Pilgrim's Pride Corporation · NASDAQ:PPC

Pilgrim's Pride — Q4 2022 Earnings Presentation

27 slides from Pilgrim's Pride's earnings presentation, Feb 9, 2023

1. Slide 1: Financial Results for Fourth Quarter and Year Ended December 25, 2022

   Pilgrim’s Pride Corporation (NASDAQ: PPC) Financial Results for Fourth Quarter and Year Ended December 25, 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: Fourth Quarter 2022 Financial Review

   Fourth Quarter 2022 Financial Review  U.S.: Significant decline in market pricing impacted Big Bird business; however, diversified portfolio across bird sizes and Key Customer strategy helped to reduce impact; UK/Europe: Recorded restructuring charge of $30.5MM as part of network optimization; excl

4. Slide 4: Fiscal Year 2022 Financial Review

   Fiscal Year 2022 Financial Review  U.S.: Diversified portfolio across bird sizes and Key Customer strategy proved differentiating factor during changing market conditions in 2H 2022; UK/Europe: Demonstrated resiliency versus challenging market conditions through Key Customer partnerships and operat

5. Slide 5: Corn Stocks Decrease

   Corn Stocks Decrease 5  USDA decreased final ‘22/’23 corn production to 13.73B bushels, the lowest estimate of the crop year, through a reduction in harvest area. Production cuts were supported by low December 1 grain stocks of 10.8M bushels, down 7% year-on-year.  Stocks-to-Use ratio increased sl

6. Slide 6: Soybean Stocks Decrease

   Soybean Stocks Decrease 6  US Soybean production was also reduced in the latest USDA WASDE report as were exports. Net impact on ending stocks were a reduction of 10M bu to 210M bu vs 274 last year.  USDA reduced Argentina soybean production 4M mt to 45.5M mt in the last report. However, global so

7. Slide 7: Fiscal Year 2022 Capital Spending

   Fiscal Year 2022 Capital Spending  Early strong financial results have enabled us to maintain and 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 foc

8. Slide 8: Pullet Placements Down 5.5% in Q4-2022

   - 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 down 8.6% vs. year ago. Pullet Placements Down 5.5% in Q4-2022; Placements Down 5% in 2022 Source: USDA Intended Pullet Placements 8

9. Slide 9: Broiler Layer Flock Increased Y/Y In Q4; Eggs/100 In Line With 5 Year Average

   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 Source: USDA  Broiler layer flock +0.5% YoY in Q4-22.  Eggs/100 -1.2% YoY in Q4-22. Broiler Layer Flock Increased Y/Y In Q4; Eggs/100 Pacing In Line With 5 Year Average

10. Slide 10: Hatchery Utilization Remains Above Historical Levels

    Despite Declining Three Straight Months, Hatchery Utilization Remains Above Historical 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 10

11. Slide 11: Egg Sets +0.5% YoY in Q4-22; Hatchability Above Q4-21

    Egg Sets +0.5% YoY in Q4-22; Hatchability Consistently Above Q4-21 Levels 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 5 Yr. Avg. 2021 2022 2023 74.0% 75.0% 76.0% 77.0% 78.0%

12. Slide 12: USDA Broiler Placements Grew 2.3% Y/Y in Q4-22

    Source: USDA 12 Broiler Placements Grew 2.3% Y/Y in Q4-22 160,000 165,000 170,000 175,000 180,000 185,000 190,000 195,000 200,000 H ea d (0 00 ) Chicken Broiler Placed by Week- USDA 5 Year Range 5 Yr. Avg. 2021 2022 2023

13. Slide 13: USDA Industry Head Counts Shift Away From <4.25 Segment

    Source: USDA 13 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% 17.5% 15.1% 32.2% 31.2% 30.4% 30.2% 28.7% 27.4% 26.2% 27.5% 29.3% 20.9% 22.5% 23.6% 25.4% 26.2% 27.6% 28.4% 29.6% 28.0% 21.4% 20.9% 21.2% 21.7% 2

14. Slide 14: Industry Cold Storage Supplies Rebounded Above 5 Year Average

    Source: USDA  Inventories ended 7% above 5-year average in Q4.  Breast meat inventories grew 21% from September through end of December finishing the year 19% above the 5-year December average.  Wings inventories continued to grow, up 11% vs. December 2021.  Dark meat inventories up a combined 1

15. Slide 15: PPC, EMI Jumbo Cutout Declined Sharply Entering Q4-2022

    Source: PPC, EMI 15 Jumbo Cutout Declined Sharply Entering Q4-2022 And Trended Near Bottom of 5 Year Range 50 70 90 110 130 150 170 1/ 6 2/ 3 3/ 3 3/ 31 4/ 28 5/ 26 6/ 23 7/ 21 8/ 18 9/ 15 10 /1 3 11 /1 0 12 /8 C en ts /L b Jumbo Cutout 5 Year Range 5 Yr. Avg. 2021 2022 2023

16. Slide 16: BSB, Tenders and Wings Stabilized at Bottom of Historical Range

    BSB, Tenders and Wings Stabilized at Bottom of Historical Range in Q4; LQs Remain Near 5 Year Average Note: On the week of September 2, 2022, USDA revised their reporting of chicken prices from regional prices to one national metric. The old USDA NE Broiler prices previously used provided the larges

17. Slide 17: WOGs Maintaining Pricing Well Above Historical Average

    17 WOGs Maintaining Pricing Well Above Historical Average as Pricing Remains Stable 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/ 6 1/ 20 2/ 3 2/ 17 3/ 3 3/ 17 3/ 31 4/ 14 4/ 28 5/ 12 5/ 26 6/ 9 6/ 23 7/ 7 7/ 21 8/ 4 8/ 18 9/ 1 9/ 15 9/ 29 10 /1 3 10 /2 7 11 /1 0 11 /2

18. Slide 18: Appendix

    pilgrims APPENDIX 18

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

    Source: PPC Appendix: Reconciliation of Adjusted EBITDA 19 “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 b

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

    Source: PPC Appendix: Reconciliation of Adjusted EBITDA 20 PILGRIM'S PRIDE CORPORATION Reconciliation of Adjusted EBITDA (Unaudited) Three Months Ended Year Ended December 25, 2022 December 26, 2021 December 25, 2022 December 26, 2021 (In thousands) Net income (loss) $ (155,042) $ 36,468 $ 746,538 $

21. Slide 21: PPC Appendix: Reconciliation of LTM Adjusted EBITDA

    Source: PPC Appendix: Reconciliation of LTM Adjusted EBITDA 21 The summary unaudited consolidated income statement data for the 12 months ended December 25, 2022 (the LTM Period) have been calculated by summing each of the unaudited three month periods within the audited year ended December 25, 2022

22. Slide 22: PPC Appendix: Reconciliation of EBITDA Margin

    Source: PPC Appendix: Reconciliation of EBITDA Margin 22 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 they are frequently used

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

    Appendix: Reconciliation of Adjusted EBITDA by Segment Source: PPC 23 (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 r

24. Slide 24: Appendix: Reconciliation of Adjusted EBITDA by Segment

    Appendix: Reconciliation of Adjusted EBITDA by Segment Source: PPC 24 PILGRIM'S PRIDE CORPORATION Reconciliation of Adjusted EBITDA (Unaudited) Year Ended Year Ended December 25, 2022 December 26, 2021 U.S. U.K. & Europe Mexico Total U.S. U.K. & Europe Mexico Total (In thousands) (In thousands) Net

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

    Source: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS 25 PILGRIM'S PRIDE CORPORATION Reconciliation of Adjusted Net Income (Unaudited) Three Months Ended Year Ended December 25, 2022 December 26, 2021 December 25, 2022 December 26, 2021 (In thousands, except per share data) Net income (lo

26. Slide 26: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS

    Source: PPC Appendix: Reconciliation of GAAP EPS to Adjusted EPS 26 PILGRIM'S PRIDE CORPORATION Reconciliation of GAAP EPS to Adjusted EPS (Unaudited) Three Months Ended Year Ended December 25, 2022 December 26, 2021 December 25, 2022 December 26, 2021 (In thousands, except per share data) U.S. GAAP

27. Slide 27: PPC Appendix: Supplementary Selected Segment and Geographic Data

    Source: PPC Appendix: Supplementary Selected Segment and Geographic Data 27 PILGRIM'S PRIDE CORPORATION Supplementary Geographic Data (Unaudited) Three Months Ended Year Ended December 25, 2022 December 26, 2021 December 25, 2022 December 26, 2021 (In thousands) Sources of net sales by country of or

Pilgrims Pride — Q4 2022 Earnings Presentation on 6ix