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Sanderson Farms Provides Update on Hurricane Damage

Company resumed operations at its feed mill in Kinston, NC, Monday morning

Sanderson Farms Inc. reports it continues its assessment of damage to its North Carolina assets caused by Hurricane Florence. The company is pleased to report that it has still received no report of serious injuries or loss of life among its employees and growers.

The company experienced no significant damage to either of its North Carolina processing facilities, feed mill or two hatcheries.

The company’s facilities located in the affected area maintained generator power until permanent electrical service was restored.

Sanderson Farms resumed operations at its feed mill located in Kinston, NC, Monday morning. However, many roadways in North Carolina remain impassable, serious flooding continues, and local streams and rivers are expected to crest later this week. The company will resume operations at its Kinston, NC, processing plant on Tuesday, and at its St. Pauls processing plant by the end of this week, once it is safe for employees to navigate roads and highways.

The company continues its assessment of damage to independent farms and losses to its live inventories. Out of 880 broiler houses in North Carolina, 60 have flooded.

Another six houses experienced damage and will be unable to house broilers until repairs are made. In addition to the affected broiler houses, four breeder houses out of a total of 92 in North Carolina flooded. At this point, none of the company’s 33 pullet houses have reported serious damage.

As a result of these losses, the company estimates that approximately 1.7 million head of broiler chickens out of an average live inventory of approximately 20 million head, ranging in age from six days to 62 days, were destroyed as a result of flooding. In addition, approximately 30 farms, housing approximately 211,000 chickens per farm, in the Lumberton, NC, area are isolated by flood waters and the company is unable to reach those farms with feed trucks. Losses of live inventory could escalate if the company does not regain access to those farms.

The company does not believe the loss of housing capacity will affect its ongoing operations, as it can shorten layouts and take other temporary measures to compensate for these losses.

In addition to the loss of live birds, the company will be unable to hatch and place live broilers in the field at its normal rate during the coming week. While the company maintained operations at its hatcheries, the company was unable to set eggs in hatcheries on its normal schedule.

Sanderson Farms believes the terms, conditions and extent of its insurance coverage will cover a significant portion of losses resulting from this storm. The company’s retention under its policy is $2.5 million.

“I am relieved that it appears the company’s employees and independent contract producers experienced no loss of life or serious injuries," says Joe Sanderson, Jr., chairman and chief executive officer of Sanderson Farms Inc. "The magnitude of this storm and the damage it has caused continue to be widespread, and I am pleased that our people remain safe.

"Our focus over the next few weeks will include working to maintain our assets, responding to customers’ needs and replenishing our live production inventories," he continues. "Most importantly, we will provide ice, water, food and other necessities to those affected by this catastrophic storm. While we will work hard over the next week to get our operations back on line, our primary focus will be to respond to the needs of our local communities. We are fortunate that Sanderson Farms sustained only minimal damage and no loss of life as a result of the storm. We will continue to help those whose lives have been more seriously disrupted."

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