Pilgrim's Pride has reported its first quarterly profit since 2007, helped by lower feed prices and a cost cutting drive being implemented to take the bankrupt chicken group off the critical list.

The group, America's top chicken producer, reported earnings of $53.2m for the three months to June 27.

The profit ends a string of quarterly losses dating back to the last three months of 2007, and which totalled nearly $1.3bn.

'Improved environment'

The improvement reflected a drop in prices of feed from the "unprecedented" levels a year ago, while production cuts at Pilgrim's Pride and competitors were showing signs of stemming a decline in prices received for chicken meat.

"Market prices for chicken products have stabilised since the end of 2008," a Pilgrim's Pride filing said.

"We experienced an improved business environment in the quarter."

The company's administration costs dropped by 18.9% to $74.8m, helped by staff reductions.

Soaring fees

Nonetheless, the group warned of a "substantial doubt" over its future, and said it was continuing to look at ways of improving its prospects, including further plant sales.

Fees to advisers on the group's rescue and restructuring came in at $15.1m for the quarter, taking the total bill to $35.2m so far.

Pilgrim's Pride sought bankruptcy protection in December last year after being badly hurt by rising feed prices at a time when its debts remained swollen by the $1.1bn purchase of Atlanta-based Gold Kist in 2007.

The group listed assets of $3.75bn and debts of $2.72bn at the time.

Pilgrim's Pride was delisted from the New York Stock Exchange in December, and its stock is now quoted on the Pink Sheets Electronic Quotation Service.