THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Thursday, February 23, 1995 TAG: 9502230365
SECTION: BUSINESS PAGE: D3 EDITION: FINAL
SOURCE: BY LON WAGNER, STAFF WRITER
LENGTH: Short : 39 lines
Smithfield Foods Inc. said Wednesday that net income for its fiscal third quarter soared to record levels due to lower hog prices and its participation in a federal program that exports pork to Russia.
The Smithfield-based meatpacker and processor reported net income of $17.3 million, or $1 per share, for the three months ending Jan. 29, a 48 percent increase from $11.7 million, or 69 cents a share, for the comparable period in 1994.
``An ample supply of hogs at relatively low prices led to significantly improved fresh meat margins and were an important factor in the record third-quarter earnings,'' said Joseph W. Luter III, the company's chairman, president and chief executive officer.
For the first nine months of its 1995 fiscal year, net income was a record $27.5 million, or $1.58 a share, which was more than double the $12.3 million, or 70 cents a share, earned in the year-earlier period.
Smithfield's strategy to buffer itself from fluctuations in the hog industry by raising its own hogs seemed to pay off in the third quarter. While the company's margins on fresh meat sales grew, the decline in hog prices meant Smithfield's hog production operations were not profitable for the second consecutive quarter.
Those production operations should become profitable in the fourth quarter, Luter said, if recent increases in live hog prices hold.
Smithfield's results for the third quarter reflected little, if any, contribution from the company's two newest efforts: a Flying-Pig program of air-shipped pork to Japan and the Lean Generation Pork program, the company's line of low-fat pork products. by CNB