Pilgrim's Pride Corporation Q3 FY2025 earnings call

• Financial performance: Net revenues $4.8 billion, adjusted EBITDA $633 million, margin 13.3%.
• U.S. segments: Case Ready realized strong growth, Big Bird improved operating costs, Small Bird had robust demand, Prepared Foods expanded.
• Europe: Entered new phase of profitability journey with partnerships, focus on growth through protein platform. Pork business challenged by European hog pricing and China antidumping.
• Mexico: Diversified portfolio, growth in Fresh and Prepared Foods, strong QSR demand.
• Sustainability: Reduced Scope 1 and 2 emissions intensity by 23%, improved safety index, provided over 5.7 million training hours.

For the third quarter of 2025, Pilgrim's Pride reported net revenues of $4.8 billion. In the U.S., net revenues grew 2.3% year-over-year, with adjusted EBITDA of $479.1 million in Q3 2025 compared to $499.4 million in Q3 2024. Case Ready and Prepared Foods showed growth. Europe had net revenues up over 6% year-over-year, with adjusted EBITDA margin of 7.9% in Q3 2025 vs 8.6% in Q3 2024. Mexico had revenues up over 5% year-over-year, with adjusted EBITDA of $43.7 million in Q3 2025 vs $49 million in Q3 2024.

• USDA forecasts 2% broiler production growth in 2025, 2.3% in Q4.
• Expect seasonal export declines but robust demand vs prior years.
• CapEx estimate $700 million for the year.

• Commodity market volatility affecting pricing.
• Biosecurity risks, especially avian influenza.
• Trade barriers and tariffs, e.g., China antidumping affecting Europe.
• SNAP dollar reductions impacting holiday season pricing.

Q: Clarify market commoditized price rollover, driver, and seasonality expectations for 1Q.

A: Pricing is supply-demand driven. Q3 had demand influenced by consumer spending and inflation. Supply had hatchability and livability impacts. Seasonality expected with lower Q4 demand but prices starting to rise.

Q: Update on portfolio pricing contracts exposed to Big Bird.

A: Close to 25% of portfolio exposed to Big Bird commodity markets, with diversification and premium in novel categories.

Q: Conceptual explanation of beef-chicken price dynamics.

A: Consumers move from foodservice to retail, with beef supported by trade down, and chicken benefiting from beef price spreads.

Q: Impact of Q3 input cost headwinds on P&L and EU export challenges.

A: Prepared Foods input costs took time to flush through P&L. EU export affected by China antidumping, addressed by differentiated offerings.

Q: EU profitability journey and M&A opportunities.

A: EU in new phase of profitability, with organic growth in chicken and opportunities in M&A across segments.

Q: Leverage and U.S. export opportunities.

A: No major leverage change expected. U.S. competitive in chicken production but faced China trade barriers.

Q: Q4 pricing outlook and SNAP impact.

A: Q4 has promotional activity, SNAP delays temporary, demand supported by competitive chicken pricing.

Q: P&L impact of contract pricing vs promotions and bond buybacks.

A: Promotions increase volume and reduce operating costs. Bond buybacks completed, no current activity.