Pilgrim's Pride Corporation · NASDAQ:PPC
Pilgrim's Pride — Q1 2017 Earnings Presentation
25 slides from Pilgrim's Pride's earnings presentation, May 4, 2017
Slide 1: Pilgrim's Pride Corporation Financial Results for First Quarter Ended Mar 26, 2017
Pilgrim’s Pride Corporation Financial Results for First Quarter Ended Mar 26, 2017
Slide 2: 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” and similar expressions, are forward-looking state
Slide 3: Eggs Sets Average Marginally Up in 2017 from 2016
Eggs Sets Average Marginally Up in 2017 from 2016 Source: USDA 3 212,032 198,914 209,003 214,246 212,341 185,000 190,000 195,000 200,000 205,000 210,000 215,000 220,000 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
Slide 4: 2017 Placements Modestly Higher
2017 Placements Modestly Higher Source: USDA 4 174,588 162,586 170,071 175,048 173,208 154,000 159,000 164,000 169,000 174,000 179,000 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 Th ou
Slide 5: Broiler Type Hatching Layers In-line YTD with 2016
Broiler Type Hatching Layers In-line YTD with 2016 Source: USDA 5
Slide 6: Jumbo Bird Share Down Slightly After Significant Increase Since 2011
Jumbo Bird Share Down Slightly After Significant Increase Since 2011 Source: USDA 6
Slide 7: Hatchery Utilization Close to Peak Levels
Hatchery Utilization Close to Peak Levels Source: Agristats/EMI 7 84.00% 85.00% 86.00% 87.00% 88.00% 89.00% 90.00% 91.00% 92.00% 93.00% 94.00% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec % Hatchery Utilization 2016 2017 5 year avg.
Slide 8: Hatching Layers Flat vs 2016, Placements Marginally Higher
Hatching layers are in-line in Mar and YTD with last year. Egg production is below 2016, while pullet placements are only slightly higher year on year, supportive of a modest production growth in 2017. Hatching Layers Flat vs 2016, Placements Marginally Higher Source: USDA 8
Slide 9: Cold Storage Levels Lower Than 2016
Cold Storage Levels Lower Than 2016 Source: USDA Overall inventories 3.5% lower than 2016 levels, driven by strong retail and improved demand for export-oriented cuts. 9
Slide 10: Cutout Values above 2016 but still Lower than year levels
Cutout Values above 2016 but still Lower than 5 year levels Source: PPC 10 Cutout Value
Slide 11: Leg Quarters Improved vs 2016, Other Parts In-line with Normal Seasonality
Leg Quarters Improved vs 2016, Other Parts In-line with Normal Seasonality Source: USDA 11
Slide 12: Strength in Small Bird and Retail Contracts Continues
12 Strength in Small Bird and Retail Contracts Continues Source: EMI
Slide 13: Corn Stocks at Record High Levels
Corn Stocks at Record High Levels Global stocks continue to stay at record high levels. USDA raised global stocks-to-use in April for new crop on higher than expected South American corn harvest. Source: USDA 13
Slide 14: Global Soybean Inventories Grow
Global Soybean Inventories Grow Global inventories of soybeans remain high and at record high levels, surpassing 2014 previous highs. Demand for oilseed products estimated to grow to finish out the 2016 crop year. Source: USDA 14
Slide 15: First Quarter 2017 Financial Review
First Quarter 2017 Financial Review Balanced performance during Q1 within Fresh; case-ready and small birds strength continues while large birds improving; MX operating results solid but FX impacted cost. SG&A higher due to addition of GNP. Adjusted Q1-17 EBITDA below Q1-16 but in- line with e
Slide 16: Solid Balance Sheet, With Plenty of Room for Strategic Investments
1,316.3 Solid Balance Sheet, With Plenty of Room for Strategic Investments Source: PPC Cash Flow From Operations generation of $61MM in the quarter due to timing of strategic capital investments as well as bonus payments and share repurchase. Net debt multiple is 1.5x LTM EBITDA, vs target of 2-
Slide 17: First Quarter 2017 Capital Spending
First Quarter 2017 Capital Spending Capex (US$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 de-emphasize our expos
Slide 18: Investor Relations Contact
Investor Relations Contact Investor Relations: Dunham Winoto Director, Investor Relations E-mail: IRPPC@pilgrims.com Address: 1770 Promontory Circle Greeley, CO 80634 USA Website: www.pilgrims.com 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 Source: PPC The summary unaudited consolidated income statement data for the twelve months ended March 26, 2017 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the three months ended March 27,
Slide 21: Appendix: EBITDA Margin Reconciliation
Appendix: EBITDA Margin Reconciliation Source: PPC EBITDA margins have been calculated by taking the relevant unaudited EBITDA figures, then dividing by Net Revenue for the applicable period. 21 PILGRIM'S PRIDE CORPORATION Reconciliation of EBITDA Margin (Unaudited) Thirteen Weeks Ended Thirteen Wee
Slide 22: Appendix: Reconciliation of Adjusted Earnings
Appendix: Reconciliation of Adjusted Earnings Source: PPC A reconciliation of net income (loss) attributable to Pilgrim's Pride Corporation per common diluted share to adjusted net income (loss) attributable to Pilgrim's Pride Corporation per common diluted share is as follows: 22 PILGRIM'S PRIDE CO
Slide 23: Appendix: Adjusted EPS Bridge
Appendix: Adjusted EPS Bridge Source: PPC A reconciliation of GAAP earnings per share (EPS) to adjusted earnings per share (EPS) is as follows: 23 PILGRIM'S PRIDE CORPORATION Reconciliation of GAAP EPS to Adjusted EPS (Unaudited) Thirteen Weeks Ended March 26, 2017 March 27, 2016 (In thousands, exce
Slide 24: Appendix: Net Debt / Cash Position Reconciliation
Appendix: Net Debt / Cash Position Reconciliation Source: PPC Net debt is defined as total long term debt less current maturities, plus current maturities of long term debt and notes payable, minus cash, cash equivalents and investments in available-for-sale securities. Net debt is presented because
Slide 25: Appendix: Segment and Geographic Data
Appendix: Segment and Geographic Data Source: PPC 25 PILGRIM'S PRIDE CORPORATION Supplementary Selected Segment and Geographic Data Thirteen Weeks Ended March 26, 2017 March 27, 2016 (Unaudited) (In thousands) Sources of net sales by country of origin: US: $ 1,736,405 $ 1,670,281 Mexico: 284,087 292