Slide 1: Financial Results for Second Quarter Ended June 25th, 2023
Pilgrim’s Pride Corporation (NASDAQ: PPC) Financial Results for Second Quarter Ended June 25th, 2023
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: Second Quarter 2023 Financial Review
Second Quarter 2023 Financial Review Main Indicators ($MM) Q2 2023 Q2 2022 Net Revenue 4,308.1 4,631.6 Gross Profit 278.4 676.8 SG&A 148.4 163.9 Operating Income 100.3 512.9 Net Interest 39.5 37.1 Net Income 60.9 362.0 Earnings Per Share (EPS) 0.25 1.50 Adjusted EBITDA* 248.7 623.3 Adjusted EBITDA M
Slide 4: Increased Corn Area Boost Supply Prospects
Increased Corn Area Boost Supply Prospects 4 ▪ USDA ‘22/23 ending stocks are up 4.5% since the end of Q1, largely a result of a competitively-priced Brazil crop working to ration U.S. corn export demand. Corn for Ethanol demand estimates also worked lower over time. ▪ The ‘23/24 balance sheet is beg
Slide 5: Soybean Dynamics
Soybean Dynamics 5 ▪ U.S. ‘22/23 soybean ending stocks estimates have moved higher throughout Q2 as Brazil’s record crop worked to ration some US export demand. ▪ The addition of corn acres in USDA’s June 30th acreage report came at the expense of soybean acres. ‘23/24 soybean acres were reduced 4M
Slide 6: Fiscal Year 2023 Capital Spending
Fiscal Year 2023 Capital Spending ▪ Continued investment in strategic and automation projects will support Key Customers’ growth and emphasize our focus on further diversification of our portfolio and operational improvements Capex (US$M) 6Source: PPC
Slide 7: Intended Pullet Placements
- 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Th o u sa n d H e a d 2022 2023 5 Yr. Avg. ▪ Trailing 8-Month placements down 1.6% vs. year ago. Pullet Placements +0.1% Y/Y in Q2-2023; Down 1.9% YTD Intended Pullet Placements 7Source: US
Slide 8: Broiler Layer Flock Increased Y/Y In Q2; Eggs/100 Below Year Ago level
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 E g g s Eggs/100 2022 2023 5 Yr. Avg. ▪ Broiler layer flock +3.3% YoY in Q2-23. ▪ Eggs/100 -2.1% YoY in Q2-23. Broiler Layer Flock Increased Y/Y In Q2; Eggs/100 Below Year Ago level 58,0
Slide 9: Egg Sets +0.3% YoY in Q2-23; Hatchability Trended -0.9% YoY
Egg Sets +0.3% YoY in Q2-23; Hatchability Trended -0.9% YoY in Q2-23 9 200,000 205,000 210,000 215,000 220,000 225,000 230,000 235,000 240,000 245,000 250,000 T h o u s a n d s o f E g g 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% 79.0% 80.0
Slide 10: Broiler Placements Down -0.8% Y/Y in Q2-23
10 Broiler Placements Down -0.8% Y/Y in Q2-23 160,000 165,000 170,000 175,000 180,000 185,000 190,000 195,000 200,000 H e a d ( 0 0 0 ) Chicken Broiler Placed by Week- USDA 5 Year Range 5 Yr. Avg. 2021 2022 2023 Source: USDA
Slide 11: Industry Head Counts Continue to Shift Away From <4.25 LBS
11 Industry Head Counts Continue to Shift Away From <4.25 and Growing in 4.26-6.25 LBS Range 25.5% 25.3% 24.8% 22.7% 21.8% 20.9% 19.7% 17.3% 16.6% 32.2% 31.2% 30.4% 30.2% 28.7% 27.4% 26.2% 27.6% 29.9% 20.9% 22.5% 23.6% 25.4% 26.2% 27.6% 28.4% 29.7% 27.8% 21.4% 20.9% 21.2% 21.7% 23.3% 24.1% 25.7% 25.
Slide 12: Industry Cold Storage Supplies Ended Q2 Above Historical Average
▪ Inventories increased mildly from end of Q1 through June. ▪ Breast meat inventories maintain elevated levels above 5-year average. ▪ Wing inventories in June below year ago levels. ▪ Dark meat inventories reduced -1.2% Y/Y in June driven by fewer LQs which decreased 8.4% Y/Y. ▪ Other category cont
Slide 13: Chicken Pricing Continues to Move Seasonally, But Below Yr. Avg.
13 Chicken Pricing Continues to Move Seasonally, But Below 5 Yr. Avg. 50 70 90 110 130 150 170 1 /6 2 /3 3 /3 3 /3 1 4 /2 8 5 /2 6 6 /2 3 7 /2 1 8 /1 8 9 /1 5 1 0 /1 3 1 1 /1 0 1 2 /8 C e n ts /L b Jumbo Cutout 5 Year Range 5 Yr. Avg. 2021 2022 2023 Source: PPC, EMI
Slide 14: Prices Moving Seasonally, but Only LQ Above Year Average
Prices Moving Seasonally, but Only LQ Above 5 Year Average; Wings Continue Below 5 Year Range 14 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 largest sam
Slide 15: WOG Values Moving Downward Seasonally
15 WOG Values Moving Downward Seasonally 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/ 2 0 2/ 3 2/ 1 7 3/ 3 3/ 1 7 3/ 3 1 4/ 1 4 4/ 2 8 5/ 1 2 5/ 2 6 6/ 9 6/ 2 3 7/ 7 7/ 2 1 8/ 4 8/ 1 8 9/ 1 9/ 1 5 9/ 2 9 1 0 /1 3 1 0 /2 7 1 1 /1 0 1 1 /2 4 12 /8 1 2 /2 2 C e n ts /L b . EMI
Slide 16: Appendix
pilgrims APPENDIX
Slide 17: Adjusted EBITDA
Appendix: Reconciliation of Adjusted EBITDA 17 “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 not indi
Slide 18: Adjusted EBITDA
Appendix: Reconciliation of Adjusted EBITDA 18 (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 assets and lia
Slide 19: LTM Adjusted EBITDA
Appendix: Reconciliation of LTM Adjusted EBITDA 19 The summary unaudited consolidated income statement data for the twelve months ended June 25, 2023 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the six months ended June 26, 202
Slide 20: EBITDA Margin
Appendix: Reconciliation of EBITDA Margin 20 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 securities
Slide 21: Adjusted EBITDA by Segment
Appendix: Reconciliation of Adjusted EBITDA by Segment 21 (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 ass
Slide 22: Adjusted EBITDA by Segment
Appendix: Reconciliation of Adjusted EBITDA by Segment 22 (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 ass
Slide 23: Adjusted Operating Income
Appendix: Reconciliation of Adjusted Operating Income 23 Adjusted Operating Income is calculated by adding to Operating Income certain items of expense and deducting from Operating Income certain items of income. Management believes that presentation of Adjusted Operating Income provides useful supp
Slide 24: GAAP Operating Income Margin to Adjusted Operating Income Margin
Appendix: Reconciliation of GAAP Operating Income Margin to Adjusted Operating Income Margin 24 Adjusted Operating Income Margin for each of our reportable segments is calculated by dividing Adjusted operating income by Net Sales. Management believes that presentation of Adjusted Operating Income Ma
Slide 25: Adjusted Net Income
Appendix: Reconciliation of Adjusted Net Income 25 (a) Net tax expense (benefit) of adjustments represents the tax impact of all adjustments shown above. Adjusted net income attributable to Pilgrim's Pride Corporation (“Pilgrim's”) is calculated by adding to Net income (loss) attributable to Pilgrim
Slide 26: GAAP EPS to Adjusted EPS
Appendix: Reconciliation of GAAP EPS to Adjusted EPS 26 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 about our ope
Slide 27: Supplementary Selected Segment and Geographic Data
Appendix: Supplementary Selected Segment and Geographic Data 27Source: PPC