Imperial Sugar Company Reports First Quarter Fiscal Year 2009 Results

Sugar Land, Texas, Feb, 9, 2009 - The Imperial Sugar Company today reported a loss from continuing operations for the fiscal first quarter ended December 31, 2008 of $0.6 million, or $0.05 per share, compared to income from continuing operations of $12.3 million, or $1.04 per diluted share, for the same period last year.

The recent quarter also included a pre-tax charge of $3.3 million related to the company’s Port Wentworth refinery accident that occurred in February, 2008 as well as a gain on litigation settlement of $16.1 million. Last year’s first quarter included $11.4 million of other income related to a limited partnership investment distribution.

Port Wentworth charges in the recent quarter include amounts for cleanup and repairs, continuing refinery payroll and other costs related to the accident totaling $14.9 million, offset by $11.7 million of insurance recoveries recognized under the company’s property insurance coverage.

Net sales and gross margin for the fiscal fourth quarter declined to $108.6 million and a negative 2.7%, compared to $215.5 million and a positive 6.6%, respectively, for the same period last year. The operating loss for the recent quarter was $1.7 million compared to operating income of $3.6 million for the first quarter of last year. Overall results were affected primarily by the loss of production capability due to the Port Wentworth incident as well as higher freight, manufacturing, energy, and selling, general and administrative costs, offset in part by higher refined sugar prices.

“Understandably, financial results continue to be affected by the Port Wentworth outage,” stated John Sheptor, president and CEO of Imperial Sugar. However, construction at the Port Wentworth site is making excellent progress as we have begun erecting steel and major equipment is on order. After reviewing equipment delivery and construction schedules, we now anticipate bulk sugar production will begin in the spring of 2009 with the complete restoration of packaging capabilities by fall of 2009. We will continue managing our business to best maximize our resources until all insurance recoveries are received and full manufacturing is restored.

“Initiatives in other areas are also progressing. Discussions with the Louisiana sugar growers and Cargill to become an equity partner in the Louisiana Sugar Refining joint venture are progressing with due diligence underway. Despite the economic slowdown, consumers continue to seek out Wholesome’s organic, natural and fair trade products preferentially. And with the seasonal harvest in Mexico now underway, the second year of operations at our joint venture Comercializadora Santos Imperial is in full swing as our customer base continues to grow.”