THE VIRGINIAN-PILOT

                         THE VIRGINIAN-PILOT
                 Copyright (c) 1994, Landmark Communications, Inc.

DATE: THURSDAY, June 9, 1994                    TAG: 9406090538 
SECTION: BUSINESS                     PAGE: I1    EDITION: FINAL  
SOURCE: By PHIL MURRAY, STAFF WRITER 
DATELINE: 940609                                 LENGTH: Medium 

SMITHFIELD FOODS SEES ITS CHANGES START TO PAY OFF

{LEAD} Smithfield Foods Inc.'s massive investments in new facilities and products in the last three years are beginning to make a difference in the company's bottom line.

The Smithfield-based meatpacker posted better-than-expected results in the three-month period that ended May 1 - the company's fourth fiscal quarter - thanks in part to more efficient production at new and existing plants.

{REST} It was the second straight strong quarter for Smithfield, which had suffered through two years of depressed earnings.

Investors were pleased: Smithfield stock closed Wednesday at 24 3/4, up 1. And analysts are upbeat about the company's future.

``The company has clearly turned the corner,'' said George F. Shipp, a stock analyst in the Norfolk office of Scott & Stringfellow Inc., the Richmond-based brokerage.

In the most recent period, Smithfield's net income soared to $7.4 million, up from $536,000 in the same quarter a year ago.

For the entire fiscal year, the company's net income was $19.7 million, a fivefold increase from the previous year. Sales for the year increased 26 percent to $1.45 billion.

The difference, companies officials said, was improved efficiencies at the new Bladen County, N.C., hog-slaughtering plant and fatter profits on fresh pork and processed meats. The $76 million plant, which opened in October 1992, had been a drag on earnings while it worked out kinks.

Assuming stable industry conditions, the company expects ``significant improvement'' over 1994 in the current year's financial results.

Shipp agreed.

``Our hope is that this is the second in a series of up quarters. I think there's still room for improvement.''

by CNB