Reports for the quarter ending June 30, 2009, posted by Land ‘O Lakes Inc., owner of Moark Inc., reflect the impact of a 20% decline in average UB price of $1.24/dozen prevailing during Q2 of 2008, compared to $1/dozen during Q2 of 2009.
The egg-production subsidiary of Land 'O Lakes recorded sales of $119.8 million ($138.6 million in 2008) for the quarter, generating a loss of $6.9 million ($3.4 million in 2008). Gross margin for Q2 of 2009 attained 2.2%, a decline from 16.5% during the corresponding Q2 of 2008. Effectively revenue for egg sales decreased by 13.6% but with only a fractional increase in cost.
For the first six months of FY 2009, Moark generated a profit of $4.3 million compared to $43.3 million in the corresponding two quarters of FY 2009 combined.
Notes to the accounts revealed a $6.8 million decrease in unrealized hedging gains for Q2 2009.
The Moark egg operations represented 4.2% of total Land 'O Lakes sales of $2.81 billion in Q2. The 2.2% gross margin compares unfavorably with the 9.9% generated by the entire enterprise.