×

Pilgrim's Pride Reports Strong Revenue Growth and Increase of 39% in Net Income for First Quarter 2013

GREELEY, Colo., May 2, 2013 (GLOBE NEWSWIRE) -- Pilgrim's Pride Corporation (Nasdaq:PPC) reported first quarter 2013 earnings results with net sales of $2.0 billion, Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") of $116.9 million and net income of $54.6 million, resulting in earnings per share of $0.21 for the quarter. This compares to $1.9 billion in sales, EBITDA of $101.5 and Net Income of $39.2 million, with earnings per share of $0.18 in the first quarter of 2012.

"Every quarter we see that our strategy and execution is working effectively. We delivered better results year over year despite $141 million of increased feed ingredient costs. By focusing on creating value with our key customers, we have diversified our product mix, honed our execution and are seeing our portfolio of business become a more profitable model," stated Bill Lovette, Pilgrim's Chief Executive Officer.

"Our pursuit of operational excellence has resulted in an improved safety record, significantly better than the industry average. We are reducing our turnover and measuring quality at every level of the organization. Despite challenging environmental conditions, Mexico continues to outperform due to its effective business model and the versatility and value that chicken provides to consumers."

Mr. Lovette explained, "We made significant steps on our strategy to strengthen our company and our balance sheet. Even with as much improvement as we have demonstrated to date, we believe there is still opportunity to stretch towards our vision of being the best managed and most respected company in the industry."

Conference Call Information

A conference call to discuss Pilgrim's quarterly results will be held tomorrow, May 3 at 7:00 a.m. Mountain (9 a.m. Eastern). 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: http://services.choruscall.com/links/ppc130503.html

You may also reach the pre-registration link by logging in through the investor section of our website at www.pilgrims.com and clicking on the link under "Upcoming Events."

For those who would like to join the call but have not pre-registered, access is available by dialing +1 (877) 270-2148 within the US or +1 (412) 902-6510 internationally and requesting the "Pilgrim's Pride Conference." Please note that to submit a question to management during the call, you must be logged in via telephone.

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. The webcast will be available for replay through August 1, 2013.

About Pilgrim's Pride

Pilgrim's employs approximately 37,500 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.

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. 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 channel, including anti-dumping proceedings and countervailing duty proceedings; 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.

PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Balance Sheets
March 31, December 30
2013 2012
(Unaudited)
(In thousands)
Cash and cash equivalents $ 43,560 $ 68,180
Trade accounts and other receivables, less allowance for doubtful accounts 390,421 384,930
Account receivable from JBS USA, LLC 3,814 1,514
Inventories 972,358 950,296
Income taxes receivable 58,321 54,719
Prepaid expenses and other current assets 64,436 56,047
Assets held for sale 26,832 27,042
Total current assets 1,559,742 1,542,728
Deferred tax assets 97,455 97,431
Other long-lived assets 42,789 45,523
Identified intangible assets, net 36,831 38,266
Property, plant and equipment, net 1,181,518 1,189,921
Total assets $ 2,918,335 $ 2,913,869
Accounts payable $ 290,533 $ 312,365
Account payable to JBS USA, LLC 7,045 13,436
Accrued expenses and other current liabilities 284,641 283,540
Income taxes payable -- 468
Current deferred tax liabilities 104,515 104,482
Current maturities of long-term debt 15,888 15,886
Total current liabilities 702,622 730,177
Long-term debt, less current maturities 1,126,477 1,148,870
Other long-term liabilities 115,053 125,825
Total liabilities 1,944,152 2,004,872
Common stock 2,590 2,590
Additional paid-in capital 1,642,551 1,642,003
Accumulated deficit (615,129) (669,711)
Accumulated other comprehensive loss (58,101) (68,511)
Total Pilgrim's Pride Corporation stockholders' equity 971,911 906,371
Noncontrolling interest 2,272 2,626
Total stockholders' equity 974,183 908,997
Total liabilities and stockholders' equity $ 2,918,335 $ 2,913,869
PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Statements of Operations
(Unaudited)
Thirteen Weeks Ended
March 31, March 25,
2013 2012
(In thousands, except per share data)
Net sales $ 2,036,929 $ 1,888,773
Costs and expenses:
Cost of sales 1,918,495 1,778,708
Gross profit (loss) 118,434 110,065
Selling, general and administrative expense 43,992 45,256
Administrative restructuring charges, net 484 2,885
Operating income (loss) 73,958 61,924
Interest expense 24,821 28,245
Interest income (216) (274)
Foreign currency transaction losses (gains) (7,624) (5,928)
Miscellaneous, net (5) (370)
Income (loss) before income taxes 56,982 40,251
Income tax expense (benefit) 2,754 653
Net income (loss) 54,228 39,598
Less: Net income (loss) attributable to noncontrolling interests (354) 425
Net income (loss) attributable to Pilgrim's Pride Corporation $ 54,582 $ 39,173
Weighted average shares of common stock outstanding:
Basic 258,823 223,562
Diluted 258,953 223,631
Net income (loss) per share of common stock outstanding:
Basic $ 0.21 $ 0.18
Diluted $ 0.21 $ 0.18
PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Statements of Cash Flows
Thirteen Weeks Ended
March 31, March 25,
2013 2012
(In thousands)
Cash flows from operating activities:
Net income (loss) $ 54,228 $ 39,598
Adjustments to reconcile net income (loss) attributable to Pilgrim's Pride Corporation to cash provided by (used in) operating activities:
Depreciation and amortization 37,790 35,766
Asset impairment -- 1,342
Foreign currency transaction losses (gains) (7,753) (5,407)
Accretion of bond discount 114 114
(Loss) Gain on property disposals (1,139) 859
Share-based compensation 548 149
Changes in operating assets and liabilities:
Restricted cash and cash equivalents -- 7,996
Trade accounts and other receivables (5,183) 3,043
Inventories (17,061) (25,813)
Prepaid expenses and other current assets (6,819) 13,144
Accounts payable and accrued expenses (30,629) (35,003)
Income taxes (3,381) (3,421)
Long-term pension and other postretirement obligations (421)
Other 345 (2,985)
Cash provided by (used in) operating activities 20,639 29,382
Cash flows from investing activities:
Acquisitions of property, plant and equipment (25,778) (16,670)
Purchases of investment securities -- (88)
Proceeds from property sales and disposals 1,660 3,066
Cash used in investing activities (24,118) (13,692)
Cash flows from financing activities:
Proceeds from revolving line of credit 288,500 183,200
Payments on revolving line of credit, long-term borrowings and capital lease obligations (311,005) (341,802)
Payment of note payable to JBS USA -- (50,000)
Proceeds from sale of common stock -- 198,379
Cash provided by (used in) financing activities (22,505) (10,223)
Effect of exchange rate changes on cash and cash equivalents 1,364 494
Increase (decrease) in cash and cash equivalents (24,620) 5,961
Cash and cash equivalents, beginning of period 68,180 41,609
Cash and cash equivalents, end of period 43,560 47,570

PILGRIM'S PRIDE CORPORATION
Selected Financial Information
(Unaudited)

NOTE: "EBITDA" is defined as the sum of income (loss) from continuing operations plus interest, taxes, depreciation and amortization. "Adjusted EBITDA" is defined as the sum of EBITDA plus restructuring charges, reorganization items and loss on early extinguishment of debt less 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 US ("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 from continuing operations. The Company also believes that Adjusted EBITDA, in combination with the Company's financial results calculated in accordance with 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 GAAP. They should not be considered as an alternative to cash flow from operating activities or as a measure of liquidity or an alternative to net income as indicators of our operating performance or any other measures of performance derived in accordance with GAAP.

Thirteen Weeks Ended
March 31, March 25,
2013 2012
(In thousands)
Net loss from continuing operations $ 54,228 $ 39,598
Add:
Income tax expense (benefit) 2,754 653
Interest expense, net 24,605 27,971
Depreciation and amortization 37,790 35,766
Minus:
Amortization of capitalized loan costs 2,516 2,468
EBITDA 116,861 101,520
Add:
Restructuring charges 484 2,885
Minus:
Net income attributable to noncontrolling interest (354) 425
Adjusted EBITDA $ 117,699 $ 103,980
PILGRIM'S PRIDE CORPORATION
Supplementary Selected Segment and Geographic Data
Thirteen Weeks Ended
March 31, March 25,
2013 2012
(In thousands)
Net sales to customers by country of origin:
US: $ 1,808,486 $ 1,684,604
Mexico: 228,443 204,169
Total net sales $ 2,036,929 $ 1,888,773
Cost of sales by country of origin:
US: $ 1,729,836 $ 1,600,269
Mexico: 188,659 178,439
Total net sales $ 1,918,495 $ 1,778,708
Components of gross profit
US: $ 78,650 $ 84,335
Mexico: $ 39,784 $ 25,730
Total net sales $ 118,434 $ 110,065

CONTACT: Rosemary Geelan Pilgrim's Pride Corp Investor Relations Rosemary.geelan@pilgrims.com (970) 506-8192Source:Pilgrim's Pride Corporation