Pilgrim’s Pride Corporation (NYSE: CHX, CHX.A) yesterday announced income before extraordinary charges of $13.8 million, or $.33 per share, for the fourth fiscal quarter ended September 29, 2001, a $2.5 million increase, compared to net income in the prior year’s fourth quarter of $11.3 million, or $.28 per share. The Company also announced net sales for the fourth fiscal quarter ended September 29, 2001 of $641.3 million, a 69.0% increase, compared to the $379.4 million for the same period last year, with the increase resulting primarily from the acquisition of WLR Foods, Inc., which was effective January 27, 2001.
For fiscal 2001, the Company reported income before extraordinary charges of $42.0 million, or $1.02 per share, a $10.3 million decrease when compared to the prior fiscal year’s net income of $52.3 million, or $1.27 per share. Net sales for fiscal 2001 were a record $2.2 billion, a 47.7% increase, compared to $1.5 billion for the same period last year, with the increase resulting primarily from the acquisition of WLR Foods, Inc.
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The Company incurred an extraordinary charge of $.9 million, net of tax, in the fourth fiscal quarter in connection with the early repayment of debt. Net income was $12.9 million, or $.31 per share and $41.1 million, or $1.00 per share, respectively, for quarter and year ended September 29, 2001.
“Increased sales volumes generated by the WLR acquisition along with higher overall prices for chicken products in the U.S., offset in part by lower overall prices for chicken products in Mexico, during the quarter were the significant factors that combined to produced the net improvements in this quarter’s profitability over the prior year’s fourth fiscal quarter,” stated David Van Hoose, Chief Executive Officer, President and Chief Operating Officer for the Company. “Additionally, we continue to realize the synergies that were anticipated when we acquired our eastern division once again resulting in this acquisition being accretive to our earnings in the fourth fiscal quarter.”
Pilgrim’s Pride Corporation is the second largest poultry producer in the United States; the third largest in chicken and fourth largest in turkey, and second largest chicken company in Mexico. Pilgrim’s Pride employs more than 24,500 persons and operates processing and further processing plants, distribution centers, hatcheries and feed mills in Texas, Arkansas, Arizona, North Carolina, Pennsylvania, Oklahoma, Virginia and West Virginia and Mexico.
Products are sold under the “Pilgrim’s Pride®” and “Wampler Foods®” labels to foodservice, retail and frozen entree customers. The Company’s primary distribution is through retailers and restaurants throughout the United States and in the Northern and Central regions of Mexico and to the foodservice industry nation-wide in both countries.
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By GlobalDataStatements 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. For example, factors that could cause actual results to differ materially from those projected in such forward-looking statements include: changes in the commodity prices of feed ingredients, chicken and turkey; the Company’s indebtedness; risks associated with the Company’s foreign operations, including currency exchange rate fluctuations, trade barriers, exchange controls and expropriation; the impact of current and future laws and regulations; risks associated with the Company’s integration of WLR Foods, Inc. into the Company; and the other risks described in the Company’s SEC filings.
For further information:
Richard A. Cogdill
Chief Financial Officer
903/855-4205
PILGRIM’S PRIDE CORPORATION
Consolidated Statements of Income
[In thousands, except share and per share amounts]
Three Months Ended September 29, 2001 September 30, 2000
Net Sales $641,251 $379,375
Costs and Expenses:
Cost of sales 579,308 339,717
Selling, general and administrative 30,826 24,023
610,134 363,740
Operating Income 31,117 15,635
Other Expenses [Income]:
Interest expense, net 9,537 4,210
Foreign exchange [gain] loss 561 [684]
Miscellaneous, net [998] 327
Total other expenses, net 9,100 3,853
Income Before Income Taxes and
Extraordinary Charge 22,017 11,782
Income Tax Expense 8,189 463
Income Before Extraordinary Charge 13,828 —
Extraordinary Charge – Early repayment
of Debt, Net of Tax [894] —
Net Income $12,934 $11,319
Net Income Per Common Share Before
Extraordinary Charge
– Basic and Diluted $.33 $.28
Extraordinary Charge Per Common Share .02 —
Net Income Per Common Share
– Basic and Diluted .31 .28
Dividends Declared Per Share $.015 $.015
Weighted Average Shares Outstanding 41,112,679 41,114,353
Year Ended September 29, 2001 September 30, 2000
Net Sales $2,214,712 $1,499,439
Costs and Expenses:
Cost of sales 2,000,762 1,333,611
Selling, general and administrative 119,407 85,340
2,120,169 1,418,951
Operating Income 94,543 80,488
Other Expenses [Income]:
Interest Expense, Net 30,776 17,779
Foreign Exchange Loss [Gain] 122 [152]
Miscellaneous, net 351 75
Total other expenses, net 31,249 17,702
Income Before Income Taxes and
Extraordinary Charge 63,294 62,786
Income Tax Expense 21,263 10,442
Income Before Extraordinary Charge 42,031 —
Extraordinary Charge – Early repayment
of Debt, Net of Tax [894] —
Net Income $41,137 $52,344
Net Income Per Common Share Before
Extraordinary Charge $1.02 $1.27
Extraordinary Charge Per Common Share 0.02 —
Net Income Per Common Share 1.00 1.27
Dividends Declared Per Share $0.06 $0.06
Weighted Average Shares Outstanding 41,112,679 41,289,142
PILGRIM’S PRIDE CORPORATION
Condensed Consolidated Balance Sheets
[In thousands]
September 29, 2001 September 30, 2000
ASSETS
Total Current Assets $443,272 $268,970
Other Assets 20,067 18,576
Property, Plant and Equipment, Net 740,356 417,874
Total Assets $1,203,695 $705,420
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total Current Liabilities $235,023 $144,439
Long-term Debt-Less Current Maturities 467,241 165,037
Deferred Income Taxes 119,610 52,496
Minority Interest in Subsidiary 889 889
Total Stockholders’ Equity 380,932 342,559
Total Liabilities and
Stockholders’ Equity $1,203,695 $705,420
PILGRIM’S PRIDE CORPORATION
Condensed Consolidated Statements of Cash Flows
[In thousands]
Year Ended September 29, 2001 September 30, 2000
Cash Provided by Operating Activities $86,957 $130,803
Investing Activities:
Acquisitions of property, plant
and equipment [112,632] [92,128]
Business acquisitions [239,539] —
Proceeds from property disposals 2,472 2,319
Other, net 1,244 [6,055]
Cash Used In Investing Activities [348,455] [95,864]
Financing Activities:
Borrowing for acquisition 285,070 —
Repayment of WLR Foods Inc. debt [45,532] —
Net payments on long-term debt 17,310 [18,575]
Purchase of treasury stock — [1,568]
Cash dividends paid [2,466] [2,476]
Cash Provided by Financing Activities 254,382 [22,619]
Effect of exchange rate changes on
cash and cash equivalents [28] 37
[Decrease] increase in cash and
cash equivalents $[7,144] $12,357
PILGRIM’S PRIDE CORPORATION
[In thousands, except share and per share amounts]
Pro Forma Financial Information: The unaudited pro forma financial information has been presented as if the acquisition of WLR Foods, Inc. had occurred as of the beginning of each period presented. In addition, certain reclassifications have been made to the WLR historical financial statements to conform to the presentation used by Pilgrim’s Pride Corporation.
Quarter Ended September 29, 2001 September 30, 2000
Net Sales $641,251 $583,412
Net Income $12,934 $11,185
Interest Expense, Net $9,537 $10,970
Depreciation and Amortization $14,546 $16,245
Year Ended September 29, 2001 September 30, 2000
Net Sales $2,479,159 $2,311,666
Net Income $38,277 $39,792
Interest Expense, Net $39,790 $44,820
Depreciation and Amortization $63,149 $63,892
