LAUREL, Miss. – Sanderson Farms Farms Inc. held its annual stockholders meeting at the company's headquarters and completed numerous business items including a report on the company's performance during fiscal 2011, action on a stock repurchase program, and re-election of directors.
Joe F. Sanderson Jr., chairman and chief executive officer, told stockholders the company’s performance in fiscal 2011 was highlighted by a number of important accomplishments, and challenges. The company continued to grow its business by opening a new complex in Kinston, NC. But the economic environment and market conditions of the processing industry continued to challenge profitability.
“Sanderson Farms had record annual sales of $1.98 billion in fiscal 2011, surpassing our previous record of $1.93 billion in annual sales for fiscal 2010,” Sanderson said. “These results reflect the solid execution of our growth strategy to steadily increase our production capacity and expand our customer base. Consumer demand for chicken products at retail grocery stores was steady throughout the year and supported our sales growth. However, we continued to experience reduced demand from our food service customers, reflecting the considerable slowdown in restaurant traffic across the country.
“Over the past year, we have relied on our operational efficiencies, our commitment to our customers, and our strong balance sheet to support our business in an uncertain economy," Sanderson added. "We believe we have made the right decisions under challenging conditions, and made the necessary investments to expand our production capacity and continue our pattern of steady growth. In spite of the challenges we faced, we continued to honor our commitments and moved forward in ways that we believe will create greater value for our shareholders.”
In other company business, Sanderson Farms announced that the company's board of directors expanded and extended its stock repurchase program to Feb. 16, 2014. The plan calls for the repurchase of up to 1 million shares from time to time at prevailing prices in open market transactions or in negotiated purchases. Sanderson Farms has repurchased 782,096 shares under the program since 2009. In addition to these shares, the board of directors and its compensation committee authorized the repurchase of shares issued to the company’s stock incentive plan participants to meet withholding tax obligations incurred when their stock awards vest. Sanderson Farms currently has approximately 23 million shares of common stock outstanding, the company said.
“As in the past, we plan to use our stock repurchase program to offset shares issued through our equity compensation programs,” Sanderson said. “We believe this program represents a good use of corporate funds while minimizing potential dilution related to our equity compensation programs.”
Finally, stockholders re-elected three directors to three-year terms which will expire at the 2015 annual meeting. Re-elected to three-year terms were John H. Baker, III, proprietor of John H. Baker Interests; John Bierbusse, retired manager of Research, Administration, A.G. Edwards Inc. and Mike Cockrell, treasurer and chief financial officer, Sanderson Farms Inc.
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