Imperial Sugar Company (NASDAQ: IPSU) was named as one of the 13 worst big equity stories of 2011 recently. Things are not getting better if the earnings report is a tell. The maker of sugars and sweeteners reported a net loss for its fourth quarter of $32.5 million. This comes to -$2.73 EPS and that compares to -$0.19 EPS a year ago and compares to the estimate of -$0.79 EPS from Thomson Reuters.
The company blamed high raw sugar prices and competitive pricing dynamics, and it also noted that its progress on increasing production rates and reducing costs at the Port Wentworth refinery has been slower than we expected.
Unfortunately, this company went out raising investor interest in 2011 and then suddenly the bottom fell out of the story. While not definite, it seems improbable that management did not know of many of the problems when they were talking the company up on CNBC. It sounded like it was going to be the next great breakout, but it turned out to be the next big breakdown.
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