrying Smithfield Foods for quite some time,” C. Larry Pope, the company president and chief executive, said in a conference call with analysts.

Source: Journalnow.com

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