Pilgrim's Pride Q1 loss narrows on better demand

Pilgrim's Pride Corp.'s first-quarter loss narrowed, partly owing to lower interest costs and a tax benefit, as the poultry producer saw signs of improving demand.

However, president and chief executive Don Jackson said results were below expectations. He noted the company was profitable last month and expressed confidence Pilgrim's Pride will show improvement this quarter as demand is strengthening and feed costs appear to have stabilised. As such, the company plans to reopen three idled facilities starting next year.

Pilgrim's Pride emerged from Chapter 11 bankruptcy in December after a 13-month restructuring that left Brazilian beef giant JBS S/A as a majority holder.

During its integration with JBS, the poultry producer has been shedding some jobs, consolidating some corporate functions and recently changed its fiscal year to a calendar basis. The changes occurred as Pilgrim's Pride and other meatpackers were hurt by weak demand last year, partially owing to woes at recession-hit restaurants.

Pilgrim's Pride reported a first-quarter loss of US$45.6 million, or 21 cents a share, compared with a prior-year loss of US$58.8 million, or 79 cents a share. The latest period included 16 cents of restructuring-related charges.

Revenue decreased 3.2% to US$1.64 billion while gross margin fell to 3.2% from 4.7%.

Shares closed Wednesday (May 5) at US$11.16 and were inactive premarket.