The decrease is attributable to decreased selling prices and a less favourable sales mix of $30.2m and decreased sales volume of $28.1m attributable to lower alliance and co-pack sales. Net earnings decreased to $8.1m, or $0.66 per diluted share, compared to $23.5m, or $1.92 per diluted share, in the prior year.
For the second quarter ended 2 October 2010, sales decreased $47.8m, or 14.8%, to $275.4m compared to the second quarter of last year. The decrease in sales is attributable to decreased selling prices and a less favourable sales mix of $19.1m and a sales volume reduction of $28.7m due to decreased alliance and co-pack sales. Net earnings were $2.8m, or $0.23 per diluted share, versus $12.4m or $1.02 per diluted share, in the quarter ended 26 September 2009.
During the second quarter of fiscal 2011, the company implemented workforce reductions at its plants in Buhl, Idaho and Mayville, Wisconsin and certain other locations that resulted in a restructuring charge of $1.2m for severance costs.
Pre-tax results for six months ended 2 October 2010 included a $0.1m gain on the sale of unused equipment.
“The first-half results reflect the continuing inventory overhang in the market from last year’s bumper crops which has required us to continue aggressive promotional activity,” said Kraig H Kayser, president and CEO.
On 6 August 2010, the company completed its acquisition of 100% of the partnership interest of Lebanon Valley Cold Storage LP and the assets of Unilink LLC from Pennsylvania Food Group LLC and related entities.
Source: Seneca Foods Corporation
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