Pilgrim’s Pride has been actively packing chicken products to fill orders to China, and at the present time, CEO Jayson Penn said the company has not seen any impact on chicken imports due to the current coronavirus outbreak China is experiencing.
Penn, along with Pilgrim’s Pride Chief Financial Officer Fabio Sandri, commented about the China situation while speaking during the company’s quarterly earnings call on February 21.
Since China lifted its ban on poultry products from the United States in November 2019, U.S. poultry companies have been filling orders to ship to China for the first time since the ban was enacted in 2015 over avian influenza concerns.
“We are packing. We are packing pullets. We are packing drumsticks. We are whole eggs. We're packing the leg quarters. We are packing wing tips. We're packing gizzards and we are shipping all of the above items,” Penn said in response to one analyst’s question. “We have a heavy demand for orders despite that what we're hearing in the marketplace with coronavirus and logistics. But, we are taking orders. We have currently $25 million of orders on the books, and we are receiving wired transfers to those orders and we are shipping. So, despite what we're hearing with the logistics issues, we are packing and we are shipping for (People’s Republic of China).
Responding to another analyst earlier in the call, Penn said Pilgrim’s had not “seen any impact on chicken imports due to the coronavirus.”
However, Sandri added that even if coronavirus issues slow the company’s ability to meet Chinese customer demands, the company has other options.
“We have an extensive network that we can export. If there isn't any disruption in China, we of course can divert those projects to other places. Africa has been a little bit slow in 2019, but Latin American has actually increased their demands.”
Fourth quarter financial results
Also during the call, Pilgrim’s discussed their financial results for the fourth quarter of fiscal year 2019, which ended on December 28, 2019.
For the full year, the company reported a net income of $455.9 million, or an 84% increase when compared to 2018. For the fourth quarter, the company reported a net income of $92.1 million, up from a loss of $7.32 million for the fourth quarter of fiscal year 2018.
“While overall global market conditions including U.S. commodity chicken improved during 2019, our team members have continued to deliver on our strategy, achieving a significant increase in relative performance compared to last year and to our industry competition. Our diverse global footprint has contributed to well-balanced and more consistent results against different specific market conditions,” Penn said.