Pilgrim’s reported a strong financial performance for the third quarter of fiscal year 2017, with an increase in net income, operating income and net sales.
Pilgrim’s, which closed on the acquisition of Northern Ireland-based Moy Park in September and U.S. poultry business GNP Company in January, reported the following highlights for the third quarter:
- Net sales of $2.79 billion, up 37.4 percent when compared to net sales of $2.03 billion during the third quarter of fiscal year 2016, excluding Moy Park.
- Net income of $232.7 million, up from a net income of $98.7 million during the same period of fiscal year 2016.
- Adjusted operating income margins of 16.6 percent in the United States, 13.4 percent in Mexico and 4.1 percent in Europe operations, respectively.
- Adjusted EBITDA of $463.6 million (or a 16.6 percent margin) and adjusted EPS of $0.98.
- Excluding Moy Park, net sales were $2.28 billion, adjusted operating income was $367.7 million; Adjusted EBITDA was $427.6 million (or an 18.8 percent margin).
The third quarter ended on September 24.
"During Q3, our U.S. operations were robust across all business units and Mexico performed even better than our expectations. The results once again demonstrated the strength and diversity of our portfolio of bird sizes, and is what fundamentally differentiates us from the competition, giving us the potential to reduce volatility and generate higher margins over time. Despite greater availability of alternative protein, we saw strong demand for chicken during grilling season and we expect a continuation of chicken as a choice protein in domestic and international markets," stated Bill Lovette, CEO of Pilgrim's.
Moy Park, GNP Company integration
"We closed the acquisition of Moy Park last September and are very excited about the potential opportunities in Europe because it creates a stronger, more diverse and more stable global chicken and prepared foods leader in Pilgrim's,” Lovette said. “The new European operations align with our strategic priorities as we continue expanding our geographical and brands footprint, and extending our global poultry leadership position into attractive new markets while providing us a strong platform for future growth in the region.
"We continue to increase GNP performance, and margins have increased by 600 bps since we acquired the business in Q1. The integration is tracking above expectations and we are well ahead in delivering the previously announced $30 million synergy target. Together with the success we had in improving the profitability of the acquired assets in Mexico relative to the legacy operations, we believe we have the method and the team to continue to grow the profitability of our European business."