Imperial Sugar saw its share price jump to a 52-week high in after hours trading on Wednesday, following better than expected profits in Q2, partly due to higher sugar prices.
The company’s share price surged $1.95, or 14.2 percent, to $15.47 after it reported a net income of $4.2m during the quarter ended March 31, compared to a loss of $33.3m for the prior year period. The stock price, which had been trading between $9.50 and $14.74 during the past 52 weeks, has since fallen back to $14.12. In line with higher commodity prices in general, domestic sugar prices have increased 20 percent compared to the same period last year.
"We are pleased with the progress made in a number of areas during the second quarter," said Imperial Sugar CEO and president John Sheptor. "We achieved sales price increases during the second quarter and successfully managed raw costs in a volatile price environment, so as to expand margins significantly."
Higher sugar prices also helped to offset lower net sales of $192.2m for the quarter, compared to $208.9m for Q2 2010. 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.
Sheptor said: "After a challenging re-start early in the quarter, LSR's operation of the existing Gramercy refinery is providing a steady flow of bulk sugar for our grocery packaging operation. The reconnection of the silos in Port Wentworth, which was deferred until the first week of April, went smoothly, and the refinery has begun to ramp up production rates again."
Thirteen people were killed and nearly 50 were injured in a dust explosion at the Port Wentworth sugar refinery in Georgia in February 2008. The facility produced about nine percent of the United States’ refined sugar supply for the full fiscal year prior to the disaster.