Pilgrim's Pride (PPC) Q2 2024 earnings summary

Executive summary

• Net revenues for Q2 2024 reached $4.6 billion, up 5.8% year-over-year, with adjusted EBITDA of $666 million (14.4% margin), and net income of $326.5 million, reflecting significant profitability growth across all regions.

• Adjusted net income was $398 million and adjusted EPS was $1.67, up from $0.44 year-over-year.

• U.S. operations benefited from improved commodity fundamentals, operational efficiencies, and growth in prepared foods and branded offerings.

• Europe saw over 40% growth in adjusted EBITDA year-over-year, driven by improved customer mix, operational excellence, and restructuring.

• Mexico delivered double-digit net sales growth and margin expansion, supported by investments in capacity, biosecurity, and favorable supply-demand balance.

Financial highlights

• Q2 2024 net sales: $4.56 billion, up from $4.31 billion in Q2 2023; gross profit was $691.6 million (15.2% margin), and operating income was $440.8 million (9.7% margin).

• Net income surged to $326.5 million from $60.9 million in Q2 2023; adjusted EBITDA more than doubled to $655.9 million.

• U.S. adjusted EBITDA margin rose to 16.7%, Europe to 7.4%, and Mexico to 19.4%.

• SG&A (excluding settlements and incentive accruals) declined nearly 5% year-over-year, but total SG&A increased due to legal settlements and higher incentive compensation.

• Net interest expense declined, aided by gains on early extinguishment of debt and higher interest income.

Outlook and guidance

• Full-year tax rate expected to approximate 26%; full-year net interest expense forecasted at $100–$110 million, excluding debt repurchase impacts.

• CapEx guidance increased to $525–$575 million for the year, focusing on product mix optimization, operational efficiencies, and sustainability.

• Management expects continued growth through disciplined execution, innovation, and expanded partnerships with key customers.

• Anticipates continued strong demand for chicken in both U.S. and Mexico, with normal seasonality and moderate supply growth expected.

• Favorable US and global grain stocks expected to support input cost moderation.