11 May 2012 --- Imperial Sugar Company reported a net loss of $6.5 million, or $0.54 per diluted share, for the second fiscal quarter ended March 31, 2012, compared to net income of $4.2 million, or $0.34 per diluted share, for the second fiscal quarter of 2011. The prior year’s second quarter results include a $3.6 million pretax gain related to the contribution of the Gramercy, Louisiana refinery to Louisiana Sugar Refining, LLC.

Net sales for the second fiscal quarter were $203.0 million, compared to $192.2 million for the same period last year. The increase in quarterly sales was principally due to a 10.5% increase in domestic sugar prices, which more than offset a 2.4% decrease in domestic sales volumes.

For the three months ended March 31, 2012, gross margin as a percent of sales was 1.1% compared to 5.4% in the prior year quarter. Raw sugar unit costs, before the impact of LIFO liquidations, increased 8% in the current quarter when compared to the same period of the prior year. Raw sugar costs during the prior year’s second quarter benefited from the liquidation of LIFO basis inventory at a cost which was $14.3 million lower than then-current raw sugar costs. Higher manufacturing costs in the current quarter also contributed to the lower gross margin.

The Company sold its 50% voting interest in Wholesome Sweeteners, Incorporated in April 2012 for net proceeds of $60.4 million, subject to adjustment based on Wholesome’s closing date working capital. Capital expenditures for the six months ended March 31, 2012 totaled $7.4 million. As of May 8, 2012, undrawn borrowing capacity under the Company’s revolving credit agreement was $36.4 million, after deducting $44.3 million of outstanding borrowings and $7.5 million of letters of credit.

Six Months Ended March 31, 2012

For the six-month period ended March 31, 2012, the Company reported a net loss of $10.0 million, or $0.83 per diluted share, compared to a net loss of $4.8 million, or $0.40 per diluted share, for the same period last year.

Net sales for the current six-month period were $430.7 million compared to $419.6 million during the same period last year primarily due to higher domestic sugar prices. Sales volumes for the current six-month period were reduced from the same period last year as a result of the contribution of the Gramercy refinery to Louisiana Sugar Refining, LLC in January 2011.

Gross margin as a percent of sales for the six months ended March 31, 2012 was 2.2% compared to 1.6% for the same period last year primarily due to higher refined sugar prices.

Pending Merger Agreement

On May 1, 2012, the Company and a subsidiary of Louis Dreyfus Commodities LLC entered into a definitive agreement whereby the Company would be acquired through a cash tender offer and second step merger at $6.35 per share. The proposed transaction is subject to customary closing conditions, including expiration of the applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act and a minimum tender of at least 662/3% of the Company’s total shares outstanding. For further information, please see the Current Report on Form 8-K filed by the Company on May 1, 2012.