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Pilgrim's Pride Corporation Earnings Release 1st Qtr FY 2005

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549


FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of report (Date of earliest event reported): January 24, 2005

PILGRIM'S PRIDE CORPORATION
(Exact Name of Registrant as Specified in its Charter)


Delaware
1-9273
75-1285071
(State or Other Jurisdiction
(Commission
(IRS Employer
of Incorporation)
File Number)
Identification No.)


110 South Texas Street
  
Pittsburg, Texas
75686-0093
(Address of Principal Executive Offices)
(ZIP Code)


Registrant's telephone number, including area code: (903) 855-1000

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

q
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

q 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

q 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

q 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)



 
     
 

Item 2.02.    Results of Operations and Financial Condition.

The information in this Item 2.02 and the Exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

On January 24, 2005, Pilgrim's Pride Corporation issued a press release announcing its results of operations for the first quarter of fiscal 2005.

The press release is furnished as Exhibit 99.1 to this Form 8-K.

Item 9.01. Financial Statements and Exhibits.

(c)    Exhibits

Exhibit
Number    Description

99.1    Press Release dated January 24, 2005.

  
     
 


Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

PILGRIM'S PRIDE CORPORATION


Date: January 24, 2005   By: /s/ Richard A. Cogdill
               Richard A. Cogdill
                           Executive Vice President,         
                                                            Chief Financial Officer,
                                 Secretary and Treasurer



  
     
 


Exhibit Index
Exhibit
Number    Description
99.1    Press Release dated January 24, 2005.


Pilgrim's Pride Corporation Earnings Release
PILGRIM'S PRIDE CORPORATION REPORTS RECORD EARNINGS AND NET SALES FOR 2005 FISCAL FIRST QUARTER

Gains in Net Income, EPS and Operating Margin Driven by Growth in Prepared Foods and Lower Feed Ingredient Costs

PITTSBURG, Texas, Jan. 24, 2005 - Pilgrim's Pride Corporation (NYSE: PPC) today reported record net income of $48.5 million, or $0.73 per share, for the first fiscal quarter ended January 1, 2005, an increase of $38.2 million, or $0.53 per share, compared with net income of $10.3 million, or $0.20 per share, in the first quarter of fiscal 2004. The Company also reported net sales for the first quarter of fiscal 2005 of $1.37 billion, an increase of $0.33 billion, compared with net sales of $1.04 billion for the same period last year.

“Our record performance in the first fiscal quarter reflects both the successful integration of the November 2003 ConAgra chicken division acquisition and strong performance in our prepared foods and fresh chicken businesses, lower feed ingredient costs, rising exports and strong demand in the foodservice sector,” said O.B. Goolsby, President and Chief Executive Officer of Pilgrim's Pride. “The outlook for sustained profitability in our chicken business is encouraging. We anticipate further growth in our chicken business as we respond to favorable consumer trends and demand for high-quality, convenient, meat proteins that will enable us to continue delivering value to our customers and shareholders,” Goolsby concluded.

Conference Call Information
Pilgrim’s Pride will hold a conference call to discuss the Company's fiscal 2005 first quarter financial results at 10:00 a.m. CST (11:00 a.m. EST) on January 24, 2005. To listen live via telephone, call 800-391-2548, verbal pass code VG495227. The call also will be webcast live on the Internet at http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=68228&eventID=996433. (Note: Due to length URL may not hyperlink. Please copy and paste into your browser.)Additionally, the Company has posted a slide presentation on its website at www.pilgrimspride.com which can be viewed by listeners in connection with today’s conference call. The webcast will be available for replay within two hours of the conclusion of the call. A telephone replay will be available beginning at 2:00 p.m. CST on January 24 through February 1 at 800-355-2355 passcode 495227#.

Pilgrim's Pride Corporation is the second-largest poultry producer in the United States and Mexico, and the largest in Puerto Rico. Pilgrim's Pride employs more than 40,000 people and has major operations in Texas, Alabama, Arkansas, Georgia, Kentucky, Louisiana, North Carolina, Pennsylvania, Tennessee, Virginia, West Virginia, Puerto Rico and Mexico, with other facilities in Arizona, California, Iowa, Mississippi, Utah and Wisconsin.
 
Pilgrim's Pride products are sold to foodservice, retail and frozen entrée customers. The Company's primary distribution is through retailers, foodservice distributors and restaurants throughout the United States (including Puerto Rico) and in the Northern and Central regions of Mexico. For more information, please visit www.pilgrimspride.com.
 
 
Forward Looking Statements: Statements contained in this press release that state the intentions, hopes, beliefs, anticipations, expectations or predictions of the future of Pilgrim's Pride Corporation and its management are forward-looking statements. It is important to note that the 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, including fluctuations in the commodity prices of feed ingredients, chicken and turkey; additional outbreaks of avian influenza or other diseases affecting the production performance and/or marketability of the company's poultry products; contamination of our products, which has recently 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 our cash resources, particularly in light of our leverage; restrictions imposed by and as a result of our leverage; currency exchange rate fluctuations, trade barriers, exchange controls, expropriation and other risks associated with foreign operations; changes in laws or regulations affecting our operations as well as competitive factors and pricing pressures; risks associated with the acquisition of ConAgra Foods' chicken division including possible unknown liabilities assume d in connection with the acquisition and loss of customers of the acquired business; inability to recognize the anticipated cost savings and anticipated benefits in connection with our turkey division restructuring; and the impact of uncertainties of litigation as well as other risks described under "Risk Factors" in our 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.
 

Contact:
Sondra Fowler
Pilgrim's Pride Corporation
(903) 855-4195

  
     
 

PILGRIM'S PRIDE CORPORATION
News Release
January 24, 2005
Page 3

PILGRIM'S PRIDE CORPORATION
Consolidated Statements of Income
(Unaudited)
[In thousands, except share and per share amounts]

Three Months Ended
  
January 1, 2005
  
 January 3, 2004
  
Net Sales
  
$
1,368,247
  
$
1,044,367
  
Costs and Expenses
              
Cost of sales
    
1,212,836
    
967,264
  
Selling, general and administrative
    
64,396
    
46,303
  
     
1,277,232
    
1,013,567
  
Operating Income
    
91,015
    
30,800
  
               
Other Expense (Income):
              
Interest expense, net
    
12,224
    
12,444
  
Foreign exchange (gain) loss
    
(103
)
  
78
  
Miscellaneous, net
    
(1,015
)
  
(329
)
Total other expenses, net
    
11,106
    
12,193
  
               
Income before income taxes
    
79,909
    
18,607
  
Income tax expense
   
31,400
    
8,321
  
Net Income
  
$
48,509
  
$
10,286
  
               
Net income per common share
              
-basic and diluted
  
$
0.73
  
$
0.20
  
Dividends declared per common share
  
$
0.015
  
$
0.015
  
Weighted average shares outstanding
    
66,555,733
    
51,757,222
  


 
     
 
PILGRIM'S PRIDE CORPORATION
News Release
January 24, 2005
Page 4

PILGRIM'S PRIDE CORPORATION
Condensed Consolidated Balance Sheets
(Unaudited)
[In thousands]

   
January 1, 2005
  
October 2, 2004
  
ASSETS
          
Cash and Cash Equivalents
  
$
171,098
  
$
38,165
  
Other current assets
    
888,458
    
979,063
  
Total Current Assets
    
1,059,556
    
1,017,228
  
Other Assets
    
50,323
    
50,086
  
Property, Plant and Equipment, net
    
1,169,957
    
1,178,675
  
               
Total Assets
  
$
2,279,836
  
$
2,245,989
  
               
LIABILITIES AND STOCKHOLDERS' EQUITY
              
Current maturities of long-term debt
  
$
8,454
  
$
8,428
  
Other current liabilities
    
620,768
    
625,074
  
Total Current Liabilities
    
629,222
    
633,502
  
Long-Term Debt, Less Current Maturities
    
525,602
    
535,866
  
Deferred Income Taxes
    
153,286
    
152,455
  
Minority Interest in Subsidiary
    
1,304
    
1,210
  
Total Stockholders' Equity
    
970,422
    
922,956
  
               
Total Liabilities and Stockholders’ Equity
  
$
2,279,836
  
$
2,245,989
  
               

 
     
 
PILGRIM'S PRIDE CORPORATION
News Release
January 24, 2005
Page 5


Pilgrim’s Pride Corporation
Pro forma Financial Information
(Unaudited)
(In thousands except per share amounts)
 
The unaudited pro forma financial information has been presented as if the acquisition of the ConAgra chicken division had occurred as of the beginning of fiscal year 2004
  
       
Three Months Ended
  
January 3. 2004
  
       
Net sales
  
$
1,505,159
  
Depreciation and amortization
  
$
32,956
  
Operating income
 
$
56,322
  
Interest expense, net
  
$
16,815
  
Income tax expense
 
$
17,181
  
Net income
  
$
24,744
  
Net income per common share
  
$
0.37
  
         

 
     
 
PILGRIM'S PRIDE CORPORATION
News Release
January 24, 2005
Page 6

Selected Financial Information
(Unaudited)
(In thousands)

Note: “EBITDA” is defined as net income before interest, income taxes, and depreciation and amortization. EBITDA is presented because it is used by us and we believe it is frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of Generally Accepted Accounting Principles (GAAP) results, to compare the performance of companies. EBITDA is not a measurement of financial performance under GAAP and 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.

EBITDA is calculated as follows:

 
            
 Pro Forma
  
Three Months Ended
  
January 1, 2005
  
 January 3, 2004
  
 January 3, 2004
  
Net Income
  
$
48,509
  
$
10,286
  
$
24,744
  
Add:
                    
Income tax expense
   
31,400
    
8,321
    
17,181
  
Interest expense, net
    
12,224
    
12,444
    
16,815
  
Depreciation and amortization
    
30,065
    
25,911
    
32,956
  
Minus:
                    
Amortization of capitalized financing costs
    
570
    
519
    
519
  
                     
EBITDA
 
$
121,628
  
$
56,443
  
$
91,177
  
                     
Capital expenditures
  
$
24,160
  
$
20,552
  
$
26,615