PITTSBURG, Texas — Pilgrim’s Pride Corporation (NYSE: PPC) today reported net
income of $33.6 million, or $0.44 per diluted share, on net sales of $1.6
billion for the quarter ended December 27, 2009. These results include an income
tax benefit of $102.4 million, or $1.33 per diluted share, related to a net
operating loss carryforward, and a net charge of $32.7 million, or $0.42 per
diluted share, related to the company’s reorganization. For the comparable
quarter a year earlier, the company reported a net loss of $228.8 million, or
$3.09 per diluted share, on total sales of nearly $1.9 billion.
“Our financial results have improved dramatically over the past year as we work
to create a market-driven company clearly focused on delivering the highest
levels of service, selection and value to our customers as efficiently as
possible,” said Don Jackson, Pilgrim’s Pride president and chief executive
officer. “While we are pleased with the progress we have made, we recognize that
there is much more work to be done in positioning Pilgrim’s Pride for sustained,
profitable growth. We will continue to focus on opportunities for improving our
product mix, expanding our customer base and operating more efficiently.”
Market pricing for chicken products during the quarter was mixed. The average
market price for breast meat rose 8 percent and for wings increased by 37
percent versus the same period a year earlier. The average market price for leg
quarters, however, declined 10 percent and Georgia Dock dropped about 5 percent.
Pilgrim’s Pride said its total U.S. feed-ingredient costs in the quarter
declined approximately $120 million, or 20 percent, when compared to the same
period a year ago.
The company reported an overall operating profit of $7.6 million for the
quarter, an improvement of $185.8 million from a year earlier. Operating income
was driven by higher gross profit and a $16 million reduction or nearly 17
percent drop in Selling, General and Administrative (SG&A) expenses in the
company’s U.S. operations as the company continued to benefit from expense
reduction efforts during its reorganization.
“Today our business strategy is clear,” said Dr. Jackson. “We are squarely
focused on being a market-driven company that produces to the needs of our
customers and the market. We have reduced our production of commodity chicken
and are targeting higher-margin products. Our core retail and foodservice demand
is driving supply. Our supply chain is focused on optimizing production, while
our operations group is driving performance through safety, quality,
productivity and cost efficiency.”
On December 28, 2009, Pilgrim’s Pride amended and restated its bylaws, which,
among other things, changed the company’s fiscal year end from the Saturday
nearest September 30 of each year to the last Sunday in December of each year.
This change aligns the company’s reporting cycle with the fiscal calendar of JBS
USA, the majority stockholder of Pilgrim’s Pride. The change resulted in an
approximate three-month transition period which began September 27, 2009, and
ended December 27, 2009.
About Pilgrim’s Pride
Pilgrim’s Pride Corporation employs approximately 41,000 people and operates
chicken processing plants and prepared-foods facilities in 12 states, Puerto
Rico and Mexico. The Company’s primary distribution is through retailers and
foodservice distributors. For more information, please visit http://www.pilgrimspride.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 forward-looking statements.
It is important to note that the 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; the ability of the company to achieve the anticipated
synergistic gains from the sale of 64% of its common stock to JBS USA Holdings,
Inc; future pricing for feed ingredients and the company’s products; additional
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,
particularly in light of Pilgrim’s Pride’s substantial leverage; restrictions
imposed by, and as a result of, Pilgrim’s Pride’s substantial 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 channel, including exports into Russia,
the anti-dumping proceeding in Ukraine and the anti-dumping and countervailing
duty proceeding in China; and the impact of uncertainties of litigation as well
as other risks described under “Risk Factors” in the Company’s Annual Report on
Form 10-K and subsequent filings with the Securities and Exchange Commission.
Pilgrim’s Pride Corporation undertakes no obligation to update or revise
publicly any forward-looking statements, whether as a result of new information,
future events or otherwise.
Source:
Pilgrim’s Pride
