Pride Corp. reported a net loss of $120.8 million, or $0.56 per share, on net sales of $1.9 billion for the first quarter ended March 27, 2011. For the comparable quarter a year ago, the company reported a net loss of $45.5 million, or $0.21 per diluted share, on total sales of $1.6 billion.
"While this quarter is historically the weakest due to lower demand at this time of year, we encountered unusually tough circumstances due to high finished inventories, combined with rapidly increasing feed and other costs associated with our inventory levels, severe winter storms and depressed prices for chicken products," said Bill Lovette, Pilgrim's president and CEO. "As part of our plan to reduce working capital, we made the decision to liquidate inventories in the first quarter. While this decision helped our balance sheet by reducing inventories and turning assets into cash, it had a significant negative effect on margins and overall net revenue per pound sold in the quarter. At the same time, lower capacity utilization - including on our prepared-foods line - led to higher operating costs, and winter storms throughout much of the Southeast in mid-January closed a large number of our plants for several days at a time and hurt consumer demand."