Pilgrim's Pride Corporation · NASDAQ:PPC

Pilgrim's Pride — Q2 2022 Earnings Presentation

26 slides from Pilgrim's Pride's earnings presentation, Jul 28, 2022

  1. Slide 1: Financial Results for Second Quarter Ended June 26, 2022

    Pilgrim’s Pride Corporation (NASDAQ: PPC) Financial Results for Second Quarter Ended June 26, 2022

  2. Slide 2: Cautionary Notes and Forward-Looking Statements

    Cautionary Notes and 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

  3. Slide 3: Second Quarter 2022 Financial Review

    Second Quarter 2022 Financial Review  U.S.: Cutout significantly higher than prior year; Continued YOY strength in Retail and Foodservice; overcoming inflation headwinds; Mexico: Balanced supply / demand; however, margins negatively impacted by seasonal mortality challenges; UK/Europe: Inflation he

  4. Slide 4: Corn Stocks Set to Decrease Slightly

    Corn Stocks Set to Decrease Slightly  US corn stocks are set to decrease from 1.51B bushels in the ‘21/22 crop year to 1.47B bushels in the ‘22/23 crop year  Market actions in the coming months are largely dependent on US weather to determine corn supply for the new crop year Source: PPC 4

  5. Slide 5: Soybean Stocks Set to Increase Slightly

    Soybean Stocks Set to Increase Slightly  US soybean stocks expected to increase slightly in the new crop year  Market relaxes as worst case scenario for Brazil and Argentina soybean production estimates increase  Soybean oil prices have decreased significantly on larger palm oil stocks Source: PP

  6. Slide 6: Fiscal Year 2022 Capital Spending

    Fiscal Year 2022 Capital Spending  Strong financial results have enabled us to direct more capital spending towards identified projects with rapid payback and structural improvements.  New strategic and automation projects will support Key Customers’ growth and emphasize our focus on continuing to

  7. Slide 7: Pullet Placements Down 3.9% Y/Y in Q2 2022; Placements Flat YTD

    7 Pullet Placements Down 3.9% Y/Y in Q2 2022; Placements Flat YTD 2022 - 2,000 4,000 6,000 8,000 10,000 12,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Th ou sa nd H ea d 2021 2022 5 Yr. Avg.  Trailing 8-Month placements up 2.2% vs. year ago.  No major capacity changes expected in 2022. Int

  8. Slide 8: Broiler Layer Flock Declined Y/Y In Q2; Eggs/100 Pacing Above 2021 Levels

    1,500 1,550 1,600 1,650 1,700 1,750 1,800 1,850 1,900 1,950 2,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Eg gs Eggs/100  Broiler layer flock down 1.3% YoY in Q2-22.  Eggs/100 up 0.8% YoY in Q2-22. Broiler Layer Flock Declined Y/Y In Q2; Eggs/100 Pacing Above 2021 Levels 50,000 52,000 54,0

  9. Slide 9: Hatchery Utilization Maintains Trend Above 2021 Levels

    Hatchery Utilization Maintains Trend Above 2021 Levels Source: Agristats 80.0% 82.0% 84.0% 86.0% 88.0% 90.0% 92.0% 94.0% 96.0% 98.0% 100.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec % Hatchery Utilization 2021 2022 4 Yr. Avg. - Excl 2020 9

  10. Slide 10: Egg Sets Above Q2-21 Levels by 0.9%; Hatchability Back in Line With 2021

    Egg Sets Above Q2-21 Levels by 0.9%; Hatchability Back in Line With 2021 Source: USDA 200,000 205,000 210,000 215,000 220,000 225,000 230,000 235,000 240,000 245,000 250,000 Th ou sa nd s of E gg s Chicken Egg Sets by Week - USDA 5 Year Range 2020 2021 2022 5 Yr. Avg. 74.0% 75.0% 76.0% 77.0% 78.0% 7

  11. Slide 11: USDA Broiler Placements Grew 0.6% Y/Y

    Source: USDA Broiler Placements Grew 0.6% Y/Y as Growth in Egg Sets Aided by Slightly Improved Hatchability 160,000 165,000 170,000 175,000 180,000 185,000 190,000 195,000 H ea d (0 00 ) Chicken Broiler Placed by Week- USDA 5 Year Range 2020 2021 2022 5 Yr. Avg. 11

  12. Slide 12: USDA Industry Head Counts Continue to Shift Away From <4.25 Segment

    Source: USDA Industry Head Counts Continue to Shift Away From <4.25 Segment; Increased Counts in Medium Sizes 25.5% 25.3% 24.8% 22.7% 21.8% 20.9% 19.7% 19.4% 32.2% 31.2% 30.4% 30.2% 28.7% 27.4% 26.2% 26.4% 20.9% 22.5% 23.6% 25.4% 26.2% 27.6% 28.4% 29.9% 21.4% 20.9% 21.2% 21.7% 23.3% 24.1% 25.7% 24.3

  13. Slide 13: Industry Cold Storage Supplies Remain Low Relative to Historical Norms

    Source: USDA  Inventories ended June 7% below the 5-year June average.  Breast meat inventories remained 7% below year ago level.  Wings inventories grew in Q2, ending June 31% above the 5-year June average.  Combined dark meat inventories (Drumsticks, Legs, LQ, Thighs, Thigh Meat) are 15% below

  14. Slide 14: Cutout Trended At New Highs Throughout Q2-22

    Source: PPC, EMI 133 50.00 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 1/ 7 1/ 21 2/ 4 2/ 18 3/ 4 3/ 18 4/ 1 4/ 15 4/ 29 5/ 13 5/ 27 6/ 10 6/ 24 7/ 8 7/ 22 8/ 5 8/ 19 9/ 2 9/ 16 9/ 30 10 /1 4 10 /2 8 11 /1 1 11 /2 5 12 /9 12 /2 3 Ce nt s/ Lb Cutout Value 5 Year Range 202

  15. Slide 15: USDA BSB and Tenders Above Historical Ranges; Wings Have Slumped

    Source: USDA BSB and Tenders Above Historical Ranges; LQ Pricing Steady While Wings Have Slumped 279.6 75 125 175 225 275 325 375 425 1/ 7 2/ 6 3/ 8 4/ 7 5/ 7 6/ 6 7/ 6 8/ 5 9/ 4 10 /4 11 /3 12 /3 Ce nt s/ Lb USDA Boneless/Skinless Breast NE 5 Year Range 2020 2021 2022 5 Year Average 164.8 120 170 2

  16. Slide 16: WOG Prices Continue At Elevated Levels As Supplies Remain Tight

    WOG Prices Continue At Elevated Levels As Supplies Remain Tight Source: EMI 60.0 70.0 80.0 90.0 100.0 110.0 120.0 130.0 140.0 150.0 160.0 1/ 7 1/ 21 2/ 4 2/ 18 3/ 4 3/ 18 4/ 1 4/ 15 4/ 29 5/ 13 5/ 27 6/ 10 6/ 24 7/ 8 7/ 22 8/ 5 8/ 19 9/ 2 9/ 16 9/ 30 10 /1 4 10 /2 8 11 /1 1 11 /2 5 12 /9 12 /2 3 C e

  17. Slide 17: Appendix

    pilgrims APPENDIX 17

  18. Slide 18: PPC Appendix: Reconciliation of Adjusted EBITDA

    Source: PPC Appendix: Reconciliation of Adjusted EBITDA “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

  19. Slide 19: PPC Appendix: Reconciliation of Adjusted EBITDA

    Source: PPC Appendix: Reconciliation of Adjusted EBITDA (a) Interest expense, net, consists of interest expense less interest income. (b) The Company measures the financial statements of its Mexico reportable segment as if the U.S. dollar were the functional currency. Accordingly, we remeasure asset

  20. Slide 20: PPC Appendix: Reconciliation of LTM Adjusted EBITDA

    Source: PPC Appendix: Reconciliation of LTM Adjusted EBITDA The summary unaudited consolidated income statement data for the twelve months ended June 26, 2022 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the six months ended Jun

  21. Slide 21: PPC Appendix: Reconciliation of EBITDA Margin

    Source: PPC Appendix: Reconciliation of EBITDA Margin 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 se

  22. Slide 22: PPC Appendix: Reconciliation of Adjusted EBITDA by Segment

    Source: PPC Appendix: Reconciliation of Adjusted EBITDA by Segment PILGRIM'S PRIDE CORPORATION Reconciliation of Adjusted EBITDA (Unaudited) Three Months Ended Three Months Ended June 26, 2022 June 27, 2021 U.S. U.K. & Europe Mexico Total U.S. U.K. & Europe Mexico Total (In thousands) (In thousands)

  23. Slide 23: PPC Appendix: Reconciliation of Adjusted EBITDA by Segment

    Source: PPC Appendix: Reconciliation of Adjusted EBITDA by Segment PILGRIM'S PRIDE CORPORATION Reconciliation of Adjusted EBITDA (Unaudited) Six Months Ended Six Months Ended June 26, 2022 June 27, 2021 U.S. U.K. & Europe Mexico Total U.S. U.K. & Europe Mexico Total (In thousands) (In thousands) Net

  24. Slide 24: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS

    Source: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS 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 abou

  25. Slide 25: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS

    Source: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS 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 abou

  26. Slide 26: PPC Appendix: Supplementary Selected Segment and Geographic Data

    Source: PPC Appendix: Supplementary Selected Segment and Geographic Data PILGRIM'S PRIDE CORPORATION Supplementary Selected Segment and Geographic Data (Unaudited) Three Months Ended Six Months Ended June 26, 2022 June 27, 2021 June 26, 2022 June 27, 2021 (In thousands) Sources of net sales by geogr

Pilgrims Pride — Q2 2022 Earnings Presentation on 6ix