News last update:7 Aug 2012

Animal feed firm Ridley shows less profit

Animal feed producer Ridley Inc. headquartered in Mankato, Minn., showed a revenue of US$136.9 million in its third quarter, up from US$131.1 million in the same period a year earlier. The actual profit however fell to US$3.1m, US$8 million less than 2006.

"Strong results in our US feed business were offset by sharply lower earnings in the Canadian business and weak demand for blocks," stated CEO Steve VanRoekel. "A combination of external factors, including continued strength in the Canadian dollar, high feed prices, and uncertainty in the meat industry continue to depress demand and as a result, earnings in Canada."
Additionally, "our results were negatively impacted by the departure of several sales personnel from a Canadian business unit who have formed a competing firm."

Excellent results in the US
Ridley said feed supplement demand "has been depressed for the second consecutive year by weather patterns that have extended good grazing conditions throughout the western US and western Canada." But the US feed business "produced excellent results" thanks to "generally favourable meat, milk, and egg production economics."

Weaker results in Canada
VanRoekel said the American business is expected to remain solid for the rest of the year, but results in Canada "are likely to remain weaker for some time." Ridley, along with the federal government, remains involved in litigation brought by cattle producers hurt by international bans on Canadian cattle and beef following the May 2003 discovery of mad cow disease an Alberta cow. Plaintiff attempts to win class-action status "are still at an early stage," and Ridley said it "cannot determine what impact, if any, these lawsuits may have."

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