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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 Quarter Ended September 28, 2002
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: 2-62681
GOLD KIST INC.
(Exact name of registrant as specified in its charter)
GEORGIA 58-0255560
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
244 Perimeter Center Parkway, N.E., Atlanta, Georgia 30346
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (770) 393-5000
N/A
(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
GOLD KIST INC.
INDEX
Page No.
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets -
September 28, 2002 and June 29, 2002 1
Consolidated Statements of Operations
Three Months Ended September 28, 2002
and September 29, 2001 2
Consolidated Statements of Cash Flows -
Three Months Ended September 28, 2002
and September 29, 2001 3
Notes to Consolidated Financial
Statements 4 - 6
Item 2. Management's Discussion and Analysis of
Consolidated Results of Operations and
Financial Condition 7 - 10
Item 3. Quantitative and Qualitative Disclosure About
Market Risks 11
Item 4. Controls and Procedures 11
Part II. Other Information
Item 6. Exhibits and reports on Form 8-K 12
Page 1
Item 1. Financial GOLD KIST INC.
Statements CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands)
(Unaudited)
September 28, June 29,
2002 2002
ASSETS
Current assets:
Cash and cash equivalents $ 11,732 8,997
Receivables, principally trade,
less allowance for doubtful
accounts of $1,223 at
September 28, 2002 and $1,194
at June 29, 2002 100,582 110,470
Inventories (note 3) 203,148 191,130
Deferred income taxes 18,634 18,285
Other current assets 39,668 22,587
Total current assets 373,764 351,469
Investments (note 4) 66,929 91,311
Property, plant and equipment, net 229,568 229,476
Prepaid pension costs 43,419 43,419
Other assets 81,793 73,854
$795,473 789,529
LIABILITIES AND EQUITY
Current liabilities:
Notes payable and current maturities of
long-term debt:
Short-term borrowings (note 5) $ - 10,000
Current maturities of long-term debt (note 5) 15,639 15,626
15,639 25,626
Accounts payable 60,738 69,275
Accrued compensation and related expenses 26,148 30,048
Interest left on deposit 9,580 9,773
Other current liabilities 60,162 38,407
Net liabilities - discontinued operations (note 6) 18,429 18,381
Total current liabilities 190,696 191,510
Long-term debt, less current maturities (note 5) 273,656 250,644
Accrued postretirement benefit costs 29,508 29,628
Other liabilities 45,567 34,586
Total liabilities 539,427 506,368
Patrons' and other equity:
Common stock, $1.00 par value - Authorized
500 shares; issued and outstanding 2 at
September 28, 2002 and 18 at June 29, 2002 2 18
Patronage reserves 194,636 195,620
Accumulated other comprehensive loss (2,169) (2,169)
Retained earnings 63,577 89,692
Total patrons' and other equity 256,046 283,161
Commitments and contingencies (notes 6 and 7) $795,473 789,529
See Accompanying Notes to Consolidated Financial Statements.
Page 2
GOLD KIST INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands)
(Unaudited)
Three Months Ended
Sept. 28, Sept. 29,
2002 2001
Net sales volume $460,624 478,434
Cost of sales 437,757 414,035
Gross margins 22,867 64,399
Distribution, administrative and
general expenses 20,540 23,835
Net operating margins 2,327 40,564
Other income (deductions):
Interest and dividend income 330 2,637
Interest expense (6,091) (8,468)
Unrealized loss on investment (note 4) (24,064) -
Miscellaneous, net 307 1,644
Total other deductions (29,518) (4,187)
Margins (loss) from continuing
operations before income taxes (27,191) 36,377
Income tax (benefit) expense (1,043) 12,128
Net margins (loss) from continuing
operations (26,148) 24,249
Discontinued operations (note 6):
Gain from operations of discontinued
joint venture partnership (less
applicable income tax expense of
$63 thousand for September 29,
2001) - 125
Net margins (loss) $(26,148) 24,374
See Accompanying Notes to Consolidated Financial Statements.
Page 3
GOLD KIST INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
Three Months Ended
Sept. 28, Sept. 29,
2002 2001
Cash flows from operating activities:
Net margins (loss) from continuing operations $ (26,148) 24,249
Non-cash items included in net margins (loss)
from continuing operations:
Depreciation and amortization 9,616 10,058
Unrealized loss on investment 24,064 -
Deferred income tax expense (benefit) (698) 10,508
Other 2,007 (262)
Changes in operating assets and liabilities:
Receivables 9,888 (16,240)
Inventories (12,018) (12,088)
Other current assets 1,306 1,433
Accounts payable, accrued and other expenses (7,264) (4,768)
Net cash provided by operating activities
of continuing operations 753 12,890
Cash flows from investing activities:
Dispositions of investments 104 24,840
Acquisitions of property, plant and equipment (9,307) (7,303)
Other (873) (1,627)
Net cash provided by (used in) investing
activities (10,076) 15,910
Cash flows from financing activities:
Short-term debt repayments, net (10,000) (26,063)
Proceeds from long-term debt 120,000 -
Principal repayments of long-term debt (96,975) (3,709)
Patron's equity redemptions paid in cash (967) (1,039)
Net cash (used in) provided by financing activities 12,058 (30,811)
Net change in cash and cash equivalents 2,735 (2,011)
Cash and cash equivalents at beginning of period 8,997 11,339
Cash and cash equivalents at end of period $ 11,732 9,328
Supplemental disclosure of cash flow data:
Cash paid (received) during the periods for:
Interest (net of amounts capitalized) $ 6,405 9,135
Income taxes, net $ (4,153) 50
See Accompanying Notes to Consolidated Financial Statements.
Page 4
GOLD KIST INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in Thousands)
(Unaudited)
1. The accompanying unaudited consolidated financial statements reflect
the accounts of Gold Kist Inc. and its subsidiaries; and a partnership
as of and for the three months ended September 28, 2002 ("Gold Kist" or
the "Association"). These consolidated financial statements should be
read in conjunction with Management's Discussion and Analysis of
Consolidated Results of Operations and Financial Condition and the
Notes to Consolidated Financial Statements on pages 9 through 14 and
pages 23 through 34, respectively, of Gold Kist's Annual Report in the
previously filed Form 10-K for the year ended June 29, 2002.
The Association employs a 52/53 week fiscal year. Fiscal 2003 will be
a 52-week year and fiscal 2002 was also a 52-week year with each
quarter in both periods consisting of 13 weeks.
2. In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting of normal
recurring accruals) necessary to present fairly the financial position,
the results of operations, and the cash flows. All significant
intercompany balances and transactions have been eliminated in
consolidation. Results of operations for interim periods are not
necessarily indicative of results for the entire year.
3. Inventories consist of the following:
Sept. 28, 2002 June 29, 2002
Live poultry and hogs $ 98,352 91,457
Marketable products 69,185 66,533
Raw materials and supplies 35,611 33,140
$203,148 191,130
4. In October 1998, the Association completed the sale of assets of the
Agri-Services segment to Southern States Cooperative, Inc. (SSC). In
order to complete the transaction, the Association committed to
purchase from SSC, subject to certain terms and conditions, up to $60
million principal amount of capital trust securities and $40 million
principal amount of cumulative preferred securities if SSC was unable
to market the securities to other purchasers. In October 1999, the
Company purchased for $98.6 million the $100 million principal amount
of the securities under the commitment. The securities carried a
combined weighted average interest/dividend rate of 8.5% at June 29,
2002. No dividends were paid on the cumulative preferred securities
for the third and fourth quarters of fiscal 2002 or for the first
quarter of fiscal 2003.
In October 2002, SSC notified the Association that, pursuant to the
provisions of the indenture under which the Association purchased the
capital trust securities from SSC, SSC would defer the capital trust
Page 5
certificates interest payment due on October 5, 2002, until January 5,
2003, unless the payment is further deferred or extended pursuant to
the indenture. As a result of the deferral of the interest payment,
the Association has reduced the carrying value of the capital trust
securities by $24.1 million with a corresponding charge against
margins from continuing operations before income taxes for the three
months ended September 28, 2002. The carrying value of the SSC
securities was $81.4 million at June 29, 2002 and $57.3 million at
September 28, 2002.
As interest rates and market conditions change, the carrying value of
the securities could be further reduced. Also, the proceeds from any
future sale of the SSC securities could differ from these
estimates. If these events were to occur, they could have a material
impact on results of operations and financial position of the
Association.
Gold Kist is permitted to sell the SSC securities pursuant to
applicable securities regulations. The SSC securities are classified
as noncurrent investments in the accompanying consolidated balance
sheets at September 28, 2002 and June 29, 2002.
5. On October 23, 2001, the Association refinanced its $240 million
Senior Secured Credit Facility. The $100 million 364-day revolving
line of credit due November 3, 2001 was replaced with a $110 million
revolving line of credit due October 23, 2002. The $95 million two-
year term loan due November 2002 was replaced with a $95 million two-
year term loan due October 2003. The $45 million five-year term loan
due November 2005 was unchanged. Other terms and conditions of the
credit facility were essentially unchanged as well.
On September 27, 2002, the Company refinanced and extended the Senior
Secured Credit Facility that included a $110 million Revolving
Credit Facility maturing November 2, 2004 and a $95 million Term Loan
maturing November 2, 2005. The interest rates on the facility will
range from 1.50% to 2.25% over LIBOR, adjusted quarterly based on the
Association's financial condition. Other terms and conditions were
essentially unchanged.
At September 28, 2002, the Association was in compliance with all
applicable loan covenants.
6. Gold Kist holds a 25% equity interest and 35% earnings (loss)
participation in a pecan processing and marketing partnership. The
partners adopted a restructuring agreement in January 2002 that gave
Gold Kist effective control of the partnership. As a result, Gold
Kist began consolidating the partnership.
Gold Kist and the other general partner are each guarantors of up to
$60 million under a secured line of credit agreement between the
agricultural credit bank and the partnership. At September 28, 2002,
the amount outstanding under the facility was $47.9 million. The line
of credit bears interest at the prime rate plus 2%, is secured by
pecan inventories, receivables and substantially all of the
partnership's property, plant and equipment, and is due on December 1,
2002. The partnership was in compliance or had obtained waivers with
respect to all applicable loan covenants.
Gold Kist believes it is reasonably possible that payments could be
required under the guarantee. If required, Gold Kist anticipates
funding such amounts from availability under its Senior Secured
Credit
Page 6
Facility. If payments were made under the guarantee, Gold Kist would
have a security interest in the inventories, receivables and
substantially all of the fixed assets of the partnership.
Effective in June 2002, Gold Kist adopted a plan to withdraw from
the partnership and discontinue its participation in the operations of
the affiliate during 2003. Accordingly, the operating results of the
partnership have been segregated from continuing operations and
reported separately in the accompanying consolidated balance sheet and
statements of operations and cash flows for 2002. The Company does
not expect to incur additional losses during the phase-out period or
upon withdrawal.
Gold Kist's management believes it is the intent of the other general
partner to raise additional equity and/or refinance the aforementioned
secured line of credit, continue operations and relieve Gold Kist of
its guaranty obligation during 2003.
7. In August 1999, the State Court of Fulton County, Georgia entered a
$22 million judgment against Golden Peanut Company (Golden Peanut) and
in favor of a peanut farming company that alleged it had been
underpaid for its 1990 crop. Gold Kist held a forty percent interest
in Golden Peanut at the time of the events which resulted in the
lawsuit. In March 2001, the Georgia Court of Appeals reversed this
judgment and ordered a new trial. In April 2002, the Georgia Supreme
Court affirmed this decision. In July 2002, Golden Peanut filed a
petition for certiorari in the United States Supreme Court, asking the
Court to reverse the trial court judgment outright and thus eliminate
the need for a second trial. If this petition is denied, the parties'
re-trial is scheduled to begin in November 2002. Gold Kist is
contingently liable through a Litigation Sharing and Indemnification
Agreement with Golden Peanut for its 40% share of any costs related
to this litigation.
Page 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF CONSOLIDATED RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
Net Sales Volume
Gold Kist's net sales volume for the quarter ended September 28, 2002
decreased 3.7% as compared to the quarter ended September 29, 2001. The
decrease in net sales volume was due primarily to a 4.5% decrease in average
poultry sales prices, which was partially offset by a 4.9% increase in ready-
to-cook (RTC) broiler meat production. The decrease in poultry sales was
principally due to a reduction in export demand, experienced industry-wide,
that negatively impacted both foreign and domestic markets. This has
resulted in an oversupply of broiler meat and lower poultry sales prices.
Increased supplies of competing meats, principally beef and pork, have also
contributed to the downward pressure on poultry prices. Depressed broiler
prices are expected to continue through the second fiscal quarter.
The Association's export sales of $11.2 million for the September 2002 period
were 50% lower than the September 2001 period, due to the continuing impact
of the Russian embargo. Although the ban was lifted in mid-April 2002 and
product specifications and other issues were resolved in August 2002, sales
to Russia are substantially below prior year levels.
According to the U.S. Department of Agriculture's (USDA) World Agricultural
Outlook Board, the forecast for calendar 2002 broiler meat production is
32.01 billion pounds, ready-to-cook weight, 3.5% above the 30.94 billion
pounds produced in 2001. The estimate for calendar 2003 production is 32.65
billion pounds, 2.0% over the 2002 forecast. Current egg placements are
below prior year levels, however, indicating a possible lower rate of
increase in broiler production.
Net Operating Margins
The Association had net operating margins of $2.3 million for the three
months ended September 28, 2002 as compared to $40.6 million in the
comparable period last year. The decrease in operating margins for the three-
month period ended September 28, 2002 was due primarily to lower poultry
selling prices and higher feed ingredient costs for the September 2002
quarter as compared to the September 2001 quarter. The 13.8% decrease in
distribution, administrative and general expenses for the three months ended
September 28, 2002 was attributable to lower incentive compensation accruals
due to the net loss for the September 2002 quarter and lower benefit costs
due to various plan changes effected in the prior year.
The Company expects that increased domestic demand, production restraint and
the resumption of export shipments to Russia could result in the
strengthening of poultry sales prices and profitable operations sometime
during the second half of fiscal 2003. The outlook for the second fiscal
quarter is for losses from operations due to the anticipated continuation of
depressed broiler sales prices and higher feed costs.
Page 8
Other Income (Deductions)
Interest and dividend income was $330 thousand for the three months ended
September 2002 as compared to $2.6 million for the September quarter last
year. The amounts for the September 2001 quarter were earned principally
from the Southern States capital trust and preferred securities. No
dividends or interest were paid or accrued on the securities for the first
quarter of fiscal 2003.
In October 2002, Southern States Cooperative, Inc. (SSC) notified the
Association that, pursuant to the provisions of the indenture under which the
Association purchased the trust securities from SSC, SSC would defer the
trust certificates interest payment due on October 5, 2002, until January 5,
2003, unless the payment is further deferred or extended pursuant to the
indenture. As a result of the deferral of the interest payment, the
Association has reduced the carrying value of the SSC securities by $24.1
million with a corresponding charge against margins from continuing
operations before income taxes for the three months ended September 28, 2002.
As interest rates and market conditions change, the carrying value of the
securities could be further reduced. Also, the proceeds from any future sale
of the securities could differ from these estimates. If these events were to
occur, they could have a material impact on results of operations and
financial position of the Association.
Interest expense was $6.1 million for the three months ended September 28,
2002 as compared to $8.5 million for the comparable period last year. The
decrease in interest expense was due to lower average loan balances resulting
from improved cash flows during fiscal 2002 from operations and the sale of
investments, and lower average market interest rates and credit spreads.
For the three months ended September 28, 2002, the Association's combined
federal and state effective income tax rate on the tax benefit of the loss
before income taxes was 3.8%. Combined effective rates for the three-month
period ended September 28, 2001 was 33%. The limited tax benefit in the
September 2002 quarter is due to the deferred income tax valuation allowance
established for the unrealized capital loss resulting from the write down of
the SSC investment. Income tax expense (benefit) for the periods presented
also reflects income taxes at statutory rates adjusted for available tax
credits and deductible nonqualified equity redemptions.
In June 2002, the Association adopted a plan to withdraw from and discontinue
participation in the pecan processing and marketing partnership within the
2003 fiscal year. Accordingly, the operating results of the partnership have
been segregated from continuing operations and reported separately in the
Statements of Operations. See Note 6 of Notes to Consolidated Financial
Statements.
LIQUIDITY AND CAPITAL RESOURCES
The Association's liquidity is dependent upon funds from operations and
external sources of financing. At July 1, 2001, the principal source of
external financing was a $240 million Senior Secured Credit Facility with a
group of financial institutions that includes a $100 million 364-day
Page 9
revolving line of credit, a $95 million two-year term loan, and a $45 million
five-year term loan. The Association also has a $39.3 million term loan with
an agricultural bank and $52.3 million in senior notes with an insurance
company. The Association's senior notes, senior secured credit facilities
and term loan with an agricultural credit bank are secured by substantially
all of the Association's inventory, receivables, and property, plant and
equipment. On October 23, 2001, the Association refinanced its $240 million
Senior Secured Credit Facility. The $100 million 364-day revolving line of
credit due November 3, 2001 was replaced with a $110 million revolving line
of credit due October 23, 2002. The $95 million two-year term loan due
November 2002 was replaced with a $95 million two-year term loan due October
2003. The $45 million five-year term loan due November 2005 was unchanged.
Other terms and conditions of the credit facility were essentially unchanged
as well.
On September 27, 2002, the Company refinanced and extended the Senior Secured
Credit Facility that included a $110 million Revolving Credit Facility
maturing November 2, 2004 and a $95 million Term Loan maturing November 2,
2005. The interest rates on the facility will range from 1.50% to 2.25% over
LIBOR, adjusted quarterly based on the Association's financial conditions.
Other terms and conditions were essentially unchanged.
At September 28, 2002, the Association had unused loan commitments of $79
million.
Covenants under the terms of the loan agreements with lenders include
conditions that could limit short-term and long-term financing available from
various external sources. The terms of debt agreements specify minimum
consolidated tangible net worth, current ratio and coverage ratio
requirements, as well as a limitation on the total debt to total capital
ratio. The debt agreements place a limitation on capital expenditures,
equity distributions, cash patronage refunds, commodity hedging contracts and
additional loans, advances or investments. At September 28, 2002, the
Association was in compliance with all applicable loan covenants.
For the first three months of fiscal 2003, cash provided from operating
activities of continuing operations was $753 thousand as compared to $12.9
million for the first three months of fiscal 2002. The decrease was due to
the net loss from continuing operations as adjusted for non-cash items. Cash
provided by financing activities was $12.1 million as compared to cash used
in financing activities of $30.8 million for the quarters ended September
2002 and September 2001, respectively.
Working capital and patrons' and other equity were $183.1 million and $256
million, respectively, at September 28, 2002 as compared to $160 million and
$283.2 million, respectively, at June 29, 2002. Working capital increased at
September 28, 2002 due to higher inventories and other current assets. The
decrease in patrons' and other equity reflects the net loss for the September
2002 quarter.
The Association plans capital expenditures of approximately $55 million in
2003 that primarily include expenditures for expansion of further processing
capacity and technological advances in poultry production and processing. In
addition, planned capital expenditures include other asset improvements and
necessary replacements. Management intends to finance planned 2003 capital
expenditures and related working capital needs with existing cash
Page 10
balances, cash expected to be provided from operations and additional
borrowings, as needed. In 2003, management expects cash expenditures to
approximate $6.5 million for equity redemptions, net of insurance proceeds,
and cash patronage refunds.
In connection with the sale of assets of the Agri-Services segment to
Southern States during 1999, Gold Kist discontinued the sale of Subordinated
Certificates. The Association believes cash on hand and cash equivalents at
September 28, 2002 and cash expected to be provided from operations, in
addition to borrowings available under committed credit arrangements, will be
sufficient to maintain cash flows adequate for the Association's operational
objectives over the next twelve months and to fund the repayment of
outstanding Subordinated Certificates as they mature.
Important Considerations Related to Forward-Looking Statements
It should be noted that this discussion contains forward-looking statements,
which are subject to substantial risks and uncertainties. There are many
factors which could cause actual results to differ materially from those
anticipated by statements made herein. In light of these risks and
uncertainties, the Association cautions readers not to place undue reliance
on any forward-looking statements. The Association undertakes no obligation
to publicly update or revise any forward-looking statements based on the
occurrence of future events, the receipt of new information or otherwise.
Among the factors that may affect the operating results of the Association
are the following: (i) fluctuations in the cost and availability of raw
materials, such as feed grain costs; (ii) changes in the availability and
relative costs of labor and contract growers; (iii) market conditions for
finished products, including the supply and pricing of alternative proteins;
(iv) effectiveness of sales and marketing programs; (v) risks associated with
leverage, including cost increases due to rising interest rates; (vi) changes
in regulations and laws, including changes in accounting standards,
environmental laws and occupational, health and safety laws; (vii) access to
foreign markets together with foreign economic conditions; and (viii) changes
in general economic conditions.
Effects of Inflation
The major factor affecting the Association's net sales volume and cost of
sales is the change in commodity market prices for broilers, hogs and feed
grains. The prices of these commodities are affected by world market
conditions and are volatile in response to supply and demand, as well as
political and economic events. The price fluctuations of these commodities
do not necessarily correlate with the general inflation rate. Inflation has,
however, affected operating costs such as labor, energy and material costs.
Future Accounting Requirements
The Financial Accounting Standards Board (FASB) has issued SFAS No. 145,
Rescission of FASB Statements Nos. 4, 44 and 64, Amendment of FASB Statement
No. 13 and Technical Corrections; and SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities. These statements will be
effective for the Company's fiscal year beginning June 29, 2003. The Company
does not anticipate that these statements will have a material impact on the
Company's consolidated financial statements.
Page 11
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS
Market Risk
The principal market risks affecting the Association are exposure to changes
in commodity prices and interest rates on borrowings. Although the Company
has international sales and related accounts receivable from foreign
customers, there is no foreign currency exchange risk as all sales are
denominated in United States dollars.
Commodities Risk
The Association is a purchaser of certain agricultural commodities used for
the manufacture of poultry feeds. The Association uses commodity futures and
options for economic hedging purposes to reduce the effect of changing
commodity prices and to ensure supply of a portion of its commodity
inventories and related purchase and sale contracts. Feed ingredients
futures and option contracts, primarily corn and soybean meal, are accounted
for at market. Changes in fair value on these commodity futures and options
are recorded as a component of product cost in the consolidated statements of
operations. Terms of the Association's secured credit facility limit the use
of forward purchase contracts and commodities futures and options
transactions. At September 28, 2002, the notional amounts and fair value of
the Association's outstanding commodity futures and options positions were
not material.
Interest Rate Risk
The Association has exposure to changes in interest rates on certain debt
obligations. The interest rates on the Senior Secured Credit facilities
fluctuate based on the London Interbank Offered Rate (LIBOR). See Note 5 of
Notes to Consolidated Financial Statements.
ITEM 4. CONTROLS AND PROCEDURES
Within ninety (90) days prior to the filing of this report, an evaluation was
performed under the supervision and with the participation of the Company's
management, including the President and Chief Executive Officer ("CEO"), and
the Chief Financial Officer ("CFO"), of the effectiveness of the design and
operation of the Company's disclosure controls and procedures. Based on that
evaluation, the Company's management, including the CEO and CFO, concluded
that the Company's disclosure controls and procedures were effective in
timely bringing to their attention material information related to the
Company required to be included in the Company's periodic Securities and
Exchange Commission filings. There have been no significant changes in the
Company's internal controls or in other factors that could significantly
affect internal controls subsequent to the most recent evaluation conducted
by the CEO and the CFO.
Page 12
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(b)Reports on Form 8-K. Gold Kist filed a Form 8-K Current Report on
October 8, 2002.
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.
GOLD KIST INC.
(Registrant)
Date November 7, 2002
John Bekkers
Chief Executive Officer
(Principal Executive Officer)
Date November 7, 2002
S. O. West
Treasurer and Chief Financial Officer
(Principal Financial Officer)
Page 12
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(b)Reports on Form 8-K. Gold Kist filed a Form 8-K Current Report on
October 8, 2002.
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.
GOLD KIST INC.
(Registrant)
Date November 7, 2002 /s/ John Bekkers
John Bekkers
Chief Executive Officer
(Principal Executive Officer)
Date November 7, 2002 /s/ S. O. West
S. O. West
Treasurer and Chief Financial Officer
(Principal Financial Officer)
CERTIFICATION
I, John Bekkers, Principal Executive Officer of Gold Kist Inc., certify that:
1. I have reviewed this quarterly report on Form 10-Q of Gold Kist Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
Date: November 7, 2002
/s/ John Bekkers
[Signature]
Title: Chief Executive Officer
CERTIFICATION
I, Stephen O. West, Principal Financial Officer of Gold Kist Inc., certify
that:
1. I have reviewed this quarterly report on Form 10-Q of Gold Kist Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
Date: November 7, 2002
/s/ Stephen O. West
[Signature]
Title: Chief Financial Officer
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