Atlanta, Georgia
February 7, 2005
PRESS RELEASE
FOR IMMEDIATE RELEASE
February 7, 2005
Cagle's Inc. today reported the following results for its third quarter ended
January 01, 2005.
Net income for the third quarter of fiscal 2005 was $115 thousand or $.02
per diluted share as compared with a net loss of $24.9 million or $(5.26)
per diluted share for the third quarter of fiscal 2004. For the first nine
months of fiscal 2005 net income improved to $9.0 million or $1.89 per
diluted share compared with a net loss of $28.6 million or $(6.02) per
diluted share for the first nine months of fiscal 2004.
Poultry markets for the first nine months of our current fiscal year were
improved by approximately 19.8% however markets for the third quarter of
this year were 6.5% less than the same period last year. Grain markets are
supportive of our margins as record corn and soy crops have resulted in a
three month reduction in feed cost of 6.6% versus the same period last
year, while the nine month period reflected an increase of 16% as compared
to the first nine months of fiscal 2004.
The Company negotiated a financing facility for portions of it?s debt with
an agriculturally focused bank group this quarter and contemplate a stable,
long term relationship going forward. Construction involving expansion of
existing hatchery capacity, which should be completed in April 2005, will
allow the Company to return to a self sufficient supply of inventory
necessary for our plants to return to full production volumes by July 2005.
Cagle's Inc.
/s/ J. Douglas Cagle
J. Douglas Cagle
Chairman, CEO
Forward-Looking Statements:
Statements contained in this press release that state the intentions,
hopes, beliefs, anticipations, expectations or predictions of the future
of Cagle's Inc. and its management are forward looking statements. It is
important to note that the actual results could differ materially from
those projected. Factors that could cause actual results to differ
materially from those project in such forward-looking statements include:
additional outbreaks of avian influenza or other diseases affecting the
production performance and/or marketability of the Company?s poultry
products; matters affecting the poultry industry in general, including
fluctuations in the commodity prices of feed ingredients and chicken;
contamination of our products leading to product liability claims and
recalls; exposures to risks related to property damage and injuries to
persons for which insurance is limited and potentially inadequate;
management of our cash resources, particularly in light of our
substantial leverage; trade barriers; changes in laws or regulations
affecting our operations as well as competitive factors and pricing
pressures; and the impact of uncertainties of litigations as well as
other risk factors.
Cagle's Inc.
Consolidated Statements of Income (in thousands except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
January 1, January 3, January 1, January 3,
2005 2004 2005 2004
- -------------------------- ---------- ---------- --------- ----------
Net Sales $ 54,594 $ 46,826 $ 185,767 $ 136,194
Cost and Expenses:
Cost of Sales 51,715 45,741 164,412 124,056
Selling, General & Admin. 3,053 4,568 9,229 12,359
Total Cost and Expenses 54,768 50,309 173,641 136,415
Loss Divested Operations
(note 1) - (17,427) - (24,050)
- -------------------------- ---------- ---------- --------- ----------
Operating Income (Loss) (174) (20,910) 12,126 (24,271)
Other Expenses (Income):
Interest Expense 653 2,213 2,004 6,054
Miscellaneous (65) 3,801 (736) 3,807
- -------------------------- ---------- ---------- --------- ----------
Total Other Expenses 588 6,014 1,268 9,861
Earnings Unconsolidated
Affiliates 941 823 3,173 2,371
- -------------------------- ---------- ---------- --------- ----------
Income (Loss) before
Income Taxes 179 816 14,031 (31,761)
Income Tax Expense(Benefit) 64 (1,159) 5,036 (3,179)
- -------------------------- ---------- ---------- --------- ----------
Net Income (Loss) $ 115 $ (24,949) $ 8,995 $ (28,582)
========================== ========== ========== ========= ==========
Net Income(Loss) per Share $ 0.02 $ (5.26) $ 1.89 $ (6.02)
Note 1: The three month and nine month periods ended January 01, 2005 have
been adjusted to reflect the pretax loss generated from the Perry Complex,
which the company sold in the fourth quarter of fiscal 2004, as a single
line item. The details of this transaction for the three and nine month
periods respectively (in 000?s) are a reduction in sales of $35,822 and
$104,236, a reduction in cost of sales of $52,391 and $126,177 and a
reduction in selling, general, and administrative expenses of $858 and
$2,109.
Cagle's Inc.
Condensed Consolidated Balance Sheet (in thousands)
(Unaudited)
ASSETS January 1, 2005 January 3, 2004
- ------------------------------------- --------------- ---------------
Current Assets $ 35,789 $ 44,071
Investments in Affiliates 5,536 4,835
Other Assets 13,240 6,564
Property, Plant, and Equipment (net) 43,076 89,880
- ------------------------------------- --------------- ---------------
TOTAL ASSETS $ 97,641 $ 145,350
LIABILITIES & STOCKHOLDER'S EQUITY
Current Maturities of Long-term Debt $ 3,451 $ 63,007
Trade Accounts Payable 11,439 20,918
Other Current Liabilities 6,650 13,887
- ------------------------------------- --------------- ---------------
Total Current Liabilities 21,540 97,812
Long-Term Debt less Current Maturities 32,194 23,112
Other Non-current Liabilities 645 1,016
Total Stockholder's Equity 43,262 23,410
- ------------------------------------- --------------- ---------------
TOTAL LIABILITIES &
STOCKHOLDER'S EQUITY $ 97,641 $ 145,350
===================================== =============== ===============
Note 2: The periods ended January 01, 2005 and January 3, 2004 reflect
changes brought about by the anticipated and final disposition of the
Perry Complex.