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May 2, 2022
Pilgrim’s Pride Corporation, one of the world's largest poultry producers, has released its first quarter 2022 financial results.
First quarter highlights are:
Net Sales of $4.24 billion, up nearly 30% from prior year.
Consolidated GAAP operating income margin of 9.5% with GAAP operating income margins of 13.8% in U.S., 14.7% in Mexico and -1.8% in Europe.
GAAP Net Income of $280.6 million and GAAP EPS of $1.15. Adjusted Net Income of $287.2 million or adjusted EPS of $1.18.
Adjusted EBITDA of $501.8 million, or an 11.8% margin, 97.7% higher than a year ago.
Diversified portfolio across geographies, brands and products coupled with our long-term investments in operational excellence, including automation, and focus on service for key customers continued to improve results and drive further earnings resilience.
U.S. foodservice business improved year-over-year, achieving pre-pandemic sales volumes, while retail volumes remained strong. Margins improved significantly within the commodity large bird deboning business, while continuing to face higher inputs, increased operating costs, and less than optimal product mix resulting from ongoing labor shortages in all business.
Brand momentum continues throughout U.S. retail as Just Bare was up 49%, Pilgrim's fully cooked grew over 150%, and e-commerce more than tripled year over year.
Continue to grow in Mexico, especially in branded product lines, while profitability followed the normal seasonality of the business.
Combined European business was severely impacted by ongoing labor shortages, increasing input costs and unprecedented inflation. Live pork operations were also challenged by excess supply conditions throughout Europe. The UK teams are focused on leveraging the combined strengths of the businesses to drive operational improvements and capture synergies.
Liquidity position remains strong with an adjusted EBITDA net leverage ratio at 1.75x.
"Throughout the first quarter, we focused on consistent execution of our strategy. As a result, first quarter net sales increased by almost 30% and Adjusted EBITDA nearly doubled from a year ago. Overall, I am very pleased with our team and their ability to navigate through volatile market conditions and grow our business both top and bottom line," says Fabio Sandri, chief executive officer of Pilgrim's.
"Our U.S. business led the way in performance as our retail demand remained stable and foodservice recovered to pre-COVID levels. Equally important, our momentum in the retail branded business continued as consumer demand remained resilient despite inflationary headwinds. We have continued to improve our operational staffing levels and to provide a better future for our team members through unprecedented wage increases the last two years and significant investments in our communities. Our team successfully managed through difficult circumstances by driving superior service levels to our Key Customers, improving overall mix, and combating inflation throughout our supply chain.
"Although our UK and European business has undertaken a variety of steps to improve profitability, we faced weak market conditions and rapid escalation of costs that have diluted efforts to improve margins. The teams are confident in their plans and are working in conjunction with key customers, while leveraging global supply chain partnerships to resume profitable growth.
"Mexico rebounded from the previous quarter as it experienced better than expected demand while managing through less than ideal grow out conditions and increasing grain costs. We continue to grow our branded business and invest in capacity expansion.
"Moving forward, we will need to remain vigilant given significant inflationary headwinds challenging our entire business. Costs have dramatically increased in commodities, labor, logistics and other operational inputs. To ensure our business continues to grow and creates value for all stakeholders, we must mitigate these impacts through operational efficiencies and growing with our key customers. We will continue to monitor and adjust our business accordingly.
"I am very excited about our growth prospects with our synergies and scale in the U.S., Mexico and the United Kingdom. We are committed to being the best and most respected company in our industry, and I am confident that our team will perform to the best of their ability to manage this extremely volatile environment."
Source: Pilgrim's Pride, which is solely responsible for the information provided, and wholly owns the information. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset.
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