Sanderson Farms, Inc. Reports Results for Second Quarter of Fiscal 2007

Sanderson Farms, Inc. (NASDAQ: SAFM) today reported results for its second fiscal quarter ended April 30, 2007.

Net sales for the second quarter of fiscal 2007 were $360.5 million compared with $239.1 million for the same period a year ago. For the quarter, net income was $26.9 million, or $1.33 per fully diluted share, compared with a net loss of $16.6 million, or $0.83 per fully diluted share, for the second quarter of fiscal 2006.

Net sales for the first six months of fiscal 2007 were $653.2 million compared with $475.3 million for the first half of fiscal 2006. Net income for the first half of the year totaled $24.1 million, or $1.19 per fully diluted share, compared with a net loss of $25.3 million, or $1.26 per fully diluted share, for the first six months of last year.

“We are pleased with our performance during the second quarter and our return to profitability," said Joe F. Sanderson, Jr., chairman and chief executive officer of Sanderson Farms, Inc. “The improvement in our financial results reflects higher overall prices in the poultry markets compared with both the prior year period and the first fiscal quarter of this year, and reflects the additional pounds available to the Company as a result of the increased production at our Moultrie, Georgia and Collins, Mississippi plants. Market conditions improved steadily throughout the quarter, as did our profitability. The Company’s top line growth resulting from improved market conditions and additional poultry pounds more than offset the higher grain costs experienced during the quarter. Our operations performed well, and our product mix of chill-pack products for the retail market and big bird deboning products for the food service market proved favorable.”

According to Sanderson, overall market prices for poultry products were significantly higher in the second quarter of 2007 compared with prices a year ago. As measured by a simple average of the Georgia dock price for whole chickens, prices increased approximately 11.9% in the Company's second fiscal quarter compared with the same period in 2006. Bulk leg quarter prices were 125.3% higher during the quarter compared with last year's second quarter. Boneless breast meat prices during the quarter were approximately 49.2% higher than the prior year period. Jumbo wing prices averaged $1.15 per pound during the second quarter of fiscal 2007, compared with the average of $0.80 per pound during the second quarter of fiscal 2006. At the same time, costs for corn and soybean meal, the Company's primary feed ingredients, increased 66.4% and 17.5%, respectively, compared with the second quarter a year ago. For the first six months of the fiscal year, these costs have increased 61.9% and 8.5%, respectively.

“We continue to move forward with construction of our Waco, Texas, complex, which is now scheduled to begin processing chickens in August,” Sanderson added. “We are pleased with the progress we have made, and we set eggs in our new Waco hatchery this week. We now expect the Waco facility to reach full production during the third quarter of fiscal 2008, processing approximately 1.25 million head of big bird deboning chickens per week.

“Looking ahead, like others in our industry, we are mindful of the current market dynamics surrounding our feed costs. While we are pleased with the direction corn and soybean meal prices have moved over the last few weeks, we expect grain prices to remain volatile for the balance of our fiscal year and into next year,” Sanderson concluded.

Sanderson Farms will hold a conference call to discuss this press release today, May 24, 2007, at 10:00 a.m. Central, 11:00 a.m. Eastern. Investors will have the opportunity to listen to a live Internet broadcast of the conference call through the Company's Web site at www.sandersonfarms.com or through www.earnings.com. To listen to the live call, please go to the Web site at least 15 minutes early to register, download, and install any necessary audio software. For those who cannot listen to the live broadcast, an Internet replay will be available shortly after the call and continue through June 24, 2007. Those without Internet access may listen to the call by dialing (800) 475-3716.

Sanderson Farms, Inc. is engaged in the production, processing, marketing and distribution of fresh and frozen chicken and other prepared food items. Its shares trade on the NASDAQ Stock Market, LLC under the symbol SAFM.

This press release contains forward-looking statements based on management's current views and assumptions. Actual results and events may differ. For a discussion of these matters, please refer to the "Cautionary Statement Regarding Risks and Uncertainties That May Affect Future Performance" in Item 7 of the Company's 2006 Annual Report on Form 10-K and please refer to the cautionary statement found in Management's Discussion and Analysis of Financial Condition and Results of Operations under the heading "General" in Part I, Item 2 of the Quarterly Report on Form 10-Q for the Company's second quarter ended April 30, 2007.