<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 30, 1995
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from________________to_______________
Commission file number
1-9050
HUDSON FOODS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 71-0427616
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1225 Hudson Road, Rogers, Arkansas 72756
(Address of principal executive offices) (Zip Code)
(501) 636-1100
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes /X/ No / /
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes / / No / /
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of January 24, 1996 Hudson Foods, Inc. had 20,477,138 shares of $0.01
par value Class A Common Stock outstanding and 9,602,672 shares of $0.01 par
value Class B Common Stock outstanding.
<PAGE>
PART 1 FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
HUDSON FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
(Dollars in thousands)
<TABLE>
<CAPTION>
December 30, September 30,
1995 1995
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 34,553 $ 2,159
Receivables, net 75,709 81,078
Inventory:
Field inventory 50,342 45,103
Feed, eggs and other 33,790 30,441
Finished products 111,961 101,511
Other 32,342 36,313
----------- -----------
Total current assets 338,697 296,605
----------- -----------
Property, plant and equipment, net of
accumulated depreciation of
$137,278 and $137,579 290,314 275,624
Excess cost of investment, net 14,541 14,682
Other assets 30,913 36,630
----------- -----------
Total assets $674,465 $623,541
=========== ===========
The accompanying notes are an integral part of the condensed consolidated
financial statements
</TABLE>
<PAGE>
PART 1 FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
HUDSON FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED) (UNAUDITED)
(Dollars in thousands)
<TABLE>
<CAPTION>
December 30, September 30,
1995 1995
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ -- $ 12,300
Current portion of long-term obligations 8,830 8,742
Accounts payable 49,931 47,676
Accrued liabilities 44,077 44,590
Deferred income taxes 2,839 2,839
----------- -----------
Total current liabilities 105,677 116,147
----------- -----------
Long-term obligations 183,705 129,973
----------- -----------
Deferred income taxes and deferred gain 71,631 73,072
----------- -----------
Stockholders' equity:
Common stock:
Class A, $.01 par value; 40,000,000
shares authorized; issued 21,346,824
and 21,331,374 shares 213 213
Class B, $.01 par value; 40,000,000
shares authorized; issued and outstanding
9,602,672 shares 96 96
Additional capital 159,128 158,842
Retained earnings 164,862 156,432
Treasury stock, at cost (876,251 and
915,438 Class A shares) (10,847) (11,234)
----------- -----------
Total stockholders' equity 313,452 304,349
----------- -----------
Total liabilities and stockholders' equity $674,465 $623,541
=========== ===========
The accompanying notes are an integral part of the condensed consolidated
financial statements.
</TABLE>
<PAGE>
PART 1 FINANCIAL INFORMATIONITEM 1. FINANCIAL STATEMENTS (CONTINUED)
HUDSON FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
(In thousands except per share data)
<TABLE>
<CAPTION>
Three Months Ended
December 30, December 31,
1995 1994
<S> <C> <C>
Sales $340,674 $279,955
Cost of sales 293,757 238,202
---------- ----------
Gross profit 46,917 41,753
Selling 23,657 19,048
General and administrative 7,121 7,252
---------- ----------
Operating income 16,139 15,453
---------- ----------
Other expense (income):
Interest, net 1,270 457
Other, net -- (1,389)
---------- ----------
Total other expense (income) 1,270 (932)
---------- ----------
Income before income taxes 14,869 16,385
Income tax expense 5,870 6,550
---------- ----------
Net income $ 8,999 $ 9,835
========== ==========
Earnings per share:
Primary $0.30 $0.35
Fully diluted $0.30 $0.35
========== ==========
Shares used in earnings per share computations:
Primary 30,404 27,902
Fully diluted 30,418 27,927
========== ==========
Dividends per share:
Class A $0.0200 $0.0200
Class B $0.0167 $0.0167
========== ==========
Sales Growth 21.7% 11.9%
Margins (Percent of Sales):
Gross Profit 13.8% 14.9%
Operating Income 4.7% 5.5%
Income Before Income Taxes 4.4% 5.9%
Net Income 2.6% 3.5%
========== ==========
The accompanying notes are an integral part of the condensed consolidated
financial statements.
</TABLE>
<PAGE>
PART 1 FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
HUDSON FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
<TABLE>
<CAPTION>
Three Months Ended
December 30, December 31,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $ 8,999 $ 9,835
Items included in net income
not requiring cash:
Depreciation 5,435 5,587
Amortization 344 212
Deferred gain amortization (694) (694)
Deferred income taxes 798 216
Other -- 72
Changes in operating assets and liabilities (19,201) (14,531)
---------- ----------
Cash flows provided by (used for) operations (4,319) 697
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment (38,821) (18,843)
Disposition of property, plant and equipment, net 106 127
Funds received from trustee for capital project 6,479 --
Sale of business (Note 2) 29,314 --
Other (1,394) 471
---------- ----------
Cash flows used for investments (4,316) (18,245)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Addition (reduction) to notes payable (12,300) (16,800)
Addition to long-term obligations 55,000 --
Reduction of long-term obligations (1,179) (3,997)
Sale of Class A common stock -- 51,373
Dividends (569) (557)
Exercise of stock options and other 77 333
---------- ----------
Cash flows provided by financing 41,029 30,352
---------- ----------
Increase in cash and cash equivalents 32,394 12,804
Cash and cash equivalents at beginning of period 2,159 1,899
---------- ----------
Cash and cash equivalents at end of period $ 34,553 $ 14,703
========== ==========
============================================================================
Supplemental disclosure of cash flow information:
Interest paid, net of amount capitalized $ 1,213 $ 674
Income taxes paid $ 7,335 $ 9,891
============================================================================
The accompanying notes are an integral part of the condensed consolidated
financial statements.
</TABLE>
<PAGE>
HUDSON FOODS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. The condensed consolidated financial statements for the periods ended
December 30, 1995 and December 31, 1994 include, in the opinion of management,
all adjustments necessary to present fairly the results of operations and cash
flows for such periods. The Annual Report for the year ended September 30,
1995, and the Company's Form 10-K contain additional information which should
be read in conjunction with these financial statements.
Note 2. On December 29, 1995, the Company sold its Topeka, Kansas, luncheon
meat plant and its Ohse and Roegelein brand names for approximately $32.3
million, of which $29.3 million was received at December 30, 1995.
Additionally, the Company closed its Wichita, Kansas, luncheon meat processing
facility on January 13, 1996. The Company has recorded the sale of the Topeka
assets, the Ohse and Roegelein brand names, and the write-down of the Wichita
assets to estimated net realizable value. These transactions did not
significantly impact the Company's results of operations for the three months
ended December 30, 1995.
Note 3. On December 28, 1995, the Company borrowed $55.0 million under six
term loan agreements from two insurance companies at 6.69% due December 28,
2005. Interest payments only will be due in the first three years. Beginning
in the fourth year, one-seventh of the principal balance will be due each year
to maturity. The loan agreements, among other things, limit the payment of
dividends to approximately $2.8 million in any fiscal year and limit annual
capital expenditures and lease obligations. They require the maintenance of
minimum levels of working capital and tangible net worth and require that the
current ratio, leverage ratio and cash flow coverage ratio be maintained at
certain levels. They also limit the creation of new secured debt to $25.0
million and new unsecured short-term debt with parties outside the Company's
$100.0 million credit agreement to $20.0 million.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders
Hudson Foods, Inc.
We have reviewed the condensed consolidated balance sheet of Hudson Foods,
Inc. and subsidiaries as of December 30, 1995 and the related condensed
consolidated statements of operations and cash flows for the three month
periods ended December 30, 1995 and December 31, 1994. These financial
statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the condensed consolidated financial statements referred to
above for them to be in conformity with generally accepted accounting
principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of September 30, 1995, and the
related consolidated statements of operations and cash flows for the year then
ended (not presented herein); and in our report dated October 31, 1995, we
expressed an unqualified opinion on those consolidated financial statements.
In our opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of September 30, 1995 is fairly stated in all
material respects in relation to the consolidated balance sheet from which it
has been derived.
Coopers & Lybrand L.L.P.
Tulsa, Oklahoma
January 22, 1996
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
Historically, the Company's operating results have been heavily influenced by
two external factors: the cost of feed grains and commodity-based finished
product prices. These two factors have fluctuated significantly and
independently. In recent years the Company has undertaken a business strategy
to increase the production and sale of further-processed products and increase
sales to large customers such as club store and foodservice chains. In
fiscal 1995, one such customer accounted for approximately 14.7 % of total
sales. This strategy decreases the proportion of feed grain costs to total
cost of sales, which reduces the impact of commodity cost fluctuations. In
addition, the sales prices of further-processed products are less sensitive to
commodity price fluctuations. Even so, a material increase in feed costs or a
material decrease in finished product prices could have an adverse effect on
the Company, but management believes that the implementation of this strategy
has reduced the Company's vulnerability to such price fluctuations.
The Company believes that its operations are in substantial compliance with
applicable environmental laws and regulations.
FIRST QUARTER OF FISCAL 1996 COMPARED WITH
FIRST QUARTER OF FISCAL 1995
Sales from the Company's operations were $340.7 million for the first quarter
of fiscal 1996, an increase of $60.7 million, or 21.7% over the first quarter
of fiscal 1995. The sales increase primarily resulted from the following:
Chicken sales increased 23.6% to $168.6 million in the first quarter of fiscal
1996 from $136.4 million in the first quarter of fiscal 1995 due to an 11.6%
increase in volume and a 10.8% increase in selling prices. The volume
increase was essentially due to increased sales in international markets,
primarily Russia and Eastern Europe. The increase in selling prices was
primarily due to increased sales of further-processed products and stronger
market prices.
Portioned entree sales decreased slightly to $43.6 million in the first
quarter of fiscal 1996 from $43.9 million in the first quarter of fiscal 1995
primarily due to a 2.4% decrease in selling prices offset somewhat by a 1.6%
increase in volume. Portioned entrees experienced some changes in customer
base and product lines that caused selling prices to decline. However, these
declines have been partially offset by adding new products and entering new
markets.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
FIRST QUARTER OF FISCAL 1996 COMPARED WITH
FIRST QUARTER OF FISCAL 1995 (CONTINUED)
Luncheon meat sales decreased 3.3% to $43.5 million in the first quarter of
fiscal 1996 from $45.0 million in the first quarter of fiscal 1995 primarily
due to a 3.6% decrease in volume. Luncheon meats had a disappointing year for
fiscal 1995 due to the loss of market position for some brand names and weaker
margins. Those difficulties caused the Company to rethink its goals for the
luncheon meat operation. As a result, the Company sold its plant in Topeka,
Kansas, and the Ohse and Roegelein brand names on December 29, 1995. Also,
the Company closed its Wichita, Kansas, plant on January 13, 1996. Those two
plants accounted for approximately 70% of fiscal 1995 luncheon meat sales.
The Company will continue to produce a full line of Schweigert luncheon meat
products at its plant in Albert Lea, Minnesota.
Turkey sales increased 22.1% to $52.9 million in the first quarter of fiscal
1996 from $43.3 million in the first quarter of fiscal 1995 due to a 14.0%
increase in volume and a 7.1% increase in selling prices. The volume increase
was primarily due to increased sales in international markets, especially in
Russia, Latin America and Eastern Europe. The increase in selling prices was
primarily due to increased sales of further-processed products and stronger
market prices.
Beef sales were $20.7 million in the first quarter of fiscal 1996. The
Company moved into a new area of food processing when its hamburger plant in
Columbus, Nebraska began production in February 1995. The plant produces beef
patties primarily for the Burger King restaurant chain but also produces ten
pound chub packages for club stores and other customers.
Cost of sales was $293.8 million in the first quarter of fiscal 1996, an
increase of $55.6 million, or 23.3%, over the first quarter of fiscal 1995.
The increase in cost of sales primarily resulted from a 15.1% increase in feed
costs per ton and higher processing costs due to increased sales of further-
processed products. As a percentage of sales, cost of sales increased to
86.2% for the first quarter of fiscal 1996 from 85.1% in the first quarter of
fiscal 1995.
Gross profit was $46.9 million in the first quarter of fiscal 1996, an
increase of $5.2 million, or 12.4%, over the first quarter of fiscal 1995. As
a percentage of sales, gross profit decreased to 13.8% in the first quarter of
fiscal 1996 from 14.9% in the first quarter of fiscal 1995 due to the factors
discussed above.
Selling and general and administrative expenses were $30.8 million in the
first quarter of fiscal 1996, an increase of $4.5 million, or 17.0%, over the
first quarter of fiscal 1995. As a percentage of sales, selling and general
and administrative expenses decreased to 9.0% in the first quarter of fiscal
1996 compared with 9.4% in the first quarter of fiscal 1995.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
FIRST QUARTER OF FISCAL 1996 COMPARED WITH
FIRST QUARTER OF FISCAL 1995 (CONTINUED)
Operating income was $16.1 million for the first quarter of fiscal 1996
compared with $15.5 million for the first quarter of fiscal 1995. The
increase was primarily due to the improvements in the Company's operations
described previously.
Interest expense increased primarily due to the interest expense on a $50.0
million unsecured term loan from an insurance company dated June 13, 1995.
Other income for the first quarter of fiscal 1995 of $1.4 million was
primarily composed of gains on assets destroyed by fire.
LIQUIDITY AND CAPITAL RESOURCES
Working capital at December 30, 1995 was $233.0 million compared with $180.5
million at September 30, 1995 and the current ratio was 3.21 to 1 and 2.55 to
1 at December 30, 1995 and September 30, 1995, respectively. Inventory
increased primarily due to inventory build-up to meet increased sales,
especially in international markets. Other current assets decreased primarily
due to the net effect of the following: 1) receipt of $15.0 million on an
insurance claim receivable for fire losses; 2) recording of a $3.0 million
receivable resulting from the sale of the Topeka, Kansas, luncheon meat
facility; and 3) recording of miscellaneous notes receivable, prepaid expenses
and other current assets. The Company's total capitalization, as represented
by long-term obligations plus stockholders' equity, was $497.2 million on
December 30, 1995, compared with $434.3 million on September 30, 1995. Long-
term obligations represented 37.0% and 29.9% of total capitalization on
December 30, 1995 and September 30, 1995, respectively.
The Company did not have any notes payable due under its unsecured credit
agreements at December 30, 1995 compared with $12.3 million on September 30,
1995. Total long-term obligations and current portion of long-term
obligations increased $53.8 million primarily due to proceeds received on
loans from two insurance companies totaling $55.0 million.
The Company's cash flows used for operating activities was $4.3 million in the
first three months of fiscal 1996 compared with cash flows provided by
operations of $.7 million in the first three months of fiscal 1995. The
decrease was primarily due to increases in operating assets, especially
finished product inventory.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
For the first three months of fiscal 1996 and 1995, the Company had capital
expenditures of $38.8 million and $18.8 million, respectively. Capital
expenditures, in the first three months of fiscal 1996, were for the
construction of a chicken complex near Henderson, Kentucky, and the expansion
and/or upgrading of existing production facilities and related equipment. The
Kentucky chicken complex is expected to begin production in 1996. The capital
expenditures have been and will continue to be financed by operations,
borrowings, lease arrangements and the issuance of common stock.
Loan proceeds received on March 2, 1995, from the county of Henderson,
Kentucky, of $25.0 million were placed with a trustee, earning interest, until
the Company expends construction funds, at which time the trustee reimburses
the Company. The proceeds are to be used to finance the construction of solid
waste disposal and sewage facilities at the Company's new chicken complex
being built near Henderson, Kentucky. During the first three months of fiscal
1996, the Company was reimbursed for $6.5 million of construction
expenditures. At December 30, 1995, the trustee held $10.4 million of the
loan proceeds (classified as "Other assets").
The Company's capital budget for fiscal 1996 contemplates aggregate capital
expenditures of approximately $100.0 million for the completion of the chicken
complex in Kentucky and upgrading and/or expanding current production
facilities and related equipment. To achieve this level of capital
expenditures, the Company will be required to obtain waivers of debt covenants
from certain lenders. Management believes that such waivers will be obtained.
However, there can be no assurance that such waivers will be granted.
Historically, the Company's operations have been financed through internally
generated funds, borrowings, lease arrangements and the issuance of common
stock. On April 26, 1994, the Company entered into a $100.0 million unsecured
credit agreement that expires June 30, 1998. At December 30, 1995, the
Company had $91.9 million available under this agreement. The Company did not
have any notes payable outstanding under the agreement but had $8.1 million in
outstanding letters of credit.
The credit agreement, among other things, limits the payment of dividends to
approximately $2.8 million in any fiscal year and limits annual capital
expenditures and lease obligations. It requires the maintenance of minimum
levels of working capital and tangible net worth and requires that the current
ratio, leverage ratio and cash flow coverage ratio be maintained at certain
levels. It also limits the creation of new secured debt to $25.0 million and
new unsecured short-term debt with parties outside the credit agreement to
$20.0 million. Additionally, an event of default will occur if the aggregate
outstanding voting power of James T. Hudson and his immediate family is
reduced below 51%.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
Also, the Company has entered into four separate unsecured short-term credit
agreements with financial institutions (outside the $100.0 million revolving
credit agreement) giving the Company the right to borrow up to $10.0 million
each from three institutions and $15.0 million from one institution. At
December 30, 1995, the Company did not have any notes payable outstanding
under these agreements.
On December 28, 1995, the Company borrowed $55.0 million under six term loan
agreements from two insurance companies at 6.69% due December 28, 2005.
Interest payments only will be due in the first three years. Beginning in the
fourth year, one-seventh of the principal balance will be due each year to
maturity. The loan agreements, among other things, limit the payment of
dividends to approximately $2.8 million in any fiscal year and limit annual
capital expenditures and lease obligations. They require the maintenance of
minimum levels of working capital and tangible net worth and require that the
current ratio, leverage ratio and cash flow coverage ratio be maintained at
certain levels. They also limit the creation of new secured debt to $25.0
million and new unsecured short-term debt with parties outside the Company's
$100.0 million credit agreement to $20.0 million.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Not Applicable
Item 2. Changes in Securities
Not Applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit Sequentially
Number Description of Exhibit Numbered Page
---------------------------------------------------------------
4a Restated Certificate of Incorporated by
Incorporation of Hudson reference from
Foods, Inc., Section 4 Registration
Statement No.
33-15274
11 Calculation of earnings
per share Page 13
15 Letter regarding unaudited
interim financial information Page 14
27 Financial Data Schedule
(b) Reports on Form 8-K
Not Applicable
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Hudson Foods, Inc.
Date February 1, 1996 Michael T. Hudson
President
Date February 1, 1996 Charles B. Jurgensmeyer
Chief Financial Officer
<PAGE>
EXHIBIT 11
HUDSON FOODS, INC. AND SUBSIDIARIES
CALCULATION OF EARNINGS PER SHARE
(In thousands except per share data)
<TABLE>
<CAPTION>
Three Months Ended
December 30, December 31,
1995 1994
<S> <C> <C>
Net income $8,999 $9,835
======================================================================
PRIMARY EARNINGS PER SHARE:
Weighted average number of common
shares outstanding 30,048 27,247
Common stock equivalents:
Dilutive options 356 655
-------- --------
Weighted average number of common
and common equivalent shares 30,404 27,902
======== ========
Primary earnings per share $0.30 $0.35
======================================================================
FULLY DILUTED EARNINGS PER SHARE:
Weighted average number of common
shares outstanding 30,048 27,247
Common stock equivalents:
Dilutive options 370 680
-------- --------
Weighted average number of common
and common equivalent shares 30,418 27,927
======== ========
Fully diluted earnings per share $0.30 $0.35
=======================================================================
</TABLE>
<PAGE>
EXHIBIT 15
HUDSON FOODS, INC. AND SUBSIDIARIES
LETTER REGARDING UNAUDITED INTERIM FINANCIAL INFORMATION
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Hudson Foods, Inc.
Registration on Forms S-8
We are aware that our report dated January 22, 1996 on our review of the
interim financial information of Hudson Foods, Inc. for the periods ended
December 30, 1995 and December 31, 1994, and included in this Form 10-Q is
incorporated by reference in the Company's registration statements on Form S-8
(File nos. 33-36690 and 33-41839). Pursuant to Rule 436(c) under the
Securities Act of 1933, this report should not be considered a part of the
registration statement prepared or certified by us within the meaning of
Sections 7 and 11 of that Act.
Coopers & Lybrand L.L.P.
Tulsa, Oklahoma
January 29, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-28-1996
<PERIOD-END> DEC-30-1995
<CASH> 34,553
<SECURITIES> 0
<RECEIVABLES> 77,407
<ALLOWANCES> 1,698
<INVENTORY> 196,093
<CURRENT-ASSETS> 338,697
<PP&E> 427,592
<DEPRECIATION> 137,278
<TOTAL-ASSETS> 674,465
<CURRENT-LIABILITIES> 105,677
<BONDS> 0
0
0
<COMMON> 309
<OTHER-SE> 313,143
<TOTAL-LIABILITY-AND-EQUITY> 674,465
<SALES> 340,674
<TOTAL-REVENUES> 340,674
<CGS> 293,757
<TOTAL-COSTS> 324,535
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,270
<INCOME-PRETAX> 14,869
<INCOME-TAX> 5,870
<INCOME-CONTINUING> 8,999
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,999
<EPS-PRIMARY> .30
<EPS-DILUTED> .30
</TABLE>
