THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Wednesday, August 24, 1994 TAG: 9408240550
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: BY LON WAGNER, STAFF WRITER
LENGTH: Short : 46 lines
WLR Foods Co. spent more than $3 million this year fending off a hostile takeover by Arkansas-based Tyson Foods Co., but the poultry processor still increased its yearly earnings by almost $2 million, the company said Tuesday.
WLR President James L. Keeler said the Rockingham County turkey and chicken processor's yearly earnings per share of $1.51 for the year ended July 2 would have been 15 cents higher without the cost of battling Tyson's takeover.
``We are pleased that the majority of the takeover costs are behind us, and grain and feed costs should be well under last year as near-record crops are expected to be harvested,'' Keeler said.
Tyson, the largest poultry processor in the country, made a $30 per share tender offer for WLR's stock last winter. Though it is a giant in the chicken industry, Tyson needed WLR's turkey processing operations to round out its offerings.
But the WLR board flatly rejected Tyson's offer. WLR's chicken and turkey growers, estimated to own 20 percent of the company's outstanding shares, remained loyal to the homegrown company, which helped keep Tyson at bay.
George Shipp, a Scott and Stringfellow Inc. analyst who follows WLR, said that though earnings rose 19 percent in the fourth quarter, WLR was ``not hitting on all cylinders all year.''
Poultry food costs increased in the second half of the year, Shipp said, and the company was still paying startup costs at its Moorefield, W.Va., chicken plant.
WLR's net earnings for the fiscal fourth quarter were $7.3 million, or 67 cents per share, compared to $6.1 million or 56 cents per share for the same quarter last year.
Earnings of $16.5 million, or $1.51 a share, for the just-completed fiscal year were up from earnings of $14.6 million, or $1.40 per share, in the previous year.
WLR is expected to complete its purchase of Cuddy Farms foods division during the next several days, Keeler said. The acquisition should give WLR yearly sales close to $1 billion, and would make the company the second-largest turkey processor in the country. by CNB