Income rises 11% for Seaboard’s trading, milling unit
SHAWNEE MISSION, KAS. — Operating income of the Commodity Trading and Milling Division of Seaboard Corp. in the first quarter ended March 31 increased 11% to $25,693,000 from $23,072,000, reflecting higher margins on commodity sales, especially wheat sales to non-consolidated affiliates, partially offset by mark-to-market adjustments. Excluding mark-to-market adjustments, operating income in the quarter increased 75% to $19,400,000 from $11,100,000.
Division sales totaled $724,538,000 in the first quarter, up 2% from $712,231,000.
Operating income in the company’s Pork segment totaled $400,661,000, down 5% from $423,969,000 in the same period a year ago.
“The decrease was primarily a result of higher feed costs and, to lesser extent, lower prices for pork products,” Seaboard said in a May 4 filing with the Securities and Exchange Commission. “Management is unable to predict future market prices for pork products or the cost of feed. However, management anticipates positive operating income for the remainder of 2012, although at a lower level than 2011.”
Sales in the Pork division fell 34% to $52,873,000 from $79,595,000, reflecting decreases in overall sales prices and sales volume for pork products and also lower sales volume of biodiesel.
In the company’s Sugar segment, operating income totaled $16,977,000 in the first quarter, down 24% from $22,439,000 in the same period of fiscal 2011. Seaboard said the decrease reflected higher costs of sugar purchased from third parties for resale in excess of increased selling prices, and, to a lesser extent, higher selling and administrative personnel costs.
Net sales for the Sugar segment in the first quarter rose 10% to $73,619,000 from $67,003,000.
Overall, Seaboard Corp. net income in the first quarter was $82,209,000, equal to $68 per share on the common stock, down 30% from $116,864,000, or $96.11 per share, in the first quarter of fiscal 2011.
Net sales for the quarter totaled $1,471,113,000, up narrowly from $1,468,179,000 in the same period last year.