LAUREL, Miss. — Joe Sanderson Jr., chairman and CEO of Sanderson Farms Inc., has good reason to look forward to better times in the new year as the poultry company’s fiscal year, which ended Oct. 31, marked the end of a challenging quarter and a lackluster 2018. Detailing the company’s Q4 loss, Sanderson referenced weak market prices for products made at the company’s big bird foodservice plants, reduced demand for chicken at retail and the negative impact two hurricanes had on the company’s bottom line in 2018.
During a Dec. 20 conference call with analysts, the company’s leader highlighted some positive developments during the year in addition to some promising prospects for 2019. For example, Sanderson Farms sold a record 4.4 billion lbs. of poultry products during fiscal 2018, which compared with 4.22 billion lbs. in fiscal 2017. He also mentioned that the company moved its St. Pauls, North Carolina, plant to full production and that it continued construction on its new Tyler, Texas, complex.
“While our overall performance in some areas during 2018 was good, we have identified significant opportunities in our operation in areas where we underperformed in 2018,” Sanderson said. “We start the new year in pretty good shape. Our balance sheet is strong. We started fiscal 2019 debt-free, and the company is well positioned to continue our growth strategy in the future. The new Tyler complex demonstrates our optimism and our confidence in the long-term success of Sanderson Farms and our industry. The new complex will add value for our investors, opportunities for our employees and their communities and more high-quality products for new customers. We are committed to continue our growth beyond Tyler, but we will take this year to work on our operations and sales at our existing facilities.
“Market conditions are challenging as we start the year. But no matter the market conditions, we will continue to focus on those things we can control and manage the others as best we can.”
In late November, Sanderson announced that by March 1, 2019, the company will discontinue the use of antibiotics considered medically important for humans in its live poultry operations. Prior to this announcement, Sanderson was one of the last holdouts among large poultry processors, that had not budged on its use of antibiotics in its flocks. This development represents an evolution in the company’s firm stance defending its responsible use of antibiotics.
In 2017, shareholders rejected a proposal to phase out the use of medically important antibiotics in Sanderson’s poultry production, and Sanderson recommended that shareholders vote against the proposal. In a letter to shareholders, Sanderson emphasized the company’s commitment to finding alternative methods of controlling avian disease such as working with drug companies to phase out medically important antibiotics when alternatives become available.