Source:  Rita Jane Gabbett, MEATINGPLACE.COM, 8/3/09

Pilgrim's Pride reported net income of $53.2 million, or $0.72 per common share, on sales of $1.77 billion in its fiscal third quarter ended June 27.

That compared to a loss of 52.8 million, or 75 cents per share, on sales of $2.03 billion in it year ago third quarter.

For the nine months ended June 27, Pilgrim's Pride reported a net loss of $234.3 million, or $3.16 per common share on sales of $5.35 billion. This compares to a year ago nine-month loss of $197.8 million.

"The company experienced an improved business environment in the third quarter of 2009," Pilgrim's Pride said in a filing with the Securities and Exchange Commission.

Market prices for feed ingredients decreased in the past nine months, after reaching unprecedented levels in the last half of 2008. "Market prices for feed ingredients remain volatile, however, and there can be no assurance that they will not increase materially," the company noted.

The company also said market prices for chicken products have stabilized since the end of 2008 but remain below levels sufficient to offset the generally higher costs of feed ingredients.

Many producers within the industry, including Pilgrim's Pride, cut production in 2008 and 2009 in an effort to correct the general oversupply of chicken in the United States. Until recently, these production cuts had a positive effect on chicken product prices.

"Despite these production cuts, there can be no assurance that chicken prices will not decrease due to such factors as weakening demand for breast meat from food service providers and lower prices for chicken leg quarters in the export market as a result of weakness in world economies and restrictive credit markets," the filing warned.

"We continue to review and evaluate various restructuring and other alternatives to streamline our operations, improve efficiencies and reduce costs. Such initiatives may include selling assets, idling facilities, consolidating operations and functions, relocating or reducing production and voluntary and involuntary employee separation programs," Pilgrim's Pride noted.

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