Pilgrim’s Pride Reports Second Quarter 2024 Results with $4.6 Billion in Net Sales and Operating Income of $440.8 Million
Pilgrim's Pride (NASDAQ: PPC) reported strong second quarter 2024 results, with net sales of $4.6 billion and a consolidated GAAP operating income margin of 9.7%. The company achieved a GAAP Net Income of $326.5 million and GAAP EPS of $1.37. Adjusted EBITDA reached $655.9 million, representing a 14.4% margin. Pilgrim's Pride saw improvements across its U.S., European, and Mexican operations, with notable growth in branded offerings and partnerships with key customers. The company's strong liquidity position, with a net leverage ratio of 1.1x Adjusted EBITDA, provides a solid foundation for executing its growth strategy.
Pilgrim's Pride (NASDAQ: PPC) ha riportato forti risultati per il secondo trimestre del 2024, con vendite nette di 4,6 miliardi di dollari e un margine di reddito operativo GAAP consolidato del 9,7%. L'azienda ha registrato un utile netto GAAP di 326,5 milioni di dollari e un utile per azione GAAP di 1,37 dollari. L'EBITDA rettificato ha raggiunto 655,9 milioni di dollari, rappresentando un margine del 14,4%. Pilgrim's Pride ha mostrato miglioramenti nelle sue operazioni negli Stati Uniti, in Europa e in Messico, con una crescita notevole nelle offerte di marca e nelle collaborazioni con clienti chiave. La solida posizione di liquidità dell'azienda, con un rapporto di leva netta di 1,1x EBITDA rettificato, fornisce una solida base per attuare la sua strategia di crescita.
Pilgrim's Pride (NASDAQ: PPC) reportó sólidos resultados del segundo trimestre de 2024, con ventas netas de 4.6 mil millones de dólares y un margen de ingreso operativo GAAP consolidado del 9.7%. La compañía alcanzó un ingreso neto GAAP de 326.5 millones de dólares y un EPS GAAP de 1.37 dólares. El EBITDA ajustado llegó a 655.9 millones de dólares, representando un margen del 14.4%. Pilgrim's Pride vio mejoras en sus operaciones en Estados Unidos, Europa y México, con un notable crecimiento en las ofertas de marca y asociaciones con clientes clave. La fuerte posición de liquidez de la compañía, con un ratio de apalancamiento neto de 1.1x EBITDA ajustado, proporciona una base sólida para ejecutar su estrategia de crecimiento.
필그림스프라이드 (NASDAQ: PPC)는 2024년 2분기 실적을 발표하며 46억 달러의 순매출과 GAAP 기준 통합 운영 수익률 9.7%를 기록했습니다. 이 회사는 GAAP 순이익이 3억 2천 6백 5십만 달러와 GAAP 주당 순이익 1.37 달러를 달성했습니다. 조정 EBITDA는 6억 5천 5백 9십만 달러에 달해 14.4%의 마진을 기록했습니다. 필그림스프라이드는 미국, 유럽 및 멕시코에서 운영 개선을 보았으며, 브랜드 제품과 주요 고객과의 파트너십에서 두드러진 성장을 이루었습니다. 회사의 강력한 유동성 위치는 조정 EBITDA에 대한 순레버리지 비율이 1.1배로, 성장 전략을 실행하기 위한 견고한 기초를 제공합니다.
Pilgrim's Pride (NASDAQ: PPC) a rapporté de solides résultats pour le deuxième trimestre 2024, avec un chiffre d'affaires net de 4,6 milliards de dollars et une marge de bénéfice d'exploitation GAAP consolidée de 9,7 %. L'entreprise a enregistré un bénéfice net GAAP de 326,5 millions de dollars et un bénéfice par action GAAP de 1,37 dollar. L'EBITDA ajusté a atteint 655,9 millions de dollars, représentant une marge de 14,4 %. Pilgrim's Pride a connu des améliorations dans ses opérations aux États-Unis, en Europe et au Mexique, avec une croissance notable des offres de marque et des partenariats avec des clients clés. La forte position de liquidité de l'entreprise, avec un ratio d'endettement net de 1,1x EBITDA ajusté, constitue une base solide pour exécuter sa stratégie de croissance.
Pilgrim's Pride (NASDAQ: PPC) meldete starke Ergebnisse für das zweite Quartal 2024, mit Nettoumsätzen von 4,6 Milliarden US-Dollar und einer konsolidierten GAAP-Betriebsgewinnspanne von 9,7 %. Das Unternehmen erreichte einen GAAP-Nettoertrag von 326,5 Millionen US-Dollar und ein GAAP-EPS von 1,37 US-Dollar. Das bereinigte EBITDA betrug 655,9 Millionen US-Dollar, was einen Margen von 14,4 % darstellt. Pilgrim's Pride verzeichnete Verbesserungen in seinen Aktivitäten in den USA, Europa und Mexiko, mit bemerkenswertem Wachstum bei Markenangeboten und Partnerschaften mit wichtigen Kunden. Die starke Liquiditätsposition des Unternehmens, mit einem Nettoverschuldungsgrad von 1,1x bereinigtem EBITDA, bietet eine solide Grundlage für die Umsetzung seiner Wachstumsstrategie.
- Net sales increased by 5.8% year-over-year to $4.6 billion
- GAAP EPS grew by 448% to $1.37 compared to the previous year
- Operating income surged by 339.5% to $440.8 million
- Adjusted EBITDA increased by 163.7% to $655.9 million
- Adjusted EBITDA margin improved by 8.6 percentage points to 14.4%
- U.S. fresh portfolio strengthened due to enhanced market conditions
- Europe's Adjusted EBITDA grew over 40% compared to the prior year
- Mexico improved performance due to balanced supply and demand fundamentals
- Strong liquidity position with a net leverage ratio of 1.1x Adjusted EBITDA
- None.
Insights
Pilgrim's Pride's Q2 2024 results demonstrate robust financial performance and strategic execution. The company reported
The adjusted EBITDA of
The company's diversification strategy is paying off, especially in the Prepared Foods segment. The double-digit growth of the Just Bare® brand and expansion of the Pilgrim's® brand indicate successful product innovation and market penetration. This diversification not only drives growth but also helps mitigate risks associated with commodity price fluctuations.
Pilgrim's Pride's strong liquidity position, with a net leverage ratio of 1.1x Adjusted EBITDA, provides financial flexibility for future growth initiatives and potential acquisitions. The ramp-up of the new protein conversion plant in South Georgia aligns with the company's strategy to add value to its portfolio and strengthen relationships with key customers.
While the results are undoubtedly strong, investors should monitor potential headwinds such as inflationary pressures, supply chain disruptions and any shifts in consumer behavior that could impact demand for protein products. Overall, Pilgrim's Pride's Q2 performance demonstrates resilience and strategic agility in a dynamic market environment.
Pilgrim's Pride's Q2 2024 results reveal significant market dynamics and consumer trends shaping the protein industry. The company's success across diverse geographical segments - U.S., Europe and Mexico - indicates a global shift in protein consumption patterns and preferences.
In the U.S., the improved performance in the Big Bird segment suggests a recovery in the foodservice sector, likely driven by post-pandemic dining out trends. The growth in Case Ready and Small Bird segments, through partnerships with key customers, reflects the ongoing shift towards convenience and value-added products in retail channels.
The European market shows signs of economic recovery, with consumer sentiment improving as wage growth outpaces inflation. This has led to increased demand for branded offerings and value-added products, as evidenced by the nearly double-digit growth of Richmond® and Fridge Raiders® brands. The launch of over 85 new products in Europe demonstrates the company's responsiveness to evolving consumer preferences and the importance of innovation in driving growth.
In Mexico, the balanced supply-demand fundamentals and growth across retail and foodservice channels indicate a maturing market with increasing protein consumption. The momentum in branded offerings across Fresh and Prepared categories suggests a growing consumer preference for trusted brands and convenience products in emerging markets.
The company's focus on operational excellence, biosecurity in live operations and capacity expansion aligns with industry trends towards food safety, sustainability and meeting growing global protein demand. The investment in the protein conversion plant in South Georgia is particularly noteworthy, as it taps into the growing market for alternative protein sources and value-added products.
These market trends and Pilgrim's Pride's strategic responses position the company well to capitalize on the evolving global protein market landscape.
GREELEY, Colo., July 31, 2024 (GLOBE NEWSWIRE) -- Pilgrim’s Pride Corporation (NASDAQ: PPC), one of the world's largest food companies, reports its second quarter 2024 financial results.
Second Quarter Highlights
- Net Sales of
$4.6 billion . - Consolidated GAAP operating income margin of
9.7% . - GAAP Net Income of
$326.5 million and GAAP EPS of$1.37 . Adjusted Net Income of$398.0 million or Adjusted EPS of$1.67 . - Adjusted EBITDA of
$655.9 million , or a14.4% margin, with Adjusted EBITDA margins of16.7% in the U.S.,7.4% in Europe, and19.4% in Mexico. - Our U.S. fresh portfolio continued to strengthen given enhanced market conditions and disciplined execution of our strategies. Case Ready and Small Bird continue to improve through expanding partnerships with Key Customers with differentiated offerings, and Big Bird improved from better commodity fundamentals and progress in operational excellence.
- Diversification through Prepared Foods continues to gain momentum as fully cooked branded offerings grew across retail and food service through innovation, increased distribution, and promotional activity. Net sales of Just Bare® grew double digits and ahead of the category; and our new and innovative offerings under the Pilgrim’s® brand has secured incremental distribution.
- Europe grew Adjusted EBITDA over
40% compared to prior year as mix with Key Customers improved and operational excellence remained on track. Our performance in safety, quality and service was recognized at the National Egg & Poultry Awards as Processor of the Year for United Kingdom. Diversification through brands and innovation accelerated as Richmond® and Fridge Raiders® grew nearly double digits, and over 85 new products have been launched. - Mexico improved given sustained balance in commodity supply and demand fundamentals, growth with Key Customers, and continued momentum of brands across Fresh and Prepared offerings.
- Strong liquidity position with a net leverage ratio of 1.1x Adjusted EBITDA providing the foundation to execute our growth strategy.
- Advancing our strategy of growing and adding value to our portfolio, we ramped up our new protein conversion plant in South Georgia during the quarter and continue to partner with Key Customers to support future growth.
| (Unaudited) | Three Months Ended | Six Months Ended | ||||||||||||||||||||
| June 30, 2024 | June 25, 2023 | Y/Y Change | June 30, 2024 | June 25, 2023 | Y/Y Change | |||||||||||||||||
| (In millions, except per share and percentages) | ||||||||||||||||||||||
| Net sales | $ | 4,559.3 | $ | 4,308.1 | +5.8 | % | $ | 8,921.2 | $ | 8,473.7 | +5.3 | % | ||||||||||
| U.S. GAAP EPS | $ | 1.37 | $ | 0.25 | +448.0 | % | $ | 2.11 | $ | 0.28 | +653.6 | % | ||||||||||
| Operating income | $ | 440.8 | $ | 100.3 | +339.5 | % | $ | 691.1 | $ | 131.6 | +425.2 | % | ||||||||||
| Adjusted EBITDA(1) | $ | 655.9 | $ | 248.7 | +163.7 | % | $ | 1,027.8 | $ | 400.7 | +156.5 | % | ||||||||||
| Adjusted EBITDA margin(1) | 14.4 | % | 5.8 | % | +8.6pts | 11.5 | % | 4.7 | % | +6.8pts | ||||||||||||
(1) Reconciliations for non-U.S. GAAP measures are provided in subsequent sections within this release.
“Our global portfolio delivered significant year-over-year profitability growth. We remained disciplined in the execution of our strategies, focusing on what we can control and continuing to expand our relationships with Key Customers, elevating our performance as market fundamentals became increasingly attractive,” said Fabio Sandri, President and Chief Executive Officer.
In the U.S., Big Bird realized benefits from enhanced commodity cutout values, further production efficiencies and lower input costs; Case Ready and Small Bird delivered above market growth with Key Customers through differentiated and customized offerings; and Prepared Foods increased its marketplace presence through innovation of branded, value-added items across retail and food service.
“Our diversified U.S. portfolio enabled our business to capture market upside as conditions evolved in the commodity market. At the same time, we also worked in partnership with our Key Customers to cultivate demand through promotional activity and innovation, further creating value for our customers and consumers alike. We also continued to strengthen our quality and service through operational excellence,” remarked Sandri.
In Europe, consumer sentiment improved as wage growth surpassed inflation. Given this environment, the team optimized mix with Key Customers and drove branded offerings. Additionally, the team identified and implemented our plan to optimize our manufacturing network and increase efficiencies.
“Europe’s performance demonstrates the robust nature of our strategies and agility of our team. Our diversified portfolio allowed us to rapidly adjust to consumer preferences and meet Key Customer needs. These efforts were further amplified by continued operational excellence to improve production efficiencies,” said Sandri.
Mexico improved given continued balance in supply and demand fundamentals in the commodity market, growth with Key Customers across retail and foodservice, and increased momentum of branded offerings in both Fresh and Prepared. Investments in operational excellence to enhance biosecurity in live operations and build capacity also remained on schedule.
“Mexico continues to drive growth above market for our Key Customers and branded offerings. Given our investments to expand production, we have an opportunity to further develop our marketplace presence and diversify our portfolio,” said Sandri.
The ramp up of our recently completed protein conversion plant in South Georgia remains on schedule and continues to cultivate additional business from Key Customers.
“Our investment in protein conversion reinforces our strategies to drive profitable growth and mitigates our operational risk. We will continue to explore opportunities to strengthen our business and further diversify our portfolio,” remarked Sandri.
Conference Call Information
A conference call to discuss Pilgrim’s quarterly results will be held tomorrow, Aug. 1, at 7 a.m. MT (9 a.m. ET). Participants are encouraged to pre-register for the conference call using the link below. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the call start time.
To pre-register, go to: https://services.choruscall.com/links/ppc240801.html
You may also reach the pre-registration link by logging in through the investor section of our website at https://ir.pilgrims.com in the “Events & Presentations” section.
For those who would like to join the call but have not pre-registered, access is available by dialing +1 (844) 883-3889 within the US, or +1 (412) 317-9245 internationally, and requesting the “Pilgrim’s Pride Conference.”
Replays of the conference call will be available on Pilgrim’s website approximately two hours after the call concludes and can be accessed through the “Investor” section of www.pilgrims.com.
About Pilgrim’s Pride
Pilgrim’s employs approximately 62,400 people and operates protein processing plants and prepared foods facilities in 14 states, Puerto Rico, Mexico, the U.K, the Republic of Ireland and continental Europe. The Company’s primary distribution is through retailers and foodservice distributors. For more information, please visit www.pilgrims.com.
Forward-Looking Statements
Statements contained in this press release that state the intentions, plans, hopes, beliefs, anticipations, expectations or predictions of the future of Pilgrim’s Pride Corporation and its management are considered forward-looking statements. Without limiting the foregoing, words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “should,” “targets,” “will” and the negative thereof and similar words and expressions are intended to identify forward-looking statements. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Factors that could cause actual results to differ materially from those projected in such forward-looking statements include: matters affecting the poultry industry generally; the ability to execute the Company’s business plan to achieve desired cost savings and profitability; future pricing for feed ingredients and the Company’s products; outbreaks of avian influenza or other diseases, either in Pilgrim’s Pride’s flocks or elsewhere, affecting its ability to conduct its operations and/or demand for its poultry products; contamination of Pilgrim’s Pride’s products, which has previously and can in the future lead to product liability claims and product recalls; exposure to risks related to product liability, product recalls, property damage and injuries to persons, for which insurance coverage is expensive, limited and potentially inadequate; management of cash resources; restrictions imposed by, and as a result of, Pilgrim’s Pride’s leverage; changes in laws or regulations affecting Pilgrim’s Pride’s operations or the application thereof; new immigration legislation or increased enforcement efforts in connection with existing immigration legislation that cause the costs of doing business to increase, cause Pilgrim’s Pride to change the way in which it does business, or otherwise disrupt its operations; competitive factors and pricing pressures or the loss of one or more of Pilgrim’s Pride’s largest customers; currency exchange rate fluctuations, trade barriers, exchange controls, expropriation and other risks associated with foreign operations; disruptions in international markets and distribution channels, including, but not limited to, the impacts of the Russia-Ukraine conflict; the risk of cyber-attacks, natural disasters, power losses, unauthorized access, telecommunication failures, and other problems on our information systems; and the impact of uncertainties of litigation and other legal matters described in our most recent Form 10-K and Form 10-Q, including the In re Broiler Chicken Antitrust Litigation, as well as other risks described under “Risk Factors” in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and subsequent filings with the Securities and Exchange Commission. The forward-looking statements in this release speak only as of the date hereof, and the Company undertakes no obligation to update any such statement after the date of this release, whether as a result of new information, future developments or otherwise, except as may be required by applicable law.
| Contact: | Andrew Rojeski |
| Head of Strategy, Investor Relations, & Sustainability | |
| IRPPC@pilgrims.com | |
| www.pilgrims.com |
| PILGRIM’S PRIDE CORPORATION | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Unaudited) | ||||||||
| June 30, 2024 | December 31, 2023 | |||||||
| (In thousands) | ||||||||
| Cash and cash equivalents | $ | 1,317,087 | $ | 697,748 | ||||
| Restricted cash and restricted cash equivalents | 17,039 | 33,475 | ||||||
| Trade accounts and other receivables, less allowance for credit losses | 1,045,860 | 1,129,178 | ||||||
| Accounts receivable from related parties | 2,055 | 1,778 | ||||||
| Inventories | 1,806,244 | 1,985,399 | ||||||
| Income taxes receivable | 93,259 | 161,062 | ||||||
| Prepaid expenses and other current assets | 230,610 | 195,831 | ||||||
| Total current assets | 4,512,154 | 4,204,471 | ||||||
| Deferred tax assets | 31,980 | 4,890 | ||||||
| Operating lease assets, net | 270,872 | 266,707 | ||||||
| Other long-lived assets | 53,236 | 35,646 | ||||||
| Intangible assets, net | 828,902 | 853,983 | ||||||
| Goodwill | 1,258,285 | 1,286,261 | ||||||
| Property, plant and equipment, net | 3,123,028 | 3,158,403 | ||||||
| Total assets | $ | 10,078,457 | $ | 9,810,361 | ||||
| Accounts payable | $ | 1,337,691 | $ | 1,410,576 | ||||
| Accounts payable to related parties | 23,331 | 41,254 | ||||||
| Revenue contract liabilities | 67,176 | 84,958 | ||||||
| Accrued expenses and other current liabilities | 999,075 | 926,727 | ||||||
| Income taxes payable | 56,487 | 31,678 | ||||||
| Current maturities of long-term debt | 585 | 674 | ||||||
| Total current liabilities | 2,484,345 | 2,495,867 | ||||||
| Noncurrent operating lease liabilities, less current maturities | 212,219 | 203,348 | ||||||
| Long-term debt, less current maturities | 3,183,095 | 3,340,841 | ||||||
| Deferred tax liabilities | 419,366 | 385,548 | ||||||
| Other long-term liabilities | 33,951 | 40,180 | ||||||
| Total liabilities | 6,332,976 | 6,465,784 | ||||||
| Common stock | 2,621 | 2,620 | ||||||
| Treasury stock | (544,687 | ) | (544,687 | ) | ||||
| Additional paid-in capital | 1,986,198 | 1,978,849 | ||||||
| Retained earnings | 2,571,797 | 2,071,073 | ||||||
| Accumulated other comprehensive loss | (284,390 | ) | (176,483 | ) | ||||
| Total Pilgrim’s Pride Corporation stockholders’ equity | 3,731,539 | 3,331,372 | ||||||
| Noncontrolling interest | 13,942 | 13,205 | ||||||
| Total stockholders’ equity | 3,745,481 | 3,344,577 | ||||||
| Total liabilities and stockholders’ equity | $ | 10,078,457 | $ | 9,810,361 | ||||
| PILGRIM’S PRIDE CORPORATION | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | |||||||||||||
| (In thousands, except per share data) | ||||||||||||||||
| Net sales | $ | 4,559,314 | $ | 4,308,091 | $ | 8,921,248 | $ | 8,473,719 | ||||||||
| Cost of sales | 3,867,688 | 4,029,666 | 7,845,713 | 8,022,247 | ||||||||||||
| Gross profit | 691,626 | 278,425 | 1,075,535 | 451,472 | ||||||||||||
| Selling, general and administrative expense | 214,161 | 148,436 | 333,237 | 282,114 | ||||||||||||
| Restructuring activities | 36,675 | 29,718 | 51,234 | 37,744 | ||||||||||||
| Operating income | 440,790 | 100,271 | 691,064 | 131,614 | ||||||||||||
| Interest expense, net of capitalized interest | 31,201 | 47,152 | 72,444 | 89,814 | ||||||||||||
| Interest income | (15,863 | ) | (7,628 | ) | (26,209 | ) | (11,228 | ) | ||||||||
| Foreign currency transaction losses (gains) | (2,225 | ) | 16,395 | (6,562 | ) | 34,538 | ||||||||||
| Miscellaneous, net | 504 | (1,331 | ) | (2,782 | ) | (23,984 | ) | |||||||||
| Income before income taxes | 427,173 | 45,683 | 654,173 | 42,474 | ||||||||||||
| Income tax expense (benefit) | 100,650 | (15,225 | ) | 152,712 | (24,065 | ) | ||||||||||
| Net income | 326,523 | 60,908 | 501,461 | 66,539 | ||||||||||||
| Less: Net income attributable to noncontrolling interests | 220 | 452 | 737 | 896 | ||||||||||||
| Net income attributable to Pilgrim’s Pride Corporation | $ | 326,303 | $ | 60,456 | $ | 500,724 | $ | 65,643 | ||||||||
| Weighted average shares of Pilgrim's Pride Corporation common stock outstanding: | ||||||||||||||||
| Basic | 236,943 | 236,733 | 236,894 | 236,659 | ||||||||||||
| Effect of dilutive common stock equivalents | 790 | 476 | 721 | 527 | ||||||||||||
| Diluted | 237,733 | 237,209 | 237,615 | 237,186 | ||||||||||||
| Net income attributable to Pilgrim's Pride Corporation per share of common stock outstanding: | ||||||||||||||||
| Basic | $ | 1.38 | $ | 0.26 | $ | 2.11 | $ | 0.28 | ||||||||
| Diluted | $ | 1.37 | $ | 0.25 | $ | 2.11 | $ | 0.28 | ||||||||
| PILGRIM’S PRIDE CORPORATION AND SUBSIDIARIES | |||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
| (Unaudited) | |||||||
| Six Months Ended | |||||||
| June 30, 2024 | June 25, 2023 | ||||||
| (In thousands) | |||||||
| Cash flows from operating activities: | |||||||
| Net income | $ | 501,461 | $ | 66,539 | |||
| Adjustments to reconcile net income to cash provided by operating activities: | |||||||
| Depreciation and amortization | 211,298 | 203,114 | |||||
| Gain on early extinguishment of debt recognized as a component of interest expense | (11,159 | ) | — | ||||
| Asset impairment | 13,412 | 4,011 | |||||
| Deferred income tax expense (benefit) | 8,952 | (56,151 | ) | ||||
| Stock-based compensation | 6,811 | 3,300 | |||||
| Loss (gain) on property disposals | 2,715 | (9,316 | ) | ||||
| Loan cost amortization | 2,573 | 4,733 | |||||
| Accretion of discount related to Senior Notes | 1,289 | 980 | |||||
| Gain (loss) on equity-method investments | (3 | ) | 328 | ||||
| Changes in operating assets and liabilities: | |||||||
| Trade accounts and other receivables | 62,350 | (54,971 | ) | ||||
| Inventories | 146,189 | (45,242 | ) | ||||
| Prepaid expenses and other current assets | (43,532 | ) | (27,754 | ) | |||
| Accounts payable, accrued expenses and other current liabilities | 14,290 | 5,139 | |||||
| Income taxes | 88,631 | 9,933 | |||||
| Long-term pension and other postretirement obligations | 3,652 | 944 | |||||
| Other operating assets and liabilities | (19,273 | ) | (16,246 | ) | |||
| Cash provided by operating activities | 989,656 | 89,341 | |||||
| Cash flows from investing activities: | |||||||
| Acquisitions of property, plant and equipment | (213,247 | ) | (286,630 | ) | |||
| Proceeds from property disposals | 4,551 | 15,008 | |||||
| Proceeds from insurance recoveries | — | 20,681 | |||||
| Cash used in investing activities | (208,696 | ) | (250,941 | ) | |||
| Cash flows from financing activities: | |||||||
| Payments on revolving line of credit, long-term borrowings and finance lease obligations | (150,895 | ) | (565,658 | ) | |||
| Proceeds from revolving line of credit and long-term borrowings | — | 1,078,032 | |||||
| Proceeds from contribution (distribution) of capital under Tax Sharing Agreement between JBS USA Holdings and Pilgrim’s Pride Corporation | 1,425 | (1,592 | ) | ||||
| Payments on early extinguishment of debt | (200 | ) | — | ||||
| Payments of capitalized loan costs | (16 | ) | (10,353 | ) | |||
| Cash provided by (used in) financing activities | (149,686 | ) | 500,429 | ||||
| Effect of exchange rate changes on cash and cash equivalents | (28,371 | ) | 3,422 | ||||
| Increase in cash, cash equivalents and restricted cash | 602,903 | 342,251 | |||||
| Cash, cash equivalents and restricted cash, beginning of period | 731,223 | 434,759 | |||||
| Cash, cash equivalents and restricted cash, end of period | $ | 1,334,126 | $ | 777,010 | |||
PILGRIM’S PRIDE CORPORATION
Non-GAAP Financial Measures Reconciliation
(Unaudited)
“EBITDA” is defined as the sum of net income plus interest, taxes, depreciation and amortization. “Adjusted EBITDA” is calculated by adding to EBITDA certain items of expense and deducting from EBITDA certain items of income that we believe are not indicative of our ongoing operating performance consisting of: (1) foreign currency transaction losses (gains), (2) costs related to litigation settlements, (3) restructuring activities losses, (4) property insurance recoveries for property damage losses, and (5) net income attributable to noncontrolling interests. EBITDA is presented because it is used by management and we believe it is frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of results prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”), to compare the performance of companies. We believe investors would be interested in our Adjusted EBITDA because this is how our management analyzes EBITDA applicable to continuing operations. The Company also believes that Adjusted EBITDA, in combination with the Company’s financial results calculated in accordance with U.S. GAAP, provides investors with additional perspective regarding the impact of certain significant items on EBITDA and facilitates a more direct comparison of its performance with its competitors. EBITDA and Adjusted EBITDA are not measurements of financial performance under U.S. GAAP. EBITDA and Adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as substitutes for an analysis of our results as reported under U.S. GAAP. In addition, other companies in our industry may calculate these measures differently limiting their usefulness as a comparative measure. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as an alternative to net income as indicators of our operating performance or any other measures of performance derived in accordance with U.S. GAAP. These limitations should be compensated for by relying primarily on our U.S. GAAP results and using EBITDA and Adjusted EBITDA only on a supplemental basis.
| PILGRIM'S PRIDE CORPORATION | |||||||||||||||
| Reconciliation of Adjusted EBITDA | |||||||||||||||
| (Unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||||||
| (In thousands) | |||||||||||||||
| Net income | $ | 326,523 | $ | 60,908 | $ | 501,461 | $ | 66,539 | |||||||
| Add: | |||||||||||||||
| Interest expense, net(a) | 15,338 | 39,524 | 46,235 | 78,586 | |||||||||||
| Income tax expense (benefit) | 100,650 | (15,225 | ) | 152,712 | (24,065 | ) | |||||||||
| Depreciation and amortization | 107,948 | 104,857 | 211,298 | 203,114 | |||||||||||
| EBITDA | 550,459 | 190,064 | 911,706 | 324,174 | |||||||||||
| Add: | |||||||||||||||
| Foreign currency transaction losses (gains)(b) | (2,225 | ) | 16,395 | (6,562 | ) | 34,538 | |||||||||
| Litigation settlements(c) | 71,250 | 13,000 | 72,190 | 24,200 | |||||||||||
| Restructuring activities losses(d) | 36,675 | 29,718 | 51,234 | 37,744 | |||||||||||
| Minus: | |||||||||||||||
| Property insurance recoveries(e) | — | — | — | 19,086 | |||||||||||
| Net income attributable to noncontrolling interest | 220 | 452 | 737 | 896 | |||||||||||
| Adjusted EBITDA | $ | 655,939 | $ | 248,725 | $ | 1,027,831 | $ | 400,674 | |||||||
(a) Interest expense, net, consists of interest expense less interest income.
(b) Prior to April 1, 2024, the Company measures the financial statements of its Mexico reportable segment as if the U.S. dollar were the functional currency. Accordingly, we remeasure assets and liabilities, other than nonmonetary assets, of the Mexico reportable segment at current exchange rates. We remeasure nonmonetary assets using the historical exchange rate in effect on the date of each asset’s acquisition. Currency exchange gains or losses resulting from these remeasurements were previously recognized in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income. Effective April 1, 2024, the Company changed the functional currency of its Mexico reportable segment from U.S. dollar to Mexican peso, which means all translation gains/losses on outstanding balances are now recognized in accumulated other comprehensive income. Transactional functional currency gains/losses are included in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income.
(c) This represents expenses recognized in anticipation of probable settlements in ongoing litigation.
(d) Restructuring activities losses are related to costs incurred, such as severance, asset impairment, contract termination, and others, as part of multiple ongoing restructuring initiatives throughout our Europe reportable segment.
(e) This represents property insurance recoveries primarily for the property damage losses incurred as a result of the tornado in Mayfield, KY in December 2021.
(f) The summary unaudited consolidated income statement data for the twelve months ended June 30, 2024 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the six months ended June 25, 2023 from the sum of (1) the applicable audited consolidated income statement data for the year ended December 31, 2023 and (2) the applicable unaudited consolidated income statement data for the six months ended June 30, 2024.
| PILGRIM'S PRIDE CORPORATION | |||||||||||||||||||
| Reconciliation of LTM Adjusted EBITDA | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||
| Three Months Ended | LTM Ended | ||||||||||||||||||
| September 24, 2023 | December 31, 2023 | March 31, 2024 | June 30, 2024 | June 30, 2024 | |||||||||||||||
| (In thousands) | |||||||||||||||||||
| Net income | $ | 121,567 | $ | 134,211 | $ | 174,938 | $ | 326,523 | $ | 757,239 | |||||||||
| Add: | |||||||||||||||||||
| Interest expense, net | 33,530 | 54,505 | 30,897 | 15,338 | 134,270 | ||||||||||||||
| Income tax expense | 44,553 | 22,417 | 52,062 | 100,650 | 219,682 | ||||||||||||||
| Depreciation and amortization | 104,300 | 112,486 | 103,350 | 107,948 | 428,084 | ||||||||||||||
| EBITDA | 303,950 | 323,619 | 361,247 | 550,459 | 1,539,275 | ||||||||||||||
| Add: | |||||||||||||||||||
| Foreign currency transaction losses (gains) | 8,924 | (22,892 | ) | (4,337 | ) | (2,225 | ) | (20,530 | ) | ||||||||||
| Litigation settlements | 10,500 | 4,700 | 940 | 71,250 | 87,390 | ||||||||||||||
| Restructuring activities losses | 940 | 5,661 | 14,559 | 36,675 | 57,835 | ||||||||||||||
| Minus: | |||||||||||||||||||
| Property insurance recoveries | — | 2,038 | — | — | 2,038 | ||||||||||||||
| Net income (loss) attributable to noncontrolling interest | 289 | (442 | ) | 517 | 220 | 584 | |||||||||||||
| Adjusted EBITDA | $ | 324,025 | $ | 309,492 | $ | 371,892 | $ | 655,939 | $ | 1,661,348 | |||||||||
EBITDA margins have been calculated by taking the relevant unaudited EBITDA figures, then dividing by net sales for the applicable period. EBITDA margins are presented because they are used by management and we believe it is frequently used by securities analysts, investors and other interested parties, as a supplement to our results prepared in accordance with U.S. GAAP, to compare the performance of companies.
| PILGRIM'S PRIDE CORPORATION | ||||||||||||||||||||||||||||
| Reconciliation of EBITDA Margin | ||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | |||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||
| Net income | $ | 326,523 | $ | 60,908 | $ | 501,461 | $ | 66,539 | 7.16 | % | 1.41 | % | 5.62 | % | 0.79 | % | ||||||||||||
| Add: | ||||||||||||||||||||||||||||
| Interest expense, net | 15,338 | 39,524 | 46,235 | 78,586 | 0.34 | % | 0.92 | % | 0.52 | % | 0.93 | % | ||||||||||||||||
| Income tax expense (benefit) | 100,650 | (15,225 | ) | 152,712 | (24,065 | ) | 2.21 | % | (0.35 | )% | 1.71 | % | (0.28 | )% | ||||||||||||||
| Depreciation and amortization | 107,948 | 104,857 | 211,298 | 203,114 | 2.36 | % | 2.43 | % | 2.36 | % | 2.39 | % | ||||||||||||||||
| EBITDA | 550,459 | 190,064 | 911,706 | 324,174 | 12.07 | % | 4.41 | % | 10.21 | % | 3.83 | % | ||||||||||||||||
| Add: | ||||||||||||||||||||||||||||
| Foreign currency transaction losses (gains) | (2,225 | ) | 16,395 | (6,562 | ) | 34,538 | (0.04 | )% | 0.38 | % | (0.07 | )% | 0.40 | % | ||||||||||||||
| Litigation settlements | 71,250 | 13,000 | 72,190 | 24,200 | 1.56 | % | 0.30 | % | 0.81 | % | 0.29 | % | ||||||||||||||||
| Restructuring activities losses | 36,675 | 29,718 | 51,234 | 37,744 | 0.80 | % | 0.69 | % | 0.57 | % | 0.45 | % | ||||||||||||||||
| Minus: | ||||||||||||||||||||||||||||
| Property insurance recoveries | — | — | — | 19,086 | — | % | — | % | — | % | 0.23 | % | ||||||||||||||||
| Net income attributable to noncontrolling interest | 220 | 452 | 737 | 896 | — | % | 0.01 | % | 0.01 | % | 0.01 | % | ||||||||||||||||
| Adjusted EBITDA | $ | 655,939 | $ | 248,725 | $ | 1,027,831 | $ | 400,674 | 14.39 | % | 5.77 | % | 11.51 | % | 4.73 | % | ||||||||||||
| Net sales | $ | 4,559,314 | $ | 4,308,091 | $ | 8,921,248 | $ | 8,473,719 | — | — | — | — | ||||||||||||||||
Adjusted EBITDA by segment figures are presented because they are used by management and we believe they are frequently used by securities analysts, investors and other interested parties, as a supplement to our results prepared in accordance with U.S. GAAP, to compare the performance of companies.
| PILGRIM'S PRIDE CORPORATION | |||||||||||||||||||||||||||||||
| Reconciliation of Adjusted EBITDA | |||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||
| Three Months Ended | Three Months Ended | ||||||||||||||||||||||||||||||
| June 30, 2024 | June 25, 2023 | ||||||||||||||||||||||||||||||
| U.S. | Europe | Mexico | Total | U.S. | Europe | Mexico | Total | ||||||||||||||||||||||||
| (In thousands) | (In thousands) | ||||||||||||||||||||||||||||||
| Net income (loss) | $ | 199,076 | $ | 41,511 | $ | 85,936 | $ | 326,523 | $ | (21,335 | ) | $ | 11,929 | $ | 70,314 | $ | 60,908 | ||||||||||||||
| Add: | |||||||||||||||||||||||||||||||
| Interest expense, net(a) | 24,946 | (2,556 | ) | (7,052 | ) | 15,338 | 43,538 | (623 | ) | (3,391 | ) | 39,524 | |||||||||||||||||||
| Income tax expense (benefit) | 82,117 | (14,212 | ) | 32,745 | 100,650 | (14,026 | ) | (6,730 | ) | 5,531 | (15,225 | ) | |||||||||||||||||||
| Depreciation and amortization | 67,200 | 34,865 | 5,883 | 107,948 | 63,759 | 35,279 | 5,819 | 104,857 | |||||||||||||||||||||||
| EBITDA | 373,339 | 59,608 | 117,512 | 550,459 | 71,936 | 39,855 | 78,273 | 190,064 | |||||||||||||||||||||||
| Add: | |||||||||||||||||||||||||||||||
| Foreign currency transaction losses (gains)(b) | (1 | ) | (39 | ) | (2,185 | ) | (2,225 | ) | 28,546 | (1,482 | ) | (10,669 | ) | 16,395 | |||||||||||||||||
| Litigation settlements(c) | 71,250 | — | — | 71,250 | 13,000 | — | — | 13,000 | |||||||||||||||||||||||
| Restructuring activities losses(d) | — | 36,675 | — | 36,675 | — | 29,718 | — | 29,718 | |||||||||||||||||||||||
| Minus: | |||||||||||||||||||||||||||||||
| Net income attributable to noncontrolling interest | — | — | 220 | 220 | — | — | 452 | 452 | |||||||||||||||||||||||
| Adjusted EBITDA | $ | 444,588 | $ | 96,244 | $ | 115,107 | $ | 655,939 | $ | 113,482 | $ | 68,091 | $ | 67,152 | $ | 248,725 | |||||||||||||||
(a) Interest expense, net, consists of interest expense less interest income.
(b) Prior to April 1, 2024, the Company measures the financial statements of its Mexico reportable segment as if the U.S. dollar were the functional currency. Accordingly, we remeasure assets and liabilities, other than nonmonetary assets, of the Mexico reportable segment at current exchange rates. We remeasure nonmonetary assets using the historical exchange rate in effect on the date of each asset’s acquisition. Currency exchange gains or losses resulting from these remeasurements were previously recognized in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income. Effective April 1, 2024, the Company changed the functional currency of its Mexico reportable segment from U.S. dollar to Mexican peso, which means all translation gains/losses on outstanding balances are now recognized in accumulated other comprehensive income. Transactional functional currency gains/losses are included in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income.
(c) This represents expenses recognized in anticipation of probable settlements in ongoing litigation.
(d) Restructuring activities losses are related to costs incurred, such as severance, asset impairment, contract termination, and others, as part of multiple ongoing restructuring initiatives throughout our Europe reportable segment.
| PILGRIM'S PRIDE CORPORATION | ||||||||||||||||||||||||||||||
| Reconciliation of Adjusted EBITDA | ||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| Six Months Ended | Six Months Ended | |||||||||||||||||||||||||||||
| June 30, 2024 | June 25, 2023 | |||||||||||||||||||||||||||||
| U.S. | Europe | Mexico | Total | U.S. | Europe | Mexico | Total | |||||||||||||||||||||||
| (In thousands) | (In thousands) | |||||||||||||||||||||||||||||
| Net income (loss) | $ | 301,707 | $ | 66,023 | $ | 133,731 | $ | 501,461 | $ | (74,925 | ) | $ | 32,742 | $ | 108,722 | $ | 66,539 | |||||||||||||
| Add: | ||||||||||||||||||||||||||||||
| Interest expense, net(a) | 69,532 | (4,539 | ) | (18,758 | ) | 46,235 | 84,903 | (821 | ) | (5,496 | ) | 78,586 | ||||||||||||||||||
| Income tax expense (benefit) | 114,177 | (4,655 | ) | 43,190 | 152,712 | (30,848 | ) | (807 | ) | 7,590 | (24,065 | ) | ||||||||||||||||||
| Depreciation and amortization | 129,885 | 69,893 | 11,520 | 211,298 | 123,996 | 67,556 | 11,562 | 203,114 | ||||||||||||||||||||||
| EBITDA | 615,301 | 126,722 | 169,683 | 911,706 | 103,126 | 98,670 | 122,378 | 324,174 | ||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||||||
| Foreign currency transaction losses (gains)(b) | 1 | (255 | ) | (6,308 | ) | (6,562 | ) | 48,859 | (2,098 | ) | (12,223 | ) | 34,538 | |||||||||||||||||
| Litigation settlements(c) | 72,190 | — | — | 72,190 | 24,200 | — | — | 24,200 | ||||||||||||||||||||||
| Restructuring activities losses(d) | — | 51,234 | — | 51,234 | — | 37,744 | — | 37,744 | ||||||||||||||||||||||
| Minus: | ||||||||||||||||||||||||||||||
| Property insurance recoveries(e) | — | — | — | — | 19,086 | — | — | 19,086 | ||||||||||||||||||||||
| Net income attributable to noncontrolling interest | — | — | 737 | 737 | — | — | 896 | 896 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 687,492 | $ | 177,701 | $ | 162,638 | $ | 1,027,831 | $ | 157,099 | $ | 134,316 | $ | 109,259 | $ | 400,674 | ||||||||||||||
(a) Interest expense, net, consists of interest expense less interest income.
(b) Prior to April 1, 2024, the Company measures the financial statements of its Mexico reportable segment as if the U.S. dollar were the functional currency. Accordingly, we remeasure assets and liabilities, other than nonmonetary assets, of the Mexico reportable segment at current exchange rates. We remeasure nonmonetary assets using the historical exchange rate in effect on the date of each asset’s acquisition. Currency exchange gains or losses resulting from these remeasurements were previously recognized in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income. Effective April 1, 2024, the Company changed the functional currency of its Mexico reportable segment from U.S. dollar to Mexican peso, which means all translation gains/losses on outstanding balances are now recognized in accumulated other comprehensive income. Transactional functional currency gains/losses are included in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income.
(c) This represents expenses recognized in anticipation of probable settlements in ongoing litigation.
(d) Restructuring activities losses are related to costs incurred, such as severance, asset impairment, contract termination, and others, as part of multiple ongoing restructuring initiatives throughout our Europe reportable segment.
(e) This represents property insurance recoveries primarily for the property damage losses incurred as a result of the tornado in Mayfield, KY in December 2021.
Adjusted Operating Income is calculated by adding to Operating Income certain items of expense and deducting from Operating Income certain items of income. Management believes that presentation of Adjusted Operating Income provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of GAAP operating income to adjusted operating income as follows:
| PILGRIM'S PRIDE CORPORATION | |||||||||||||||
| Reconciliation of Adjusted Operating Income | |||||||||||||||
| (Unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||||||
| (In thousands) | |||||||||||||||
| GAAP operating income, U.S. operations | $ | 307,988 | $ | 37,265 | $ | 487,405 | $ | 9,159 | |||||||
| Litigation settlements | 71,250 | 13,000 | 72,190 | 24,200 | |||||||||||
| Adjusted operating income, U.S. operations | $ | 379,238 | $ | 50,265 | $ | 559,595 | $ | 33,359 | |||||||
| Adjusted operating income margin, U.S. operations | 14.2 | % | 2.1 | % | 10.7 | % | 0.7 | % | |||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||||||
| (In thousands) | |||||||||||||||
| GAAP operating income, Europe operations | $ | 23,993 | $ | 2,513 | $ | 55,109 | $ | 27,774 | |||||||
| Restructuring activities losses | 36,675 | 29,718 | 51,234 | 37,744 | |||||||||||
| Adjusted operating income, Europe operations | $ | 60,668 | $ | 32,231 | $ | 106,343 | $ | 65,518 | |||||||
| Adjusted operating income margin, Europe operations | 4.7 | % | 2.5 | % | 4.1 | % | 2.6 | % | |||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||||||
| (In thousands) | |||||||||||||||
| GAAP operating income, Mexico operations | $ | 108,809 | $ | 60,719 | $ | 148,550 | $ | 94,894 | |||||||
| No adjustments | — | — | — | — | |||||||||||
| Adjusted operating income, Mexico operations | $ | 108,809 | $ | 60,719 | $ | 148,550 | $ | 94,894 | |||||||
| Adjusted operating income margin, Mexico operations | 18.3 | % | 11.0 | % | 13.4 | % | 9.1 | % | |||||||
Adjusted Operating Income Margin for each of our reportable segments is calculated by dividing Adjusted operating income by Net Sales. Management believes that presentation of Adjusted Operating Income Margin provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of GAAP operating income margin for each of our reportable segments to adjusted operating income margin for each of our reportable segments is as follows:
| PILGRIM'S PRIDE CORPORATION | |||||||||||
| Reconciliation of GAAP Operating Income Margin to Adjusted Operating Income Margin | |||||||||||
| (Unaudited) | |||||||||||
| Three Months Ended | Six Months Ended | ||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||
| (In percent) | |||||||||||
| GAAP operating income margin, U.S. operations | 11.6 | % | 1.5 | % | 9.3 | % | 0.2 | % | |||
| Litigation settlements | 2.6 | % | 0.6 | % | 1.4 | % | 0.5 | % | |||
| Adjusted operating income margin, U.S. operations | 14.2 | % | 2.1 | % | 10.7 | % | 0.7 | % | |||
| Three Months Ended | Six Months Ended | ||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||
| (In percent) | |||||||||||
| GAAP operating income margin, Europe operations | 1.8 | % | 0.2 | % | 2.1 | % | 1.1 | % | |||
| Restructuring activities losses | 2.9 | % | 2.3 | % | 2.0 | % | 1.5 | % | |||
| Adjusted operating income margin, Europe operations | 4.7 | % | 2.5 | % | 4.1 | % | 2.6 | % | |||
| Three Months Ended | Six Months Ended | ||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||
| (In percent) | |||||||||||
| GAAP operating income margin, Mexico operations | 18.3 | % | 11.0 | % | 13.4 | % | 9.1 | % | |||
| No adjustments | — | % | — | % | — | % | — | % | |||
| Adjusted operating income margin, Mexico operations | 18.3 | % | 11.0 | % | 13.4 | % | 9.1 | % | |||
Adjusted net income attributable to Pilgrim's Pride Corporation (“Pilgrim's”) is calculated by adding to Net income attributable to Pilgrim's certain items of expense and deducting from Net income attributable to Pilgrim's certain items of income, as shown below in the table. Adjusted net income attributable to Pilgrim’s Pride Corporation per common diluted share is presented because it is used by management, and we believe it is frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of results prepared in conformity with U.S. GAAP, to compare the performance of companies. Management also believe that this non-U.S. GAAP financial measure, in combination with our financial results calculated in accordance with U.S. GAAP, provides investors with additional perspective regarding the impact of such charges on net income attributable to Pilgrim’s Pride Corporation per common diluted share. Adjusted net income attributable to Pilgrim’s Pride Corporation per common diluted share is not a measurement of financial performance under U.S. GAAP, has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of our results as reported under U.S. GAAP. Management believes that presentation of adjusted net income attributable to Pilgrim’s provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of net income (loss) attributable to Pilgrim’s Pride Corporation per common diluted share to adjusted net income attributable to Pilgrim’s Pride Corporation per common diluted share is as follows:
| PILGRIM'S PRIDE CORPORATION | |||||||||||||||
| Reconciliation of Adjusted Net Income | |||||||||||||||
| (Unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||||||
| (In thousands, except per share data) | |||||||||||||||
| Net income attributable to Pilgrim's | $ | 326,303 | $ | 60,456 | $ | 500,724 | $ | 65,643 | |||||||
| Add: | |||||||||||||||
| Foreign currency transaction losses (gains) | (2,225 | ) | 16,395 | (6,562 | ) | 34,538 | |||||||||
| Litigation settlements | 71,250 | 13,000 | 72,190 | 24,200 | |||||||||||
| Restructuring activities losses | 36,675 | 29,718 | 51,234 | 37,744 | |||||||||||
| Minus: | |||||||||||||||
| Gain on early extinguishment of debt | 11,159 | — | 11,159 | — | |||||||||||
| Property insurance recoveries | — | — | — | 19,086 | |||||||||||
| Adjusted net income attributable to Pilgrim's before tax impact of adjustments | 420,844 | 119,569 | 606,427 | 143,039 | |||||||||||
| Net tax impact of adjustments(a) | (22,879 | ) | (14,306 | ) | (25,580 | ) | (18,729 | ) | |||||||
| Adjusted net income attributable to Pilgrim's | $ | 397,965 | $ | 105,263 | $ | 580,847 | $ | 124,310 | |||||||
| Weighted average diluted shares of common stock outstanding | 237,733 | 237,209 | 237,615 | 237,186 | |||||||||||
| Adjusted net income attributable to Pilgrim's per common diluted share | $ | 1.67 | $ | 0.44 | $ | 2.44 | $ | 0.52 | |||||||
(a) Net tax expense (benefit) of adjustments represents the tax impact of all adjustments shown above.
Adjusted EPS is calculated by dividing the adjusted net income attributable to Pilgrim's stockholders by the weighted average number of diluted shares. Management believes that Adjusted EPS provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of U.S. GAAP to non-U.S. GAAP financial measures is as follows:
| PILGRIM'S PRIDE CORPORATION | |||||||||||||||
| Reconciliation of GAAP EPS to Adjusted EPS | |||||||||||||||
| (Unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | ||||||||||||
| (In thousands, except per share data) | |||||||||||||||
| GAAP EPS | $ | 1.37 | $ | 0.25 | $ | 2.11 | $ | 0.28 | |||||||
| Add: | |||||||||||||||
| Foreign currency transaction losses (gains) | (0.01 | ) | 0.07 | (0.03 | ) | 0.15 | |||||||||
| Litigation settlements | 0.30 | 0.05 | 0.30 | 0.09 | |||||||||||
| Restructuring activities losses | 0.15 | 0.13 | 0.23 | 0.16 | |||||||||||
| Minus: | |||||||||||||||
| Gain on early extinguishment of debt | 0.05 | — | 0.05 | — | |||||||||||
| Property insurance recoveries | — | — | — | 0.08 | |||||||||||
| Adjusted EPS before tax impact of adjustments | 1.76 | 0.50 | 2.56 | 0.60 | |||||||||||
| Net tax impact of adjustments(a) | (0.09 | ) | (0.06 | ) | (0.12 | ) | (0.08 | ) | |||||||
| Adjusted EPS | $ | 1.67 | $ | 0.44 | $ | 2.44 | $ | 0.52 | |||||||
| Weighted average diluted shares of common stock outstanding | 237,733 | 237,209 | 237,615 | 237,186 | |||||||||||
(a) Net tax impact of adjustments represents the tax impact of all adjustments shown above.
| PILGRIM'S PRIDE CORPORATION | ||||||||||||||
| Supplementary Selected Segment and Geographic Data | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||
| June 30, 2024 | June 25, 2023 | June 30, 2024 | June 25, 2023 | |||||||||||
| (In thousands) | ||||||||||||||
| Sources of net sales by geographic region of origin: | ||||||||||||||
| U.S. | $ | 2,663,965 | $ | 2,446,208 | $ | 5,243,297 | $ | 4,878,776 | ||||||
| Europe | 1,301,541 | 1,310,750 | 2,569,444 | 2,550,014 | ||||||||||
| Mexico | 593,808 | 551,133 | 1,108,507 | 1,044,929 | ||||||||||
| Total net sales | $ | 4,559,314 | $ | 4,308,091 | $ | 8,921,248 | $ | 8,473,719 | ||||||
| Sources of cost of sales by geographic region of origin: | ||||||||||||||
| U.S. | $ | 2,211,626 | $ | 2,332,103 | $ | 4,553,666 | $ | 4,726,342 | ||||||
| Europe | 1,187,671 | 1,223,722 | 2,363,409 | 2,378,793 | ||||||||||
| Mexico | 468,391 | 473,615 | 928,638 | 916,899 | ||||||||||
| Elimination | — | 226 | — | 213 | ||||||||||
| Total cost of sales | $ | 3,867,688 | $ | 4,029,666 | $ | 7,845,713 | $ | 8,022,247 | ||||||
| Sources of gross profit by geographic region of origin: | ||||||||||||||
| U.S. | $ | 452,339 | $ | 114,105 | $ | 689,631 | $ | 152,434 | ||||||
| Europe | 113,870 | 87,028 | 206,035 | 171,221 | ||||||||||
| Mexico | 125,417 | 77,518 | 179,869 | 128,030 | ||||||||||
| Elimination | — | (226 | ) | — | (213 | ) | ||||||||
| Total gross profit | $ | 691,626 | $ | 278,425 | $ | 1,075,535 | $ | 451,472 | ||||||
| Sources of operating income by geographic region of origin: | ||||||||||||||
| U.S. | $ | 307,988 | $ | 37,265 | $ | 487,405 | $ | 9,159 | ||||||
| Europe | 23,993 | 2,513 | 55,109 | 27,774 | ||||||||||
| Mexico | 108,809 | 60,719 | 148,550 | 94,894 | ||||||||||
| Elimination | — | (226 | ) | — | (213 | ) | ||||||||
| Total operating income | $ | 440,790 | $ | 100,271 | $ | 691,064 | $ | 131,614 | ||||||
FAQ
What were Pilgrim's Pride (PPC) key financial results for Q2 2024?
How did Pilgrim's Pride (PPC) perform in different regions during Q2 2024?
What was Pilgrim's Pride (PPC) net leverage ratio in Q2 2024?
How did Pilgrim's Pride (PPC) branded products perform in Q2 2024?
