Sanderson Farms SAFM Dec 2008 Presentation

March 27, 2018 | Author: Ala Baster | Category: Form 10 K, Economies, Foods, Finance (General), Business
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New York InvestorPresentation December 9-10, 2008 Forward Looking Statement Warning This presentation contains forward-looking statements about the business, financial condition and prospects of the Company. The actual performance of the Company could differ materially from that indicated by the forward-looking statements because of various risks and uncertainties. These risks and uncertainties are described in our most recent Annual Report on Form 10-K, and in the Company’s Quarterly Report on Form 10-Q filed with the SEC in connection with its third fiscal quarter ended July 31, 2008. 2 Who We Are • Incorporated in 1955 • Vertically Integrated in 1961 • Initial Public Offering in 1987 • NASDAQ – SAFM • 4th Largest Poultry Processor in US 3 Plant Locations and Acquisition Dates z z z z z z z z z z *On hold Location Poultry plant, Hazlehurst, MS Poultry plant, Laurel, MS Poultry plant, Hammond, LA Poultry plant, Collins, MS Prepared food plt, Jackson, MS Poultry plant, McComb, MS Poultry plant, Bryan, TX Poultry plant, Moultrie, GA Poultry plant, Waco, TX Poultry plant, Kinston, NC* Year 1961 1965 1974 1981 1986 1993 1997 2005 2007 * Total Capacity Head/Week Big Bird Retail Deboning Total     625,000     625,000     625,000  1,250,000 ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐  1,250,000  1,250,000  1,250,000  1,250,000  1,250,000  5,000,000  4,375,000 =  9,375,000 4 Facilities Š Waco, TX (2007) - Hatchery, Processing Facility - 1,250,000 chickens/week - 1,572,480 eggs/week Š McComb, MS (1993) - Hatchery, Feedmill, Processing Facility - 1,250,000 chickens/week - 1,814,400 eggs/week Š Kinston, NC (On Hold) - Hatchery, Feedmill, Processing Facility - 1,250,000 chickens/week - 1,572,480 eggs/week Š Hazlehurst, MS (1961) - Hatchery, Feedmill, Processing Facility - 625,000 chickens/week - 1,391,040 eggs/week Š Jackson, MS (1986) - Prepared Foods Facility Š Bryan, TX (1997) - Hatchery, Feedmill, Processing Facility - 1,250,000 chickens/week - 1,572,480 eggs/week Š Hammond, LA (1974) - Processing Facility - 625,000 chickens/week Š Moultrie, GA (2005) - Hatchery, Feedmill, Processing Facility - 1,250,000 chickens/week - 1,572,480 eggs/week Š Laurel, MS (1965) - Hatchery, Feedmill, Processing Facility, Corporate Offices - 625,000 chickens/week Legend - 604,800 eggs/week Š Big Bird Deboning ŠCollins, MS (1981) Š Chill Pack - Hatchery, Feedmill, Processing Facility Š Prepared Foods - 1,250,000 chickens/week - 1,572,480 eggs/week 5 3,000 2,750 2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 500 250 0 Pounds Processed Pounds (Millions) 2,441 2,500 2,601 2,601 4% 0% 2010 2011 2,025 1,802 986 722 1997 1,077 1,167 1,308 1,437 1,530 1,580 795 8% 10% 10% 24% 9% 12% 6% 1998 1999 2000 2001 2002 2003 2004 3% 2005 14% 12% 2006 2007 21% 2008 2% 2009 Sales Growth $2,000 (Millions) $1,800 $1,600 $1,400 874 1,052 1,053 1,048 $800 2003 2004 2005 2006 392 455 481 521 559 606 706 744 $600 1995 1996 1997 1998 1999 2000 2001 2002 $400 $200 1,475 $1,000 1,724 $1,200 $0 2007 2008 6 What Are Our Strengths • A Low Cost Producer • Favorable Product Mix • Steady, Manageable Growth • Strong, Conservative Balance Sheet 7 Chill Pack Product 8 RETAIL CUSTOMERS WE ARE PROUD TO SERVE 9 Prepared Foods 10 11 12 Broiler Eggs Set 106% 104% 102% 100% 98% 96% 94% 92% 90% 88% Previous 52 Wks Source: USDA Nov-08 Oct-08 Sep-08 Aug-08 Jul-08 Jun-08 May-08 Apr-08 Mar-08 Feb-08 Jan-08 Dec-07 86% Current 52 Wks 13 USDA Broiler-Type Eggs Set (in thousands) Week of Jan 05 Jan 12 Jan 19 Jan 26 Feb 02 Feb 09 Feb 16 Feb 23 Mar 01 Mar 08 Mar 15 Mar 22 Mar 29 Apr 05 Apr 12 Apr 19 Apr 26 May 03 May 10 May 17 May 24 May 31 Jun 07 Jun 14 Jun 21 Jun 28 2005 210,241 210,232 209,419 210,607 211,314 213,567 213,830 213,897 214,037 214,134 213,460 212,827 212,819 212,400 217,067 213,639 214,053 214,496 214,968 215,855 216,179 215,767 215,859 215,865 214,570 212,615 Source: USDA 2006 213,631 213,887 215,411 213,665 213,110 212,616 215,181 216,842 216,674 216,953 213,723 211,053 213,405 215,324 214,411 212,618 209,630 211,907 213,275 213,440 213,510 213,289 214,205 210,878 210,792 208,353 2007 210,475 211,204 208,591 210,236 211,617 212,295 214,750 214,659 216,547 215,053 215,611 215,509 216,513 218,877 219,385 220,515 218,515 218,353 219,938 219,928 219,527 218,990 219,184 217,590 216,287 210,141 2008 217,209 215,444 216,499 217,333 218,338 217,271 218,479 219,311 219,820 219,355 218,469 215,850 214,627 217,082 215,925 214,822 213,675 214,415 214,502 218,141 217,153 216,826 217,489 213,146 213,717 210,641 Week of Jul 05 Jul 12 Jul 19 Jul 26 Aug 02 Aug 09 Aug 16 Aug 23 Aug 30 Sep 06 Sep 13 Sep 20 Sep 27 Oct 04 Oct 11 Oct 18 Oct 25 Nov 01 Nov 08 Nov 15 Nov 22 Nov 29 Dec 06 Dec 13 Dec 20 Dec 27 2005 209,457 212,174 213,912 214,079 214,149 212,984 210,878 213,756 211,281 208,341 209,054 202,233 207,893 205,138 209,824 202,592 202,327 199,160 206,882 210,394 212,380 215,087 214,189 214,534 216,055 214,236 2006 210,432 213,989 213,629 214,589 213,605 212,775 213,049 213,156 211,989 204,174 202,449 207,558 204,665 205,543 203,383 196,812 192,827 198,175 207,802 211,187 211,184 212,782 207,215 211,893 209,627 211,375 2007 216,018 218,175 216,979 217,989 216,255 217,312 216,594 215,662 215,502 208,821 205,863 212,015 207,513 213,532 208,741 202,695 201,890 205,754 217,195 215,925 219,089 221,543 214,617 217,884 218,740 219,246 2008 208,143 211,467 211,598 209,964 207,138 206,783 206,759 206,726 204,890 202,299 197,850 194,203 199,265 188,449 194,857 188,880 191,330 186,006 193,326 200,977 203,177 203,287 Last 6 weeks 2008 vs 2007 91.9% 14 12/31/07 01/07/08 01/14/08 01/21/08 01/28/08 02/04/08 02/11/08 02/18/08 02/25/08 03/03/08 03/10/08 03/17/08 03/24/08 03/31/08 04/07/08 04/14/08 04/21/08 04/28/08 05/05/08 05/12/08 05/19/08 05/26/08 06/02/08 06/09/08 06/16/08 06/23/08 06/30/08 07/07/08 07/14/08 07/21/08 07/28/08 08/04/08 08/11/08 08/18/08 08/25/08 09/01/08 09/08/08 09/15/08 09/22/08 09/29/08 10/06/08 10/13/08 10/20/08 10/27/08 11/03/08 11/10/08 11/17/08 11/24/08 12/01/08 12/08/08 12/15/08 12/22/08 12/29/08 0.9000 Georgia Dock 0.8750 0.8500 5 Year Average - .7619 0.8250 0.8000 0.7750 0.7500 0.7250 0.7000 0.6750 0.6500 2008 2007 2006 2005 2004 5 Yr Avg 15 2.6000 5 Year Average - 1.4689 2.4000 1.2000 2008 2008 2007 2007 2006 2006 2005 2005 2004 1.4000 1.3500 5 Year Average - 1.0404 1.1000 1.0500 1.0000 0.7500 0.7000 2004 5 Yr Avg 12/31/07 01/07/08 01/14/08 01/21/08 01/28/08 02/04/08 02/11/08 02/18/08 02/25/08 03/03/08 03/10/08 03/17/08 03/24/08 03/31/08 04/07/08 04/14/08 04/21/08 04/28/08 05/05/08 05/12/08 05/19/08 05/26/08 06/02/08 06/09/08 06/16/08 06/23/08 06/30/08 07/07/08 07/14/08 07/21/08 07/28/08 08/04/08 08/11/08 08/18/08 08/25/08 09/01/08 09/08/08 09/15/08 09/22/08 09/29/08 10/06/08 10/13/08 10/20/08 10/27/08 11/03/08 11/10/08 11/17/08 11/24/08 12/01/08 12/08/08 12/15/08 12/22/08 12/29/08 12/31/07 01/07/08 01/14/08 01/21/08 01/28/08 02/04/08 02/11/08 02/18/08 02/25/08 03/03/08 03/10/08 03/17/08 03/24/08 03/31/08 04/07/08 04/14/08 04/21/08 04/28/08 05/05/08 05/12/08 05/19/08 05/26/08 06/02/08 06/09/08 06/16/08 06/23/08 06/30/08 07/07/08 07/14/08 07/21/08 07/28/08 08/04/08 08/11/08 08/18/08 08/25/08 09/01/08 09/08/08 09/15/08 09/22/08 09/29/08 10/06/08 10/13/08 10/20/08 10/27/08 11/03/08 11/10/08 11/17/08 11/24/08 12/01/08 12/08/08 12/15/08 12/22/08 12/29/08 UB Boneless Skinless Breast 1.0000 1.0000 0.8000 0.8000 5 Yr Avg 1.2500 0.5000 1.2000 0.4500 0.9000 0.2500 0.8500 0.2000 12/31/07 01/07/08 01/14/08 01/21/08 01/28/08 02/04/08 02/11/08 02/18/08 02/25/08 03/03/08 03/10/08 03/17/08 03/24/08 03/31/08 04/07/08 04/14/08 04/21/08 04/28/08 05/05/08 05/12/08 05/19/08 05/26/08 06/02/08 06/09/08 06/16/08 06/23/08 06/30/08 07/07/08 07/14/08 07/21/08 07/28/08 08/04/08 08/11/08 08/18/08 08/25/08 09/01/08 09/08/08 09/15/08 09/22/08 09/29/08 10/06/08 10/13/08 10/20/08 10/27/08 11/03/08 11/10/08 11/17/08 11/24/08 12/01/08 12/08/08 12/15/08 12/22/08 12/29/08 12/31/07 01/07/08 01/14/08 01/21/08 01/28/08 02/04/08 02/11/08 02/18/08 02/25/08 03/03/08 03/10/08 03/17/08 03/24/08 03/31/08 04/07/08 04/14/08 04/21/08 04/28/08 05/05/08 05/12/08 05/19/08 05/26/08 06/02/08 06/09/08 06/16/08 06/23/08 06/30/08 07/07/08 07/14/08 07/21/08 07/28/08 08/04/08 08/11/08 08/18/08 08/25/08 09/01/08 09/08/08 09/15/08 09/22/08 09/29/08 10/06/08 10/13/08 10/20/08 10/27/08 11/03/08 11/10/08 11/17/08 11/24/08 12/01/08 12/08/08 12/15/08 12/22/08 12/29/08 2.8000 2.6000 UB Breast Tenders 2.4000 2.2000 5 Year Average - 1.4016 2.2000 2.0000 2.0000 1.8000 1.8000 1.6000 1.6000 1.4000 1.4000 1.2000 2008 UB Wings 2008 2007 2007 2006 0.8000 2006 2005 2005 2004 2004 5 Yr Avg 0.6000 UB Leg Quarters 1.3000 0.5500 1.1500 0.4000 0.3500 0.9500 0.3000 0.1500 5 Year Average - .3678 0.1000 5 Yr Avg 16 Chicago Board of Trade Corn Soybean Meal Source: Chicago Board of Trade 17 Fiscal 2008 Product Mix 18 Export Product Mix Fiscal 2008 19 Export Destinations Fiscal 2008 20 Product Mix at Full Capacity Big Bird Deboning Head/Week Chill Pack 4,375,000 3,750,000 8.00 lbs 6.15 lbs Live Pounds Processed 35,000,000 23,062,500 Average Industry Yields 86.14% 83.66% 31,049,000 19,294,088 Average Bird Weights RTC Pounds/Week Industry Averages: Boneless Breast Tenders Leg Quarters Wings Paws Other 21.79% 4.78% 38.58% 8.87% 2.32% 23.66% Chill Pack Bulk Sales Paws Other 45.28% 45.82% 2.69% 6.21% 21 Operating Results 2007 Net Sales Operating Income $1,474.8 million 2008 $1,723.6 million Change $248.8 million $125.4 million ($65.7 million) ($191.1 million) $78.8 million ($43.1 million) ($121.9 million) Shareholders’ Equity $404.5 million $354.0 million ($50.5 million) Poultry Pounds Sold 2,048.8 million 2,398.6 million 349.8 million Debt to Capital Ratio 19.4% 39.0% 19.6% Capital Expenditures $114.4 million* $62.8 million* ($51.6 million) Net Income * Operating leases included. 22 Capital Expenditures $140 $120 $100 $80 128.1 $60 114.4 82.6 $40 62.8 $20 42.3 23.5 28.6 16.6 14.6 19.7 23.4 27.5 1.2* 16.0 $0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 *Operating Leases 23 Total Debt To Capitalization 60% 51.00% 48.14% 50% 43.50% 45.38% 39.02% 40% 35.72% 30% 25.45% 19.89% 19.36% 20% 11.74% 10% 5.19% 3.06% 0% 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 24 100% Chicken. Naturally.
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