* 2nd-quarter adj earnings/share $0.61 vs est $0.45
* 2nd-quarter sales $3.22 bln vs est $3.30 bln
* Packaged meats operating margin up 7 pct
Dec 6 Smithfield Foods Inc's
second-quarter profit beat estimates as margins rose and volumes
grew in its packaged meats business, and the largest U.S. pork
and hog producer said it expects the growth to continue for the
rest of its fiscal year.
The company said it expects its new Smithfield Pecan Praline
and Caramel Apple spiral sliced hams and Cook's spiral sliced
hams to boost packaged food revenue in the current quarter.
Smithfield gets about 46 percent of its revenue from
packaged meats, including brands such as Armour, Farmland and
The company has been introducing new brands such as Eckrich
Bacon Lovers Deli Meats and Kretschmar over the past year.
Margins in the packaged meats segment rose to 7 percent in
the second quarter from 5 percent a year earlier on lower
material costs. Volume at the business rose about 2 percent.
Total revenue fell nearly 3 percent to $3.23 billion.
Hog operating margins fell to a negative 4 percent, hurt by
higher grain costs and lower live hog prices.
The company, however, expects lower supplies of competing
proteins to boost hog prices in the second half of its fiscal
year, ending April 2013.
Net income fell to $10.9 million, or 7 cents per share, in
the quarter ended Oct. 28 from $120.7 million, or 74 cents per
share, a year earlier.
Excluding debt-related transactions, the company, which also
owns the Gwaltney, Margherita and Healthy Ones brands, earned 61
cents per share.
Analysts on average expected the company to earn 45 cents
per share on revenue of 3.30 billion, according to Thomson
Smithfield shares, which have risen more than 15 percent in
the past three months, closed at $22.90 on the New York Stock
Exchange on Wednesday.