Joseph W. Luter III announced June 15 that he plans to relinquish the title of chief executive officer of Smithfield Foods, Inc., Smithfield, Va., after serving for 31 years as chairman and CEO.
Smithfields board of directors said Luter will leave the CEO post as of Aug.1, but will remain non-executive chairman of the board. The board has elected C. Larry Pope, currently president and chief operating officer, to be CEO effective Sept. 1. As chairman, Luter will continue to focus on acquisitions and long-term strategic development, the two areas where he believes he can make the greatest contribution to Smithfield.
Looking back over the past 31 years, it is gratifying to see how far Smithfield Foods has come," said Luter. "We have grown the company from a humble enterprise into one of the largest and well-respected food companies in the world. It is a task to which I have dedicated most of my life, and I am glad that I have done so. Perhaps my greatest joy, however, is assembling an outstanding team of managers and employees.
Luter, 67 years old, said he is leaving the company in good hands. Larry Pope could not be more qualified to be chief executive of Smithfield," Luter remarked. "For the last 25 years, he has worked with me to build this company for the long term, not being distracted by near-term industry dynamics. He has played a vital role in the integration of our many acquisitions we have made to build this company. There could not be a more seamless transition to solidify Smithfields future. Larry is a dedicated leader who will make the right decisions for employees and shareholders.
After four years with an accounting firm, Pope joined Smithfield Foods in 1980 as controller. He became vice president, finance, in 1999 and was named chief financial officer in 2000. The board elected him president and chief operating officer in 2001.
Joe Luter will be a hard act to follow. He clearly is the most respected man in the meat industry, said Pope. On the other hand, I am the beneficiary of having many years of experience in working closely with him, and look forward to continuing in that relationship as he remains chairman. I am especially pleased that Mr. Luter will continue to stay actively involved in many of the major decisions.
Pope added, Mr. Luter has spent his life building a very strong foundation for the future. I look forward to completing many of the projects currently under way, especially in Europe. My goal is to ensure that Smithfields future remains as bright as its past, Pope said.
Joe Luter became chief executive of Smithfield in 1975 when the company was in severe economic distress, with sales of $115 million, debt of $20 million and net worth of less than $1 million. At the time Smithfield Foods stock was trading as low as $.50 per share. The stock closed on June 14 at $26.36 per share, adjusted for five 2-for-1 stock splits. Unadjusted for stock splits, the stock would have closed at $843.52 per share. Smithfield recently reported fiscal 2006 sales of $11.4 billion and is the largest pork processor and hog producer in the world. Additionally, the company is the fifth largest beef processor and the largest cattle producer through a joint venture. Luter grew the business primarily through acquisitions, acquiring some 53 companies in the last 25 years.
Luter has been instrumental in translating Smithfields growth into enhanced shareholder value. Over his 31 years at Smithfield, the company has delivered a 24 percent annual compounded rate of return to shareholders. For the last 15 years, Smithfield has outperformed the S&P 500 Index by more than 160 percent.