In a press release dated July 26th Pilgrim’s Pride Corp. (PPC) announced results for the 3rd Quarter of FY 2023 ending September 24th 2023. The quarterly figures showed positive earnings for all three segments despite lower revenue and operating profit across all three geographic areas. Earnings were lower than in Q3 2022 but exceeded consensus estimates on the top and bottom lines.
The following table summarizes the results for Q3 2023 derived from the SEC 10-Q form and the Company release. Values are compared with the corresponding Q3 FY 2022 (Values expressed as US$ x 103 except EPS)
|
Third Quarters 2023 and 2022, Ending
|
September 24th 2023
|
September 25th
2022
|
Difference (%)
|
|
Sales:
|
$4,360,196
|
$4,468,969
|
-2.4
|
|
Gross profit:
|
$345,882
|
$497,270
|
-30.4
|
|
Operating income:
|
$206,373
|
$339,202
|
-39.1
|
|
Pre-tax Income
Net Income*
|
$166,120
$121,278
|
$324,748
$258,352
|
-48.8
-53.1
|
|
Diluted earnings per share:
|
$0.51
|
$1.08
|
-52.8
|
|
Gross Margin (%)
|
7.9
|
11.1
|
-28.8
|
|
Operating Margin (%)
|
4.7
|
7.6
|
-38.2
|
|
Profit Margin (%)
|
2.8
|
5.8
|
-51.7
|
|
Long-term Debt and other liabilities:
|
$3,958,720
|
$3,648,140
|
+14.2
|
|
12 Months Trailing:
|
|
|
|
|
Return on Assets (%)
|
2.4
|
|
|
|
Return on Equity (%)
|
1.1
|
|
|
|
Operating Margin (%)
|
4.8
|
|
|
|
Profit Margin (%)
|
0.2
|
|
|
|
Total Assets (approximately 21% intangibles)
|
$9,927,168
|
$9,255,769
|
+7.3
|
|
Intraday Market Capitalization July 28th
|
$5,570,000
|
|
|
- Q3 2023, $12.1 million interest income (Q3 2022, $2.7 million)
- Q3 2023 $2.2 million miscellaneous income (Q3 2022, $19.8 million)
Income and sales posted by the three business segments during Q3 2023 were:-
U.S. 25.7 percent of company net income on 57.1 percent of total sales
E.U and U.K. 29.4 percent of company net income on 27.9 percent of total sales
Mexico 45.1 percent of company net income on 12.8 percent of total sales
In commenting on Q results Fabio Sandri, CEO stated, “Throughout the quarter, we continued to strengthen our business through consistent application and execution of our strategies of Key Customer partnership, portfolio diversification, and operational excellence. Given our focus, profitability improved again relative to prior quarter across all regions despite uneven market conditions and persistent consumer inflation,”
With respect to the U.S. Sandri stated “Margins grew from the second quarter given further momentum in our operational excellence efforts and enhanced fundamentals in Big Bird. Margins were further aided by growth in promotional activity and increased distribution in Case Ready, along with strong performance in Small Bird. Prepared Foods generated growth in branded offerings as Just Bare® and Pilgrim’s® net sales collectively grew 65 percent compared to prior year.
Sandri noted that for the U.K. and European business, profitability grew over 65 percent from the prior year given continued benefits from manufacturing network optimization, continued recovery of inflationary costs, and enhanced Key Customer partnerships. He added, “Over the past 18 months, the team has demonstrated remarkable determination to further cultivate operational excellence in our production facilities and back office activities. When these efforts are combined with our Key Customer focus, innovation pipeline, and diversified offerings, the business has strengthened the foundation to drive further profitable growth,” said Sandri.
Mexico achieved strong, counter-seasonal results for the third quarter through a combination of improved live operations, grain and currency favorability, and enhanced supply and demand fundamentals. Sandri opined, “Our Mexico team has shown extraordinary ownership to overcome challenges in live operations through operational excellence over the past year. Given these efforts, the team was well positioned to drive profitable growth with Key Customers and further cultivate its branded presence throughout the quarter.
Sandri concluded “Over the past year, we’ve faced a demanding set of business circumstances. Nonetheless, we maintained a leadership mindset given the opportunity in food and agriculture to reduce emissions and to create a better future for our team members. I look forward to continuation of these efforts to achieve our vision of becoming the best and most respected company in our industry”.
52-Week Range in Share Price of PPC: $19.96 to $26.57. 50-day Moving average, $24.16
Market Close: Wednesday October 25th pre-release $23.40. Close Thursday October 26th post-release $24.32 up 3.7 percent.
Current Trailing P/E 32.2
Equity held by insiders and holding Company: 82.7 percent, Institutions, 18.1 percent
Shares short of float October 13th, 6.5 percent