Smithfield Foods Inc. (SFD, Financial) filed Quarterly Report for the period ended 2009-11-01.
Smithfield Foods, Inc. is one of the world's largest pork processors and hog producer. Smithfield Foods conducts its business through two groups, the Meat Processing Group and the Hog Production Group. The Meat Processing Group produces domestically and internationally a wide variety of fresh pork and processed meat products and markets them nationwide and to foreign markets. The company has vertically integrated into hog production through its Hog Production Group, which provides the Meat Processing Group with its live hog requirements. Smithfield Foods Inc. has a market cap of $2.7 billion; its shares were traded at around $16.33 with and P/S ratio of 0.2. Smithfield Foods Inc. had an annual average earning growth of 1.9% over the past 10 years.
The farm assets we intend to sell, which consist solely of property, plant and equipment, have been reclassified as held for sale within prepaid expenses and other current assets in the consolidated condensed balance sheets. The carrying amount of those assets was $27.9 million as of November 1, 2009 and $33.1 million as of May 3, 2009.
In February 2009 (fiscal 2009), we announced a plan to consolidate and streamline the corporate structure and manufacturing operations of our Pork segment (the Restructuring Plan). This restructuring is intended to make us more competitive by improving operating efficiencies and increasing plant utilization. By the end of the first quarter of fiscal 2010, all of the targeted plants had been closed except for The Smithfield Packing Company, Incorporated s Smithfield South plant, which is expected to close by the end of the third quarter of fiscal 2010. The Restructuring Plan is expected to result in annual cost savings and improved pre-tax earnings, after applicable restructuring charges, of approximately $55 million in fiscal 2010 and $125 million by fiscal 2011. Our results through the first two quarters of fiscal 2010 indicate that we are on target to achieve these estimates.
Of the $9.7million of restructuring charges recorded in fiscal 2010, $7.1 million was recorded in cost of sales with the remainder recorded in selling, general and administrative expenses. Substantially all of the estimated remaining expenses are expected to be incurred through the end of fiscal 2010. We also estimate that an additional $21 million in capital expenditures will be incurred relative to plant consolidations through the remainder of fiscal 2010.
Read the The complete ReportSFD is in the portfolios of Steve Mandel of Lone Pine Capital, Michael Price of MFP Investors LLC, Louis Moore Bacon of Moore Capital Management, LP, Arnold Schneider of Schneider Capital Management, Andreas Halvorsen of Viking Global Investors LP, David Einhorn of Greenlight Capital Inc, Jeremy Grantham of GMO LLC.
Smithfield Foods, Inc. is one of the world's largest pork processors and hog producer. Smithfield Foods conducts its business through two groups, the Meat Processing Group and the Hog Production Group. The Meat Processing Group produces domestically and internationally a wide variety of fresh pork and processed meat products and markets them nationwide and to foreign markets. The company has vertically integrated into hog production through its Hog Production Group, which provides the Meat Processing Group with its live hog requirements. Smithfield Foods Inc. has a market cap of $2.7 billion; its shares were traded at around $16.33 with and P/S ratio of 0.2. Smithfield Foods Inc. had an annual average earning growth of 1.9% over the past 10 years.
Highlight of Business Operations:
Net loss was $26.4 million, or $(.17) per diluted share, in the second quarter of fiscal 2010, compared to net income of $1.7 million, or $.01 per diluted share, in the same quarter last year. The following significant factors impacted second quarter of fiscal 2010 results compared to the second quarter of fiscal 2009:The farm assets we intend to sell, which consist solely of property, plant and equipment, have been reclassified as held for sale within prepaid expenses and other current assets in the consolidated condensed balance sheets. The carrying amount of those assets was $27.9 million as of November 1, 2009 and $33.1 million as of May 3, 2009.
In February 2009 (fiscal 2009), we announced a plan to consolidate and streamline the corporate structure and manufacturing operations of our Pork segment (the Restructuring Plan). This restructuring is intended to make us more competitive by improving operating efficiencies and increasing plant utilization. By the end of the first quarter of fiscal 2010, all of the targeted plants had been closed except for The Smithfield Packing Company, Incorporated s Smithfield South plant, which is expected to close by the end of the third quarter of fiscal 2010. The Restructuring Plan is expected to result in annual cost savings and improved pre-tax earnings, after applicable restructuring charges, of approximately $55 million in fiscal 2010 and $125 million by fiscal 2011. Our results through the first two quarters of fiscal 2010 indicate that we are on target to achieve these estimates.
Of the $9.7million of restructuring charges recorded in fiscal 2010, $7.1 million was recorded in cost of sales with the remainder recorded in selling, general and administrative expenses. Substantially all of the estimated remaining expenses are expected to be incurred through the end of fiscal 2010. We also estimate that an additional $21 million in capital expenditures will be incurred relative to plant consolidations through the remainder of fiscal 2010.
Read the The complete ReportSFD is in the portfolios of Steve Mandel of Lone Pine Capital, Michael Price of MFP Investors LLC, Louis Moore Bacon of Moore Capital Management, LP, Arnold Schneider of Schneider Capital Management, Andreas Halvorsen of Viking Global Investors LP, David Einhorn of Greenlight Capital Inc, Jeremy Grantham of GMO LLC.
