GREELEY, COLO. – Pilgrim's Pride Corp. reported a net loss of $6,036,000, or 2¢ per diluted share, in the second quarter ended June 28, 2020, compared with a profit of $170,080,000, or 68¢ per diluted share, in the year-ago period. Fabio Sandri, interim chief executive officer of Pilgrim’s, cited “tough market dynamics in the US and Mexico,” in addition to pandemic-related impacts as factors influencing the company’s results.

“In the US, the first half of Q2 the market was significantly challenged before a gradual loosening of travel and movement restrictions due to Covid-19 drove an improvement in channel demand, especially from foodservice,” Sandri said. “Similar to Q1, large bird deboning was once again the most volatile this quarter, with quick moves between the lows and the highs, and remained challenging compared to 2019.

“In continuation from Q1, Mexico remained challenged as the effects of weak macro conditions, which added to uncertainties in consumer spending, have persisted,” Sandri said. “In addition, the Peso continued to be weak putting additional pressure on the results. Industry prices were also below seasonality, driven by much better than expected growing conditions, before reverting closer to normal levels by the end of the quarter. Our increased share of non-commodity products, strong execution, and growth in Prepared Foods, have also helped to partially offset the softness.”

Net sales for the second quarter were $2.8 billion was down 0.7% from $2.8 billion reported in the second quarter ended June 30, 2019.

“We are once again extremely proud of our team for their continued commitment, dedication and hard work, in supporting our ability to keep our team members safe and healthy, and allowing us the capability to maintain production and supply to our customers during this unprecedented crisis,” Sandri said. “Despite the continuing volatility and very challenging markets in Q2 due to COVID-19, our diversified strategy has continued to produce respectable results in relative performance to industry competition and deliver more resilient performance regardless of changes in specific market conditions.”

For the six months ended June 28, 2020, net income attributable to Pilgrim’s Pride was $61,232,000, or 25¢ per diluted share, down from $254,079,000, or $1.02 per diluted share, reported in the comparable year-ago period. Net sales for the first six months of fiscal 2020 were $5.9 billion compared with net sales of $5.6 billion reported in the first six months ended June 30, 2019.

Sandri said that Pilgrim’s operations in Europe generated operating results similar to 2019 but were more than offset by tough market conditions in the United States and Mexico. Markets have adapted since the beginning of the quarter and results were showing a noticeable improvement globally.

“Our legacy European operations (Moy Park) performed in-line with last year, driven by strong retail demand and despite the significant impact of COVID-19 on the operations, as our strong internal operating performance and improved SG&A management helped in mitigating the difficult environment,” he explained. “The improvement in results from the newly acquired European assets has been maintained, with positive EBITDA continuing to increase. The performance was driven by strong demand at retail partially offset by a reduction in foodservice, continuing strength in pork exports especially to China, as well as the implementations of operational improvements and synergy capture.”