Pilgrim's Pride Corporation · NASDAQ:PPC
Pilgrim's Pride — Q1 2020 Earnings Presentation
22 slides from Pilgrim's Pride's earnings presentation, Apr 30, 2020
Slide 1: Financial Results for First Quarter Ended March 29, 2020
Financial Results for First Quarter Ended March 29, 2020 Pilgrim’s Pride Corporation (NASDAQ: PPC)
Slide 2: Cautionary Notes and Forward-Looking Statements
Cautionary Notes and Forward-Looking Statements Statements contained in this presentation that share our intentions, beliefs, expectations or predictions for the future, denoted by the words “anticipate,” “believe,” “estimate,” “should,” “expect,” “project,” “plan,” “imply,” “intend,” “foresee” an
Slide 3: Pullet Placement Up to February In Line With Expectations
Pullet Placement Up to February In Line With Expectations 10,000 Intended Pullet Placements 9,000 8,000 7,000 6,000 5,000 4,000 3,000 ThousandHead 2,000 1,000 - Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2019 2020 5 Yr. Avg. . Trailing 8-Month placements 3.0% above year ago placements to suppor
Slide 4: Hatching Layer Flock Consistent With Expected Growth
Hatching Layer Flock Consistent With Expected Growth Broiler Type Hatching Layers Eggs/100 62,000 1,950 1,900 60,000 1,850 58,000 1,800 1,750 56,000 Eggs 1,700 Head Head (000) 54,000 1,650 1,600 52,000 1,550 50,000 1,500 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug
Slide 5: Hatchery Utilization Slightly Above Year Average
Hatchery Utilization Slightly Above 5 Year Average 94.0% 92.0% 90.0% % % 88.0% 86.0% 84.0% 82.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2019 2020 5 Yr. Avg. Source: Agristats 5
Slide 6: Egg Sets Started Q1 In Line with Growth Expectations
Egg Sets Started Q1 In Line with Growth Expectations Before Recent Reductions; Hatchability Remains Lower Than Historical Chicken Egg Sets Chicken Hatchability by Week - USDA by Week - USDA 250,000 84.0% 240,000 82.0% 230,000 80.0% 220,000 % 78.0% 210,000 76.0% 200,000 Thousands of Eggs 74.0% 190,00
Slide 7: Chick Placements Up +3.4% in Q1-20, But Recent Placements Close to 5 Year Lows
Chick Placements Up +3.4% in Q1-20, But Recent Placements Close to 5 Year Lows Chicken Broiler Placed by Week- USDA 195,000 190,000 185,000 180,000 175,000 Head Head (000) 170,000 165,000 160,000 5 Year Range 2018 2019 2020 5 Yr. Avg. Source: USDA 7
Slide 8: Growth Previously Concentrated in Big Bird Categories
Growth Previously Concentrated in Big Bird Categories; Recent Weeks Showing Reductions in <4.25 and >7.75 Birds Head Processed by Size 100% 15.1% 15.6% 90% 18.3% 19.7% 21.4% 20.9% 21.2% 21.7% 23.3% 24.3% 80% 19.1% 19.3% 70% 19.4% 19.3% 20.9% 22.5% 23.6% 25.4% 26.2% 25.7% 60% 50% 42.9% 40.7% 35.5% 35
Slide 9: Total February Freezer Inventories Higher Y/Y but Stable M/M
Total February Freezer Inventories Higher Y/Y but Stable M/M Total Chicken Inventories 1,100,000 1,000,000 900,000 800,000 LBS (000) LBS 700,000 600,000 500,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2018 2019 2020 3 Yr. Avg. . Breast meat inventories increased YOY but stabilized in P2-P3 .
Slide 10: Cutout Tracked Seasonality Before Declining in Early April
Cutout Tracked Seasonality Before Declining in Early April Due to Reduction in Foodservice Operation Cutout Value 100.00 90.00 80.00 70.00 Cents/Lb 60.00 50.00 44.88 40.00 2/1 1/4 3/1 6/7 7/5 8/2 5/10 1/18 2/15 3/15 3/29 4/12 4/26 5/24 6/21 7/19 8/16 8/30 9/13 9/27 11/8 12/6 12/20 10/11 10/25 11/22
Slide 11: Tenders and Wings In Line Before Reduction in Foodservice
Tenders and Wings In Line Before Reduction in Foodservice; LQ Remains in Historical Range USDA Boneless/Skinless Breast NE USDA Tenders NE 175.00 235.00 215.00 155.00 195.00 135.00 175.00 155.00 115.00 Cents/Lb Cents/Lb 135.00 115.00 95.00 93.11 95.00 91.81 75.00 75.00 1/5 2/4 3/6 4/5 5/5 6/4 7/4 8/
Slide 12: Q1 Pricing Within Normal Seasonality Before Declining
Q1 Pricing Within Normal Seasonality Before Declining Due to Reduction in Foodservice Operation EMI WOG 2.5-4.0 LBS 120.0 110.0 100.0 90.0 80.0 Cents/Lb. 70.0 60.0 50.0 41.1 40.0 1/3 5/8 6/5 7/3 1/17 1/31 2/14 2/28 3/13 3/27 4/10 4/24 5/22 6/19 7/17 7/31 8/14 8/28 9/11 9/25 10/9 11/6 12/4 10/23 11/2
Slide 13: Corn Stocks Remain at Adequate Levels
Corn Stocks Remain at Adequate Levels . USDA raised US corn ending stocks by 200 million in April after lowering their Ethanol use by 375 million bushels . USDA reported that farmers intend to plant 96.9 million corn acres this year up over 7 million from last year’s planted acres Source: USDA 13
Slide 14: Soybean Inventories Remain High
Soybean Inventories Remain High . USDA raised soybean ending stocks by 55 million bushels in April after lowering exports by 50 million bushels . USDA reported that farmers intend to plant 83.5 million acres up almost 7.5 million from last year’s planted acres Source: USDA 14
Slide 15: First Quarter 2020 Financial Review
First Quarter 2020 Financial Review . U.S.: Diversified portfolio and Key Customer strategy minimized channel Main Indicators ($M) Q1-20 Q1-19 demand disruption; MX: Weak macro environment persisted; UK/Europe: Legacy Net Revenue 3,074.9 2,724.7 operations margins significantly improved, Gross Profi
Slide 16: Fiscal Year 2020 Capital Spending
Fiscal Year 2020 Capital Spending CapexCapex (US$M)(US$M) . Strong Free Cash Flow generation has enabled us to direct more capital spending towards identified projects with rapid payback and structural projects. . New strategic projects will support key customers growth and de-emphasize our exposure
Slide 17: Investor Relations Contact
Investor Relations Contact Investor Relations: Dunham Winoto Investor Relations E-mail: IRPPC@pilgrims.com Address: 1770 Promontory Circle Greeley, CO 80634 USA Website: www.pilgrims.com 17
Slide 18: Appendix
APPENDIX All about great taste 18
Slide 19: Appendix: EBITDA Reconciliation
Appendix: EBITDA Reconciliation “EBITDA” is defined as the sum of net income (loss) 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 o
Slide 20: Appendix: Reconciliation of LTM EBITDA
Appendix: Reconciliation of LTM EBITDA The summary unaudited consolidated income statement data for the twelve months ended March 29, 2020 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the three months ended March 31, 2019 from t
Slide 21: Appendix: EBITDA Margin Reconciliation
Appendix: EBITDA Margin Reconciliation EBITDA margins have been calculated by taking the relevant unaudited EBITDA figures, then dividing by Net Sales for the applicable period. PILGRIM'S PRIDE CORPORATION Reconciliation of EBITDA Margin (Unaudited) Three Months Ended Three Months Ended March 29, 20
Slide 22: Appendix: Segment and Geographic Data
Appendix: Segment and Geographic Data PILGRIM'S PRIDE CORPORATION Supplementary Selected Segment and Geographic Data (Unaudited) Three Months Ended March 29, 2020 March 31, 2019 (In thousands) Sources of net sales by geographic region of origin: US $ 1,926,880 $ 1,883,591 Europe 822,262 514,962 Mexi