“The results for the first quarter of fiscal 2011 were influenced by a number of factors,” said Joe F. Sanderson, Jr., chairman and CEO of Sanderson Farms Inc. “Overall, we experienced lower poultry market prices than the same period a year ago, primarily due to an oversupply of chicken during the first quarter of fiscal 2011. While retail demand for chicken has remained steady, we have continued to see weak food service demand, and we expect this trend will remain until the national unemployment rate improves. Consumers are simply not dining out as frequently and restaurant traffic has remained under pressure. We also experienced a significant increase in feed costs during the quarter, compared with a year ago, and this affected our profitability.”
“While market conditions have been challenging, we are pleased with the successful start-up of our new Kinston, N. C., facility,” Sanderson continued. “This project was completed on time and on budget, and, as planned, we began processing chickens in Kinston in January 2011. At full capacity, which is expected to be reached early during calendar 2012, the Kinston complex will employ approximately 1,500 people and will be equipped to process and sell 6.7 million pounds per week of dressed poultry meat. We look forward to the new marketing opportunities the Kinston plant will provide for Sanderson Farms as we embark on our next phase of growth in fiscal 2011.”