Smithfield owner’s profits boosted by improved U.S. pork business

WH Group Ltd. — the owner of U.S.-based Smithfield Foods — saw profits rise in the first quarter as a “substantial improvement” in its U.S. operations more than offset a decline in homeland China.

Operating profit for the the three months ended March 31 rose 37% to $501 million even as revenue and sales volumes shrank, Hong Kong-based WH said in a statement. Shares of the company rose as much as 3.5% before trimming gains.

A combination of higher pork prices and a series of “reform measures” helped slash losses related to hog farming, slaughtering and sales of fresh and frozen pork in the U.S. and Mexico. The losses were more than offset by $288 million in profit from the sale of packaged meats in the region.

That’s a sign the worst may be behind for the company’s giant North American operation, which last year was slammed by high costs and weak consumer demand. The result may serve a bellwether for the pork businesses of rivals Tyson Foods Inc. and JBS SA, which report earnings next month.