Seaboard Corp. faced a multi-million loss during the first quarter of the 2019 fiscal year on its investment in Butterball, the largest turkey company in the United States.
In a Form 10-Q filed by Seaboard Corp. with the U.S. Securities and Exchange Commission on April 30, Butterball’s summarized income statement revealed the first three months of FY 2019 were not as favorable as the first three months of FY 2018 was. For the most recent quarter, which ended March 30, Butterball’s net sales of $303 million for the first three months of 2019, an operating loss of $19 million and a net loss of $21 million. Those figures compare to net sales of $321 million, an operating income of $2 million and a net income of $2 million for the same period a year ago.
Seaboard Foods’ turkey segment, which is accounted for using the equity method and represents Seaboard’s investment in Butterball, reported a $11 million loss.
Seaboard said the year-over-year losses were an outcome of increased production costs and logistics costs, as well as lower volumes of turkey products sold.
Looking forward, Seaboard Foods stated in the 10-Q it could not predict future market prices for turkey products or the cost of feed, nor could it predict whether the turkey segment would return to profitability during the remainder of 2019.
Primarily known as a pork production company, Seaboard Foods, in addition to having a presence in the turkey industry, also operates segments in commodity trading and milling, marine, sugar and alcohol, and power.
For the company as a whole, Kansas-based Seaboard Foods reported net earnings of $57 million, up from the $32 million it reported during the first three months of the 2018 fiscal year.
Butterball slaughtered 1.36 billion pounds of turkey in 2018, according to the WATTAgNet Top Poultry Companies Database.
