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Seaboard Corp Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: August 9, 2011 04:11PM

Seaboard Corp (SEB) filed Quarterly Report for the period ended 2011-07-02. Seaboard Corp. has a market cap of $2.96 billion; its shares were traded at around $2363 with a P/E ratio of 8.8 and P/S ratio of 0.7. Seaboard Corp. had an annual average earning growth of 4.9% over the past 10 years.



Highlight of Business Operations:

Assets: Available-for-sale securities-short-term investments: Corporate bonds $ 95,903 $ - $ 95,903 $ - Fixed income mutual funds 78,821 78,821 - - Money market funds 72,622 72,622 - - Fixed rate municipal notes and bonds 18,110 - 18,110 - U.S. Government agency securities 16,286 - 16,286 - U.S. Treasury securities 5,762 - 5,762 - Variable rate demand notes 3,200 - 3,200 - Asset backed debt securities 3,058 - 3,058 - Other 801 - 801 - Trading securities - short-term investments: High yield debt securities 21,261 - 21,261 - Other debt securities 4,393 - 4,393 - Trading securities - other current assets: Domestic equity securities 14,496 14,496 - - Foreign equity securities 9,136 4,850 4,286 - Fixed income mutual funds 4,874 4,874 - - Money market funds 3,897 3,897 - - U.S. Treasury securities 2,150 - 2,150 - U.S. Government agency securities 2,111 - 2,111 - Other 234 169 65 - Derivatives: Commodities 8,068 8,068 - - Interest rate swaps 1,084 - 1,084 - Foreign currencies 240 - 240 - Total Assets $366,507 $187,797 $178,710 $ -

Liabilities: Derivatives: Commodities(1) $ 27,425 $ 27,425 $ - $ - Interest rate swaps 1,973 - 1,973 - Foreign currencies 2,679 - 2,679 - Total Liabilities $ 32,077 $ 27,425 $ 4,652 $ -

Assets: Available-for-sale securities - short-term investments: Money market funds $110,164 $110,164 $ - $ - Corporate bonds 87,401 - 87,401 - Fixed income mutual funds 60,302 60,302 - - Fixed rate municipal notes and bonds 20,648 - 20,648 - U.S. Government agency securities 17,514 - 17,514 - U.S. Treasury securities 7,148 - 7,148 - Asset backed debt securities 2,848 - 2,848 - Other 2,355 - 2,355 - Trading securities- short term investments: High yield debt securities 20,783 - 20,783 - Other debt securities 3,042 - 3,042 - Trading securities - other current assets: Domestic equity securities 13,332 13,332 - - Foreign equity securities 8,157 4,131 4,026 - Fixed income mutual funds 3,758 3,758 - - Money market funds 3,208 3,208 - - U.S. Treasury securities 2,732 - 2,732 - U.S. Government agency securities 1,371 - 1,371 - Other 183 157 26 - Derivatives: Commodities 15,966 15,958 8 - Interest rate swaps 1,410 - 1,410 - Foreign currencies 120 - 120 - Total Assets $382,442 $211,010 $171,432 $ -

Liabilities: Derivatives: Commodities(1) $ 9,170 $ 9,170 $ - $ - Interest rate swaps 1,161 - 1,161 - Foreign currencies 11,652 - 11,652 - Total Liabilities $ 21,983 $ 9,170 $ 12,813 $ -

Components of net periodic benefit cost: Service cost $ 1,805 $ 1,558 $ 3,732 $ 3,169 Interest cost 2,249 2,165 4,543 4,327 Expected return on plan assets (1,684) (1,573) (3,319) (3,107) Amortization and other 992 994 2,043 1,997 Net periodic benefit cost $ 3,362 $ 3,144 $ 6,999 $ 6,386

On April 8, 2011, Seaboard closed the sale of its two floating power generating facilities in the Dominican Republic, the Estrella Del Norte ("EDN") and Estrella Del Mar ("EDM"), for $73,102,000 (net of $3,000,000 placed in escrow for potential dry dock costs). During March 2009, $15,000,000 was paid to Seaboard. In the second quarter of 2011, the previously escrowed balance of $55,000,000, less $3,000,000 to remain in escrow for potential dry dock costs, plus $2,796,000 of escrow earnings and $3,306,000 for various inventory items related to the EDN, was paid to Seaboard. Seaboard received $1,500,000 of the $3,000,000 in escrow subsequent to July 2, 2011. Seaboard ceased depreciation on January 1, 2010 for these two power generating facilities but continued to operate them until March 30, 2011. The net book value of the two power generating facilities and various inventory items related to EDN was $21,679,000 at the sale close date. Seaboard recognized a gain on sale of assets of $51,423,000 in operating income in the second quarter of 2011. In late March 2011, the purchaser entered into discussions with Seaboard to lease the EDM to Seaboard for a short period of time. On April 20, 2011, Seaboard signed a short-term lease agreement that allowed Seaboard to resume operations of the EDM (72 megawatts) and operate it through approximately March 31, 2012. Seaboard and the purchaser also agreed to defer the sale to the purchaser of the inventory related to the EDM until the end of the lease term. Seaboard retained all other physical properties of this business and is currently building a 106 megawatt floating power generating facility for use in the Dominican Republic for approximately $125,000,000. This new facility is anticipated to begin operations by the end of 2011 or early 2012, resulting in lower sales for this segment for the remainder of 2011.

Read the The complete Report



Stocks Discussed: SEB,
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