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What changed in PILGRIMS PRIDE CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of PILGRIMS PRIDE CORP's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+256 added−247 removedSource: 10-K (2026-02-12) vs 10-K (2025-02-13)

Top changes in PILGRIMS PRIDE CORP's 2025 10-K

256 paragraphs added · 247 removed · 202 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

29 edited+1 added−2 removed33 unchanged
Biggest changeOur prepared products include processed sausages, bacon, slow cooked, smoked meat, gammon joints, ready-to-cook variety of meat products, pre-packed meats, sandwich and deli counter meats, pulled pork balls, meatballs and coated foods. In 2024, our prepared foods products sales accounted for 10.3%, 65.8%, and 10.4% of our total U.S., Europe, and Mexico chicken and pork sales, respectively. Exported Products Overview.
Biggest changeThese products are sold either refrigerated or frozen and may be fully cooked, partially cooked or raw. In addition, these products may be breaded and/or marinated. Our prepared products include processed sausages, bacon, slow cooked, smoked meat, gammon joints, ready-to-cook variety of meat products, pre-packed meats, sandwich and deli counter meats, pulled pork balls, meatballs and coated foods.
Regulation and Environmental Matters The chicken, pork and prepared foods industries are subject to government regulation, particularly in the health, workplace safety and environmental areas, including provisions relating to the discharge of materials into the environment, treatment and disposal of agricultural and food processing wastes, the use and maintenance of refrigeration systems, ammonia-based chillers, noise, odor and dust management, the operation of mechanized processing equipment and other operations, storm water, air emissions, treatment, storage and disposal of wastes, handling of hazardous substances and remediation of contaminated soil, surface water and groundwater, by the Centers for Disease Control, the United States Department of Agriculture (“USDA”), the Food and Drug Administration (“FDA”), the Environmental Protection Agency (“EPA”), the Occupational Safety and Health Administration and state and local regulatory authorities in the U.S. and by similar governmental agencies in the U.K., the Republic of Ireland, continental Europe and Mexico.
Regulation and Environmental Matters The chicken, pork and prepared foods industries are subject to government regulation, particularly in the health, workplace safety and environmental areas, including provisions relating to the discharge of materials into the environment, treatment and disposal of agricultural and food processing wastes, the use and maintenance of refrigeration systems, ammonia-based chillers, noise, odor and dust management, the operation of mechanized processing equipment and other operations, storm water, air emissions, treatment, storage and disposal of wastes, handling of hazardous substances and remediation of contaminated soil, surface water and groundwater, by the Centers for Disease Control, the United States Department of Agriculture (“USDA”), the Food and Drug Administration (“FDA”), the Environmental Protection Agency (“EPA”), the 3 Table of Contents Occupational Safety and Health Administration and state and local regulatory authorities in the U.S. and by similar governmental agencies in the U.K., the Republic of Ireland, continental Europe and Mexico.
JBS S.A., through its indirect wholly-owned subsidiaries (together, “JBS”), beneficially owns 82.42% of our outstanding common stock. We market our balanced portfolio of fresh, prepared and value-added meat products to a diverse set of customers across the U.S., the U.K. and Europe, Mexico and in over 120 other countries.
JBS S.A., through its indirect wholly-owned subsidiaries (together, “JBS”), beneficially owns 82.28% of our outstanding common stock. We market our balanced portfolio of fresh, prepared and value-added meat products to a diverse set of customers across the U.S., the U.K. and Europe, Mexico and in over 120 other countries.
Live pigs sourced from independent farmers make up approximately 68.4% of the total number of pigs processed by the Company each year. Although we generally expect adequate supply of live pigs in the U.K., there may be periods of imbalance in supply and demand. Trademarks We own registered trademarks which are used in connection with our business.
Live pigs sourced from independent farmers make up approximately 69.4% of the total number of pigs processed by the Company each year. Although we generally expect adequate supply of live pigs in the U.K., there may be periods of imbalance in supply and demand. Trademarks We own registered trademarks which are used in connection with our business.
The Company’s pork operations in the U.K. maintain a pig production base that makes up approximately 31.6% of the total number of pigs processed by the Company each year. Additionally, the Company’s pork operations procure live pigs for slaughter within a few days of purchase from numerous independent farmers throughout the U.K.
The Company’s pork operations in the U.K. maintain a pig production base that makes up approximately 30.6% of the total number of pigs processed by the Company each year. Additionally, the Company’s pork operations procure live pigs for slaughter within a few days of purchase from numerous independent farmers throughout the U.K.
We respect our team members’ rights of association, including by joining labor unions and collective bargaining. Approximately 35.4% of our workforce are covered by a collective bargaining agreement. For additional information, see “Item 1A. Risk Factors - Our performance depends on favorable labor relations with our employees and our compliance with labor laws.
We respect our team members’ rights of association, including by joining labor unions and collective bargaining. Approximately 35.1% of our workforce are covered by a collective bargaining agreement. For additional information, see “Item 1A. Risk Factors - Our performance depends on favorable labor relations with our employees and our compliance with labor laws.
Net Sales for Primary Product Lines and Markets The following table sets forth, for the periods beginning with 2022, net sales attributable to each of our primary product lines and markets served with those products. We based the table on our internal sales reports and their classification of product types.
Net Sales for Primary Product Lines and Markets The following table sets forth, for the periods beginning with 2023, net sales attributable to each of our primary product lines and markets served with those products. We based the table on our internal sales reports and their classification of product types.
Key examples of our focus and commitment include: • We engage with our team members through the use of safety committees and other safety initiatives to improve the overall safety of the workplace and advance a safety first culture. • We train team members on how to identify physical hazards, conduct focused daily, monthly and annual physical hazard assessments at all facilities, ensure that identified physical hazards are logged and ensure timely remediation. • Leveraging third-party experts, we conduct regular ergonomic assessments, ensure that identified ergonomic issues are logged and ensure timely remediation. • We conduct safety audits of all facilities on an annual basis.
Key examples of our focus and commitment include: • We engage with our team members through the use of safety committees and other safety initiatives to improve the overall safety of the workplace and advance safety as a condition for culture. • We train team members on how to identify physical hazards, conduct focused daily, monthly and annual physical hazard assessments at all facilities, ensure that identified physical hazards are logged, and ensure timely remediation. • Leveraging third-party experts, we conduct regular ergonomic assessments, ensure that identified ergonomic issues are logged and ensure timely remediation. • We conduct safety audits of all facilities on an annual basis.
He earned his Master’s of Business Administration degree in 2001 from the Wharton School at the University of Pennsylvania and a degree in electrical engineering in 1993 from Escola Politécnica da Universidade de São Paulo. Matthew Galvanoni was named the Chief Financial Officer in February 2021, effective March 2021. Prior to his appointment to the Company, Mr.
He earned his Master’s of Business Administration degree in 2001 from the Wharton School at the University of Pennsylvania and a degree in electrical engineering in 1993 from Escola Politécnica da Universidade de São Paulo. Matthew Galvanoni became the Chief Financial Officer in February 2021, effective March 2021. Prior to his appointment to the Company, Mr.
We attempt to mitigate the impact of price volatility on our profitability by decreasing the amount of our products that are sold under longer term fixed-price contracts, broadening our product portfolio and expanding the variety of contracts within our book of business. To also manage this risk, we purchase derivative financial instruments.
We attempt to mitigate the impact of price 2 Table of Contents volatility on our profitability by decreasing the amount of our products that are sold under longer term fixed-price contracts, broadening our product portfolio and expanding the variety of contracts within our book of business. To also manage this risk, we purchase derivative financial instruments.
Our case-ready chicken includes various combinations of freshly refrigerated, whole chickens, chicken parts in trays, bags or other consumer packs labeled and priced ready for the retail grocer’s fresh meat counter. Additionally, we are an important player in the live chicken market in Mexico.
Our case-ready chicken includes various combinations of freshly refrigerated, whole chickens, chicken parts in trays, bags or other consumer packs labeled and priced ready for the retail grocer’s fresh meat counter. Additionally, we 1 Table of Contents are an important player in the live chicken market in Mexico.
The Company has long-standing relationships with its sources of grain and other feed ingredients and expects to have an adequate supply for its present needs. 2 Table of Contents Live chicks . The Company’s chicken operations purchase one-day old chicks from a few major breeders.
The Company has long-standing relationships with its sources of grain and other feed ingredients and expects to have an adequate supply for its present needs. Live chicks . The Company’s chicken operations purchase one-day old chicks from a few major breeders.
Some of the more significant owned or licensed trademarks used by the Company or its affiliates include Pilgrim’s®, Just Bare®, Gold’n Plump®, Gold Kist®, Country Pride®, Pierce Chicken®, Pilgrim’s® Mexico, Savoro, To-Ricos®, Del Dia®, Moy Park, O’Kane, Richmond, Fridge Raiders and Denny.
Some of the more significant owned or licensed trademarks used by the Company or its affiliates include Pilgrim’s ® , Just Bare ® , Gold’n Plump ® , Gold Kist ® , Country Pride ® , Pierce Chicken ® , Pilgrim’s ® Mexico, To-Ricos ® , Del Dia ® , Moy Park, Matteson’s, Richmond, Fridge Raiders and Denny.
Our benefits offerings include a minimum paid time off and paid sick leave for salaried employees, life and disability insurance and Company-matching retirement plans. • We have extensive leadership training programs, such as our Supervisor Development Program, created to help identify and develop production workers into frontline supervisors, the aforementioned People First Program, designed to equip frontline supervisors with the behavioral and technical skills needed to effectively lead their production teams and our Summit Program, designed to improve the skill set of our senior leadership team.
Our benefits offerings include a minimum paid time off and paid sick leave for salaried employees, life and disability insurance and Company-matching retirement plans. • We have extensive leadership training programs, such as our Supervisor Development Program, created to help identify and develop production workers into frontline supervisors and provide additional development to existing supervisors, the aforementioned People First Program, designed to equip frontline supervisors with the behavioral and technical skills needed to effectively lead their production teams and our Summit Program, designed to 4 Table of Contents improve the skill set of our senior leadership team.
Better Futures, which we launched in 2021, is the largest privately funded free community college program in rural America, offering free community college to our team members and their dependents. So far, over 2,126 team members or dependents have signed up and 705 have started their selected academic pathway. Employee Relations.
Better Futures, which we launched in 2021, is the largest privately funded free community college program in rural America, offering free community college to our team members and their dependents. So far, over 2,319 team members or dependents have signed up and 780 have started their selected academic pathway. Employee Relations.
We operate on the basis of a 52/53-week fiscal year ending on the Sunday falling on or before December 31. Any reference we make to a particular year (for example 2024) in the notes to these Consolidated Financial Statements applies to our fiscal year and not the calendar year.
We operate on the basis of a 52/53-week fiscal year ending on the Sunday falling on or before December 31. Any reference we make to a particular year (for example 2025) in the notes to these Consolidated Financial Statements applies to our fiscal year and not the calendar year. Fiscal years 2025 and 2024 were both 52-week fiscal years.
Our food processing facilities and feed mills in the U.K., continental Europe and Mexico are subject to 3 Table of Contents on-site examination, inspection and regulation by government agencies that perform functions similar to those performed by the USDA and FDA.
Our food processing facilities and feed mills in the U.K., continental Europe and Mexico are subject to on-site examination, inspection and regulation by government agencies that perform functions similar to those performed by the USDA and FDA.
These audits include auditing the physical state of the plant, policies, safety culture and our occupational health clinics. • Our efforts in 2024 have resulted in year-over-year reductions in severe injuries of 37%. Anti-discrimination.
These audits include auditing the physical state of the plant, policies, safety culture and our occupational health clinics. • Our efforts in 2025 have resulted in year-over-year reductions in severe injuries of 64%. Anti-discrimination.
Information about our Executive Officers Name Age Background and Experience Dates Fabio Sandri 53 President and Chief Executive Officer September 2020 to Present Matthew Galvanoni 52 Chief Financial Officer March 2021 to Present Fabio Sandri was named the Chief Executive Officer in September 2020 and previously served as our Chief Financial Officer from June 2011 to March 2021.
Information about our Executive Officers Name Age Background and Experience Dates Fabio Sandri 54 President and Chief Executive Officer September 2020 to Present Matthew Galvanoni 53 Chief Financial Officer March 2021 to Present Fabio Sandri became the Chief Executive Officer in September 2020 and previously served as our Chief Financial Officer from June 2011 to March 2021.
Key Customers Our two largest customers, which operate in the U.S., together accounted for approximately 16.6% and 13.2% of our consolidated net sales in 2024 and 2023, respectively. No single customer accounted for ten percent or more of our consolidated net sales in either 2024 or 2023.
Key Customers Our two largest customers, which operate in the U.S., together accounted for approximately 16.8% and 16.6% of our consolidated net sales in 2025 and 2024, respectively. No single customer accounted for ten percent or more of our consolidated net sales in either 2025 or 2024.
Many of our pork sites are additionally certified by farm-to-fork traceability schemes including Royal Society for the Prevention of Cruelty to Animals Assured, Soil Association, Organic Farmers and Growers and Assured Food Standards. Human Capital Resources As of December 29, 2024, we employed over 61,600 persons. Our success is largely dependent on the skills, experience and efforts of our employees.
Many of our pork sites are additionally certified by farm-to-fork traceability schemes including Royal Society for the Prevention of Cruelty to Animals Assured, Soil Association, Organic Farmers and Growers and Assured Food Standards. Human Capital Resources As of December 28, 2025, we employed over 63,000 persons. Our success is largely dependent on the skills, experience and efforts of our employees.
In 2024, our export product sales accounted for 4.4% and 9.3% of our total U.S. and Europe product sales, respectively. Market Overview. Our foodservice market principally consists of chain restaurants, food processors, broad-line distributors and certain other institutions. Our retail market consists primarily of grocery store chains, wholesale clubs and other retail distributors.
In 2025, our export product sales accounted for 4.1% and 10.8% of our total U.S. and Europe product sales, respectively. Market Overview. Our foodservice market principally consists of chain restaurants, food processors, broad-line distributors and certain other institutions. Our retail market consists primarily of grocery store chains, wholesale clubs and other retail distributors.
With our global network of approximately 4,500 growers, 35 feed mills, 49 hatcheries, 39 processing plants, 30 prepared foods cook plants, 29 distribution centers, 12 protein conversion facilities and five pet food plants, we believe we are well-positioned to supply the growing demand for our products.
With our global network of approximately 4,500 growers, 36 feed mills, 50 hatcheries, 39 processing plants, 28 prepared foods cook plants, 38 distribution centers, 10 protein conversion facilities and five pet food plants, we believe we are well-positioned to supply the growing demand for our products.
In 2024, our fresh product sales accounted for 82.1%, 22.9%, and 84.2% of our total U.S., Europe, and Mexico product sales, respectively. Prepared Products Overview. Our prepared products include portion-controlled breast fillets, tenderloins and strips, delicatessen products, salads, formed nuggets and patties and bone-in chicken parts.
In 2025, our fresh product sales accounted for 80.9%, 29.9%, and 83.2% of our total U.S., Europe, and Mexico product sales, respectively. Prepared Products Overview. Our prepared products include portion-controlled breast fillets, tenderloins and strips, delicatessen products, salads, formed nuggets and patties and bone-in chicken parts.
The Company utilizes various raw materials in its operations, including corn, soybean meal and wheat, along with various other ingredients from which the Company produces its own formulated feeds. In 2024, corn, soybean meal and wheat accounted for approximately 42.2%, 38.0% and 5.0% of our feed costs, respectively.
The Company utilizes various raw materials in its operations, including corn, soybean meal and wheat, along with various other ingredients from which the Company produces its own formulated feeds. In 2025, corn, soybean meal and wheat accounted for approximately 45.9%, 33.7% and 4.6% of our feed costs, respectively.
Fiscal year 2024 was a 52-week fiscal year and fiscal year 2023 was a 53-week fiscal year. Reportable Segments We operate in three reportable segments: U.S., Europe, and Mexico. We produce or purchase for resale chicken products through our operations in the U.S., the U.K. and continental Europe, and Mexico and pork products through our operations in the U.K.
Reportable Segments We operate in three reportable segments: U.S., Europe, and Mexico. We produce or purchase for resale chicken products through our operations in the U.S., the U.K. and continental Europe, and Mexico and pork and lamb products through our operations in the U.K.
Years Ended December 29, 2024 December 31, 2023 December 25, 2022 (In thousands) U.S. reportable segment: Fresh products $ 8,731,905 $ 8,105,269 $ 8,624,421 Prepared foods 1,094,818 978,423 1,107,734 Export 468,553 533,205 552,823 Other products 334,653 410,846 463,372 Total U.S. reportable segment 10,629,929 10,027,743 10,748,350 Europe reportable segment: Fresh products 1,178,459 1,074,900 908,882 Prepared foods 3,381,178 3,525,359 3,104,347 Export 477,486 472,656 712,685 Other products 99,624 130,406 148,824 Europe reportable segment 5,136,747 5,203,321 4,874,738 Mexico reportable segment: Fresh products 1,777,815 1,796,670 1,587,809 Prepared foods 220,270 212,651 167,589 Other products 113,530 121,832 89,891 Total Mexico reportable segment 2,111,615 2,131,153 1,845,289 Total net sales $ 17,878,291 $ 17,362,217 $ 17,468,377 Raw Materials Grains .
Years Ended December 28, 2025 December 29, 2024 December 31, 2023 (In thousands) U.S. reportable segment: Fresh products $ 8,892,558 $ 8,731,904 $ 8,105,268 Prepared foods 1,316,423 1,094,818 978,423 Export 451,284 468,553 533,205 Other products 338,467 334,654 410,846 Total U.S. reportable segment 10,998,732 10,629,929 10,027,742 Europe reportable segment: Fresh products 1,607,792 1,178,459 1,074,900 Prepared foods 3,150,863 3,381,178 3,525,359 Export 578,259 477,486 472,657 Other products 41,951 99,624 130,406 Europe reportable segment 5,378,865 5,136,747 5,203,322 Mexico reportable segment: Fresh products 1,763,169 1,777,815 1,796,670 Prepared foods 239,426 220,270 212,651 Other products 117,361 113,530 121,832 Total Mexico reportable segment 2,119,956 2,111,615 2,131,153 Total net sales $ 18,497,553 $ 17,878,291 $ 17,362,217 Raw Materials Grains .
We are focused on supporting the communities in which we operate and serve. • Hometown Strong Initiative. Hometown Strong, which we launched in 2020, is an initiative to help the communities in which we operate respond to the unexpected challenges on society.
Hometown Strong, which we launched in 2020, is an initiative to help the communities in which we operate respond to the unexpected challenges on society. We believe the Hometown Strong initiative has provided consequential investment projects and helped communities prepare for unanticipated challenges and build for the future. • Tomorrow Fund.
We have found that recognizing our employees’ efforts through training for continued advancement strengthens their performance and helps with our goals to achieve business results. Our employees completed over 1,394,426 training hours during 2024 and over 332,000 training hours during 2023. 4 Table of Contents Community Support .
We have found that recognizing our employees’ efforts through training for continued advancement strengthens their performance and helps with our goals to achieve business results. Community Support . We are focused on supporting the communities in which we operate and serve. • Hometown Strong Initiative.
Removed
These products are sold either refrigerated 1 Table of Contents or frozen and may be fully cooked, partially cooked or raw. In addition, these products may be breaded and/or marinated.
Added
In 2025, our prepared foods products sales accounted for 12.0%, 58.6%, and 11.3% of our total U.S., Europe, and Mexico chicken and pork sales, respectively. Exported Products Overview.
Removed
We believe the Hometown Strong initiative has provided consequential investment projects and helped communities prepare for unanticipated challenges and build for the future. Since inception, we have committed to Hometown Strong donations of $20 million. • Tomorrow Fund.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

51 edited+9 added−15 removed143 unchanged
Biggest changeOutbreaks of both HPAI and LPAI are increasingly common. For example, HPAI H5 has been detected in a number of states in the U.S. predominantly in poultry flocks but also more recently in dairy cattle, wild birds and mammals, as well as in farm workers directly exposed to infected animals.
Biggest changeThere have been recent outbreaks of both high- and low-pathogenic strains of avian influenza (“HPAI” and “LPAI”, respectively) and other bird diseases in Europe, the U.S., the U.K., and in Mexico. Outbreaks of both HPAI and LPAI are increasingly common. For example, HPAI H5 has been detected in a number of states in the U.S.
Additionally, should any of these strains spread to or within Europe, the U.S., the U.K. or Mexico, there can be no assurance that it would not significantly affect our ability to conduct our operations and/or demand for our products, in each case in a manner having a material adverse effect on our business, reputation and/or prospects. 6 Table of Contents While our pork products are produced through our U.K. operations, previous outbreaks of African swine fever in China and its subsequent spread across the world had a significant effect on both the global supply of pork and on pork prices.
Additionally, should any of these strains spread further within Europe, the U.S., the U.K. or Mexico, there can be no assurance that it would not significantly affect our ability to conduct our operations and/or demand for our products, in each case in a manner having a material adverse effect on our business, reputation and/or prospects. 6 Table of Contents While our pork products are produced through our U.K. operations, previous outbreaks of African swine fever in China and its subsequent spread across the world had a significant effect on both the global supply of pork and on pork prices.
Increasing concern over climate change also may adversely impact demand for our products due to changes in consumer preferences and result in additional legal or regulatory requirements designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment.
Concern over climate change also may adversely impact demand for our products due to changes in consumer preferences and result in additional legal or regulatory requirements designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment.
Foreign operations may be exposed to a number of special risks such as currency exchange rate fluctuations, trade barriers, exchange controls, expropriation and changes in laws and policies, including tax laws and laws governing foreign-owned operations. Currency exchange rate fluctuations have had adverse effects on us in the past.
Foreign operations may be exposed to a number of special risks such as currency exchange rate fluctuations, tariffs, trade barriers, exchange controls, expropriation and changes in laws and policies, including tax laws and laws governing foreign-owned operations. Currency exchange rate fluctuations have had adverse effects on us in the past.
For example, the European Union’s Deforestation Regulation (the “EUDR”), which generally becomes effective on December 30, 2025, will require companies trading in cattle, cocoa, coffee, oil palm, rubber, soya, and wood, as well as products derived from these commodities, to conduct extensive diligence on the value chain to ensure the goods do not result from recent deforestation, forest degradation, or breaches of local laws in order to sell such products in the European Union market.
For example, the European Union’s Deforestation Regulation (the “EUDR”), which generally becomes effective on December 30, 2026, will require companies trading in cattle, cocoa, coffee, oil palm, rubber, soya, and wood, as well as products derived from these commodities, to conduct extensive diligence on the value chain to ensure the goods do not result from recent deforestation, forest degradation, or breaches of local laws in order to sell such products in the European Union market.
The complaints seek, among other relief, treble damages for an alleged conspiracy among defendants to reduce output and increase prices of broiler chickens from the period of January 2008 to 2019. For additional information on this and other litigation matters, see Part II, Item 8, Notes to Consolidated Financial Statements, “Note 21. Commitments and Contingencies” in this annual report.
The complaints sought, among other relief, treble damages for an alleged conspiracy among defendants to reduce output and increase prices of broiler chickens from the period of January 2008 to 2019. For additional information on this and other litigation matters, see Part II, Item 8, Notes to Consolidated Financial Statements, “Note 21. Commitments and Contingencies” in this annual report.
If we fail to achieve, adequately specify or accurately report on our progress toward achieving our carbon emissions reduction goals and targets, we could be subject to lawsuits, investigations, government actions, or other claims made by public or private entities, each of which could have a material impact on our business, financial condition, results of operations and prospects.
If we fail to achieve or accurately report on our progress toward achieving our carbon emissions reduction goals and targets, we could be subject to lawsuits, investigations, government actions, or other claims made by public or private entities, each of which could have a material impact on our business, financial condition, results of operations and prospects.
JBS USA Holding’s concentration of ownership could also have the effect of delaying or preventing a change in control or otherwise discouraging a potential acquirer from attempting to obtain control of us, which could cause the market price of our common stock to decline or prevent our shareholders from realizing a premium over the market price for their common stock.
JBS USA Holdings’ concentration of ownership could also have the effect of delaying or preventing a change in control or otherwise discouraging a potential acquirer from attempting to obtain control of us, which could cause the market price of our common stock to decline or prevent our shareholders from realizing a premium over the market price for their common stock.
In addition, disruptions may be caused by outbreaks of diseases—either in our flocks and herds or elsewhere in the world—and resulting changes in consumer preferences. One or more of these or other disruptions in the international markets and distribution channels could adversely affect our business.
In addition, disruptions may be caused by outbreaks of diseases—either in our flocks and herds or elsewhere in the world—and resulting border closings or changes in consumer preferences. One or more of these or other disruptions in the international markets and distribution channels could adversely affect our business.
In total, we incurred a loss of approximately $10.0 million related to the cyberattack during the second quarter of 2021, which included an allocation of $2.4 million of the total $11.0 million ransom paid by our parent company. However, there can be no assurances that future attacks would not have an adverse effect on our operations of financial condition.
In total, we incurred a loss of approximately $10.0 million related to the cyber-attack during the second quarter of 2021, which included an allocation of $2.4 million of the total $11.0 million ransom paid by our parent company. However, there can be no assurances that future attacks would not have an adverse effect on our operations of financial condition.
For example, as disclosed in prior filings, we were the target of an organized cybersecurity attack in 2021 that affected some of the servers supporting our global IT systems. Our encrypted backup servers allowed for a return to full operation within two days and the loss of food produced was limited to less than one day of production.
For example, as disclosed in prior filings, we were the target of an organized cybersecurity attack in 2021 that affected some of the servers supporting our global information technology systems. Our encrypted backup servers allowed for a return to full operation within two days and the loss of food produced was limited to less than one day of production.
The potential consequences of a material cyber-security incident include reputational damage, litigation with third parties, regulatory actions, disruption of plant operations, and increased cyber-security protection and remediation costs. We cannot assure that we will be able to prevent all of the rapidly evolving forms of increasingly sophisticated and frequent cyber-attacks.
The potential consequences of a material cyber-security incident include reputational damage, litigation with third parties, regulatory actions, disruption of plant operations, and increased cyber-security protection and remediation costs. We cannot assure that we will be able to prevent all of the rapidly evolving forms of increasingly 9 Table of Contents sophisticated and frequent cyber-attacks.
We are involved, on an ongoing basis, in litigation relating to alleged antitrust violations or arising in the ordinary course of business or otherwise. Trends in litigation may include class actions involving consumers, shareholders, employees, or injured persons, and claims relating to commercial, labor, employment, antitrust, securities, or environmental matters.
We are involved, on an ongoing basis, in litigation relating to alleged antitrust violations or arising in the ordinary course of business or otherwise. Trends in litigation may include class actions involving consumers, shareholders, employees, or injured persons, and claims relating to commercial, labor, employment, antitrust, securities, or environmental matters. Claims in the future may also arise.
Our business could suffer significant setbacks in revenues and operating income if we lost one or more of our largest customers, or if our customers’ plans and/or markets should change significantly. 10 Table of Contents We depend on contract growers and independent producers to supply us with livestock.
Our business could suffer significant setbacks in revenues and operating income if we lost one or more of our largest customers, or if our customers’ plans and/or markets should change significantly. We depend on contract growers and independent producers to supply us with livestock.
Our continued growth requires us to attract, hire, retain and develop key team members, including our executive officers and senior management team, and maintain a highly skilled and diverse global workforce. We compete to attract and hire highly skilled team members and our own team members are highly sought after by our competitors and other companies.
Our continued growth requires us to attract, hire, retain and develop key team members, including our executive officers and senior management team, and maintain a highly skilled and diverse global workforce at such levels. We compete to attract and hire highly skilled team members and our own team members are highly sought after by our competitors and other companies.
Several factors have had and may continue to have adverse effects on the labor force available to us and our third-party vendors, including government regulations, which include laws and regulations related to workers’ health and safety, wage and hour practices and work authorization.
Several factors have had and may continue to have adverse effects on the labor force available to us and our third-party vendors, including immigration laws and government regulations, which include laws and regulations related to workers; health and safety, wage, and hour practices and work authorization.
If the carrying value of our reporting units exceeds their current fair value as determined based on the discounted future cash flows of the related business, the goodwill is considered impaired and is reduced to fair value by a non-cash charge to earnings.
If the carrying value of our reporting units exceeds their current fair value as determined based on the discounted future cash flows of 15 Table of Contents the related business, the goodwill is considered impaired and is reduced to fair value by a non-cash charge to earnings.
The vulnerability of our systems and our failure to identify or respond timely to cyber incidents could have an adverse effect on our operations and reputation and expose us to liability or regulatory enforcement actions. 9 Table of Contents Our operations are subject to general risks of litigation.
The vulnerability of our systems and our failure to identify or respond timely to cyber incidents could have an adverse effect on our operations and reputation and expose us to liability or regulatory enforcement actions. Our operations are subject to general risks of litigation.
Also, no assurance can be given that further enforcement efforts by governmental authorities will not result in the assessment of fines that could adversely affect our financial position, operating results or cash flows.
Also, no assurance can be given that further enforcement efforts by governmental authorities will not result in the assessment of fines or other increases in cash outlays that could adversely affect our financial position, operating results or cash flows.
The loss of the services of one or more members of our senior management or of numerous employees with essential skills could have a negative effect on our business, financial condition and results of operations.
The loss of the services of one or more members of our senior management or of similarly positioned employees with essential skills could have a negative effect on our business, financial condition and results of operations.
In addition, regulators, stockholders, customers and other interested parties have focused increasingly on the environmental, social and governance practices of companies. This has led to an increase in regulations and may continue to cause us to be subject to additional regulations in the future.
In addition, regulators, stockholders, customers and other interested parties have focused increasingly on the sustainability practices of companies. This has led to an increase in regulations and may continue to cause us to be subject to additional regulations in the future.
If we fail to meet these targeted reductions in 2025, the interest rate applied to these Senior Notes will increase. Finally, from time to time we establish and publicly announce goals and targets to reduce our carbon footprint.
If we fail to meet these targeted reductions in 2025, the interest rate applied to these Senior Notes will increase. Finally, from time to time we establish, assess, and publicly announce aspirations to reduce our carbon footprint.
Our future financial and operating flexibility may be adversely affected by significant leverage. On a consolidated basis, as of December 29, 2024, we had approximately $3.2 billion of unsecured indebtedness and had the ability to borrow approximately $1.1 billion under our credit agreements.
Our future financial and operating flexibility may be adversely affected by significant leverage. On a consolidated basis, as of December 28, 2025, we had approximately $3.1 billion of unsecured indebtedness and had the ability to borrow approximately $1.1 billion under our credit agreements.
Stock Ownership and Financial Risk Factors JBS USA beneficially owns a majority of our common stock and has the ability to control the vote on most matters brought before the holders of our common stock. JBS USA Food Company Holdings, Inc.
Stock Ownership and Financial Risk Factors JBS USA beneficially owns a majority of our common stock and has the ability to control the vote on most matters brought before the holders of our common stock.
Trained and experienced personnel in our industry are in high demand, and we have experienced high turnover and difficulty retaining employees with appropriate training and skills.
Trained and experienced personnel in our industry are in high demand, and we and our third-party vendors have experienced high turnover and difficulty retaining employees with appropriate training and skills.
(“JBS USA Holdings”) beneficially and indirectly owns a majority of the shares and voting power of our common stock and is entitled to appoint a majority of the members of our Board of Directors.
JBS USA Food Company Holdings (“JBS USA Holdings”) beneficially and indirectly owns a majority of the shares and voting power of our common stock and is entitled to appoint a majority of the members of our Board of Directors.
Because of these trends, our volume growth could slow or we may need to lower prices or increase promotional spending for our products, any of which could adversely affect our financial results. Our two largest customers together accounted for approximately 16.6% of our consolidated net sales in 2024.
Because of these trends, our volume growth could slow or we may need to lower prices or increase promotional spending for our products, any of which could adversely affect our financial results. 10 Table of Contents Our two largest customers together accounted for approximately 16.8% of our consolidated net sales in 2025.
Our customers or other interested parties may also require us to implement certain environmental, social or governance procedures or standards before doing or continuing to do business with us. Also, the U.S. government has increased its focus on market dynamics within the meat industry.
Our customers or other interested parties may also require us to implement certain sustainability procedures or standards before doing, or continuing to do, business with us. Also, the U.S. government has increased its focus on market dynamics or other facets of the meat industry.
Litigation trends and the outcome of litigation cannot be predicted with certainty, and adverse litigation trends and outcomes could result in material damages, which could adversely affect our financial condition and results of operations.
The long-term impact of this executive order, litigation trends and the outcome of litigation, cannot be predicted with certainty, and adverse litigation trends and outcomes could result in material damages, which could adversely affect our financial condition and results of operations.
Any deterioration of those relations or increase in labor costs due to our compliance with labor laws could adversely affect our business. As of December 29, 2024, we employed approximately 61,600 persons. Approximately 35.4% of our workforce are covered by a collective bargaining agreement.
Any deterioration of those relations or increase in labor costs due to our compliance with labor laws could adversely affect our business. As of December 28, 2025, we employed approximately 63,000 persons. Approximately 35% of our workforce are covered by a collective bargaining agreement.
The U.K. prepared foods market is less exclusively sourced from within the U.K. so vertical integration is less of a consideration, and competition is opened up to other processors; some of whom produce or source from abroad.
The U.K. fresh market is primarily sourced from within the U.K., making vertical integration a prerequisite for operating in that market. The U.K. prepared foods market is less exclusively sourced from within the U.K. so vertical integration is less of a consideration, and competition is opened up to other processors; some of whom produce or source from abroad.
This increased attention on environmental, social, and governance practices could cause us to incur additional compliance costs, divert management attention from operating our business, impair our access to capital among certain investors, and subject us to litigation risk for disclosures we make and practices we adopt regarding these issues.
This increased attention on sustainability practices and other facets of the meatpacking industry could cause us to incur additional compliance costs, divert management attention from operating our business, impair our access to capital among certain investors, and subject us to litigation risk for disclosures we make and practices we adopt regarding these issues.
Media campaigns related to food production; regulatory and customer focus on environmental, social and governance responsibility; and recent increased focus and attention by the U.S. government on market dynamics in the meat processing industry could expose us to additional costs or risks.
Media campaigns related to food production, regulatory and customer focus on sustainability, and recent increased focus and attention by the U.S. government on market dynamics and other facets of the meat processing industry could expose us to additional costs or risks.
Significant political or regulatory developments in the jurisdictions in which we sell our products, such as those stemming from the presidential administration in the U.S., are difficult to predict, may create uncertainty, and could impact our business.
Significant political or regulatory developments in the jurisdictions in which we sell our products, such as those stemming from the presidential administration in the U.S., are difficult to predict, may create uncertainty, and could impact our business. For example, the implementation of new tariff schemes by various governments, such as those implemented by the U.S.
Labor shortages and increased turnover rates within the Company and our third-party vendors have led to and could in the future lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees and could negatively affect our ability to efficiently operate our production facilities or otherwise operate at full capacity and could result in downtime of our production facilities.
This has led to, and could in the future continue to lead to, increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, and could negatively affect our ability to efficiently operate our production facilities or otherwise operate at full capacity or result in downtime of our production facilities.
Disruptions in credit and other financial markets caused by deteriorating or weak national and international economic conditions could, among other things: • make it more difficult for us, our customers or our growers or prospective growers to obtain financing and credit on reasonable terms; • cause lenders to change their practice with respect to the industry generally or our company specifically in terms of granting credit extensions and terms; • impair the financial condition of our customers, suppliers or growers making it difficult for them to meet their obligations and supply raw material; or • impair the financial condition of our insurers, making it difficult or impossible for them to meet their obligations to us. 16 Table of Contents Our business may be negatively impacted by economic or other consequences from Russia’s war against Ukraine and the sanctions imposed as a response to that action.
Disruptions in credit and other financial markets caused by deteriorating or weak national and international economic conditions could, among other things: • make it more difficult for us, our customers or our growers or prospective growers to obtain financing and credit on reasonable terms; • cause lenders to change their practice with respect to the industry generally or our company specifically in terms of granting credit extensions and terms; • impair the financial condition of our customers, suppliers or growers making it difficult for them to meet their obligations and supply raw material; or • impair the financial condition of our insurers, making it difficult or impossible for them to meet their obligations to us.
For example, in 2018, the European Union (the “E.U.”) recently commenced enforcement of the General Data Protection Regulation (the “GDPR”). The GDPR imposes significant additional compliance obligations on companies regarding the handling of personal data and provides certain individual privacy rights to persons whose data is stored.
For example, in 2018, the E.U. recently commenced enforcement of the General Data Protection Regulation (the “GDPR”). The GDPR imposes significant additional compliance obligations on companies regarding the handling of personal data and provides certain individual privacy rights to persons whose data is stored. The GDPR grants enforcement powers to certain E.U. regulators including extra-territorial powers in some cases.
The impacts have included and may continue to include, but are not limited to, higher prices for commodities, such as food products, ingredients and energy products, increasing inflation in some countries, and disrupted trade and supply chains. The conflict has disrupted shipments of grains, vegetable oils, fertilizer and energy products.
The impacts have included and may continue to include, but are not limited to, higher prices for commodities, such as food products, ingredients and energy products, increasing inflation in some countries, riskier futures prices, disrupted trade and supply chains, and increased pressure on the supply of feed ingredients and energy products.
Bioterrorism, fire, pandemic, extreme weather or natural disasters, including droughts, floods, excessive cold or heat, hurricanes or other storms, could impair the health or growth of our flocks, production or availability of feed ingredients, or interfere with our operations due to power outages, fuel shortages, damage to our production and processing facilities or disruption of transportation channels, among other things.
Extreme weather, natural disasters or other events beyond our control as well as interruption by man-made problems such as power disruptions could negatively impact our business. 16 Table of Contents Bioterrorism, fire, pandemic, extreme weather or natural disasters, including droughts, floods, tornados, excessive cold or heat, hurricanes or other storms, could impair the health or growth of our flocks, production or availability of feed ingredients, or interfere with our operations due to power outages, fuel shortages, damage to our production and processing facilities or disruption of transportation channels, among other things.
There is no certainty that enforcement efforts by governmental authorities will not disrupt a portion of our workforce or operations at one or more facilities, which could negatively impact our business.
There is no certainty that enforcement efforts by governmental authorities will not disrupt a portion of our workforce or operations at one or more facilities, which could negatively impact our business. For example, we have historically increased headcounts in certain facilities to avoid disruptions to our operations.
If we are not able to retain or attract talented, committed individuals to fill vacant positions when needs arise, it may adversely affect our ability to achieve our business objectives. We also rely on an adequate supply of skilled employees at our processing and food facilities.
If we are not able to retain or attract talented, committed individuals to fill vacant positions when needs arise, it may also adversely affect our ability to achieve our business objectives.
Also in 2020, J&F reached a plea agreement with the Department of Justice (“DOJ”) in which J&F pled guilty to one count of conspiracy to violate the FCPA in relation to the circumstances and payments that were the subject of the Collaboration Agreements and Leniency Agreement and agreed to pay a criminal penalty of US$256.5 million, payable in two installments of approximately US$128.2 million each.
JBS S.A. was ordered to pay disgorgement to the SEC in the amount of US$26.9 million, and each of our ultimate controlling shareholders was ordered to pay a civil penalty of US$550,000, each of which payment has been made in full. 14 Table of Contents Also in 2020, J&F reached a plea agreement with the Department of Justice (the “DOJ”) in which J&F pled guilty to one count of conspiracy to violate the FCPA in relation to the circumstances and payments that were the subject of the Collaboration Agreements and Leniency Agreement and agreed to pay a criminal penalty of US$256.5 million, payable in two installments of approximately US$128.2 million each.
Pursuant to the Leniency Agreement, J&F agreed to pay a fine of R$8.0 billion and contribute an additional R$2.3 billion to social projects in Brazil, each adjusted for inflation, over a 25-year period.
Pursuant to the Leniency Agreement, J&F agreed to pay a fine of R$8.0 billion and contribute an additional R$2.3 billion to social projects in Brazil, each adjusted for inflation, over a 25-year period. The total fine was subsequently reduced to R$3.5 billion (equivalent to approximately US$630 million, converted using the foreign exchange rate as of June 30, 2024).
While our industry 13 Table of Contents generally operates with high employee turnover, any material increases in employee turnover rates or any widespread employee dissatisfaction could also have a material adverse effect on our business, financial condition and results of operations. Labor shortages and increased turnover or increases in employee and employee-related costs could have adverse effects on our profitability.
While our industry generally operates with high employee turnover, any material increases in employee turnover rates or any widespread employee dissatisfaction could also have a material adverse effect on our business, financial condition and results of operations. 13 Table of Contents If we are unable to attract, hire or retain key team members, it could have a negative impact on our business, financial condition or results of operations.
We are upgrading wastewater treatment facilities at a number of these locations, either pursuant to consent agreements with regulatory authorities or on a voluntary basis in anticipation of future permit requirements. For example, the EPA has proposed Meat and Poultry Products Effluent Guidelines and Standards, which may increase requirements and necessitate further upgrades to existing facilities.
We are upgrading wastewater treatment facilities at a number of these locations, either pursuant to consent agreements with regulatory authorities or on a voluntary basis in anticipation of future permit requirements.
In the Mexico retail and foodservice markets, where product differentiation has traditionally been limited, product quality and price have been the most critical competitive factors. In the U.K., the Republic of Ireland, and continental Europe retail and food service markets, key competitive factors include price, delivering consistent levels of the highest quality, service level, and delivering strong innovation.
In the U.K., the Republic of Ireland, and continental Europe retail and food service markets, key competitive factors include price, delivering consistent levels of the highest quality, service level, and delivering strong innovation. The fresh U.K. and continental Europe market primarily consists of retailer private label products.
This could result in customer order cancellations or create adverse publicity that may have a material adverse effect on our ability to market our products successfully and on our business, reputation and prospects. There have been recent outbreaks of both high- and low-pathogenic strains of avian influenza (“HPAI” and “LPAI”, respectively) in Europe, the U.S., the U.K., and in Mexico.
This could result in customer order cancellations or create adverse publicity that may have a material adverse effect on our ability to market our products successfully and on our business, reputation and prospects.
This, to a certain extent, is subject to various business factors (including, among others, the commodity prices of feed ingredients, chicken and pork) and general economic, financial, competitive, legislative, regulatory, and other factors that are beyond our control. 15 Table of Contents There can be no assurance that we will be able to generate sufficient cash flow from operations or that future borrowings will be available under our credit facilities in an amount sufficient to enable us to pay our debt obligations, including obligations under our credit facilities, or to fund our other liquidity needs.
There can be no assurance that we will be able to generate sufficient cash flow from operations or that future borrowings will be available under our credit facilities in an amount sufficient to enable us to pay our debt obligations, including obligations under our credit facilities, or to fund our other liquidity needs.
For example, the implementation of new tariff schemes by various governments, such as those implemented by the U.S. and China in recent years, could increase the costs of our operations and ultimately increase the cost of products sold from one country into another country.
Mexico, European countries, and China in recent years, could increase the costs of our operations and ultimately increase the cost of products sold from one country into another country, or otherwise adversely impact our operations.
We face risks related to the ongoing Russia-Ukraine war that began in February 2022. The impact of the ongoing war and sanctions will likely not be limited to businesses that operate in Russia and Ukraine and may negatively impact other global economic markets including where we operate.
Our business may be negatively impacted by economic or other consequences from Russia’s war against Ukraine and the sanctions imposed as a response to that action. We face continued risks related to the ongoing Russia-Ukraine war that began in February 2022.
Loss of essential employees or material increase in employee turnover could have a significant negative impact on our business. Our success is largely dependent on the skills, experience, and efforts of our management and other employees.
Loss of skilled employees, labor shortages, or a material increase in employee turnover could have a significant negative impact on our business and adverse effects on our profitability. We also rely on an adequate supply of skilled employees at our processing and food facilities.
Removed
The GDPR grants enforcement powers to certain E.U. regulators including extra-territorial powers in some cases.
Added
In the Mexico retail and foodservice markets, where product differentiation has 8 Table of Contents traditionally been limited, product quality and price have been the most critical competitive factors.
Removed
The fresh U.K. and continental Europe market primarily consists of retailer private label products. The U.K. fresh market is primarily sourced from within the U.K., making 8 Table of Contents vertical integration a prerequisite for operating in that market.
Added
For example, in December 2025, President Trump signed an executive order directing the Justice Department and Federal Trade Commission to antitrust investigations across the food supply sector.
Removed
Furthermore, compliance with any such legal or regulatory requirements could necessitate significant changes to our business operations and strategy, which may require substantial time, attention and resources. There is no assurance that we will not be subject to significant fines if such laws and regulations are interpreted and applied in a manner inconsistent with our practices.
Added
This, to a certain extent, is subject to various business factors (including, among others, the commodity prices of feed ingredients, chicken and pork) and general economic, financial, competitive, legislative, regulatory, and other factors that are beyond our control.
Removed
We cannot predict whether we will be able to attract, motivate and maintain an adequate skilled workforce necessary to operate our existing and future facilities efficiently, or that labor expenses will not increase as a result of a shortage in the supply of skilled personnel, thereby adversely impacting our financial performance.
Added
The war’s impact on the global feed ingredient and energy markets continues to be less pronounced than during the initial onset of the war, but there remain many risks and uncertainties that may and have impacted global markets.
Removed
We and our third-party vendors have experienced increased labor shortages at some of our production facilities and other locations.
Added
There is also an ongoing risk of a cyber-attack as a result of the ongoing conflict, although we have not to date seen any new or heightened risk of such potential attacks.
Removed
An overall or prolonged labor shortage, lack of skilled labor, increased turnover or labor inflation for any of the foregoing reasons could have a material adverse impact on our operations, results of operations, reputation, liquidity or cash flows.
Added
Our use of artificial intelligence and machine learning may result in legal and regulatory risks.
Removed
If we are unable to attract, hire or retain key team members or a highly skilled and diverse global workforce, it could have a negative impact on our business, financial condition or results of operations.
Added
While we currently have limited use cases for artificial intelligence, to the extent we use technology more broadly in the future, its use entails significant legal risks, including the breach of a data or software license, website terms of service claims, claimed violations of privacy rights or other tort claims.
Removed
The total fine was subsequently reduced to R$3.5 billion (equivalent to approximately US$630 million, converted using the 14 Table of Contents foreign exchange rate as of June 30, 2024).
Added
The regulatory landscape surrounding artificial intelligence is also evolving, and expanded use of machine learning technologies may become subject to regulation under new laws or new applications of existing laws.
Removed
JBS S.A. was ordered to pay disgorgement to the SEC in the amount of US$26.9 million, and each of our ultimate controlling shareholders was ordered to pay a civil penalty of US$550,000, each of which payment has been made in full.
Added
Compliance with these regulations may increase costs, and violations of these laws and regulations could result in fines and penalties, criminal sanctions against us, our officers or our employees, prohibitions on the conduct of our business, and damage to our reputation. Item 1B. Unresolved Staff Comments None.
Removed
The impact on the agriculture markets falls into two main categories: (1) the effect on Ukrainian crop production, as the region is key in global grain production; and (2) the duration of the disruption in trade flows.
Removed
Safety and financing concerns in the region are restricting export execution, which is in turn forcing grain and oil demand to find alternative supply. The duration of the war and related volatility makes global markets extremely sensitive to growing-season weather in other global grain producing regions and has led to a large risk premium in futures prices.
Removed
Moreover, Russia’s suspension of the Black Sea Grain Initiative in June 2023 may further pressure on trade flows in the region.
Removed
The continued volatility in the global markets, in part as a result of the war, has adversely impacted our costs by driving up prices, raising inflation and increasing pressure on the supply of feed ingredients and energy products throughout the global markets.
Removed
In addition, the U.S. government and other governments in jurisdictions in which we operate have imposed sanctions and export controls against Russia, Belarus and interests therein and threatened additional sanctions and controls. The impact of these measures, now and in the future, could adversely affect our business, supply chain or customers.
Removed
Finally, there may be increased risk of cyberattack as a result of the ongoing conflict. We have not seen any new or heightened risk of potential cyberattacks since the outbreak of the Russia-Ukraine war. Extreme weather, natural disasters or other events beyond our control as well as interruption by man-made problems such as power disruptions could negatively impact our business.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

8 edited+4 added−1 removed2 unchanged
Biggest changeWe maintain a cross-functional Cybersecurity Committee, as well as a Global Security Committee consisting of the information technology professionals and security managers from each country in which we have operations. 17 Table of Contents We have both policies and procedures that align with the National Institute of Standards and Technology Cybersecurity Framework.
Biggest changeOur CIO has significant experience in information technology and many of our information technology team members hold qualifications in technology security positions. We maintain a cross-functional Cybersecurity Committee, as well as a Global Security Committee consisting of the information technology professionals and security managers from each country in which we have operations.
Item 1C. Cybersecurity Cybersecurity Risk, Strategy and Governance The Company maintains a robust cybersecurity infrastructure to safeguard our operations, networks and data through comprehensive security measures including our technology tools, internal management and external service providers. The Company’s Chief Information Officer (“CIO”) is responsible for assessing, identifying, and managing the risks from cybersecurity threats.
Item 1C. Cybersecurity The Company maintains a robust cybersecurity infrastructure to safeguard our operations, networks and data through comprehensive security measures including our technology tools, internal management and external service providers. The Company’s Chief Information Officer (“CIO”) is responsible for assessing, identifying, and managing the risks from cybersecurity threats.
The incident response plan ties into our Cybersecurity Committee processes for review to ensure the required reporting of material incidents to the Board of Directors, as applicable. Our Board of Directors, primarily through the Audit Committee, oversees management’s approach to managing cybersecurity risks as part of its risk management oversight.
The incident response plan ties into our Cybersecurity Committee processes for review to ensure the required reporting of material incidents to the Board of Directors, as applicable. 17 Table of Contents Our Board of Directors, primarily through the Audit Committee, oversees management’s approach to managing cybersecurity risks as part of its risk management oversight.
We also endeavor to apprise employees of emerging risks and require them to undergo regular security awareness trainings and supplemental trainings as needed. Additionally, we conduct periodic internal exercises to gauge the effectiveness of the trainings and assess the need for additional training. In addition, we engage independent third-party cybersecurity providers for testing and vulnerability detection.
We also endeavor to apprise employees of emerging risks and require them to undergo regular security awareness trainings and supplemental trainings as needed. Additionally, we conduct periodic internal exercises to gauge the effectiveness of the trainings and assess the need for additional training. At least annually, we engage independent third-party cybersecurity providers for testing and vulnerability detection.
The Audit Committee holds periodic discussions with management regarding the Company’s guidelines and policies with respect to cybersecurity risks and receives regular reports from the CIO regarding such risks and the steps management has taken to monitor and control any exposure resulting from such risks.
The Audit Committee holds discussions at least annually with management regarding the Company’s guidelines and policies with respect to cybersecurity risks and receives regular reports from the CIO regarding such risks and the steps management has taken to monitor and control any exposure resulting from such risks.
Risks identified by our cybersecurity program are analyzed to determine the potential impact on us and the likelihood of occurrence. Such risks are continuously monitored to ensure that the circumstances and severity of such risks have not changed.
Our CIO, together with our Global Security Committee, reviews emerging threats, controls, and procedures as part of assessing, identifying, and managing risks. Risks identified by our cybersecurity program are analyzed to determine the potential impact on us and the likelihood of occurrence. Such risks are continuously monitored to ensure that the circumstances and severity of such risks have not changed.
As of the date of this report, we are not aware of any risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. 18 Table of Contents
While we have experienced cybersecurity incidents, to date, we are not aware of any risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. For more information, see “Item 1A.
Our information security program includes, among other aspects, vulnerability management, antivirus and malware protection, encryption and access control, and employee training. Our CIO, together with our Global Security Committee, reviews emerging threats, controls, and procedures as part of assessing, identifying, and managing risks.
We have both policies and procedures that align with the National Institute of Standards and Technology Cybersecurity Framework. Our information security program includes, among other aspects, vulnerability management, antivirus and malware protection, encryption and access control, and employee training.
Removed
Our CIO has significant experience in information technology and many of our information technology team members hold qualifications in technology security positions.
Added
Computer viruses, hackers, and employee or vendor misconduct, and other external hazards could expose our data systems and those of our vendors to security breaches, cybersecurity incidents or other disruptions, any of which could materially and adversely affect our ability to conduct our business.
Added
The sophistication of cybersecurity threats continues to increase, and the controls and preventative actions we take to reduce the risk of cybersecurity incidents and protect our systems, including the regular testing of our cybersecurity incident response plan, may be insufficient.
Added
In addition, new technology that could result in greater operational efficiency may further expose our computer systems to the risk of cybersecurity incidents.
Added
Risk Factors - We are increasingly dependent on information technology, and our business and reputation could suffer if we are unable to protect our information technology systems against, or effectively respond to, cyber-attacks or other cyber security incidents or breaches, or if our information technology systems are otherwise disrupted.” 18 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeProperties Operating Facilities Our main operating facilities are as follows: Number of Facilities Owned Leased Total Capacity (a) Unit of Measure Average Capacity Utilization Chicken Operations: Fresh processing facilities 35 1 36 8.3 million Birds per day 93.4 % Prepared foods facilities 12 2 14 535,368 Tons per year 81.7 % Hatcheries 47 2 49 3.2 billion Eggs per year 91.3 % Other operation facilities (b) 51 1 52 16.1 million Tons per year 73.9 % Grain elevator 1 — 1 8.6 million Bushels per year 13.6 % Pork Operations: Fresh processing facilities 2 — 2 8,550 Pigs per day 94.3 % Prepared foods facilities 7 — 7 232,401 Tons per year 66.1 % Other operation facilities (c) 1 — 1 3,750 Pigs per year 88.9 % Lamb Operations (d) : Fresh processing facilities 1 — 1 3,333 Lambs per day 89.7 % Prepared foods facilities 1 — 1 13,614 Tons per year 69.9 % Prepared Meals Operations: Prepared meals facilities 5 3 8 294,666 Tons per year 64.5 % Distribution Centers and Other 11 18 29 N/A N/A (a) Capacity and utilization numbers do not include idled facilities.
Biggest changeProperties Operating Facilities Our main operating facilities are as follows: Number of Facilities Owned Leased Total Capacity (a) Unit of Measure Average Capacity Utilization Chicken Operations: Fresh processing facilities 35 1 36 8.3 million Birds per day 94.7 % Prepared foods facilities 12 2 14 536,934 Tons per year 84.6 % Hatcheries 47 3 50 3.2 billion Eggs per year 91.7 % Other operation facilities (b) 50 1 51 16.4 Tons per year 74.9 % Grain elevator 1 — 1 8.6 million Bushels per year 21.3 % Pork Operations: Fresh processing facilities 2 — 2 8,600 Pigs per day 95.3 % Prepared foods facilities 7 — 7 203,742 Tons per year 64.2 % Other operation facilities (c) 1 — 1 20,850 Pigs per year 79.9 % Lamb Operations (d) : Fresh processing facilities 1 — 1 3,333 Lambs per day 93.1 % Prepared foods facilities 1 — 1 13,614 Tons per year 79.1 % Prepared Meals Operations: Prepared meals facilities 5 1 6 265,732 Tons per year 66.4 % Distribution Centers and Other 11 27 38 N/A N/A (a) Capacity and utilization numbers do not include idled facilities.
(b) Other facilities in the chicken operations include feed mills, protein conversion and rendering facilities, and pet food facilities in the U.S. (c) Other facilities in the pork operations include company-owned pig farms in the U.K. (d) Facilities in lamb operations are from the acquisition of Randall Parker Foods and are in the U.K. 19 Table of Contents
(b) Other facilities in the chicken operations include feed mills, protein conversion and rendering facilities, and pet food facilities in the U.S. (c) Other facilities in the pork operations include company-owned pig farms in the U.K.
Added
(d) Facilities in lamb operations are from the acquisition of Randall Parker Foods (renamed to “Pilgrim’s UK Lamb Ltd.”) and are in the U.K. 19 Table of Contents

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+1 added−1 removed2 unchanged
Biggest changeThe stock price performance represented by this graph is not necessarily indicative 21 Table of Contents of future stock performance. 12/29/19 06/30/20 12/27/20 06/30/21 12/26/21 06/30/22 12/25/22 06/30/23 12/31/23 06/30/24 12/29/24 PPC $ 100.00 $ 51.23 $ 58.69 $ 67.27 $ 83.56 $ 94.72 $ 72.19 $ 65.18 $ 83.89 $ 116.74 $ 139.28 Russell 2000 100.00 87.02 119.96 141.00 137.74 105.47 109.59 118.45 128.14 130.36 142.93 Peer Group 100.00 83.63 86.82 94.23 102.85 104.05 87.07 75.85 70.52 72.38 75.67
Biggest changeThe stock price performance represented by this graph is not necessarily indicative of future stock performance. 21 Table of Contents 12/27/20 06/30/21 12/26/21 06/30/22 12/25/22 06/30/23 12/31/23 06/30/24 12/29/24 06/30/25 12/28/25 Pilgrim's Pride Corporation $ 100.00 $ 114.63 $ 142.38 $ 161.40 $ 123.00 $ 111.06 $ 142.95 $ 198.91 $ 237.31 $ 261.14 $ 241.47 Russell 2000 100.00 117.54 114.82 87.92 91.35 98.74 106.82 108.67 119.14 117.02 134.40 Peer Group 100.00 108.53 118.47 119.85 100.29 87.37 81.23 83.37 87.15 85.00 81.04
Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is listed on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “PPC.” Holders As of February 7, 2025, the Company estimates that there were approximately 85,000 holders (including individual participants in security position listings) of the Company’s common stock.
Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is listed on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “PPC.” Holders As of February 10, 2026, the Company estimates that there were approximately 99,000 holders (including individual participants in security position listings) of the Company’s common stock.
Performance Graph The graph below shows a comparison from December 29, 2019 through December 29, 2024 of the cumulative 5-year total stockholder return of holders of the Company’s common stock with the cumulative total returns of the Russell 2000 index and a customized peer group of two companies: Tyson Foods Inc and Hormel Foods Corp.
Performance Graph The graph below shows a comparison from December 27, 2020 through December 28, 2025 of the cumulative 5-year total stockholder return of holders of the Company’s common stock with the cumulative total returns of the Russell 2000 index and a customized peer group of two companies: Tyson Foods Inc and Hormel Foods Corp.
The graph assumes that the value of the investment in our common stock, in each index, and in the peer group (including reinvestment of dividends) was $100 on December 29, 2019 and tracks it through December 29, 2024.
The graph assumes that the value of the investment in our common stock, in each index, and in the peer group (including reinvestment of dividends) was $100 on December 27, 2020 and tracks it through December 28, 2025.
The graph covers the period from December 29, 2019 to December 29, 2024, and reflects the performance of the Company’s single class of common stock.
The graph covers the period from December 27, 2020 to December 28, 2025, and reflects the performance of the Company’s single class of common stock.
Dividends The Company does not have a policy of paying dividends to its stockholders. Any change in dividend policy will depend upon future conditions, including earnings and financial condition, general business conditions, any applicable contractual limitations and other factors deemed relevant by our Board of Directors in its discretion. Both the U.S.
Any change in dividend policy will depend upon future conditions, including earnings and financial condition, general business conditions, any applicable contractual limitations and other factors deemed relevant by our Board of Directors in its discretion. Both the U.S. Credit Facility and the indentures governing the Company’s senior notes restrict, but do not prohibit, the Company from declaring dividends.
Removed
Credit Facility and the indentures governing the Company’s senior notes restrict, but do not prohibit, the Company from declaring dividends.
Added
Dividends The Company does not have a policy of paying dividends to its stockholders. In 2025, the Board of Directors authorized to pay approximately $2 billion of special dividends due to the significant cash generation.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

93 edited+38 added−26 removed69 unchanged
Biggest changeProceeds from property disposals were primarily for the sale of a farm in Mexico and other miscellaneous equipment. 29 Table of Contents Year Ended Cash Flows from Financing Activities December 29, 2024 December 31, 2023 (In millions) Proceeds from revolving line of credit and long-term borrowings $ — $ 1,768.2 Payments on revolving line of credit, long-term borrowings, and finance lease obligations (152.1) (1,616.3) Payment of capitalized loan costs — (19.8) Payment on early extinguishment of debt (0.2) (13.8) Proceeds from contribution (payment of distribution) of capital under Tax Sharing Agreement with JBS USA Holdings 1.4 (1.6) Cash provided by (used in) financing activities $ (150.9) $ 116.7 Payments on revolving line of credit, long-term borrowings and finance lease obligations during 2024 are primarily related to open market repurchases of outstanding senior notes.
Biggest changeYear Ended Cash Flows from Financing Activities December 28, 2025 December 29, 2024 (In millions) Payments for dividends $ (1,994.3) $ — Payments on revolving line of credit, long-term borrowings, and finance lease obligations (115.2) (152.1) Payments on early extinguishment of debt (2.1) (0.2) Purchase of noncontrolling interest (1.3) — Proceeds from contribution of capital under Tax Sharing Agreement with JBS USA Holdings — 1.4 Cash used in financing activities $ (2,113.0) $ (150.9) Payments for dividends during 2025 are related to the special cash dividends that were paid in April and September 2025.
The Sustainability Committee meets on a quarterly basis to monitor progress, provide feedback, and evaluate impact of trends. Reportable Segments We operate in three reportable segments: the U.S., Europe, and Mexico. We measure segment profit as operating income.
The Sustainability Committee meets on a quarterly basis to monitor progress, provide feedback, and evaluate the impact of trends. Reportable Segments We operate in three reportable segments: the U.S., Europe, and Mexico. We measure segment profit as operating income.
We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
We base our estimates on historical experience and on various other assumptions, which are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Reconciliation of Net Income to EBITDA and Adjusted EBITDA “EBITDA” is defined as the sum of net income (loss) plus interest, taxes, depreciation and amortization.
Reconciliation of Net Income to EBITDA, Adjusted EBITDA and Adjusted Net Income “EBITDA” is defined as the sum of net income (loss) plus interest, taxes, depreciation and amortization.
Pillar II is part of one of the OECD’s most recent initiatives, known as BEPS 2.0, which aims to address tax challenges arising from evolving business models in a globalized economy. The goal of Pillar II is to establish a global minimum tax system for multinational enterprises (“MNEs”) with annual consolidated revenue exceeding €750 million.
Pillar II is part of one of the OECD’s most recent initiatives, known as BEPS 2.0, which aims to address tax challenges arising from evolving business models in a globalized economy. The goal of Pillar II is to establish a global minimum tax system for multinational enterprises (“MNEs”) with annual consolidated revenue exceeding EUR 750 million.
As part of our business management processes, progress against these metrics is reviewed at least monthly and evaluated by external agencies to assess progress against industry peers. In addition, the Board of Directors formed a Sustainability Committee to provide oversight and counsel on strategies, policies, and investments to reduce the impact of climate change.
As part of our business management processes, progress against these metrics is reviewed at least monthly and evaluated by external agencies to assess progress relative to industry peers. In addition, the Board of Directors formed a Sustainability Committee to provide oversight and counsel on strategies, policies, and investments to reduce the impact of climate change.
The costs associated with breeder sow inventories are accumulated up to the production stage and amortized on a straight-line basis over their productive lives to the estimated residual cull value. The costs associated with finished poultry products, finished pork products, feed, eggs and other inventories are stated at the lower of cost (average) or net realizable value.
The costs associated with breeder sow inventories are accumulated up to the production stage and amortized on a straight-line basis over their productive lives to the estimated residual cull value. The costs associated with finished poultry products, finished pork products, feed, eggs and other inventories are stated at the lower of cost or net realizable value.
The previous reporting units were Moy Park, Pilgrim's UK, and Pilgrim's Food Masters. The new reporting units are Fresh Pork/Lamb, Fresh Poultry, Food Service, Meals, and Brands & Snacking. As a result of this reorganization, the Company reassigned assets and liabilities to the applicable reporting units and allocated goodwill using the relative net assets approach.
The previous reporting units were Moy Park, Pilgrim's UK, and Pilgrim's Food Masters. The new reporting units were Fresh Pork/Lamb, Fresh Poultry, Food Service, Meals, and Brands & Snacking. As a result of this reorganization, the Company reassigned assets and liabilities to the applicable reporting units and allocated goodwill using the relative net assets approach.
We recognize potential interest and penalties related to income tax positions as a part of the income tax provision. Defined Benefit Pension and Other Postretirement Plans. We sponsor four qualified defined benefit pension plans, two nonqualified defined benefit retirement plans, and one defined benefit postretirement life insurance plan.
We recognize potential interest and penalties related to income tax positions as a part of the income tax provision. Defined Benefit Pension and Other Postretirement Plans. We sponsor two qualified defined benefit pension plans, two nonqualified defined benefit retirement plans, and one defined benefit postretirement life insurance plan.
Net noncash expense items included $433.6 million of depreciation and amortization, deferred income tax expense of $4.8 million, asset impairment of $28.6 million, stock-based compensation expense of $14.9 million, gain on early extinguishment of debt recognized as a component of interest expense of 28 Table of Contents $11.2 million, loan cost amortization of $5.0 million, accretion of bond discount of $2.5 million, and a $1.8 million gain on property disposals.
Net noncash expense items included $433.6 million of depreciation and amortization, deferred income tax expense of $4.8 million, asset impairment of $28.6 million, stock-based compensation expense of $14.9 million, gain on early extinguishment of debt recognized as a component of interest expense of $11.2 million, loan cost amortization of $5.0 million, accretion of bond discount of $2.5 million, and a $1.8 million gain on property disposals.
The termination included settling all outstanding obligations through a combination of lump-sum payouts to participants who elected to receive one and through a purchase of annuities for the participants who did not elect a lump-sum payout. In order to fund the lump-sum payments and purchases of nonparticipating annuity contracts, all invested assets within each of the two plans was liquidated.
The termination included settling all outstanding obligations through a combination of lump-sum payouts to participants who elected to receive one and through a purchase of annuities for the participants who did not elect a lump-sum payout. In order to fund the lump-sum payments and purchases of nonparticipating annuity contracts, all invested assets within each of the two plans were liquidated.
We, along with the actuaries, review assumptions including estimates of the present value of projected future pension payments to participants. We accumulate and amortize the impact of actuarial gains and losses over future periods. Our defined benefit pension and other postretirement plans contains uncertainties because it requires management to make assumptions and apply judgments.
We, along with the actuaries, review assumptions including estimates of the present value of projected future pension payments to participants. We accumulate and amortize the impact of actuarial gains and losses over future periods. Our defined benefit pension and other postretirement plans contain uncertainties because it requires management to make assumptions and apply judgments.
U.S. commodity market prices throughout 2025 will be impacted by the evolution of foodservice, retail, and export meat demand, influenced by factors such as government regulation, spread of Avian influenza cases both domestically and abroad, evolution of the general economy, and overall protein supply.
U.S. commodity market prices throughout 2026 will be impacted by the evolution of foodservice, retail, and export meat demand, influenced by factors such as government regulation, spread of avian influenza cases both domestically and abroad, evolution of the general economy, and overall protein supply.
We are focused on improving the efficiency of our operations and supporting producers to reduce our environmental footprint.
Environmental Stewardship . We are focused on improving the efficiency of our operations and supporting producers to reduce our environmental footprint.
The mortality 34 Table of Contents assumption reflects experience from representative populations, based on the Pri-2012 Private Retirement Plans Mortality Table Report issued by the Society of Actuaries (“SOA”) in October 2019 and the Mortality Improvement Scale MP-2021 Report issued by the SOA in October 2021.
The mortality assumption reflects experience from representative populations, based on the Pri-2012 Private Retirement Plans Mortality Table Report issued by the Society of Actuaries (“SOA”) in October 2019 and the Mortality Improvement Scale MP-2021 Report issued by the SOA in October 2021.
To cultivate discipline and drive accountability for Sustainability-related matters, we use our annual budgeting process to establish strategies, plans, and risk mitigation tactics. This process is further reinforced by a series of key performance indicators to evaluate and monitor progress. These performance indicators are linked with compensation for both senior executive and plant level personnel.
To cultivate discipline and drive accountability for sustainability-related matters, we use our annual budgeting process to establish strategies, plans, and risk mitigation tactics. This process is further reinforced by a series of key performance indicators to evaluate and monitor progress. These performance indicators are linked to compensation for both senior executives and plant-level personnel.
Generally, we perform an evaluation of whether any lower of cost or net realizable value adjustments are required at the country level based on a number of factors, including: (1) pools of related inventory, (2) product continuation or discontinuation, (3) estimated market selling prices and (4) expected distribution channels.
Generally, we perform an evaluation of whether any lower of cost or net realizable value adjustments are required at the country level based on a number of factors, including: (1) pools of related inventory, (2) product continuation or 32 Table of Contents discontinuation, (3) estimated market selling prices and (4) expected distribution channels.
The discount rates reflect yields on high-quality corporate bonds as of the measurement date and were compared to the effective discount rate determined by discounting plan cash flows using the 12/27/2024 Empower Above Mean Curve. All other assumptions reflect estimates of future experience and considering relevant historical information, such as credible plan experience, from representative populations and relevant plan characteristics.
The discount rates reflect yields on high-quality corporate bonds as of the measurement date and were compared to the effective discount rate determined by discounting plan cash flows using the 12/26/2025 Empower Above Mean Curve. All other assumptions reflect estimates of future experience and considering relevant historical information, such as credible plan experience, from representative populations and relevant plan characteristics.
The amount of deferred tax on these temporary differences is determined using the tax rates expected to apply to the period when the asset is realized or the liability is settled, as applicable, based on the tax rates and laws in the respective tax jurisdiction enacted as of the balance sheet date.
The amount of deferred tax on these temporary differences is determined using the tax rates expected to apply to the period when the asset is realized or the liability is settled, as applicable, based on the tax rates and laws in the respective tax 34 Table of Contents jurisdiction enacted as of the balance sheet date.
GAAP, provides investors with additional perspective regarding the impact of certain significant items on EBITDA and facilitates a more direct comparison of our performance with our competitors. 35 Table of Contents EBITDA and Adjusted EBITDA are not measurements of financial performance under U.S. GAAP.
GAAP, provides investors with additional perspective regarding the impact of certain significant items on EBITDA and facilitates a more direct comparison of our performance with our competitors. EBITDA and Adjusted EBITDA are not measurements of financial performance under U.S. GAAP.
Long-term debt includes the Live Oak CHP Project PACE Loan. For a description, refer to Part II, Item 8, Notes to Consolidated Financial Statements, “Note 13. Debt.” (b) Interest expense in the table above assumes the continuation of interest rates and outstanding borrowings as of December 29, 2024.
Long-term debt includes the Live Oak CHP Project PACE Loan. For a description, refer to Part II, Item 8, Notes to Consolidated Financial Statements, “Note 13. Debt.” (b) Interest expense in the table above assumes the continuation of interest rates and outstanding borrowings as of December 28, 2025.
Management assessed if events or changes in circumstances indicated that the aggregate carrying amount of its identified intangible assets with definite lives might not be recoverable and determined that there were no impairment indicators during the years ended December 29, 2024 and December 31, 2023. Litigation and Contingent Liabilities.
Management assessed if events or changes in circumstances indicated that the aggregate carrying amount of its identified intangible assets with definite lives might not be recoverable and determined that there were no impairment indicators during the years ended December 28, 2025 and December 29, 2024. Litigation and Contingent Liabilities.
This gives us the opportunity to continue to create growth and development opportunities, further increasing our position as a leading domestic and global protein company. We reported net income attributable to Pilgrim’s Pride Corporation of $1.1 billion, or $4.57 per diluted common share, and profit before tax totaling $1.4 billion, for 2024.
This gives us the opportunity to continue to create growth and development opportunities, further increasing our position as a leading domestic and global protein company. We reported net income attributable to Pilgrim’s Pride Corporation of $1.1 billion, or $4.54 per diluted common share, and profit before tax totaling $1.5 billion, for 2025.
Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II of the 2023 Annual Report on Form 10-K filed on February 27, 2024. Liquidity and Capital Resources Our principal sources of liquidity are cash generated from operations, funds from borrowings, and existing cash on hand.
Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II of the 2024 Annual Report on Form 10-K filed on February 13, 2025. Liquidity and Capital Resources Our principal sources of liquidity are cash generated from operations, funds from borrowings, and existing cash on hand.
Inventory typically transfers from one stage of production to another at a standard cost, where it accumulates additional cost directly incurred with the production of inventory, including overhead. The standard cost at which each type of inventory transfers is set by management to reflect the actual costs incurred in the prior steps.
Inventory within a production facility typically transfers from one stage of production to another at a standard cost, at which point it accumulates additional cost directly incurred with the production of inventory, including overhead. The standard cost at which each type of inventory transfers is set by management to reflect the actual costs incurred in the prior steps.
Management estimates the fair value of assets and liabilities based upon quoted market prices, the carrying value of the acquired assets and widely accepted valuation techniques, including discounted cash flows and market multiple analyses.
Management estimates the fair value of assets and liabilities based upon quoted market prices, the carrying value of the acquired assets and widely accepted valuation 35 Table of Contents techniques, including discounted cash flows and market multiple analyses.
These operating results included gross profit of $2.3 billion and generated $2.0 billion of cash from operations. We generated consolidated operating margins of 8.4% with operating margins of 10.5%, 3.3%, and 10.6% in our U.S., Europe, and Mexico reportable segments, respectively. During 2024, we generated EBITDA and Adjusted EBITDA of $1.9 billion and $2.2 billion, respectively.
These operating results included gross profit of $2.4 billion and generated $1.4 billion of cash from operations. We generated consolidated operating margins of 8.7% with operating margins of 10.7%, 5.1%, and 7.9% in our U.S., Europe, and Mexico reportable segments, respectively. During 2025, we generated EBITDA and Adjusted EBITDA of $2.1 billion and $2.3 billion, respectively.
For goodwill, an impairment loss is recognized for any excess of the carrying 32 Table of Contents amount of a reporting unit’s goodwill over the implied fair value of that goodwill.
For goodwill, an impairment loss is recognized for any excess of the carrying amount of a reporting unit’s goodwill over the implied fair value of that goodwill.
As of December 29, 2024, the Company assessed qualitative factors to determine if it was necessary to perform quantitative impairment tests related to the carrying amounts of its intangible assets not subject to amortization.
As of December 28, 2025, the Company assessed qualitative factors to determine if it was necessary to perform quantitative impairment tests related to the carrying amounts of its intangible assets not subject to amortization.
Certain corporate expenses are allocated to the Mexico and Europe reportable segments based upon various apportionment methods for specific expenditures incurred related thereto with the remaining amounts allocated to the U.S. For additional information, see “Note 20. Reportable Segments” of our Consolidated Financial Statements included in this annual report.
Certain corporate expenses are allocated to the Mexico and Europe reportable segments based upon various apportionment methods for specific expenditures incurred related thereto with the remaining amounts allocated to the U.S. For additional information, see “Note 20. Reportable Segments” of our Consolidated Financial Statements included in this annual report. Results of Operations 2025 Compared to 2024 Net sales.
The remaining assets within the two plans at the end of the year represents an excess of the liquidated assets over the amount of outstanding obligations at time of termination. These assets will be split between an amount transferred to our qualifying 401(k) retirement plan and an amount reverted to the Company less applicable excise taxes in Q1 2025.
The remaining assets within the two plans at the end of 2024 represented an excess of the liquidated assets over the amount of outstanding obligations at time of termination. These assets were split between an amount transferred to our qualifying 401(k) retirement plan and an amount reverted to the Company less applicable excise taxes in Q1 2025.
SG&A expense decreased primarily from the favorable impact of foreign currency translation due to the weakening of the Mexican peso against the U.S. dollar, partially offset by increased wages and employee profit share costs. Net interest expense . Consolidated interest expense decreased 46.9% to $88.5 million in 2024 from $166.6 million in 2023.
SG&A expense decreased primarily from the favorable impact of foreign currency translation due to the weakening of the Mexican peso against the U.S. dollar, partially offset by increased wages and employee profit share costs. Net interest expense . Consolidated interest expense increased 24.6% to $110.3 million in 2025 from $88.5 million in 2024.
The change in income taxes, which includes income taxes receivable, income taxes payable, deferred tax assets, deferred tax liabilities, reserves for uncertain tax positions and the tax components within accumulated other comprehensive loss, represented a $109.4 million source of cash in 2024.
This change resulted primarily from the timing of estimated tax payments. The change in income taxes, which includes income taxes receivable, income taxes payable, deferred tax assets, deferred tax liabilities, reserves for uncertain tax positions, and the tax components within accumulated other comprehensive loss, represented a $109.4 million source of cash in 2024.
The increase in income tax expense in 2024 resulted primarily from an increase in pre-tax income during 2024. 27 Table of Contents 2023 Compared to 2022 For discussion of 2023 results of operations in comparison to 2022 results of operations, see Item 7.
The increase in income tax expense in 2025 resulted primarily from an increase in pre-tax income and higher state income tax expense recognized during 2025. 27 Table of Contents 2024 Compared to 2023 For discussion of 2024 results of operations in comparison to 2023 results of operations, see Item 7.
This change resulted primarily from a net increase in the commodity derivatives assets from favorable fair value positions, an increase from short-term available-for-sale investments, and the impact of foreign currency translation. The change in prepaid expenses and other current assets represented a $17.8 million source of cash in 2023.
The change in prepaid expenses and other current assets represented a $33.3 million use of cash in 2024. This change resulted primarily from a net increase in the commodity derivatives assets from favorable fair value positions, an increase from short-term available-for-sale investments, and the impact of foreign currency translation.
Net noncash expense items included $419.9 million of depreciation and amortization, loss on early extinguishment of debt recognized as a component of interest expense of $20.7 million, loan cost amortization of $7.4 million, stock-based compensation expense of $7.2 million, deferred income tax expense of $6.7 million, asset impairment of $4.0 million, and accretion of bond discount of $2.3 million.
Net noncash expense items included $456.2 million of depreciation and amortization, stock-based compensation expense of $29.4 million, deferred income tax expense of $10.0 million, loan cost amortization of $4.9 million, a $3.9 million loss on property disposals, accretion of bond discount of $2.4 million, loss on early extinguishment of debt recognized as a component of interest expense of $0.6 million, and asset impairment of $0.5 million.
The following table presents our available sources of liquidity as of December 29, 2024: Sources of Liquidity Facility Amount Amount Outstanding Available (In millions) Cash and cash equivalents $ — $ — $ 2,043.2 Borrowing arrangements: U.S.
The following table presents our available sources of liquidity as of December 28, 2025: Sources of Liquidity Facility Amount Amount Outstanding Available (In millions) Cash and cash equivalents $ — $ — $ 640.2 Borrowing arrangements: U.S.
We also continue to build on Hometown Strong through our Better Futures program, which provides team member and their dependents in tuition free, higher education program, to improve their skills and career opportunities. The program has been exceptionally well received as we have over 2,100 participants since inception.
To date, we have approved over $15 million for these areas. We also continue to build on Hometown Strong through our Better Futures program, which provides team members and their dependents in tuition free, higher education program, to improve their skills and career opportunities. The program has been exceptionally well received, as we have over 2,200 participants since its inception.
We continue to focus on partnering with our Key Customers and increasing operational efficiency. Sustainability We believe sustainability involves continuously improving social responsibility, economic viability and environmental stewardship. We are committed to helping society meet the global challenge of feeding a growing population in a responsible matter. Environmental Stewardship .
U.K. prices for prepared foods have increased due to inflationary pressures. We continue to focus on partnering with our Key Customers and increasing operational efficiency. Sustainability We believe sustainability involves continuously improving social responsibility, economic viability, and environmental stewardship. We are committed to helping society meet the global challenge of feeding a growing population in a responsible manner.
As a percent of net sales, net interest expense in 2024 and 2023 was 0.5% and 1.0%, respectively. Income taxes. Our consolidated income tax expense in 2024 was $325.0 million, compared to income tax expense of $42.9 million in 2023.
As a percent of net sales, net interest expense in 2025 and 2024 was 0.6% and 0.5%, respectively. Income taxes. Our consolidated income tax expense in 2025 was $418.8 million, compared to income tax expense of $325.0 million in 2024.
In support of this initiative in April 2021, we issued $1.0 billion of sustainability-linked bonds, which require us to reduce our Scope 1 and 2 global greenhouse gas emissions intensity of 17.7% by 2025 and by 30.0% by 2030 from our 2019 baseline. Social Responsibility . Safety of our team members is a condition at Pilgrim’s.
In support of this initiative, in April 2021, we issued $1.0 billion of sustainability-linked bonds, which require us to reduce our Scope 1 and Scope 2 global greenhouse gas emissions intensity of 17.7% by 2025 and by 24 Table of Contents 30.0% by 2030 from our 2019 baseline.
The change in inventories represented a $134.5 million source of cash in 2024. The change in cash resulted from a decrease in our finished goods inventories and lower input costs included in inventory values. The change in inventories represented a $12.6 million source of cash in 2023.
The change in cash resulted from an increase in our finished goods inventories to meet increased demand. The change in inventories represented a $134.5 million source of cash in 2024. The change in cash resulted from a decrease in our finished goods inventories and lower input costs included in inventory values.
Items necessary to reconcile from net income to cash flow provided by operating activities included net noncash expenses of $462.4 million for the year ended December 31, 2023.
Items necessary to reconcile from net income to cash flow provided by operating activities included net noncash expenses of $480.0 million for the year ended December 29, 2024.
This change resulted primarily from a net decrease in the commodity derivatives assets. Accounts payable and accrued expenses, including accounts payable to related parties, represented a $126.7 million source of cash in 2024. This change resulted primarily from increases in litigation settlement and incentive compensation accruals.
Accounts payable and accrued expenses, including accounts payable to related parties, represented a $155.8 million source of cash in 2025. This change resulted primarily from the increases in litigation settlement and payroll accruals. Accounts payable and accrued expenses, including accounts payable to related parties, represented a $126.7 million source of cash in 2024.
We account for a contract, which may be verbal or written, when it is approved and committed by both parties, 31 Table of Contents the rights of the parties are identified along with payment terms, the contract has commercial substance and collectability is probable.
While there may be master agreements, the contract is only established when the customer’s order is accepted by us. We account for a contract, which may be verbal or written, when it is approved and committed by both parties, the rights of the parties are identified along with payment terms, the contract has commercial substance and collectability is probable.
The change in cash was primarily due to the timing of customer payments and collections of insurance proceeds. The change in trade accounts and other receivables, including accounts receivable from related parties, represented a $19.0 million use of cash in 2023. The change in cash was primarily due to the timing of customer payments.
The change in trade accounts and other receivables, including accounts receivable from related parties, represented an $88.3 million source of cash in 2024. The change in cash was primarily due to the timing of customer payments, and collections of insurance proceeds. The change in inventories represented a $193.5 million use of cash in 2025.
Therefore, management elected to bypass qualitative assessments for all indefinite-life intangible assets and performed quantitative impairment tests. Based on the outcome of the quantitative tests, management determined that no material impairment existed as of December 29, 2024. The Company additionally assessed if the Pilgrim’s Europe reorganization indicated that any carrying amounts of its non-goodwill intangible assets might not be recoverable.
Based on the outcome of the quantitative tests, management determined that no material impairment existed as of December 28, 2025. The Company additionally assessed if the July 1, 2024 Pilgrim’s Europe reorganization indicated that any carrying amounts of its non-goodwill intangible assets might not be recoverable.
The decrease in net interest expense resulted primarily from an increase in interest income earned on higher cash balances, a decrease from early extinguishment of debt, and a decrease in interest expense on outstanding borrowings due to decreased borrowings.
The increase in net interest expense resulted primarily from a decrease in interest income earned on lower cash balances, an increase from early extinguishment of debt from a gain recognized in the prior year, partially offset by a decrease in interest expense on outstanding borrowings due to debt repurchases reducing the outstanding borrowings.
Management first reviews relevant qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that an intangible asset is impaired. If management determines there is an indication that the carrying amount of the intangible asset might be impaired, a quantitative impairment test is performed.
An impairment loss is recognized if the carrying amount of an indefinite-life intangible asset exceeds the estimated fair value of that intangible asset. Management first reviews relevant qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that an intangible asset is impaired.
Reconciliation of Adjusted EBITDA (Unaudited) Year Ended December 29, 2024 December 31, 2023 Net income $ 1,087,223 $ 322,317 Add: Interest expense, net 88,509 166,621 Income tax expense 325,046 42,905 Depreciation and amortization 433,622 419,900 EBITDA 1,934,400 951,743 Add: Foreign currency transaction losses (gains) (10,025) 20,570 Litigation settlements expense 167,228 39,400 Restructuring activities losses 93,388 44,345 Loss on settlement of pension from plan termination 21,649 — Inventory write-down as a result of hurricane 8,075 — Minus: Property insurance recoveries — 21,124 Net income attributable to noncontrolling interest 785 743 Adjusted EBITDA $ 2,213,930 $ 1,034,191 36 Table of Contents Reconciliation of Adjusted Net Income (Unaudited) Year Ended December 29, 2024 December 31, 2023 Net income attributable to Pilgrim’s $ 1,086,438 $ 321,574 Add: Foreign currency transaction losses (gains) (10,025) 20,570 Litigation settlements 167,228 39,400 Restructuring activities losses 93,388 44,345 Loss on settlement of pension from plan termination 21,649 — Inventory write-down as a result of hurricane 8,075 — Loss (gain) on early extinguishment of debt recognized as a component of interest expense (a) (11,211) 20,694 Minus: Property insurance recoveries — 21,124 Adjusted net income attributable to Pilgrim’s before tax impact of adjustments 1,355,542 425,459 Net tax benefit of adjustments (b) (66,057) (25,140) Adjusted net income attributable to Pilgrim ’ s $ 1,289,485 $ 400,319 Weighted average diluted shares of common stock outstanding 237,800 237,297 Adjusted net income attributable to Pilgrim ’ s per common diluted share $ 5.42 $ 1.69 (a) The gain on early extinguishment of debt recognized as a component of interest expense in 2024 was due to the bond repurchases.
GAAP results and using EBITDA and Adjusted EBITDA only on a supplemental basis. 36 Table of Contents Reconciliation of Adjusted EBITDA (Unaudited) Year Ended December 28, 2025 December 29, 2024 Net income $ 1,083,344 $ 1,087,223 Add: Interest expense, net 110,270 88,509 Income tax expense 418,794 325,046 Depreciation and amortization 456,157 433,622 EBITDA 2,068,565 1,934,400 Add: Foreign currency transaction losses (gains) 6,777 (10,025) Litigation settlements expense 162,659 167,228 Restructuring activities losses 31,354 93,388 Loss on settlement of pension from plan termination — 21,649 Inventory write-down as a result of hurricane — 8,075 Minus: Net income attributable to noncontrolling interest 985 785 Adjusted EBITDA $ 2,268,370 $ 2,213,930 Reconciliation of Adjusted Net Income (Unaudited) Year Ended December 28, 2025 December 29, 2024 Net income attributable to Pilgrim’s $ 1,082,359 $ 1,086,438 Add: Foreign currency transaction losses (gains) 6,777 (10,025) Litigation settlements 162,659 167,228 Restructuring activities losses 31,354 93,388 Loss on settlement of pension from plan termination — 21,649 Inventory write-down as a result of hurricane — 8,075 Gain on early extinguishment of debt recognized as a component of interest expense (a) — (11,211) Adjusted net income attributable to Pilgrim’s before tax impact of adjustments 1,283,149 1,355,542 Net tax benefit of adjustments (b) (49,288) (66,057) Adjusted net income attributable to Pilgrim ’ s $ 1,233,861 $ 1,289,485 Weighted average diluted shares of common stock outstanding 238,449 237,800 Adjusted net income attributable to Pilgrim ’ s per common diluted share $ 5.17 $ 5.42 (a) The gain on early extinguishment of debt recognized as a component of interest expense in 2024 was due to the bond repurchases.
These decreases were partially offset by the unfavorable impact of foreign currency translation of $140.1 million, or 2.9 percentage points. The decrease in cost per pound was driven by decreased feed ingredients, labor, utilities and other operating costs and from production efficiencies as a result of our restructuring initiatives. Mexico Reportable Segment.
The decrease in cost per pound was driven by decreased feed ingredients, labor, utilities and other operating costs and from production efficiencies as a result of our restructuring initiatives. Mexico Reportable Segment.
To support the communities where our team members live and work, we have committed $20 million in funding for local projects focused on alleviating food insecurity and strengthening 24 Table of Contents long-term community infrastructure through our Hometown Strong initiative. To date, we have approved over $15 million for these areas.
As such, we implemented hundreds of safety measures within our facilities and continue to evolve our operations as needed. To support the communities where our team members live and work, we have committed $20 million in funding for local projects focused on alleviating food insecurity and strengthening long-term community infrastructure through our Hometown Strong initiative.
Credit Facility (a) 850.0 — 825.8 Mexico Credit Facility (b) 54.6 — 54.6 Europe Credit Facility (c) 188.6 — 188.6 (a) Availability under the U.S. Credit Facility is also reduced by our outstanding standby letters of credit. Standby letters of credit outstanding at December 29, 2024 totaled $24.2 million.
Credit Facility (a) 850.0 — 846.0 Mexico BBVA Credit Facility (b) 71.2 — 71.2 Mexico Bajio Credit Facility (c) 83.8 — 83.8 Europe Credit Facility (d) 202.5 — 202.5 (a) Availability under the U.S. Credit Facility is also reduced by our outstanding standby letters of credit. Standby letters of credit outstanding at December 28, 2025 totaled $4.0 million.
Management has the option to bypass the qualitative assessment for any indefinite-life intangible asset in any period and proceed directly to performing the quantitative impairment test.
If management determines there is an indication that the carrying amount of the intangible asset might be impaired, a quantitative impairment test is performed. Management has the option to bypass the qualitative assessment for any indefinite-life intangible asset in any period and proceed directly to performing the quantitative impairment test.
Cost of sales incurred by the Mexico operations during 2024 decreased $85.1 million, or 4.5%, from cost of sales incurred by the Mexico operations during 2023 primarily because of the favorable impact of foreign currency remeasurement and a decrease in cost per pound sold of $53.6 million, or 2.8 percentage points, and $34.3 million, or 1.8 percentage points, respectively.
Cost of sales incurred by the Mexico operations during 2025 increased $64.1 million, or 3.5%, from cost of sales incurred by the Mexico operations during 2024 primarily because of an increase in cost per pound sold and an increase in sales volume of $119.2 million, or 6.4 percentage points, and $39.8 million, or 2.2 percentage points, respectively.
The proceeds from contribution of capital under the Tax Sharing Agreement with JBS USA Holdings during 2024 were an allocation made during tax year 2023 for payment of historical tax adjustments. Payments on early extinguishment of debt during 2024 are transaction fees related to the bond repurchases.
Payments on revolving line of credit, long-term borrowings and finance lease obligations during 2024 are primarily related to open market repurchases of outstanding senior notes. The proceeds from contribution of capital under the Tax Sharing Agreement with JBS USA Holdings during 2024 were an allocation made during tax year 2023 for payment of historical tax adjustments.
Our 2022 indefinite-life intangible assets impairment analyses did not result in an impairment charge. 33 Table of Contents In 2023, we experienced an increase in long-term treasury rates that management determined could negatively affect discount rates, which are used in estimating the fair value of the reporting units.
In 2023, we experienced an increase in long-term treasury rates that management determined could negatively affect discount rates, which are used in estimating the fair value of the reporting units. Therefore, management elected to bypass qualitative assessments for all indefinite-life intangible assets and performed quantitative impairment tests.
Reportable Segment. U.S. net sales generated in 2024 increased $602.2 million, or 6.0%, from U.S. net sales generated in 2023 primarily because of an increase in net sales per pound, contributing $739.0 million, or 7.4 percentage points, to the increase in net sales.
Reportable Segment. U.S. net sales generated in 2025 increased $368.8 million, or 3.5%, from U.S. net sales generated in 2024 primarily because of an increase in sales volume of $365.2 million, or 3.4 percentage points, and a slight increase in net sales per pound of $3.6 million, or 0.1 percentage points.
Historical Flow of Funds Year Ended Cash Flows from Operating Activities December 29, 2024 December 31, 2023 (In millions) Net income $ 1,087.2 $ 322.3 Net noncash expenses 480.0 462.5 Changes in operating assets and liabilities: Trade accounts and other receivables 88.3 (19.0) Inventories 134.5 12.6 Prepaid expenses and other current assets (33.3) 17.8 Accounts payable and accrued expenses 126.7 (68.7) Income taxes 109.4 (8.9) Long-term pension and other postretirement obligations 26.1 (10.0) Other operating assets and liabilities (28.8) (30.7) Cash provided by operating activities $ 1,990.1 $ 677.9 Net Noncash Expenses Items necessary to reconcile from net income to cash flow provided by operating activities included net noncash expenses of $480.0 million for the year ended December 29, 2024.
We expect cash flows from operations, combined with availability under our credit facilities, to provide sufficient liquidity to fund current obligations, projected working capital requirements, maturities of long-term debt and capital spending for at least the next twelve months. 28 Table of Contents Historical Flow of Funds Year Ended Cash Flows from Operating Activities December 28, 2025 December 29, 2024 (In millions) Net income $ 1,083.3 $ 1,087.2 Net noncash expenses 507.8 480.0 Changes in operating assets and liabilities: Trade accounts and other receivables (113.1) 88.3 Inventories (193.5) 134.5 Prepaid expenses and other current assets (44.5) (33.3) Accounts payable and accrued expenses 155.8 126.7 Income taxes 35.4 109.4 Long-term pension and other postretirement obligations (1.9) 26.1 Other operating assets and liabilities (57.6) (28.8) Cash provided by operating activities $ 1,371.7 $ 1,990.1 Net Noncash Expenses Items necessary to reconcile from net income to cash flow provided by operating activities included net noncash expenses of $507.8 million for the year ended December 28, 2025.
The change in income taxes, which includes income taxes receivables, income taxes payable, deferred tax assets, deferred tax liabilities, reserves for uncertain tax positions and the tax components within accumulated other comprehensive loss, represented a $8.9 million use of cash in 2023. This change resulted primarily from the timing of estimated tax payments and lower profitability in 2023.
This change resulted primarily from increases in litigation settlement and incentive compensation accruals. The change in income taxes, which includes income taxes receivable, income taxes payable, deferred tax assets, deferred tax liabilities, reserves for uncertain tax positions, and the tax components within accumulated other comprehensive 29 Table of Contents loss, represented a $35.4 million source of cash in 2025.
You should compensate for these limitations by relying primarily on our U.S. GAAP results and using EBITDA and Adjusted EBITDA only on a supplemental basis.
You should compensate for these limitations by relying primarily on our U.S.
Year Ended Cash Flows from Investing Activities December 29, 2024 December 31, 2023 (In millions) Acquisitions of property, plant and equipment $ (476.2) $ (543.8) Proceeds from insurance recoveries — 20.7 Proceeds from property disposals 15.4 19.8 Cash used in investing activities $ (460.8) $ (503.4) Capital expenditures during the two years were incurred for growth projects, such as the Athens, GA expansion and the South Georgia protein conversion plant, and to improve operational efficiencies, information technology system enhancement projects, and to reduce costs for the years ended December 29, 2024 and December 31, 2023.
Year Ended Cash Flows from Investing Activities December 28, 2025 December 29, 2024 (In millions) Acquisitions of property, plant and equipment $ (711.1) $ (476.2) Proceeds from property disposals 5.6 15.4 Cash used in investing activities $ (705.5) $ (460.8) Capital expenditures were incurred primarily for growth projects, projects to improve operational efficiencies, portfolio enhancement projects, such as the conversion of a commodity plant to a plant supporting our U.S. retail customers, and projects to reduce costs during the year ended December 28, 2025.
We eliminate all significant affiliate accounts and transactions upon consolidation. U.S. Reportable Segment. Selling, general and administrative (“SG&A”) expense incurred by the U.S. operations during 2024 increased $167.5 million, or 59.1%, from SG&A expense incurred by the U.S. operations during 2023 primarily from increases in litigation settlement costs and incentive compensation costs. Europe Reportable Segment.
Selling, general and administrative (“SG&A”) expense incurred by the U.S. operations during 2025 increased $9.6 million, or 2.1%, from SG&A expense incurred by the U.S. operations during 2024 primarily from increases in incentive compensation costs, marketing costs, and professional fees, such as legal defense costs, partially offset by a decrease in litigation settlement costs. Europe Reportable Segment.
(b) As of December 29, 2024, the U.S. dollar-equivalent of the amount available under the Mexico Credit Facility was $54.6 million ($1.1 billion Mexican pesos). (c) As of December 29, 2024, the U.S. dollar-equivalent of the amount available under the Europe Credit Facility was $188.6 million (£150.0 million).
(b) As of December 28, 2025, the U.S. dollar-equivalent of the amount available under the Mexico BBVA Credit Facility was $71.2 million ($1.3 billion Mexican pesos). (c) As of December 28, 2025, the U.S. dollar-equivalent of the amount available under the Mexico Bajio Credit Facility was $83.8 million ($1.5 billion Mexican pesos).
Other intangible assets with indefinite lives are not amortized but are tested for impairment on an annual basis in the fourth quarter of each fiscal year or more frequently if impairment indicators arise. An impairment loss is recognized if the carrying amount of an indefinite-life intangible asset exceeds the estimated fair value of that intangible asset.
Based on these assessments, the Company determined that it was not necessary to perform quantitative impairment tests related to the carrying amount of its goodwill at that date. 33 Table of Contents Other intangible assets with indefinite lives are not amortized but are tested for impairment on an annual basis in the fourth quarter of each fiscal year or more frequently if impairment indicators arise.
The following table provides additional information regarding net sales: Change from 2023 Impact on Change from 2023 Sources of net sales 2024 Amount Percent Sales Volume Sales Prices Foreign Currency Translation Impact (In thousands, except percent data) U.S. $ 10,629,929 $ 602,187 6.0 % (1.4) % 7.4 % — % Europe 5,136,747 (66,575) (1.3) % (0.9) % (3.1) % 2.7 % Mexico 2,111,615 (19,538) (0.9) % 0.1 % 1.8 % (2.8) % Total net sales $ 17,878,291 $ 516,074 3.0 % U.S.
The following table provides additional information regarding net sales: Change from 2024 Impact on Change from 2024 Sources of net sales 2025 Amount Percent Sales Volume Sales Prices Foreign Currency Translation Impact (In thousands, except percent data) U.S. $ 10,998,732 $ 368,803 3.5 % 3.4 % 0.1 % — % Europe 5,378,865 242,118 4.7 % 2.5 % (0.9) % 3.1 % Mexico 2,119,956 8,341 0.4 % 2.2 % 3.3 % (5.1) % Total net sales $ 18,497,553 $ 619,262 3.5 % U.S.
Soybean prices were lower than 2023 due to better growing conditions and lower demand. 23 Table of Contents Corn (a) Soybean Meal (a) Wheat (a) Highest Price Lowest Price Highest Price Lowest Price Highest Price Lowest Price (In whole dollars) (In whole pounds sterling) 2024 Fourth Quarter 4.54 4.01 350.0 279.5 190.5 174.0 Third Quarter 4.18 3.62 387.0 303.4 196.9 168.7 Second Quarter 4.65 3.97 386.5 328.3 202.8 165.1 First Quarter 4.67 4.00 381.2 327.8 184.5 153.7 2023 Fourth Quarter 5.05 4.50 473.6 363.2 193.9 182.0 Third Quarter 6.37 4.61 464.7 388.2 216.0 170.8 Second Quarter 6.78 5.55 465.7 389.7 204.8 165.5 First Quarter 6.85 6.19 513.0 438.3 239.0 191.0 (a) We obtain corn and soybean meal prices from the Chicago Board of Trade, and we obtain wheat prices from the London International Financial Futures and Options Exchange.
Demand for these grains increased in 2025 compared to 2024 levels, however supply outpaced demand resulting in slightly lower prices and higher ending stocks. 23 Table of Contents Corn (a) Soybean Meal (a) Wheat (a) Highest Price Lowest Price Highest Price Lowest Price Highest Price Lowest Price (In whole dollars) (In whole pounds sterling) 2025 Fourth Quarter 4.51 4.11 330.8 264.7 166.8 155.2 Third Quarter 4.32 3.72 297.2 260.7 180.0 136.5 Second Quarter 4.90 4.10 299.6 270.9 173.6 138.2 First Quarter 5.02 4.36 315.8 285.9 185.6 165.0 2024 Fourth Quarter 4.54 4.01 350.0 279.5 190.5 174.0 Third Quarter 4.18 3.62 387.0 303.4 196.9 168.7 Second Quarter 4.65 3.97 386.5 328.3 202.8 165.1 First Quarter 4.67 4.00 381.2 327.8 184.5 153.7 (a) We obtain corn and soybean meal prices from the Chicago Board of Trade, and we obtain wheat prices from the London International Financial Futures and Options Exchange.
Mexico sales generated in 2024 decreased $19.5 million, or 0.9%, from sales generated in 2023 primarily because of the unfavorable impact of foreign currency translation of $62.0 million, or 2.8 percentage points, partially offset by an increase in net sales per pound and an increase in sales volume of $39.3 million, or 1.8 percentage points, and $3.2 million, or 0.1 percentage points, respectively.
Mexico sales generated in 2025 increased $8.3 million, or 0.4%, from sales generated in 2024 primarily from an increase in net sales per pound and an increase in sales volume of $68.7 million, or 3.3 percentage points, and $46.1 million, or 2.2 percentage points, respectively.
The Company then performed an interim impairment test on the reporting units on both a pre- and post-reorganization basis. There was no impairment recognized as a result of these tests. As of December 29, 2024, the Company assessed qualitative factors to determine if it was necessary to perform quantitative impairment tests related to the carrying amounts of its goodwill.
The Company then performed an interim impairment test on the reporting units on both a pre- and post-reorganization basis. There was no impairment recognized as a result of these tests. On July 28, 2025, the Company modified its previous reorganization within its Europe reportable segment.
SG&A expense incurred by the Europe operations during 2024 decreased $3.6 million, or 1.8%, from SG&A expense incurred by the Europe operations during 2023 primarily due to decreased labor and employee-related costs. Mexico Reportable Segment. SG&A expense incurred by the Mexico operations during 2024 decreased $2.3 million, or 3.6%, from SG&A expense incurred by the Mexico operations during 2023.
Mexico Reportable Segment. SG&A expense incurred by the Mexico operations during 2025 decreased $0.1 million, or 0.1%, from SG&A expense incurred by the Mexico operations during 2024.
The following table summarizes the total amounts due as of December 29, 2024 under all debt agreements, commitments and other contractual obligations. The table indicates the years in which payments are due under the contractual obligations.
Contractual Obligations In addition to our debt commitments at December 28, 2025, we had other commitments and contractual obligations that require us to make specified payments in the future. The following table summarizes the total amounts due as of December 28, 2025, under all debt agreements, commitments and other contractual obligations.
Cost of sales incurred by the Europe operations during 2024 decreased $153.5 million, or 3.2%, from cost of sales incurred by the Europe operations during 2023 primarily due to decreases in cost per pound sold and sales volume of $248.7 million, or 5.2 percentage points, and $44.9 million, or 0.9 percentage points, respectively.
Cost of sales incurred by the Europe operations during 2025 increased $211.0 million, or 4.5%, from cost of sales incurred by the Europe operations during 2024 primarily due to the impact of foreign currency translation and an increase in sales volume of $143.5 million, or 3.1 percentage points, and $118.6 million, or 2.5 percentage points, respectively.
The unfavorable impact of foreign currency translation was due to a weakening of the Mexican peso against the U.S. dollar. The increases in net sales per pound and sales volume were driven by 25 Table of Contents improved product mix and increased commodity chicken prices. Sales volumes increased across all sales channel, except live chicken which slightly decreased. Gross profit.
Sales volumes increased across all sales channels, except live chicken which slightly decreased. The unfavorable impact of foreign currency translation was due to a 5% weakening of the Mexican peso against the U.S. dollar. Gross profit. Gross profit increased by $45.4 million, or 2.0%, from $2.31 billion generated in 2024 to $2.36 billion generated in 2025.
During 2024, the U.K. chicken market saw an increase in labor costs due to the national living wages change in April 2024. Through customer contracts and additional negotiations, we have offset the majority of these cost increases.
Through customer contracts and additional negotiations, we have offset the majority of these cost increases. Partially offsetting the labor and animal welfare costs was an easing of feed costs in 2025 relative to 2024. Due to increased competition with the U.K. egg market, there continues to be an increase in costs to retain growers.
These decreases in cost of sales were partially offset by an increase in sales volume of $2.8 million, or 0.1 percentage points. The favorable impact of foreign currency remeasurement was due to a weakening of the Mexican peso against the U.S. dollar.
These increases were partially offset by a decrease in net sales per pound of $48.3 million, or 0.9 percentage points. The favorable impact of foreign currency translation was the result of a 3% strengthening of the British pound against the U.S. dollar.
The reduction in live operations costs was partially offset by an increase in labor, incentive compensation, and insurance costs. Europe Reportable Segment.
The decrease in cost per pound sold was driven by a reduction in feed ingredients, such as corn and soy, costs in our live operations. The reduction in live operations costs was partially offset by increases in labor, incentive compensation, and grower costs. Europe Reportable Segment.
Partially offsetting the net noncash expenses was an $6.1 million gain on property disposals. Other items affecting net noncash expenses were individually immaterial. Changes in Operating Assets and Liabilities The change in trade accounts and other receivables, including accounts receivable from related parties, represented a $88.3 million source of cash in 2024.
Changes in Operating Assets and Liabilities The change in trade accounts and other receivables, including accounts receivable from related parties, represented a $113.1 million use of cash in 2025. The change in cash was primarily due to an increase in sales volume.
For a description, refer to Part II, Item 8, Notes to Consolidated Financial Statements, “Note 13. Debt.” Capital Expenditures We anticipate spending between $450 million and $500 million on the acquisition of property, plant and equipment in 2025. Capital expenditures will primarily be incurred to grow our operations, improve efficiencies, to reduce costs, and for information technology system enhancement projects.
Debt.” Capital Expenditures We anticipate spending between $900 million and $950 million on the acquisition of property, plant and equipment in 2026. Capital expenditures will primarily be incurred to grow our operations, to improve efficiencies, to reduce costs, and to sustain our operations. We expect to fund these capital expenditures with cash flow from operations and cash on hand.
The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, inventory, goodwill and other intangible assets, litigation and income taxes.
We continually evaluate our estimates, including those related to revenue recognition, inventory, goodwill and other intangible assets, litigation and income taxes.
We eliminate all significant affiliate accounts and transactions upon consolidation. U.S. Reportable Segment. Cost of sales incurred by our U.S. operations in 2024 decreased $439.4 million, or 4.6%, from cost of sales incurred by our U.S. operations in 2023.
We eliminate all significant affiliate accounts and transactions upon consolidation. U.S. Reportable Segment.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeYear Ended December 29, 2024 Amount Impact of 10% Increase in Feed Ingredient Prices (In thousands) Feed ingredient purchases (a) $ 3,451,498 $ 345,150 Feed ingredient inventory (b) 166,993 16,699 37 Table of Contents (a) Based on our feed consumption, a 10% increase in the price of our feed ingredient purchases would have increased cost of sales for the year ended December 29, 2024.
Biggest changeYear Ended December 28, 2025 Amount Impact of 10% Increase in Feed Ingredient Prices (In thousands) Feed ingredient purchases (a) $ 3,357,311 $ 335,731 Feed ingredient inventory (b) 172,237 17,224 (a) Based on our feed consumption, a 10% increase in the price of our feed ingredient purchases would have increased cost of sales for the year ended December 28, 2025.
We have analyzed our portfolios of investments and, to the best of our knowledge, none of our investments, including money market funds units, commercial paper and municipal securities, have been downgraded, and neither we nor any fund in which we participate hold significant 38 Table of Contents amounts of structured investment vehicles, auction rate securities, collateralized debt obligations, credit derivatives, hedge funds investments, fund of funds investments or perpetual preferred securities.
We have analyzed our portfolios of investments and, to the best of our knowledge, none of our investments, including money market funds units, commercial paper and municipal securities, have been downgraded, and neither we nor any fund in which we participate hold significant amounts of structured investment vehicles, auction rate securities, collateralized debt obligations, credit derivatives, hedge funds investments, fund of funds investments or perpetual preferred securities.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk Market Risk-Sensitive Instruments and Positions The risk inherent in our market risk-sensitive instruments and positions is primarily the potential loss arising from adverse changes in commodity prices, foreign currency exchange rates, interest rates and the credit quality of available-for-sale securities as discussed below.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk Market Risk-Sensitive Instruments and Positions The risk inherent in our market risk-sensitive instruments and positions is primarily the potential loss arising from adverse changes in commodity prices, foreign currency exchange rates, interest rates and the credit quality of available-for-sale 37 Table of Contents securities as discussed below.
A 10% strengthening in the Mexican peso against the U.S dollar exchange rate would cause an increase in the net assets of our Mexican subsidiaries of $88.5 million We are also exposed to the effect of potential currency exchange rate fluctuations to the extent that amounts are repatriated from Mexico to the U.S.
A 10% strengthening in the Mexican peso against the U.S dollar exchange rate would cause an increase in the net assets of our Mexican subsidiaries of $79.0 million We are also exposed to the effect of potential currency exchange rate fluctuations to the extent that amounts are repatriated from Mexico to the U.S.
The Mexican peso exchange rate can directly and indirectly impact our financial condition and results of operations. Europe Foreign Investments We are exposed to foreign exchange-related variability of investments and earnings from our Europe subsidiaries.
The Mexican peso exchange rate can directly and indirectly impact our financial condition and results of operations. 38 Table of Contents Europe Foreign Investments We are exposed to foreign exchange-related variability of investments and earnings from our Europe subsidiaries.
A 10% increase in corn, soybean meal, soybean oil and wheat prices would have resulted in an increase in the fair value of our net commodity derivative asset position, including margin cash, as of December 29, 2024. Interest Rates Fixed-rate debt .
A 10% increase in corn, soybean meal, soybean oil and wheat prices would have resulted in an increase in the fair value of our net commodity derivative asset position, including margin cash, as of December 28, 2025. Interest Rates Fixed-rate debt .
For this sensitivity analysis, market risk is estimated as a hypothetical 10% change in exchange rates used to convert British pound and euro to U.S. dollars, and the effect of this change on our Europe foreign investments. Net Assets. As of December 29, 2024, our Europe subsidiaries that are denominated in the British pound had net assets of $0.8 billion.
For this sensitivity analysis, market risk is estimated as a hypothetical 10% change in exchange rates used to convert British pound and euro to U.S. dollars, and the effect of this change on our Europe foreign investments. Net Assets. As of December 28, 2025, our Europe subsidiaries that are denominated in the British pound had net assets of $1.1 billion.
A 10% weakening in Mexican peso against the U.S. dollar exchange rate would cause a decrease in the net assets of our Mexican subsidiaries by $72.4 million.
A 10% weakening in Mexican peso against the U.S. dollar exchange rate would cause a decrease in the net assets of our Mexican subsidiaries by $(64.7) million.
For this sensitivity analysis, market risk is estimated as a hypothetical 10% change in exchange rates used to convert Mexican peso to U.S. dollars, and the effect of this change on our Mexican foreign investments. Net Assets. As of December 29, 2024, our Mexican subsidiaries that are denominated in Mexican peso had net assets of $796.9 million.
For this sensitivity analysis, market risk is estimated as a hypothetical 10% change in exchange rates used to convert Mexican peso to U.S. dollars, and the effect of this change on our Mexican foreign investments. Net Assets. As of December 28, 2025, our Mexican subsidiaries that are denominated in Mexican peso had net assets of $711.2 million.
Market risk for fixed-rate debt is estimated as the potential decrease in fair value resulting from a hypothetical increase in interest rates of 10%. Using a discounted cash flow analysis, a hypothetical 10% increase in interest rates would have decreased the fair value of our fixed-rate debt by $101.4 million as of December 29, 2024.
Market risk for fixed-rate debt is estimated as the potential decrease in fair value resulting from a hypothetical increase in interest rates of 10%. Using a discounted cash flow analysis, a hypothetical 10% increase in interest rates would have decreased the fair value of our fixed-rate debt by $87.9 million as of December 28, 2025.
(b) A 10% increase in ending feed ingredient prices would have increased inventories as of December 29, 2024.
(b) A 10% increase in ending feed ingredient prices would have increased inventories as of December 28, 2025.
December 29, 2024 Amount Impact of 10% Increase to the Fair Value of Commodity Derivative Assets (In thousands) Commodity derivative assets (a) $ 9,677 $ 968 (a) We purchase commodity derivative financial instruments, specifically exchange-traded futures and options, in an attempt to mitigate price risk related to our anticipated consumption of commodity inputs for the next 12 months.
December 28, 2025 Amount Impact of 10% Increase to the Fair Value of Commodity Derivative Assets (In thousands) Commodity derivative assets (a) $ 8,167 $ 817 (a) We purchase commodity derivative financial instruments, specifically exchange-traded futures and options, in an attempt to mitigate price risk related to our anticipated consumption of commodity inputs for the next 12 months.
A 10% weakening in the British pound against the U.S. dollar exchange rate would cause a decrease in the net assets of our Europe subsidiaries by $70.7 million. A 10% strengthening in the British pound against the U.S. dollar exchange rate would cause an increase in the net assets of our Europe subsidiaries by $86.4 million. Cash flow hedging transactions.
A 10% weakening in the British pound against the U.S. dollar exchange rate would cause a decrease in the net assets of our Europe subsidiaries by $96.0 million. A 10% strengthening in the British pound against the U.S. dollar exchange rate would cause an increase in the net assets of our Europe subsidiaries by $117.3 million. Cash flow hedging transactions.

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