Imperial Sugar loss widens, shares fall to year-low
The company reported a net loss for the fiscal fourth quarter ended September 30, 2011 of $32.5m, or $2.73 per share, compared to a net loss of $2.3 million, or $0.19 per share, for the same period in fiscal 2010. Analysts polled by Thomson Reuters had expected a net loss of $0.89 per share.
The company’s share price had dropped to $2.61 early on Wednesday. The stock price had been trading between $3.14 and $25.68 during the past 52 weeks.
Sales in the quarter fell 12% to $231.4m, with higher sugar prices only partially offsetting lower sales volumes. Imperial Sugar said that the lower volume was mainly due to the loss of direct sales from its Gramercy refinery, which has been operated by Louisiana Sugar Refining (LSR) since January 2011.
President and CEO of Imperial Sugar John Sheptor said in a statement: “Imperial’s results continue to be challenged by high raw sugar prices and competitive pricing dynamics. Additionally, our progress on increasing production rates and reducing costs at the Port Wentworth refinery has been slower than we expected, adding to the unsatisfactory financial results.”
The company is still struggling to recover from a dust explosion at a Georgia refinery nearly four years ago, in which 13 people were killed and nearly 50 were injured. The facility produced about nine percent of the United States’ refined sugar supply for the full fiscal year prior to the disaster.
Sheptor added that the company is also considering selling assets to increase liquidity.
“We continue to evaluate additional capital projects which may be required to be undertaken later in fiscal 2012 or in fiscal 2013. Our operating results and the impact of high sugar prices on working capital have strained our financial resources and we are exploring opportunities to improve liquidity, including potential further asset sales,” he said.
“We continue to maintain compliance with the terms of our revolving credit agreement and have an open dialog with our lenders.”
