Pilgrim's Pride Reports EBITDA of $203.5 Million and 10.1% EBITDA Margin for the First Quarter of 2014, an EBITDA Improvement of 87% Compared to 2013

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| Source: Pilgrim's Pride Corporation

GREELEY, Colo., April 30, 2014 (GLOBE NEWSWIRE) -- Pilgrim's Pride Corporation (Nasdaq:PPC) reported first quarter 2014 earnings with Net Sales of $2.0 billion, Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") of $203.5 million, and Net Income of $98.1 million, resulting in Earnings Per Share of $0.38 for the quarter. These results compare to $2.0 billion in net sales, $116.9 million of EBITDA, and Net Income of $54.6 million, or Earnings Per Share of $0.21 for the same quarter in 2013.

"Consistent with the progress we've made for the past three years, we remain committed to operational improvement year after year," stated Bill Lovette, Pilgrim's Chief Executive Officer. "We continue to execute against our strategy that combines focusing on key customers, relentless pursuit of operational excellence and growing value added exports while rapidly adapting to changing market conditions.

"Our teams continue to raise the standard and drive accountability deeper into the organization, from cost control through the implementation of zero-based budgets to gains in efficiency and superior mix management, providing us with a competitive advantage in the market.

"The strong results, combined with effective management of our working capital, have enabled us to pay off the balance of our exit credit facility, reducing our cost of capital and freeing up cash flow to support investments directed at growing our business. We already started our growth project in Mexico, and with a strong balance sheet, we are prepared to deploy resources where we see a complement to our existing portfolio.

"The current environment for the chicken industry indicates robust prospects for 2014, and with the improvements we've implemented, Pilgrim's is well positioned to reap the benefits."

Conference Call Information

A conference call to discuss Pilgrim's quarterly results will be held tomorrow, May 1, at 7:00 a.m. MDT (9 a.m. EDT). Participants are encouraged to pre-register for the conference call using the link below. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the call start time. 

To pre-register, go to:

http://services.choruscall.com/links/ppc140501.html

You may also reach the pre-registration link by logging in through the investor section of our website at www.pilgrims.com and clicking on the link under "Upcoming Events." 

For those who would like to join the call but have not pre-registered, access is available by dialing +1 (877) 270-2148 within the U.S. or +1 (412) 902-6510 internationally and requesting the "Pilgrim's Pride Conference."  Please note that to submit a question to management during the call, you must be logged in via telephone. 

Replays of the conference call will be available on Pilgrim's website approximately two hours after the call concludes and can be accessed through the "Investor" section of www.pilgrims.com.   The webcast will be available for replay through July 31, 2014. 

About Pilgrim's Pride

Pilgrim's Pride Corporation employs approximately 35,700 people and operates chicken processing plants and prepared-foods facilities in 12 states, Puerto Rico and Mexico. The Company's primary distribution is through retailers and foodservice distributors. 

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. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Factors that could cause actual results to differ materially from those projected in such forward-looking statements include: matters affecting the poultry industry generally; the ability to execute the Company's business plan to achieve desired cost savings and profitability; future pricing for feed ingredients and the Company's products; outbreaks of avian influenza or other diseases, either in Pilgrim's Pride's flocks or elsewhere, affecting its ability to conduct its operations and/or demand for its poultry products; contamination of Pilgrim's Pride's products, which has previously and can in the future lead to product liability claims and product recalls; exposure to risks related to product liability, product recalls, property damage and injuries to persons, for which insurance coverage is expensive, limited and potentially inadequate; management of cash resources; restrictions imposed by, and as a result of, Pilgrim's Pride's leverage; changes in laws or regulations affecting Pilgrim's Pride's operations or the application thereof; new immigration legislation or increased enforcement efforts in connection with existing immigration legislation that cause the costs of doing business to increase, cause Pilgrim's Pride to change the way in which it does business, or otherwise disrupt its operations; competitive factors and pricing pressures or the loss of one or more of Pilgrim's Pride's largest customers; currency exchange rate fluctuations, trade barriers, exchange controls, expropriation and other risks associated with foreign operations; disruptions in international markets and distribution channel, including anti-dumping proceedings and countervailing duty proceedings; and the impact of uncertainties of litigation as well as other risks described under "Risk Factors" in the Company's Annual Report on Form 10-K and subsequent filings with the Securities and Exchange Commission. Pilgrim's Pride Corporation undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. 

     
     
PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Balance Sheets
     
     
  March 30,
2014
December 29,
2013
  (In thousands)
  (UNAUDITED)  
Cash and cash equivalents  $ 514,975  $ 508,206
Investment in available-for-sale securities  37,005  96,902
Trade accounts and other receivables, less allowance for doubtful accounts  373,609  376,678
Account receivable from JBS USA, LLC  3,220  2,388
Inventories  793,516  808,832
Income taxes receivable  20,635  64,868
Current deferred tax assets  2,227  2,227
Prepaid expenses and other current assets  72,914  61,848
Assets held for sale  5,849  7,033
Total current assets  1,823,950  1,928,982
     
Deferred tax assets  16,049  18,921
Other long-lived assets  33,895  40,163
Identified intangible assets, net  31,089  32,525
Property, plant and equipment, net  1,165,434  1,151,811
Total assets  $ 3,070,417  $ 3,172,402
     
Current maturities of long-term debt  $ 205,357  $ 410,234
Accounts payable  381,745  370,360
Account payable to JBS USA, LLC  6,144  3,934
Accrued expenses and other current liabilities  275,730  283,355
Current deferred tax liabilities  15,495  15,515
Total current liabilities  884,471  1,083,398
     
Long-term debt, less current maturities  502,077  501,999
Deferred tax liabilities  10,452  13,944
Other long-term liabilities  87,428  80,459
Total liabilities  1,484,428  1,679,800
     
Common stock  2,590  2,590
Additional paid-in capital  1,654,141  1,653,119
Accumulated deficit  (22,039)  (120,156)
Accumulated other comprehensive loss  (51,557)  (45,735)
Total Pilgrim's Pride Corporation stockholders' equity  1,583,135  1,489,818
     
Noncontrolling interest  2,854  2,784
Total stockholders' equity  1,585,989  1,492,602
Total liabilities and stockholders' equity  $ 3,070,417  $ 3,172,402
 
 
PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Statements of Operations
     
  Thirteen Weeks
Ended
Thirteen Weeks
Ended
  March 30,
2014
March 31,
2013
  (In thousands, except per share data)
  (UNAUDITED)  
Net sales  $ 2,018,065  $ 2,036,929
Cost of sales  1,802,959  1,918,495
Gross profit  215,106  118,434
     
Selling, general and administrative expense  45,201  43,992
Administrative restructuring charges, net  1,713  484
Operating income   168,192  73,958
     
Interest expense, net of capitalized interest  19,473  24,821
Interest income  (811)  (216)
Foreign currency transaction losses (gains)  337  (7,624)
Miscellaneous, net  (1,006)  (5)
     
     
Income before income taxes  150,199  56,982
Income tax expense   52,012  2,754
Net income  98,187  54,228
Less: Net income (loss) attributable to noncontrolling interests  70  (354)
Net income attributable to Pilgrim's Pride Corporation  $ 98,117  $ 54,582
     
Weighted average shares of common stock outstanding:    
Basic  258,923  258,823
Diluted  259,446  258,953
     
Net income per share of common stock outstanding:    
Basic  $ 0.38  $ 0.21
Diluted  $ 0.38  $ 0.21
     
     
PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Statements of Cash Flows
     
  Thirteen Weeks Ended
  March 30,
2014
March 31,
2013
  UNAUDITED
Cash flows from operating activities:    
Net income  $ 98,187  $ 54,228
Adjustments to reconcile net income to cash provided by operating activities:    
Depreciation and amortization  38,260  37,790
Foreign currency transaction losses (gains)  941  (7,753)
Accretion of bond discount  114  114
Loss (gain) on property disposals  570  (1,139)
Gain on investment securities  (53)  --
Share-based compensation  1,022  548
Changes in operating assets and liabilities:    
Trade accounts and other receivables  2,145  (5,183)
Inventories  14,310  (17,061)
Prepaid expenses and other current assets  (11,099)  (6,819)
Accounts payable, accrued expenses and other current liabilities  5,833  (30,629)
Income taxes  43,662  (3,381)
Long-term pension and other postretirement obligations  995  (421)
Other operating assets and liabilities  814  345
Cash provided by operating activities  195,701  20,639
Cash flows from investing activities:    
Acquisitions of property, plant and equipment  (47,760)  (25,778)
Purchases of investment securities  (37,000)  --
Proceeds from sale or maturity of investment securities  96,950  --
Proceeds from property disposals  1,511  1,660
Cash used in investing activities  13,701  (24,118)
Cash flows from financing activities:    
Proceeds from revolving line of credit  --  288,500
Payments on revolving line of credit, long-term borrowings and capital lease obligations  (204,913)  (311,005)
Cash used in financing activities  (204,913)  (22,505)
Effect of exchange rate changes on cash and cash equivalents  2,280  1,364
Increase in cash and cash equivalents  6,769  (24,620)
Cash and cash equivalents, beginning of period  508,206  68,180
Cash and cash equivalents, end of period  514,975  43,560

PILGRIM'S PRIDE CORPORATION
Selected Financial Information
(Unaudited)

"EBITDA" is defined as the sum of net income (loss) plus interest, taxes, depreciation and amortization. "Adjusted EBITDA" is defined as the sum of EBITDA plus restructuring charges, reorganization items and loss on early extinguishment of debt less net income attributable to noncontrolling interests. EBITDA is presented because it is used by management and we believe it is frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of results prepared in conformity with accounting principles generally accepted in the US ("GAAP"), to compare the performance of companies. We believe investors would be interested in our Adjusted EBITDA because this is how our management analyzes EBITDA. The Company also believes that Adjusted EBITDA, in combination with the Company's financial results calculated in accordance with GAAP, provides investors with additional perspective regarding the impact of certain significant items on EBITDA and facilitates a more direct comparison of its performance with its competitors. EBITDA and Adjusted EBITDA are not measurements of financial performance under GAAP. They should not be considered as an alternative to cash flow from operating activities or as a measure of liquidity or an alternative to net income as indicators of our operating performance or any other measures of performance derived in accordance with GAAP.

(UNAUDITED) Thirteen Weeks Ended
  March 30,
2014
March 31,
2013
  (In thousands)
Net income from continuing operations  $ 98,187  $ 54,228
Add:    
Interest expense, net  18,662  24,605
Income tax expense (benefit)  52,012  2,754
Depreciation and amortization  38,260  37,790
Asset impairments  --   
Minus:    
Amortization of capitalized financing costs  3,586  2,516
EBITDA  203,535  116,861
Add:    
Restructuring charges  1,714  484
Minus:    
 Net income (loss) attributable to noncontrolling interest  70  (354)
Adjusted EBITDA  $ 205,179  $ 117,699

The summary unaudited consolidated income statement data for the twelve months ended March 30, 2014 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the three months ended March 31, 2013 from the sum of (1) the applicable audited consolidated income statement data for the year ended December 29, 2013 and (2) the applicable unaudited consolidated income statement data for the three months ended March 30, 2014.

(UNAUDITED) Thirteen Weeks
Ended
Thirteen Weeks
Ended
Thirteen Weeks
Ended
Thirteen Weeks
Ended

LTM Ended
  June 30,
2013
September 29,
2013
December 29,
2013
March 30,
2014
March 30,
2014
           
Net income from continuing operations  $ 190,791  $ 161,024  $ 143,670  $ 98,187  $ 593,672
Add:          
Interest expense, net  22,258  19,842  18,176  18,662  78,938
Income tax expense (benefit)  15,884  5,578  11  52,012  73,485
Depreciation and amortization  38,149  37,914  36,670  38,260  150,993
Asset impairments    361  --  --  361
Minus:        --  
Amortization of capitalized financing costs  2,518  2,204  2,069  3,586  10,377
EBITDA  264,564  222,515  196,458  203,535  887,072
Add:          
Restructuring charges  480  3,658  1,039  1,714  6,891
Minus:          
 Net income (loss) attributable to noncontrolling interest  86  107  319  70  582
Adjusted EBITDA  $ 264,958  $ 226,066  $ 197,178  $ 205,179  $ 893,381

Net debt is defined as total long term debt, less current maturities, plus current maturities of long term debt minus cash and cash equivalents.  Net debt is presented because it is used by us, and we believe it is frequently used by securities analysts, investors and other parties, in addition to and not in lieu of debt as presented under GAAP, to compare the indebtedness of companies.  A reconciliation of net debt is as follows:

PILGRIM'S PRIDE CORPORATION
Reconciliation of Net Debt
(UNAUDITED)
           
        Thirteen Weeks Ended
  2011 2012 2013 March 30, 2014 March 31, 2013
  (in Thousands)        
Long term debt, less current maturities  $1,458,001  $1,148,870  $ 501,999  $ 502,077  $ 1,126,477
Add:  Current maturities of long term debt  15,611  15,886  410,234  205,357  15,888
Minus:  Cash and cash equivalents  49,289  68,180  508,206  514,975  43,560
Minus:  Available-for-sale Securities  157  --   96,902  37,005  -- 
Net debt  $1,424,166  $1,096,576  $ 307,125  $ 155,454  $ 1,098,805
     
     
PILGRIM'S PRIDE CORPORATION
Supplementary Selected Segment and Geographic Data
     
  Thirteen Weeks Ended
  March 30,
2014
March 31,
2013
  (In thousands)
  (UNAUDITED)
Sources of net sales by country of origin:     
US:  $ 1,794,677  $ 1,808,486
Mexico:  223,388  228,443
Total net sales:  $ 2,018,065  $ 2,036,929
     
Sources of cost of sales by country of origin:     
US:  $ 1,621,977  $ 1,729,836
Mexico:  180,982  188,659
Total cost of sales:  $ 1,802,959  $ 1,918,495
     
Sources of gross profit by country of origin:    
US:  $ 172,700  $ 78,650
Mexico:  42,406  39,784
Total gross profit:  $ 215,106  $ 118,434
Rosemary Raysor
Pilgrim's Pride Corp Investor Relations

(970) 506-8192
www.pilgrims.com