AGFEED INDUSTRIES, INC. ANNOUNCES RESULTS FOR THE FIRST QUARTER OF 2011
NEW YORK, May 10, 2011 – AgFeed Industries, Inc. (Nasdaq: FEED, NYSE Alternext: ALHOG - News) (“AgFeed” or the “Company”), an international agribusiness with operations in the U.S. and China announced its results for the first quarter of 2011.
AgFeed reports revenue of $93 million and an operating profit of $0.5 million. Revenues for the company’s U.S hog production unit reached $57.9 million with an operating profit of $3.6 million. In China, significant progress was made in restructuring hog production and containing operating issues in this business segment with revenue reported at $10.9 million and an operating loss of $139,000. In its Chinese based animal nutrition segment, the Company reports first quarter revenue of $24.2 million and an operating loss of $835,000. These results do not reflect the loss attributable to discontinued operations within the Company’s legacy Chinese hog production unit.
John A. Stadler, AgFeed’s Chairman & Interim Chief Executive Officer stated, “Our team of hog production professionals that were deployed in the past months to focus on turning around our legacy Chinese hog production system has made significant strides in closing and liquidating facilities that could not meet our standard production metrics while at the same time moving rapidly to bring appropriate operating discipline to the remaining legacy assets. This work is not yet complete. However, we expect that we can return the legacy system to profitability later this year. The performance of our animal nutrition unit was disappointing. The size of the nation-wide Chinese hog herd is down which has impacted demand for our nutrition products. More importantly we were unable to pass along the rapidly increasing cost of grains in real time.
Gerard Daignault, President & Chief Executive Officer of AgFeed’s animal nutrition business pointed out, “As our business continues to evolve from its historic base of being focused on pre-mix to having a significant complete feed business, we will face ever greater exposure to swings in the price of corn and soy bean meal. Our ability to pass these price increases on to our customers on a timely basis will be vital. Faced with record high commodity prices, we will be confronted with price competition as growers seek alternative feed sources in order to lower their own operating costs. We are committed to providing our customers with quality animal feeds to promote healthy animals and a safe food supply. As part of this commitment and in order to bring a more diverse product line to our distributor base of over 1,887 outlets, we are continuing our R&D efforts to bring our customers specialized products designed for sow development and nursery pig growth.”
Edward Pazdro, the Company’s Chief Financial Officer observed, “During the first quarter we continued to rationalize our Chinese hog production and headquarters operations which allowed us to reduce our headcount by 203 since the end of 2010. We also retired approximately $4.5 million of local bank debt in China in May 2011.”
The following information was filed by Agfeed Industries, Inc. (FEED) on Tuesday, May 10, 2011 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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Ticker: FEED CIK: 1331427 Form Type:10-Q Quarterly Report Accession Number: 0001144204-11-027796 Submitted to the SEC: Tue May 10 2011 5:16:25 PM EST Accepted by the SEC: Tue May 10 2011 Period: Thursday, March 31, 2011 Industry: Agricultural Prod Livestock And Animal Specialties