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Pilgrim's Pride reports Q1 financial results

Pilgrim's Pride has reported a net loss of $45.5 mln on net sales of $1.6 bln for the first quarter ended March 28, 2010.

These results include nonrecurring administrative restructuring charges and reorganisation expenses of $56.5 mln pre-tax, or $32.7 mln after tax.

For the comparable quarter a year earlier, the company reported a net loss of $58.8 mln on total sales of nearly $1.7 bln. Adjusted EBITDA, which excludes restructuring and reorganisation charges, was a positive $59.5 mln for the first quarter of fiscal 2010.

"While I am encouraged by the progress we have made in several areas of our business, our overall performance in the first quarter of fiscal 2010 was below our expectations," said Don Jackson, Pilgrim's Pride president and CEO.

The company said several factors contributed to the loss for the quarter, including: restructuring and reorganisation costs; a delay in the addition of new further-processed volume, which forced the company to sell commodity meat at lower prices; a loss of approx. $11 mln related to grain hedges, of which $6 mln was mark-to-market on open positions; and lower-than-anticipated market prices for dark meat. Jackson said the further-processed volume should be onboard before the end of June.

"Our single largest opportunity to create value is through improved product mix both in retail and foodservice," he explained. "At the same time, we must continue to focus on operating more efficiently. We are making good progress in all of these areas, and I am confident that our financial results in the second quarter will show significant improvement. Based on preliminary results, we were profitable for the month of April."

Natalie Berkhout

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