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Pilgrim's Pride Swings to Loss, Closes Plant

GREELEY, Colo. ( TheStreet) -- Pilgrim's Pride (PPC - Get Report) posted a wider-than-expected second quarter loss as rising feed costs pressured results.

The chicken producer said early Friday that costs for feed rose more than $400 million in the first half of the year from year-earlier costs, as rising commodity prices for things like corn and soymeal have surged.

Pilgrim's Pride booked a net loss of $128.1 million, or 60 cents a share, compared with a year-earlier profit of $32.9 million, or 15 cents a share. Analysts had expected the company to lose $48.8 million, or 23 cents a share.

Revenue rose 12.3% to a better-than-expected $1.92 billion from $1.71 billion.

"Our second-quarter financial results reflect the significant challenges facing our industry this year from the combination of record-high feed costs, weaker-than-expected consumer demand and an oversupply of chicken," said CEO Bill Lovette. "At this time of year we are usually benefiting from stronger market pricing and increased demand from both foodservice and retail, but to date neither that demand nor pricing has materialized."

Pilgrim's Pride also announced early Friday it would close its Dallas processing facility by late September as part of its continuing effort to reduce costs and operate more efficiently.

Shares of Pilgrim's Pride were unchanged in premarket trading Friday after the stock closed lower at $4.96 in Thursday's session.
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