Smithfield Foods Reports Record Third Quarter Results

SMITHFIELD, Va., March 10, 2011 (GLOBE NEWSWIRE) -- Smithfield Foods, Inc. (NYSE:SFD) today reported record fiscal 2011 third quarter results. All comparisons are to the third quarter of fiscal 2010.

Highlights

-- Net income was $202.6 million, or $1.21 per diluted share, an improvement of $165.3 million

-- Adjusted EPS of $.84 was record high for the third quarter

-- Consolidated operating profit improved $276.2 million, or $155.6 million after adjusting for a fire insurance recovery gain of $120.6 million

• Pork segment produced record third quarter operating profit

• Pork earnings increased $102.0 million to $254.8 million
• Fresh pork operating profit improved $119.1 million to $130.3 million
• Packaged meats results remained strong at $124.5 million

• Hog Production segment operating results increased $75.8 million
• International segment results were steady at $34.5 million

-- Consolidated sales increased 10% to $3.2 billion

-- Fundamentals are strong in all operating segments

• Pork cutout reached record highs
• Export demand remained very strong
• Pork in cold storage remained low
• U.S. hog inventory reported below year ago for ninth consecutive quarter in December

-- Repurchased $390.9 million of 2013 and 2014 notes subsequent to quarter end; retired $913 million of total debt during current fiscal year

Following are the company's sales, operating profit and margin by segment (dollars in millions):

	Three Months Ended				Nine Months Ended
	January 30, 2011		January 31, 2010		January 30, 2011		January 31, 2010
Sales:
Pork
Fresh Pork	$ 1,093.1		$ 1,038.6		$ 3,336.3		$ 3,090.8
Packaged Meats	1,591.6		1,360.8		4,240.0		3,802.1
Total Pork	2,684.7		2,399.4		7,576.3		6,892.9
Hog Production	649.9		597.4		2,004.8		1,541.3
International	355.9		338.5		1,001.6		965.2
Other	12.9		27.3		74.7		125.2
Total segment sales	3,703.4		3,362.6		10,657.4		9,524.6
Intersegment	(517.2)		(477.9)		(1,571.1)		(1,232.2)
Consolidated	$ 3,186.2		$ 2,884.7		$ 9,086.3		$ 8,292.4
Operating profit (loss) and margin %:
Pork
Fresh Pork	$ 130.3		$ 11.2		$ 289.7		$ 50.5
Packaged Meats	124.5		141.6		267.3		377.0
Total Pork	254.8	9%	152.8	6%	557.0	7%	427.5	6%
Hog Production	(2.3)	0%	(78.1)	(13)%	139.8	7%	(453.0)	(29)%
International	34.5	10%	35.6	11%	103.1	10%	104.0	11%
Other	(0.5)	(4)%	6.6	24%	(2.3)	(3)%	1.2	1%
Corporate	86.2		(20.4)		30.8		(56.2)
Consolidated	$ 372.7	12%	$ 96.5	3%	$ 828.4	9%	$ 23.5	0%

Sales for the third quarter of fiscal 2011 were $3.2 billion, up 10%. The increase is primarily attributable to higher average unit selling prices in the Pork segment and higher live hog market prices. The company reported net income in the current quarter of $202.6 million ($1.21 per diluted share) compared to net income of $37.3 million ($.22 per diluted share) last year, an improvement of $165.3 million.