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Chick-News.com Poultry Industry News, Comments and more by Simon M. Shane

Pilgrims Pride Reports on Q2 2022

07/29/2022

In a press release dated July 27th Pilgrim’s Pride Corp. (PPC) announced results for the 2nd Quarter of FY 2022 ending June 26th. The report incorporates operations in the U.S. Mexico, the EU and the U.K.

 

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as US$ x 1,000 except EPS)

 

2nd Quarter Ending

June 26th 2022

June 27th 2021

Difference (%)

Sales:

$4,631,648

$3,637,698

+27.3

Gross profit:

$676,771

$380,241

+77.9

Operating income:             

$512,904

$(123,131)

+517

Pre-tax Income

Net Income / (loss)

            $474,732

            $362,021

$(176,315)

$(165,503)

+369

+319

Diluted earnings per share:

$1.50

$(0.68)

+320

Gross Margin (%)

14.6

10.5

+39.1

Operating Margin (%)

11.1

(3.4)

+426

Profit Margin (%)

7.8

(4.5)

+273

Long-term Debt and lease obligations:

$3,371,373

        $3,191,161

         +5.6

12 Months Trailing:

 

 

 

           Return on Assets    (%)

11.9

 

 

           Return on Equity    (%)

27.0

 

 

           Operating Margin   (%)

9.7

 

 

           Profit Margin          (%)

4.2

 

 

Total Assets ’22 22.7% / ’21 25.8% intangibles

$9,322,932

        $8,913,205

          +4.6

Market Capitalization  July 29th

$7,610,000

                    

          

Notes for the 2nd Quarter:

 

SGA ’22 $164 million comprising 3.5% of sales compared to ’21 $503 million at 13.8% of sales

Foreign Currency loss $2.7 million ’22; $4.2 million ‘21

Tax payment $113 million ’21; $9.8 million benefit, ’22.

 

 

52-Week Range in Share Price:  $20.23 to $32.56     50-day Moving average  $31.17

Market Close July 26th pre-release  $32.92;  Market Close July 27th $32.31

Forward P/E  13.8             5-year Beta 0.9

 

 

In reviewing the relative revenue and contribution to operating profit, the following proportions of Company totals were derived from data presented:-

 

Geographic Segment     Proportion of Revenue    Contribution to Operating Profit

             U.S.                               62.6%                                      88.4%

             U.K. and  EU                26.9%                                        1.5%

             Mexico                          10.5%                                      10.1%

            

In commenting on Q3 results Fabio Sandri, CEO of Pilgrim's Pride Corp. stated, “Throughout the second quarter, we emphasized discipline and ownership throughout all aspects of our strategy and organization. As a result, second quarter sales grew over 27 percent and Adjusted EBITDA was up almost 68 percent from last year. I am continually impressed with our team’s determination to drive operational excellence to mitigate inflationary headwinds and work with Key Customers to profitably grow our business”.

 

“Our results continue to reflect the benefits of our diversified US portfolio. Investments in automation and in our hourly team members and their communities led to significant progress in net staffing levels, enabling our operations to realize the benefits of strong market fundamentals. Moreover, our overall demand in retail and foodservice remained robust given our emphasis on Key Customers and our diversified product portfolio. In addition, our retail branded business maintained its momentum, as Just Bare® and Pilgrim’s® continued their strong growth trajectory.

In commenting on U.K and EU. operations Sandri stated, “Our  business continued to recover through enhanced partnerships with Key Customers, improved cost recovery, and accelerated implementation of supply chain solutions. The team will continue to identify ways to leverage our diverse portfolio of offerings and further optimize our production capabilities to alleviate continual cost escalation and consistently innovate to drive profitable growth in a difficult economic environment.

 

With regard to Mexico Sandri opined “Our Mexican operations were impacted by seasonal diseases that reduced our efficiency of live production. Nonetheless, the team leveraged our diverse geographic footprint to ensure sufficient supply, driving superior service for Key Customers. Moving forward, the team will continue to monitor conditions and adjust accordingly to grow the business.

 

Perspectives for the future included “Given our market momentum and focus on profitable growth, we are announcing a number of new investments in the US. These investments include an expansion of our Athens, Georgia facility, which will enhance our service levels and support growth for a Key Customer. It also includes funding for operational excellence improvements via automation throughout our U.S. footprint and construction of a protein conversion plant for pet food ingredients in Georgia. Also, we are committing to the development of a Prepared Foods facility in the Southeast U.S. to cultivate our branded growth, further diversifying our portfolio”.


 
Copyright © 2022 Simon M. Shane