Source:  MEATINGPLACE.COM, 2/4/10

Pilgrim's Pride Corp., which exited bankruptcy protection in December, on Thursday posted a quarterly profit fueled by a one-time tax gain, and said it may reopen one of its several idled plants this year due to improving poultry demand.

Pilgrim's Pride, now majority-owned by Brazilian meat giant JBS S.A., said the industry is poised for improvement and signaled its intention to boost production modestly and continue to recoup market share.

The company is considering reopening one of its shuttered production plants by the end of this year, Pilgrim's chief executive, Don Jackson, told Wall Street analysts on a conference call.

"Pilgrim's Pride is finished cutting production. There is no plan to close any more plants," Jackson said, noting the company's active plants are now operating at about 92 percent of capacity.

The poultry producer remains focused on improving its product mix as it de-emphasizes production of commodity chicken, recovering market share and operating more efficiently, Jackson said. Pilgrim's share of the poultry market has rebounded to 20 percent, still below its pre-bankruptcy level of 24 percent, he said.

Pilgrim's plans to outpace the industry's current 1 percent growth rate this year as it continues to recoup business lost while it retrenched during the bankruptcy process.

Tighter chicken supplies and strong export demand have buoyed prices, with breasts up 8 percent and wings up 37 percent in the latest quarter from a year ago, although prices for leg quarters have declined, Pilgrim's Pride said.

Overall, pricing has strengthened since the end of December, but Russia's effective ban on imports of U.S. poultry has caused a lot of concern in the industry, Jackson said.

"We are monitoring the situation and remain cautiously optimistic that a resolution can be reached near term," he said.

Pilgrim's Pride reported a profit of $33.6 million, or 44 cents per share, in the quarter ended Dec. 27, compared with a loss of $228.8 million, or $3.09 per share, a year ago. Results included a $102.4 million income tax benefit and a $32.7 million charge for reorganization costs.

Revenue declined to $1.60 billion from $1.88 billion a year ago due to production cutbacks and the company's reorganization.

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