Pilgrim's has best earnings 'in years'

Pilgrim's has best earnings 'in years'

- Company points to increased chicken pricing and improvements in yields and mix. - Additional biosecurity measures taken at Mexican complex due to H7N3.

PILGRIM'S Pride Corp. has reported a return to earnings for its fourth quarter and full year in 2012 after recording significant losses in 2011.

The company said 2012 was, in fact, its best earnings year "in recent years."

Results achieved in 2012 point to "a determined and disciplined execution of the strategy that was implemented more than 18 months ago," chief executive officer Bill Lovette said. "We have improved our competitive position significantly over the past two years, and we believe that we are well positioned for that to continue."

Although Pilgrim's has offset "the volatile increase" in corn and other feed ingredient costs with increased chicken pricing, it's the improvements in cost reductions, yield and product mix that have made "a pivotal impact" on the company's financial results, Lovette said.

He said Pilgrim's will continue to focus on creating value for its key customers and growing its value-added exports "to maintain the trajectory" of improvement in 2013 and beyond.

The company said it reduced debt by $327.8 million last year to a net debt of $1.1 billion.

Financial results for Pilgrim's Pride are shown in the Tables.

 

Mexican situation

Meanwhile, Pilgrim's has reported "an increased mortality rate" in the breeder flock at its complex in Guanajuato state in central Mexico, where the chicken industry and Mexican animal health organization are responding to an outbreak of highly pathogenic H7N3 avian influenza (Feedstuffs, Feb. 25).

The company said management at the complex is working with regulatory authorities to conduct blood tests to determine if the H7N3 virus is present and has implemented additional biosecurity measures, including asking for and receiving authorization to vaccinate breeders and grandparent stock in unaffected areas.

Pilgrim's said most of its hatching operations in Mexico are located in other states.

Lovette said the company recognizes the importance of chicken for its Mexican customers and has taken proactive steps to ship eggs and processed chicken meat from its U.S. operations to Mexican customers and arranged for alternative local suppliers for those customers.

He said there should be no interruption to the supply of eggs and chicken meat products.

Outbreaks also have been reported in the states of Aquascalientes and Jalisco.

Pilgrim's, headquartered in Greeley, Colo., is the second-largest chicken integrator in the U.S. and also has chicken growing and processing operations in Mexico and Puerto Rico. The company is majority owned by JBS USA, the U.S. division of JBS S.A.

 

1. Pilgrim's Pride earnings and sales*

 

-Fourth quarter-

-Full year-

 

2012

2011

2012

2011

Sales (billion $)

2.190

1.829

8.121

7.536

Earnings (million $)

22.773

(85.355)

17.234

(496.772)

Earnings per share ($)

0.09

(0.40)

0.70

(2.21)

 

2. Sales to customers by country of production (million $)*

 

-Full year-

 

2012

2011

U.S.

 

 

Fresh chicken

3,583.854

3,160.429

Prepared chicken

2,239.289

2,135.337

Exports

817.723

808.038

Other products

608.619

674.923

Total U.S. sales

7,249.485

6,778.727

Mexico

 

 

Chicken

758.023

720.333

Other products

113.874

36.638

Total Mexico sales

871.897

756.971

*For the quarters and years ended Dec. 30, 2012, and Dec. 25, 2011.

Source for Tables: Pilgrim's Pride Corp.

 

Volume:85 Issue:09

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