GREELEY, Colo. – Pilgrim’s Pride Corp., a subsidiary of São Paulo, Brazil-based JBS SA reported a 2.9 percent gain in sales during the first quarter ended March 26, 2017.

Net sales for quarter were $2,020,492,000 compared with $1,962,937,000. Net income for the first quarter dropped 20 percent to $93,921,000, or $0.38 per diluted share, from $118,371,000, or $0.46 per diluted share reported in the year-ago quarter.

Bill Lovette, CEO, Pilgrim’s Pride Corp.

Bill Lovette, CEO of Pilgrim’s, attributed the sales improvement to the diversity of the company’s portfolio of bird sizes. Additionally, the completion of some previously announced capital investments which include projects in the organic and “no antibiotics ever” segments will further diversify the company’s product portfolio with differentiated and customized solutions along with products to serve key customer demand, muting the impact of commodity markets, and further raising Pilgrim’s margin profile.

“Highlighting the diversity of our portfolio of bird sizes, small bird and tray-pack have remained strong during the period, while large bird deboning has rebounded from a weaker than expected January and continued to improve with stronger exports and increasing domestic demand,” he said. “With summer grilling season nearing and a supportive export environment, we expect profits for our large birds to further increase, given the improved cutout. Our exposure to multiple bird sizes through our well-balanced portfolio will provide an opportunity for us to capture the improvement in performance across all bird segments.”

Lovette said Pilgrim’s already has identified additional synergies to be gained from the GNP integration, raising the annualized run-rate to $30 million from $20 million.

“We have a sustainable competitive advantage in the upper Midwest and the potential to expand into new markets with the Gold’n Plump brand as well as the new premium Just BARE chicken in the “better for you” category,” he noted. “We already started to grow and leverage our combined product offerings by introducing a new line of fully-cooked sausages under the Gold’n Plump brand to complement the NAE veg-fed fully cooked line of artisanal chicken sausages we launched recently, giving us a great solution to satisfy every consumer segment in this growing category.”

Lovette added that Pilgrim’s is increasing the company’s capital investment target for 2017 to $250 million from $220 million to reflect the acquisition of GNP. He said this revised investment is higher than depreciation and just slightly below the record level reported in 2016.