U.S. poultry producer Sanderson Farms on Tuesday posted a sharply higher quarterly profit, fueled by higher chicken prices, but fell short of Wall Street expectations.
For the third quarter ended on July 31, earnings rose to $30.7 million, or $1.51 per share, from $3.3 million, or 16 cents, a year earlier.
Revenue jumped to $394.8 million from $281.0 million.
Wall Street analysts on average expected earnings of $1.93 on revenue of $412.87 million, according to Reuters Estimates.
During the quarter, prices for leg quarters were up 49.5%, while breast meat averaged 24% higher, and whole chicken prices were up about 17%.
Sanderson's fiscal 2007 grain costs will be about $124.7 million higher than the previous year, but expects favorable chicken market conditions to offset those costs.
The Laurel, Mississippi, company expects the corn and soybean meal market to remain high and volatile into the 2008 fiscal year.
Sanderson and other U.S. poultry companies have raised chicken prices to cover higher production costs and improve bottom lines. The profits have also helped Sanderson and other increase production.