Full Transcript: Pilgrims Pride Q2 2026 Earnings Call

Pilgrims Pride (NASDAQ: PPC ) held its second-quarter earnings conference call on Thursday. Below is the complete transcript from the call. This transcript is brought to you APIs. For real-time access to our entire catalog, please visit for a consultation.

4% the previous year. Chicken demand remained strong across all regions, with growth in both retail and food service. The Just Bare brand led growth in the frozen fully cooked category. , operational improvements were noted after plant upgrades, with case-ready volumes increasing.

European sales were supported by poultry and ready meals, despite margin pressures from imported pork. Mexico saw increased volumes due to favorable growing conditions, but margins were impacted by increased supply of competing proteins. The company completed several strategic investments, including the Russellville plant conversion and investments in Georgia to support prepared foods growth. S.

and continued focus on portfolio diversification, especially in prepared foods. Management highlighted efforts in sustainability, team member satisfaction, and operational excellence, with recognition across multiple regions. Full Transcript OPERATOR Good morning and welcome to the second quarter of 2026 Pilgrims Pride earnings conference call and webcast. All participants will be in a listen-only mode for the duration of the call.

Should you need any assistance today, please signal a conference specialist by pressing the star key followed by zero. At the company's request, this call is being recorded. Please note that the slides referenced during today's call are available for download from the Investor section of the company's website at After today's presentation, there will be an opportunity to ask questions. I would now like to turn the conference call over to Andrew Rojeski, Head of Strategy, Investor Relations, and Sustainability for Pilgrims Pride.

Andrew Rojeski — Head Of Strategy, Investor Relations, and Sustainability Good morning and thank you for joining us today as we review our operating and financial results for the second quarter ended on June 28, 2026. Yesterday afternoon we issued a press release providing an overview of our financial performance for the quarter, including a reconciliation of any non-GAAP measures we may discuss. com along with slides for reference. gov.

Fabio Sandri, President and Chief Executive Officer, and Matt Galvanoni, Chief Financial Officer, will present on today's call. Before we begin our prepared remarks, I would like to remind everyone of our Safe Harbor disclaimer. Today's call may contain certain forward-looking statements that represent our outlook and current expectations as of the day of this release. Other additional factors not anticipated by management may cause actual results to differ materially from those projected in these forward-looking statements.

Further information concerning these factors has been provided in yesterday's press release, our Form 10-K, and our regular filings with the SEC. I would now like to turn the call over to Fabio Sandri. Fabio Sandri, President and Chief Executive Officer Thank you. Good morning, good morning everyone and thank you for joining us today.

6 billion with an adjusted EBITDA of 360 million. 4% last year. During the quarter, chicken demand remained firm across all regions, leading the growth in meat protein consumption. S.

Demand for chicken continued to grow in both retail and food service. Operations improved compared to the previous quarter given the completion of our plant upgrades and progress in the efficiency of our live operations. Volumes to key customers in fresh remained steady, whereas prepared grew double digits as Just Bare continued to lead growth and velocity in the frozen fully cooked category. In Europe, poultry and ready meals drove overall sales growth as their affordability and convenience resonated with value—conscious consumers.

Margins were compressed given competition from imported pork into the UK and increased costs driven by the Middle East conflict. Mexico also increased volumes compared to last year, driven by an exceptional growing environment for birds. We continue to grow our branded offerings in both fresh and prepared, and the previously announced growth and diversification projects all remain on schedule. We continue to focus all aspects in the environment, social and governance matters and within sustainability.

, Employer of the Year by The Grocer in Europe, and Exceptional Companies Award by the Institute for the Promotion of Quality in Mexico. 5% over the same period last year from higher head counts and modestly higher live weights. 4% from moderate improvements in hatchability. A significant part of the growth came from much better livability than previous years given the size of the layer flock, recent pullet placements, and production environment.

3%. As for other proteins, the USDA expected limited growth in pork along with a minor increase in beef availability as higher imports partially offset domestic production headwinds. 2% compared to last year. , the affordability of chicken provided a great option to household budgets pressured by persistent inflation and elevated energy prices.

As a result, chicken continued to be resilient as volumes increased across both retail and food service channels. In retail, the fresh meat department posted dollar sales growth across all major proteins. From a value standpoint, chicken delivered the highest growth among all proteins compared to the same period last year. Boneless, skinless breast volumes increased year over year as pricing remained steady and the spread versus ground beef remained at record levels.

Boneless, skinless dark meat continued to deliver strong growth as volumes rose compared to the first quarter of 2026. In deli, consumer demand for convenience ready—to—eat options drove growth in rotisserie and cut—up portions. Sales and volumes for appetizers, including popcorn chicken and wings, also rose compared to the same period last year. Demand for convenience and value also permeated the frozen prepared category as chicken grew compared to last year.

Within food service, chicken values remained positive despite mixed industry performance and traffic trends as operators continued to expand chicken as a value—oriented protein offering. Overall food service volumes increased despite continuous concern about foot traffic, with chicken gaining menu penetration. QSR and non—commercial channels presented the largest growth, with chicken—focused chains leading growth in QSR. Despite continued healthy growth in chicken across all channels, demand was more than offset by the increase in supply.

As a result, counter—seasonal movements emerged in the commodity chicken market, lowering cutout values compared to the previous quarter. In exports, overall poultry exports remained steady compared to last year as trade flows continued to navigate through a variety of circumstances. Our volume growth was strong, and we outpaced the channel through an increased presence in several key markets. Within the Middle East, trade to GCC countries continued to flow through alternative ports, given a comprehensive inland transportation network enabling a resilient supply chain.

S. poultry exports. As such, China released 17 states from its avian influenza ban, allowing shipments of raw products to resume. Additional opportunities exist as other states that are currently free of high—path avian influenza have yet to be fully recognized.

Further meetings scheduled later in the year may result in the release of these states and resumption by China to follow the Phase One agreement. Turning to feed, corn was volatile throughout the quarter. Early in the period, concerns about disrupted fertilizer supply and higher energy costs associated with the Middle East conflict elevated prices. S.

S. planting acreage relative to forecasted expectations, and better—than—expected production in South America. S. S.

crop, along with weather in the Midwest, will be the key drivers for corn pricing in the short term. S. soybeans. S.

versus last year, reinforced healthy stock levels. S. soybeans by China, a risk premium will continue to exist within the soy market. Soybean oil continues to be the strongest leg of the soy complex, keeping the soybean meal price relatively lower.

In wheat, global stocks remain at comfortable levels despite a decline in production from the all—time high last year. Availability may be further enhanced later this year as the UK anticipates a production increase of 25% versus the prior year. However, recent concerns regarding shipments in the Black Sea given the conflict between Ukraine and Russia may trigger an increase in price. , the investment in converting our plant in Russellville to a case—ready operation to further strengthen key customer partnerships was completed as planned.

We also continue to improve our sales mix given the recent installation of dark—meat deboning and portioning equipment in several big—bird plants. Given this work, our portfolio was more prepared to manage the counter—seasonal declines in commodity cutout values, enhancing profitability from the first quarter. In fresh, volumes grew compared to the same period last year. Margins expanded from the previous quarter given the completion of the plant upgrades and continued improvements in live operations.

Case—ready volumes rose compared to last year from incremental distribution and stable velocity throughout retail. We also secured several promotional events with several leading retailers to further drive demand during the next quarters. Small birds also grew as volumes to key customers exceeded channel averages. Our big—bird plants provided additional product to support the growth of prepared foods, mitigating the impact of commodity market declines.

To support the growth of our key customers, we recently announced investments in LGA, Georgia, to expand production and do more deboning of small birds. Based on this work, we will further align our portfolio to meet the fast—growing boneless chicken categories such as chicken sandwiches and tenders. Momentum to further diversify our portfolio through prepared foods continued to accelerate. Overall volumes increased nearly 14% compared to the same period last year.

Retail sales of Just Bare increased over 30%, six times the category average. We also received additional recognition for the taste and quality of Just Bare as a recent survey of chefs by Allrecipes named its nugget one of the best in the category. Given its extensive growth and consumer acceptance, it has achieved nearly 15% market share, making it the second—largest brand in frozen fully cooked. We continue to drive growth of our brand presence in retail through innovation.

To that end, we've created expansions to expand Just Bare presence across different occasions and consumer segments. Similarly, we are securing partnerships to deliver and launch new flavor offerings through retail and club. For the Pilgrims Pride branded in retail, we are building further awareness of our superior taste and culinary focus of the broader Just Bare Fresh Prepared portfolio through media partnerships. Recently our innovation was featured on the award—winning television series The Bear, and further supported by selected dining—experience meal kits and press coverage.

Based on this work, we've generated over 950 million earned media impressions. In foodservice, we continue to increase our presence of branded offerings as market share has increased in both commercial and non—commercial channels. Moving forward, we will continue to cultivate our presence through innovation, digital engagement, and new product development. Our investment in Walker County, Georgia, to further support our growth remains on track, with commissioning slated for the second half of 2027.

In Europe, our diversified portfolio continues to adapt to meet evolving marketplace needs. The affordability of our poultry and meals resonated with inflation—strapped consumers as each were among the fastest—growing categories in retail. Our volumes to key customers rose faster than both the grocery channel averages and prior year, reinforcing our partnerships. In the branded segments, volume in Rollover grew double digits and garnered significant retailer acceptance and consumer interest.

Fridge Raiders remained relatively steady as additional distribution was secured throughout grocery, enabling further growth for the remainder of the year. While Richmond's margins remain attractive, the pace of volume growth lags our expectations as extensive promotion activity, along with significant retailer support of premium private—label offerings, has intensified competitive pressures. Given Richmond's market presence and further profitability growth potential, we'll continue to emphasize sales execution, invest in brand building, and drive innovation. In foodservice, QSRs continue to experience declines in store visits, resulting in lower volumes and sales.

We will continue to work closely with leading foodservice providers to expand our portfolio of value—focused offerings, generating additional traffic. Despite increasing costs from the Middle East conflict and competition from imported pork into the UK, overall profitability was comparable with last year. Within pork, continued reductions in the existing herd, along with further diversification in prepared, should alleviate margin pressures. In addition, our pricing arrangements for customer—specific offerings allow for recovery from raw—material escalation.

Turning to Mexico, the country experienced a counter—seasonal, very positive growing environment for birds. As a result, production expanded from elevated livability and higher live weights. Increased production of domestic eggs and additional pork imports further grew overall protein availability in the country. Nonetheless, demand for chicken was very strong, absorbing the additional supply.

We continue to grow our differentiated branded offerings in fresh. Volumes of retail branded products grew over 30% compared to last year. Just Bare once again led the growth as volumes increased over two and a half times. Prepared foods offerings continue to gain marketplace traction as volumes rose across retail and foodservice.

Pilgrims Pride branded offering led growth as volumes grew double digit across both channels. Operational excellence efforts made significant progress given improvements in productivity and live operations, further enabling our business to navigate these challenging market conditions. We continue our investments to drive sales growth and reduce the volatility of our portfolio. To that end, we completed our expansion of the prepared line at Port Veneer and started production as scheduled.

Our investments in live in the South and Peninsula are also on track, and ramp—up continues. We continue to emphasize all aspects of sustainability throughout our operations. As part of this effort, we've made repeated investments in team member training to reinforce our values throughout our organization, build technical skills, and develop management capabilities. , The Grocer in Europe, and the Institute for the Promotion of Quality in Mexico.

With that in mind, I'd like to ask our CFO, Matt Galvanoni, to discuss our financial results. Matt Galvanoni — Chief Financial Officer Thank you, Fabio. Good morning, everyone. 4% margin in Q2 last year.

S. 1% a year ago.