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Smithfield Foods 2Q net income falls on charges

Published on NewsOK Modified: December 6, 2012 at 10:13 am •  Published: December 6, 2012
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Smithfield said its gross profit fell 10 percent, despite a 1.5 percent lower cost of sales during the quarter.

Pork producers like Smithfield are caught in a tug of war with consumers. The company needs to raise prices to offset rising commodity costs, namely the corn it uses for feed. But consumers are still extremely sensitive to price changes in the current economy. By raising prices, Smithfield risks cutting into its sales should consumers cut back or buy cheaper meats, such as chicken.

Its shares rose 56 cents, or 2.5 percent, to $23.46 in morning trading. Its shares have traded in a 52-week range of $17.55 to $25.12.

Smithfield also said Thursday it repurchased 3.4 million shares for $67 million in the second quarter.

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Michael Felberbaum can be reached at http://www.twitter.com/MLFelberbaum.