Smithfield Foods has reported financial results for the company’s fiscal 2009 fourth quarter and full year. For the quarter, net loss was $78.8 million ($.55 per diluted share) versus net income of $2.4 million ($.02 per diluted share) in the prior year. The company reported that hog production losses continued and that the Type A H1N1 virus had no significant effect on the quarter.
For the year, the company reported a net loss of $190.3 million ($1.35 per diluted share) versus net income of $128.9 million ($.96 per diluted share) last year.
"Fiscal 2009 was one of the most challenging years in over three decades for the company,” said C.Larry Pope, Smithfield president and chief executive officer. “We faced grain and oil markets that reached record highs and then fell precipitously. But despite the challenges we confronted, we did not sit on the sidelines and wait for the economic conditions to improve; we have taken numerous actions to make us a more profitable company: namely, we repositioned the company's operations and made meaningful improvements to our liquidity and financial strength.”
“For the full year, the pork segment produced record profits, before the $88 million of restructuring costs, and is set to deliver very strong results going forward," Pope said.
"While the meat business looks very good, we are concerned about our hog production business as it deals with an oversupply of live hogs and the unintended consequences of the current ethanol policy,” Pope said. “This mandate toward increased usage of corn-based ethanol is resulting in more than 30 percent of the U.S. corn crop being diverted from animal feed to ethanol production.”
“While we fully support the development of alternative fuel sources, the usage of corn, the primary source of feed for all livestock, as fuel is simply not good economics. This is a dynamic the food industry has never before faced and has the unintended consequence of increasing food costs for the American consumer in the midst of a global recession," Pope said.
See Smithfield's full year results.