Reporting quarterly net income of $232.7 million (compared to $98.7 million the previous year), net revenues were 37.4 percent higher than the same quarter last year, at $2.79 billion. The company’s acquisition of Northern Ireland-based Moy Park earlier this year accounted for revenues of approximately $510 million and according to Pilgrim’s positions it as the global leader of chicken and prepared foods in the future.
Operating income was $372.2 million for the quarter, 111 percent higher than the same period last year when it was just under $177 million.
Pilgrim’s finalized the deal to acquire GNP Co. for $350 million in early 2017 and officials report the integration is progressing and synergies are being realized. In late October, Pilgrim’s announced plans to close a plant formerly owned by GNP in Luverne, Minnesota. Production from that facility will be diverted to other Pilgrim’s plants when that operation is shuttered in late December.
Bill Lovette, Pilgrim’s CEO, said the company’s business units’ performance exceeded expectations, including facilities in Mexico. He said the positive results attest to poultry’s strength and continued demand in the market and Pilgrim’s position as a diverse supplier of poultry that caters to its customers’ needs in terms of bird size. He said it is this diversity that “fundamentally differentiates us from the competition, giving us the potential to reduce volatility and generate higher margins over time.”
Internationally, the Moy Park deal bodes well for Pilgrim’s future in Europe, according to Lovette. He said “… it creates a stronger, more diverse and more stable global chicken and prepared foods leader in Pilgrim's. The new European operations align with our strategic priorities as we continue expanding our geographical and brands footprint, and extending our global poultry leadership position into attractive new markets while providing us a strong platform for future growth in the region.”
As for integrating GNP, Lovette said the company is tracking ahead of its forecast of realizing $30 million in synergies since its Q1 acquisition. “Together with the success we had in improving the profitability of the acquired assets in Mexico relative to the legacy operations, we believe we have the method and the team to continue to grow the profitability of our European Business.”
