Stockholders' Equity and Accumulated Other Comprehensive Loss

9 Months Ended

Oct. 01, 2011

Stockholders' Equity and Accumulated Other Comprehensive Loss

Stockholders' Equity and Accumulated Other Comprehensive Loss

Note 8 — Stockholders’ Equity and Accumulated Other Comprehensive Loss

Components of total comprehensive income, net of related taxes, are summarized as follows:

	Three Months Ended						Nine Months Ended
(Thousands of dollars)	October 1, 2011			October 2, 2010			October 1, 2011			October 2, 2010
Net earnings	$	35,089		$	39,483		$	265,146		$	179,503
Other comprehensive income net of applicable taxes:
Foreign currency translation adjustment	(5,082		)	(879		)	(6,673		)	(3,920		)
Unrealized gain on investments	(1,652		)	(669		)	(849		)	(1,371		)
Unrecognized pension cost	906			704			1,977			2,189
Total comprehensive income	$	29,261		$	38,639		$	259,601		$	176,401

The components of and changes in accumulated other comprehensive loss for the nine months ended October 1, 2011 are as follows:

(Thousands of dollars)	Balance December 31, 2010			Period Change			Balance October 1, 2011
Cumulative foreign currency translation adjustment	$	(81,280	)	$	(6,673	)	$	(87,953	)
Unrealized gain on investments	445			(849		)	(404		)
Unrecognized pension cost	(43,072		)	1,977			(41,095		)
Accumulated other comprehensive loss	$	(123,907	)	$	(5,545	)	$	(129,452	)

The foreign currency translation adjustment primarily represents the effect of the Argentine peso currency exchange fluctuation on the net assets of the Sugar segment.  At October 1, 2011, the Sugar segment had $202,831,000 in net assets denominated in Argentine pesos and $31,337,000 in net liabilities denominated in U.S. dollars.

With the exception of the foreign currency translation adjustment to which a 35 percent federal tax rate is applied, income taxes for components of accumulated other comprehensive loss were recorded using a 39 percent effective tax rate.  In addition, the unrecognized pension cost includes $12,451,000 related to employees at certain subsidiaries for which no tax benefit has been recorded.

On October 31, 2011, the Board of Directors extended through October 31, 2012 the share repurchase program previously approved on November 6, 2009 and originally set to expire on October 31, 2011.  Under this share repurchase program, Seaboard is authorized to repurchase from time to time up to $100,000,000 market value of its Common Stock in open market or privately negotiated purchases which may be above or below the traded market price.  As of October 31, 2011, $63,329,000 remained available for repurchases under this program.  During the period that the share repurchase program remains in effect, from time to time, Seaboard may enter into a 10b5-1 plan authorizing a third party to make such purchases on behalf of Seaboard.  The stock repurchase will be funded by cash on hand.  Shares repurchased will be retired and resume the status of authorized and unissued shares.  All stock repurchased will be made in compliance with applicable legal requirements and the timing of the repurchases and the number of shares repurchased at any given time will depend upon market conditions, compliance with Securities and Exchange Commission regulations and other factors.  The Board’s stock repurchase authorization does not obligate a specific amount of common stock and the stock repurchase program may be suspended at any time at Seaboard’s discretion. For the nine months ended October 1, 2011, Seaboard repurchased 600 shares of common stock at a total cost of $1,158,000.  Also, Seaboard currently does not intend to declare any dividends during 2011 or 2012 as there was a prepayment of the annual 2011 and 2012 dividends in December 2010.