Pilgrim's Pride Corporation · NASDAQ:PPC
Pilgrim's Pride — Q1 2021 Earnings Presentation
26 slides from Pilgrim's Pride's earnings presentation, Apr 29, 2021
Slide 1: Financial Results for First Quarter Ended March 28, 2021
Pilgrim’s Pride Corporation (NASDAQ: PPC) Financial Results for First Quarter Ended March 28, 2021
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
Slide 3: Pullet Placements Modestly Up 1.7% in Q1
Trailing 8-Month placements up 1.5% vs. year ago Growth in placements will help offset rising pullet mortality and lower flock productivity Pullet Placements Modestly Up 1.7% in Q1 Source: USDA 3 Intended Pullet Placements - 2,000 4,000 6,000 8,000 10,000 12,000 Jan Feb Mar Apr May Jun Jul Aug S
Slide 4: Hatching Layers Slightly Increasing but Egg Productivity Results are Mixed
Hatching Layers Slightly Increasing but Egg Productivity Results are Mixed Source: USDA 4 Increased broiler layer flock, improvements in eggs/100, and reduced egg exports are contributing to growth in domestic egg supply. Eggs/100 productivity in Q1 down 0.6% due to February weakness, but March
Slide 5: Egg Sets Down 0.9% in Q1; Hatchery Utilization In-line With 5-Yr Avg
5 Egg Sets Down 0.9% in Q1, Impacted by Feb Weather Events; while, Hatchery Utilization Generally In-line With 5-Yr Avg in Q1 78.0% 80.0% 82.0% 84.0% 86.0% 88.0% 90.0% 92.0% 94.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec % 2020 2021 5 Yr. Avg. 170,000 180,000 190,000 200,000 210,000 220,000 2
Slide 6: Significant Decline in 1Q Hatchability vs. 5-Yr Average and Prior Year
Source: USDA 6 Significant Decline in 1Q Hatchability vs. 5-Yr Average and Prior Year 74.0% 75.0% 76.0% 77.0% 78.0% 79.0% 80.0% 81.0% 82.0% 83.0% % Chicken Hatchability by Week - USDA 5 Year Range 2019 2020 2021 5 Yr. Avg.
Slide 7: Avg Broiler Placements Down 2.1% in Q1
Source: USDA 7 Avg Broiler Placements Down 2.1% in Q1 as a Result of Fewer Sets and Lower 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 2019 2020 2021 5 Yr. Avg.
Slide 8: Growth Remains Concentrated in 6.26-7.75 LBS Categories
Source: USDA 8 Growth Remains Concentrated in 6.26-7.75 LBS Categories and Continuing Reduction in Small Birds
Slide 9: Inventories Have Continued to Decline and Well Below Year Ago Levels
Inventories Have Continued to Decline and Well Below vs. Year Ago Levels Source: USDA Total inventories decline another 4% M/M in March and are now down almost 20% Y/Y. Breast meat inventories fell 10% M/M. LQ inventories also remain extremely low, down 29% Y/Y. Wings inventories maintain lo
Slide 10: Strength in All Cuts Driving Total Cutout Well Above Seasonal 5-Yr Range
Strength in All Cuts Driving Total Cutout to Track Well Above Seasonal 5-Yr Range Throughout Q1 Source: PPC, EMI 10 99.63 40.00 50.00 60.00 70.00 80.00 90.00 100.00 110.00 1/ 8 1/ 22 2/ 5 2/ 19 3/ 5 3/ 19 4/ 2 4/ 16 4/ 30 5/ 14 5/ 28 6/ 11 6/ 25 7/ 9 7/ 23 8/ 6 8/ 20 9/ 3 9/ 17 10 /1 10 /1 5 10 /2 9
Slide 11: BSB, Tenders, and Wings Strong and Trending at High Levels During Q1
Source: USDA 11 BSB, Tenders, and Wings Strong and Trending at High Levels During Q1 44.46 20.00 25.00 30.00 35.00 40.00 45.00 50.00 1/ 5 2/ 4 3/ 6 4/ 5 5/ 5 6/ 4 7/ 4 8/ 3 9/ 2 10 /2 11 /1 12 /1 Ce nt s/ Lb USDA Leg Quarters NE 5 Year Range 2019 2020 2021 5 Year Average 168.54 75.00 85.00 95.00 105
Slide 12: WOG Pricing In Q1 Trended Near 5-Yr Avg; Strong Start in Early Q2
12 WOG Pricing In Q1 Trended Near 5-Yr Avg; Strong Start in Early Q2 Source: EMI 99.4 40.0 50.0 60.0 70.0 80.0 90.0 100.0 110.0 120.0 1/ 3 1/ 17 1/ 31 2/ 14 2/ 28 3/ 13 3/ 27 4/ 10 4/ 24 5/ 8 5/ 22 6/ 5 6/ 19 7/ 3 7/ 17 7/ 31 8/ 14 8/ 28 9/ 11 9/ 25 10 /9 10 /2 3 11 /6 11 /2 0 12 /4 12 /1 8 Ce nt s/
Slide 13: Corn Stocks Tighten
Corn Stocks Tighten US corn stocks continues to be lowered by USDA, tightening to stocks similar to levels last seen in 2013 The market continues to watch the corn export pace and domestic use with tighter stocks/use Source: USDA 13
Slide 14: Soybean Stocks Tighten
Soybean Stocks Tighten USDA decreased soybean ending stocks in 2020 to levels previously seen before the trade war U.S. exports of soybeans and U.S. demand both continues to be a driving factor for tightening stocks Source: USDA 14
Slide 15: First Quarter 2021 Financial Review
First Quarter 2021 Financial Review U.S.: QSR and retail maintaining strength while commodity much improved due to better foodservice demand, operationally weather events and labor tightness impacting MIX; Mexico: Strength continues on balanced supply/demand conditions, improving macro; UK/Europe:
Slide 16: Fiscal Year 2021 Capital Spending
Fiscal Year 2021 Capital Spending Capex (US$M) Source: PPC 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 emphasize our focus on a
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.
Slide 19: Appendix: Reconciliation of Adjusted EBITDA
Appendix: Reconciliation of Adjusted EBITDA Source: PPC. “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 ar
Slide 20: Appendix: Reconciliation of Adjusted EBITDA
Appendix: Reconciliation of Adjusted EBITDA Source: PPC. (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 asse
Slide 21: Appendix: Reconciliation of LTM Adjusted EBITDA
Appendix: Reconciliation of LTM Adjusted EBITDA 21 Source: PPC. The summary unaudited consolidated income statement data for the twelve months ended March 28, 2021 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the three months en
Slide 22: Appendix: Reconciliation of EBITDA Margin
Appendix: Reconciliation of EBITDA Margin 22 Source: PPC. 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 b
Slide 23: Appendix: Reconciliation of Adjusted EBITDA by Segment
Appendix: Reconciliation of Adjusted EBITDA by Segment 23 Source: PPC. Source: PPC
Slide 24: Appendix: Reconciliation of Adjusted Net Income
Appendix: Reconciliation of Adjusted Net Income 24 Source: PPC. 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
Slide 25: Appendix: Reconciliation of GAAP EPS to Adjusted EPS
Appendix: Reconciliation of GAAP EPS to Adjusted EPS 25 Source: PPC. 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
Slide 26: Appendix: Supplementary Selected Segment and Geographic Data
Appendix: Supplementary Selected Segment and Geographic Data 26 Source: PPC. Source: PPC PILGRIM'S PRIDE CORPORATION Supplementary Selected Segment and Geographic Data (Unaudited) Three Months Ended March 28, 2021 March 29, 2020 (In thousands) Sources of net sales by geographic region of origin: U.S