Pilgrim's Pride Reports EBITDA of $196.5 Million With a Margin of 9.6% for the Fourth Quarter of 2013, and EBITDA of $800.4 Million With a Margin of 9.5% for the Full Year
GREELEY, Colo., Feb. 20, 2014 (GLOBE NEWSWIRE) -- Pilgrim's Pride Corporation (Nasdaq:PPC) reports fourth quarter 2013 financial results with net sales of $2.05 billion for the thirteen week period, as compared to $2.2 billion for the fourteen week period in 2012. Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") of $196.5 million increased 205% compared to the $64.4 million generated in the prior year. Net income of $143.4 million reflected an improvement of 529% compared to the $22.8 million reported in the same period in 2012, with diluted earnings per share reaching $0.55 compared to $0.09 in the fourth quarter of 2012.
For the full 2013 fiscal year, Pilgrim's achieved $8.4 billion in net sales and $800.4 million of EBITDA, resulting in an EBITDA margin of 9.5%. Pilgrim's recognized $549.6 million in net income for the full year with net income of $2.12 per weighted average share, demonstrating consistently solid performance over the entire year.
"Three years ago our company began executing a strategy to create shareholder value and improve capital structure by partnering with key customers, relentless pursuit of operational excellence and growing our value added exports. During this period, we grew our sales by 22% while increasing our profitability, clearly demonstrating that this strategy is working as evidenced by this year's strong free cash flow generation" stated Bill Lovette, Pilgrim's Chief Executive Officer.
"Our team fully understands that our company is going through a 'Revolution of Rising Expectations' and we continue to drive accountability deeper, setting targets to achieve the highest standards for every aspect of our business. We continually emphasize that being better than average is not good enough as we strive to be the best managed and most respected company in our industry.
Cash flows from operations for our fourth quarter were $281.8 million reaching $878.5 million for the year, adding strength to our balance sheet and providing Pilgrim's with a competitive start to 2014. Our ending net debt position was $307.1 million, which is 0.4 times our trailing twelve months' EBITDA of $800.4 million. This robust capital structure will provide us with the financial strength essential to pursuing the next stages of our growth strategy."
Conference Call Information
A conference call to discuss Pilgrim's quarterly results will be held tomorrow, February 21, 2014 at 7:00 a.m. Mountain (9 a.m. Eastern). 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/ppc140221.html
The pre-registration link may also be accessed 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 US 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 May 1, 2014.
About Pilgrim's Pride
Pilgrim's Pride Corporation employs approximately 36,700 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 | ||
| Consolidated Balance Sheets | ||
| December 29, | December 30, | |
| 2013 | 2012 | |
| (In thousands) | ||
| Cash and cash equivalents | $ 508,206 | $ 68,180 |
| Investment in available-for-sale securities | 96,902 | -- |
|
Trade accounts and other receivables, less allowance for doubtful accounts | 376,678 | 384,930 |
| Account receivable from JBS USA, LLC | 2,388 | 1,514 |
| Inventories | 808,832 | 950,296 |
| Income taxes receivable | 64,868 | 54,719 |
| Current deferred tax assets | 2,227 | -- |
| Prepaid expenses and other current assets | 61,848 | 56,047 |
| Assets held for sale | 7,033 | 27,042 |
| Total current assets | 1,928,982 | 1,542,728 |
| Investment in available-for-sale securities | -- | -- |
| Deferred tax assets | 18,921 | 97,431 |
| Other long-lived assets | 40,163 | 45,523 |
| Identified intangible assets, net | 32,525 | 38,266 |
| Property, plant and equipment, net | 1,151,811 | 1,189,921 |
| Total assets | $ 3,172,402 | $ 2,913,869 |
| Current maturities of long-term debt | $ 410,234 | $ 15,886 |
| Accounts payable | 370,360 | 312,365 |
| Account payable to JBS USA, LLC | 3,934 | 13,436 |
| Accrued expenses and other current liabilities | 283,355 | 283,540 |
| Income taxes payable | -- | 468 |
| Current deferred tax liabilities | 15,515 | 104,482 |
| Total current liabilities | 1,083,398 | 730,177 |
| Long-term debt, less current maturities | 501,999 | 1,148,870 |
| Note payable to JBS USA Holdings, Inc. | -- | |
| Deferred tax liabilities | 13,944 | -- |
| Other long-term liabilities | 80,459 | 125,825 |
| Total liabilities | 1,679,800 | 2,004,872 |
| Common stock | 2,590 | 2,590 |
| Additional paid-in capital | 1,653,119 | 1,642,003 |
| Accumulated deficit | (120,156) | (669,711) |
| Accumulated other comprehensive loss | (45,735) | (68,511) |
| Total Pilgrim's Pride Corporation stockholders' equity | 1,489,818 | 906,371 |
| Noncontrolling interest | 2,784 | 2,626 |
| Total stockholders' equity | 1,492,602 | 908,997 |
| Total liabilities and stockholders' equity | $ 3,172,402 | $ 2,913,869 |
| PILGRIM'S PRIDE CORPORATION | ||||
| Consolidated Statements of Operations | ||||
| Thirteen Weeks | Fourteen Weeks | Fifty-Two Weeks | Fifty-Three Weeks | |
| Ended | Ended | Ended | Ended | |
| December 29, | December 30, | December 29, | December 30, | |
| 2013 | 2012 | 2013 | 2012 | |
| (In thousands, except per share data) | (In thousands, except per share data) | |||
| (UNAUDITED) | ||||
| Net sales | $ 2,047,285 | $ 2,189,661 | $ 8,411,148 | $ 8,121,381 |
| Cost of sales | 1,839,361 | 2,114,118 | 7,565,709 | 7,685,549 |
| Gross profit | 207,924 | 75,543 | 845,439 | 435,832 |
| Selling, general and administrative expense | 49,027 | 45,564 | 180,915 | 177,041 |
| Administrative restructuring charges, net | 1,039 | 2,528 | 5,661 | 8,449 |
| Operating income | 157,858 | 27,451 | 658,863 | 250,342 |
| Interest expense, net of capitalized interest | 18,807 | 26,496 | 87,006 | 104,926 |
| Interest income | (631) | (511) | (2,125) | (1,397) |
| Foreign currency transaction losses (gains) | (356) | 607 | 4,415 | (4,810) |
| Miscellaneous, net | (3,643) | (1,167) | (4,373) | (1,439) |
| Income before income taxes | 143,681 | 2,026 | 573,940 | 153,062 |
| Income tax expense (benefit) | 11 | (20,324) | 24,227 | (20,980) |
| Net income | 143,670 | 22,350 | 549,713 | 174,042 |
| Less: Net income (loss) attributable to noncontrolling interests | 319 | (423) | 158 | (193) |
| Net income attributable to Pilgrim's Pride Corporation | $ 143,351 | $ 22,773 | $ 549,555 | $ 174,235 |
| Weighted average shares of common stock outstanding: | ||||
| Basic | 258,826 | 258,726 | 258,826 | 250,101 |
| Diluted | 259,466 | 258,887 | 259,241 | 250,216 |
| Net income per share of common stock outstanding: | ||||
| Basic | $ 0.55 | $ 0.09 | $ 2.12 | $ 0.70 |
| Diluted | $ 0.55 | $ 0.09 | $ 2.12 | $ 0.70 |
| PILGRIM'S PRIDE CORPORATION | ||
| Consolidated Statements of Cash Flows | ||
| Fifty-Two | Fifty-Three | |
| Weeks Ended | Weeks Ended | |
| December 29, | December 30, | |
| 2013 | 2012 | |
| (In thousands) | ||
| Cash flows from operating activities: | ||
| Net income | $ 549,713 | $ 174,042 |
| Adjustments to reconcile net income to cash provided by operating activities: | ||
| Depreciation and amortization | 150,523 | 147,414 |
| Asset impairment | 4,004 | 2,770 |
| Foreign currency transaction losses (gains) | 3,382 | (5,261) |
| Accretion of bond discount | 456 | 456 |
| Loss (gain) on property disposals | 2,395 | 5,306 |
| Share-based compensation | 3,345 | 684 |
| Deferred income tax benefit | (4,999) | (1,098) |
| Changes in operating assets and liabilities: | ||
| Restricted cash and cash equivalents | -- | 12,680 |
| Trade accounts and other receivables | 7,235 | (14,137) |
| Inventories | 142,675 | (65,870) |
| Prepaid expenses and other current assets | (6,070) | (2,600) |
| Accounts payable and accrued expenses | 49,625 | (16,520) |
| Income taxes | (21,546) | (33,714) |
| Deposits | 1,877 | 1,783 |
| Long-term pension and other postretirement obligations | (6,837) | (2,700) |
| Other | 2,755 | (3,611) |
| Cash provided by operating activities | 878,533 | 199,624 |
| Cash flows from investing activities: | ||
| Acquisitions of property, plant and equipment | (116,223) | (90,327) |
| Purchases of investment securities | (96,902) | (162) |
| Proceeds from sale or maturity of investment securities | -- | 688 |
| Proceeds from property disposals | 31,337 | 29,400 |
| Cash used in investing activities | (181,788) | (60,401) |
| Cash flows from financing activities: | ||
| Payments on note payable to JBS USA | -- | (50,000) |
| Proceeds from long-term debt | 505,600 | 851,400 |
| Payments on long-term debt | (758,578) | (1,110,711) |
| Proceeds from sale of common stock | -- | 198,282 |
| Tax benefit related to share-based compensation | 7,770 | -- |
| Payment of capitalized loan costs | (5,006) | -- |
| Cash used in financing activities | (250,214) | (111,029) |
| Effect of exchange rate changes on cash and cash equivalents | (6,505) | (1,623) |
| Increase in cash and cash equivalents | 440,026 | 26,571 |
| Cash and cash equivalents, beginning of period | 68,180 | 41,609 |
| Cash and cash equivalents, end of period | 508,206 | 68,180 |
| 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.
| Thirteen Weeks | Fourteen Weeks | Fifty-Two Weeks | Fifty-Three | |
| (UNAUDITED) | Ended | Ended | Ended | Weeks Ended |
| December 29, | December 30, | December 29, | December 30, | |
| 2013 | 2012 | 2013 | 2012 | |
| (In thousands) | (In thousands) | |||
| Net income from continuing operations | $ 143,670 | $ 22,350 | $ 549,713 | $ 174,042 |
| Add: | ||||
| Interest expense, net | 18,176 | 25,985 | 84,881 | 103,529 |
| Income tax expense (benefit) | 11 | (20,325) | 24,227 | (20,980) |
| Depreciation and amortization | 36,670 | 39,088 | 150,523 | 147,414 |
| Asset impairments | -- | -- | 361 | -- |
| Minus: | ||||
| Amortization of capitalized financing costs | 2,069 | 2,658 | 9,307 | 10,063 |
| EBITDA | 196,458 | 64,440 | 800,398 | 393,942 |
| Add: | ||||
| Restructuring charges | 1,039 | 2,528 | 5,661 | 8,449 |
| Minus: | ||||
| Net income (loss) attributable to noncontrolling interest | 319 | (423) | 158 | (192) |
| Adjusted EBITDA | $ 197,178 | $ 67,391 | $ 805,901 | $402,583 |
Net debt is defined as total long term debt, less current maturities, plus current maturities of long term debt minus cash and cash equivalents and available-for-sale securities. 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 | |||
| 2011 | 2012 | 2013 | |
| (in Thousands) | |||
| Long term debt, less current maturities | $ 1,458,001 | $ 1,148,870 | $ 501,999 |
| Add: Current maturities of long term debt | 15,611 | 15,886 | 410,234 |
| Minus: Cash and cash equivalents | 49,289 | 68,180 | 508,206 |
| Minus: Available-for-sale Securities | 157 | -- | 96,902 |
| Net debt | $ 1,424,166 | $ 1,096,576 | $ 307,125 |
| PILGRIM'S PRIDE CORPORATION | ||||
| Supplementary Selected Segment and Geographic Data | ||||
| Thirteen | Fourteen Weeks | Fifty-Two | Fifty-Three | |
| Weeks Ended | Ended | Weeks Ended | Weeks Ended | |
| December 29, | December 30, | December 29, | December 30, | |
| 2013 | 2012 | 2013 | 2012 | |
| (In thousands) | (In thousands) | |||
| (UNAUDITED) | ||||
| Sources of net sales by country of origin: | ||||
| US: | $ 1,837,221 | $ 1,937,206 | $ 7,500,212 | $ 7,249,485 |
| Mexico: | 210,064 | 252,455 | 910,936 | 871,897 |
| Total net sales: | $ 2,047,285 | $ 2,189,661 | $ 8,411,148 | $ 8,121,382 |
| Sources of cost of sales by country of origin: | ||||
| US: | $ 1,642,465 | $ 1,893,169 | $ 6,782,348 | $ 6,916,874 |
| Mexico: | 196,016 | 220,949 | 782,481 | 768,676 |
| Elimination: | 880 | -- | 880 | -- |
| Total cost of sales: | $ 1,839,361 | $ 2,114,118 | $ 7,565,709 | $ 7,685,550 |
| Sources of gross profit by country of origin: | ||||
| US: | $ 194,756 | $ 44,037 | $ 717,864 | $ 332,611 |
| Mexico: | 14,048 | 31,506 | 128,455 | 103,221 |
| Elimination: | (880) | -- | (880) | |
| Total gross profit: | $ 207,924 | $ 75,543 | $ 845,439 | $ 435,832 |
CONTACT: Rosemary Geelan
Pilgrim's Pride Corp Investor Relations
Rosemary.geelan@pilgrims.com
(970) 506-8192
www.pilgrims.com