GREELEY, Colo. – Pilgrim’s Pride Corp., a US-based subsidiary of Brazil’s JBS SA, reported higher net sales and operating income during its fiscal third quarter, ended Sept. 29, and for the first 39 weeks of 2019. The improvement was attributable in part to increased sales in the US and Mexico and continued positive demand for value-added, non-commodity chicken from the retail and quick-service-restaurant segments.

For the quarter, the company reported net sales of $2.78 billion, a 3 percent increase from the $2.70 billion reported during the same 13-week period last year. Adjusted net income for the quarter was $109.8 million compared to $29.3 billion the previous year and $363.8 billion for the first 39 weeks of 2019 compared to $255.3 billion during the same period in 2018. Pilgrim’s adjusted earnings per share (EPS) of $0.44 for Q3 was 267 percent higher than the previous year’s $0.12 EPS.

Profit for the company in the quarter was up nearly 50 percent to $282.2 million compared to the same time last year, at $169.7 million.

Jayson Penn, Pilgrim's Pride“After a challenging Q3 2018 within the US pure commodity market, conditions during Q3 of this year were much improved,” said Jayson Penn, CEO.

Operating income for the year spiked by more than 120 percent to $188.2 million in Q3, compared to 85.3 percent during the same quarter in 2018. Net sales derived from operations in the US and Mexico both increased for the quarter and for the year while sales in Europe lagged.

In the US, net sales of $1.93 billion in Q3 of 2019 exceeded the previous year’s Q3 sales of $1.86 billion by 4 percent. US sales for the first three quarters this year were $5.73 billion, 2 percent higher than the same three quarters of 2018, when sales were $5.60 billion.

“The environment in non-commodity chicken was in-line with seasonality and remained strong, driven by demand from retailers and QSRs,” Penn said, adding that the company remains committed to its Key Customer strategy while continuing to innovate in all its business segments. “We are investing to further differentiate our portfolio and increase our capacities and capabilities to meet customer expectations. We expect value added, differentiated products to account for a significantly larger portion of our total results over the next few years as we continue to reduce our mix of more volatile commodity sales and improve our margin profile.”

In Mexico, sales increased by 7 percent in Q3, to $329 million compared to $307 million during the same time period in 2018. For this year, net sales in Mexico were $1.05 billion after 39 weeks compared to $1.04 billion in 2018.

“Mexico was in-line with normal seasonality and significantly better than last year,” Penn said. “We expect to generate improved performance for the remainder of 2019 as demand continues to grow. Our Prepared Foods have continued to increase at a double-digit rate and are generating great results under both premium Pilgrim’s and Del Dia brands to drive the evolution of our Mexican portfolio towards more differentiated, higher-value products and margin expansion.”

Meanwhile, in Europe, sales in Q3 of this year lagged by about 2 percent, at $517.5 million compared to $526.7 million in the third quarter of 2018. For the year, European sales in 2019 are down by almost 4 percent in the first 39 weeks, at $1.57 billion compared to $1.63 billion during the same period last year.

“Our European operations have continued to make progress in mitigating input cost challenges and are already generating better results throughout Q3. Despite seasonally cooler weather, improvements in operational efficiencies, and better integration of input costs into customer pricing models drove the improvement in performance. We expect a continuation of the momentum into Q4.”

This past August, Pilgrim’s announced the acquisition of Tulip Ltd., a pork company based in the United Kingdom, for approximately $354 million. Pilgrim’s expects the addition of Tulip to its portfolio to bolster its status across the world, in both the poultry and pork segments.

“The addition of the Tulip team further enhances our position as a leading global player by expanding our portfolio of prepared foods and brands while strengthening our leadership position in the UK market,” Penn said. “It aligns with our strategic priorities as we continue growing our geographical footprint and extending our global reach into attractive new markets.”