Pilgrim's Pride — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net sales for the three months ended September 27, 2026, were $4.65 billion, a 2.2% decrease year-over-year compared to $4.76 billion in the prior year period; nine-month net sales were $13.81 billion, down 1.2% year-over-year.
• Consolidated GAAP operating income for the quarter was $191.5 million, a 61.1% decline year-over-year, resulting in a 4.1% operating margin; nine-month operating income was $420.0 million, down 70.2% year-over-year.
• GAAP net income attributable to Pilgrim's Pride Corporation was $116.3 million ($0.49 diluted EPS) for the quarter, down 66.0% year-over-year; nine-month GAAP net income was $231.0 million ($0.97 diluted EPS), down 76.7% year-over-year.
• Adjusted net income was $117.7 million ($0.49 adjusted EPS) for the quarter; nine-month adjusted net income was $393.2 million ($1.65 adjusted EPS).
• Adjusted EBITDA was $316.3 million for the quarter, a 50.0% decrease year-over-year, with a 6.8% margin; nine-month adjusted EBITDA was $984.4 million, down 46.9% year-over-year.
• Adjusted EBITDA margins by region for the quarter were 6.9% in the U.S., 7.4% in Europe, and 4.9% in Mexico.
• Cash and cash equivalents increased to $935.8 million as of September 27, 2026, from $640.2 million at the end of 2025.
• Net leverage ratio is 1.76x Adjusted EBITDA, below the target range of 2x to 3x.
• Long-term debt increased to $3.40 billion from $3.09 billion at the end of 2025.
• Cash provided by operating activities for the nine months ended September 27, 2026, was $684.2 million, down from $1.08 billion in the prior year period.
• Cash used in investing activities for the nine months was $673.4 million, primarily driven by $682.1 million in capital expenditures.

Guidance and Future Outlook:

• Construction of the new prepared foods facility in Walker County, Ga., remains on track with commissioning expected in the second half of 2027.
• Approval process for the acquisition of Walkers Deli & Sausage continues to progress with an anticipated close in early 2027.
• Growth and geographical diversification with the ramp-up of operations in the Merida region and the Southern Peninsula in Mexico remains on schedule.
• Management indicated a focus on investments and strategies to drive profitable growth and adapt the portfolio to changing conditions.

Business Segments and Product Lines:

• U.S. Fresh: Volumes remained steady compared to the previous quarter; growth was supported by promotional activity and increased distribution, offsetting planned downtime at the Ellijay, Ga., plant for small bird debone segment investment.
• U.S. Prepared Foods: Volumes rose over 15% year-over-year; retail sales for the Just Bare® brand grew over 25% year-over-year. The Pilgrim's® brand introduced Flamin' Hot® offerings.
• Europe: Sales and volumes remained stable; branded portfolio growth was driven by Fridge Raiders® and Rollover®. Margins were compressed due to challenging pork fundamentals and rising input costs.
• Mexico: Sales grew as fresh branded offerings in retail increased over 40% year-over-year; volumes in Key Customer partnerships increased by more than 8% year-over-year. Just Bare® volumes more than doubled in retail fresh.
• Sustainability: Global Scope 1 & 2 emissions intensity reduced by over 20% since 2019; the Global Safety Index improved over 60% compared to the prior year.

Market and Competitive Landscape:

• USDA reports reflect a 2.2% year-over-year increase in poultry supply, outpacing demand growth and pressuring commodity cutout values lower.
• In Europe, inflationary pressures and excess pork imports from European countries continue to challenge the market.
• In Mexico, extensive availability of protein exists despite improving live commodity market fundamentals.
• Just Bare® market share in volume for the frozen fully cooked category rose over 300 basis points year-over-year.

Risks and Challenges:

• Volatile commodity values and increased supply are pressuring cutout values.
• Margins in Europe were compressed by challenging pork fundamentals and sustained escalation of input costs.
• Forward-looking statements note risks including avian influenza outbreaks, product contamination, litigation (including In re Broiler Chicken Antitrust Litigation), currency fluctuations, and regulatory changes.
• The company faces risks related to feed ingredient pricing, immigration legislation, and cyber-attacks.

Management Commentary and Tone:

• Fabio Sandri, President and CEO, stated that the differentiated portfolio continues to experience strong demand as affordability and convenience remain consumer priorities.
• Management noted that while consumers maintained interest in chicken, the market experienced a significant increase in supply.
• Sandri emphasized that recent investments have created a more balanced portfolio better equipped to mitigate volatile commodity values.
• Regarding innovation, Sandri noted that the Flamin' Hot® launch demonstrates the ability to generate consumer excitement with industry-leading partners.

Other Key Points:

• The company published an update on sustainability efforts through 2025, detailing progress on environmental, social, and governance ambitions.
• More than 6 million training hours were provided during 2025.
• The company maintains a strong liquidity position to support future growth opportunities.
• Asset impairment of $25.6 million for the nine-month period was primarily due to the closure announcement of the Chattanooga, TN harvest plant.
• Litigation settlements of $158.9 million were recognized for the nine-month period.
• The company repurchased Senior Notes due 2033 in the second quarter of 2026, resulting in a loss on early extinguishment of debt.
• No dividends were paid during the nine-month period ended September 27, 2026.