Pilgrim's Pride Corporation

Good morning and welcome to the first quarter of 2026 Pilgrims Pride earnings conference call and webcast. All participants will be in the listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. At the company's request, this call is being recorded. Please note that the slides referenced during today's call are available for download from the investor section of the company's website at www.pilgrims.com. After today's presentation, there will be an opportunity to ask questions. I would now like to turn the conference over to Andrew Wojcicki, Head of Strategy, Investor Relations and Sustainability for Pilgrims Pride.

Good morning and thank you for joining us today as we review our operating and financial results for the first quarter ended on March 29th, 2026. Yesterday afternoon, we issued a press release providing an overview of our financial performance for the quarter including a reconciliation of any non-GAAP measures we may discuss. A copy of this release is available on our website at ir.pilgrims.com, along with slides for reference. These items have also been filed as Form 8Ks and are available online at scc.gov. Fabio Sandri, President and Chief Executive Officer, and Matt Galvinoni, Chief Financial Officer, will present on today's call. Before we begin our prepared remarks, I would like to remind everyone of our safe harbor disclaimer. Today's call may contain certain forward-looking statements that represent our outlook and current expectations as of the day of this release. Other additional factors not anticipated by management may cause actual results to differ materially from those projected in these forward-looking statements. Further information concerning these factors have been provided in yesterday's press release along our Form 10-K and our regular filings with the SEC. I would now like to turn the call over to Fabio Sandri.

Thank you, Andy. Good morning, everyone, and thank you for joining us today. For the first quarter of 2026, we reported net revenues of $4.5 billion with adjusted EBITDA of $308 million. Our adjusted EBITDA margin was 6.8% compared to 12% last year. During the quarter, we were able to navigate the volatile market in the commodity segments, protecting the downside with the most stable parts of our portfolio. We also drove extensive progress in our growth investments, strengthening our portfolio of differentiated products that could provide higher and more stable margins while supporting the growth of our key customers. In the U.S., demand for key customers for retail trade pack remains strong and fresh. Prepared foods, grew from expansions across retail and food service. However, sales and profitability fell as jumbo commodity cutout and daily small bird values were significantly lower than last year. Margins were also impacted by planet downtime from plant upgrades to improve the mix and interruptions from winter storms during February. Europe's diversified portfolio maintained steady sales and margins compared to last year, amid changing consumer confidence towards more value offerings, especially poultry and fresh and frozen meals. Back-office integration and network optimization continues to improve productivity and support further growth. Mexico fresh sales remained steady and breaded sales increased double digits compared to last year. Prepared foods continue to grow in retail and QSR. However, margins were compressed as excess production in the live commodity market and increased imports persisted throughout the quarter. Our projects to diversify our footprint in fresh to different regions of the country and increase our presence in prepared foods remain on track. Once fully operational, these projects will unlock additional sales growth and further diversify our profitability, enhancing our margins and reducing volatility. Turning to the supply in US, USDA reported ready-to-cook production increase of 3.4% year-over-year from increased head counts, continued improvement in live performance, and higher average live weights. Egg sets grew 1.1% compared to the same period last year, extending recent gains from a more productive layer flock. Similarly, Chick placements increased 1.7% versus last year, reflecting modest improvements in hatchability during the period. Going forward, given the size of the layer flock and the growth in pullet placements, combined with the elevated hatchery utilization, the USDA expects chicken production to increase 2% for 2026, primarily driven by growth during the first half of the year. As for the other proteins, The USDA anticipates minor increase in beef supplies as higher imports offset domestic production headwinds and limited growth in pork production. When these factors are combined with additional chicken supply, the USDA expects net protein availability to rise by 1.6% compared to last year. Within the U.S., consumer sentiment declined to a three-month low at the end of the first quarter, as inflation rose amid higher energy prices. Consumers saw more value-oriented offerings. With this environment, chicken remained attractive, given its relative affordability, resulting in increased volumes across channels. In retail, the fresh meat department posted dollar sales growth across proteins, as volume grew in chicken, beef, and pork. Results were uneven during the quarter, as strong performance in January was followed by softer-than-expected demand in February and March. as winter storms disrupted shopping patterns and pulled some purchases forward as customers stocked up early. Chicken maintained a compelling value advantage on shelf compared to the other proteins. Boneless skinless breast pricing remained steady and spreads against ground beef continued to be at record levels. Boneless thighs continued their multi-year trend of strong volume growth given sustained consumer interest. continues to grow at a steady pace, given its role as a convenient and affordable meal solution for consumers. Appetizers, particularly popcorn chicken formats, along with gains in whole birds drove moderate growth. Frozen prepared products continue to deliver positive volume growth, led by popcorn chicken, chunks, and nuggets. In food service, Chicken offers expanded again as operators leaned into value proposition and responded to elevated beef pricing. As such, adoption extended beyond traditional chicken focus chains, particularly among QSRs. While menu penetration increased, volume growth was constrained by inventory levels and uneven traffic patterns. Going forward, chicken continues to be well positioned as consumers increasingly prioritize strong perceived value. Chicken-focused KSRs deliver volume growth in the first quarter and outperform full-service restaurants, as inflation-constrained consumers continue to favor value-oriented, quick-service formats. Non-commercial channels also posted growth, supported in part by favorable pricing conditions. As a result, chicken volumes in food service remain stable to slightly higher overall, even as broader sector performance and traffic trend stays mixed. In exports, we continue to monitor global trade movements. In the Middle East, all vessels operating to the Gulf Coast countries were suspended at the end of February, given the military conflict. While the GCC is an important market for U.S. broilers exports, strong domestic demand for dark meat, along with robust exports to Mexico, mitigated this disruption. To date, we have not seen any material changes to dark meat values as pricing remain above five-year average for the back half of the bird. Moving forward, we expect several international markets to reopen. The occurrences of commercial high-pat avian influenza has recently slowed, and previously restricted control zones are no longer subject to limitations, given the absence of new cases. We remain vigilant on biosecurity and will continue to leverage our geographical footprint and cooperate with various governments to ensure international customer needs are continuously met. Turning to the feed inputs, pricing support for corn emerged from higher energy and fertilizer markets. However, generally favorable crop development in South America, along with larger than expected perspective corn plantings in the U.S. reduces risks of significant price increases. As a result, corn stayed consistent with the 2025 level pricing. Stocks remain above 2.0 billion bushels, and the market focus is quickly shifting to planting and growing conditions in the U.S. for the upcoming season. In soy, Both beans and meal appreciated during the first quarter, given the expectations that China will make additional purchases from the U.S. for the 2025 and 2026 crop year. Better than expected exports demand, along with increasing domestic interest for U.S. soybeans, also provided further support. However, above average yields from South America kept global soybean markets well supplied, limiting market upside. Like corn, The market focus for soy will be growing conditions in the U.S. The USDA currently forecasts soybean ending stocks to reach 350 million bushels, up 7% prior year. When combined with the expansion of the U.S. soy processing capacity and growth in global soybean stocks, meal prices are expected to remain manageable. As for wheat, global stock remained well supplied, increasing 24 million metric tons versus last year. Nonetheless, futures appreciated from relatively low levels throughout the first quarter, giving geopolitical risks. Moving forward, favorable growing conditions in the eastern hemisphere for winter wheat, along with an increase in planted acres and a historic yield in the UK, should unlock additional value. In the U.S., demand for chicken continued to grow across retail and food service. Equally important, we made significant headway in projects to reduce volatility, enhance margins, and drive sales of our portfolio. Our progress has also improved our ability to meet increased key customer demand, especially during the upcoming months. In Big Bird, we implemented a variety of plant layout changes, equipment improvement, and operation procedures across many locations to increase dark meat deboning and portioning capabilities to support key customers and our prepared food operations that were previously done by external companies. Because of these investments, each site incurred plant downtime along with additional expenses from project mobilization and production ramp-up. During this time, we also continue to invest in our team members through training and education on revised plant operations. In case ready, Both sales and volume grew as traffic pack retail offerings to key customers grew above category. In early April, we also completed our conversion at the Russellville facility from Big Bird to retail to support the growth of one of our key customers. Our investments in Russellville and throughout the Big Bird network will create a more resilient portfolio, giving our expanded capability to meet the growth needs of prepared foods, strengthening leadership presence in higher attribute offerings and portions, and enhanced production efficiencies. In small bird, overall demand remains strong as volume increased compared to prior year. However, consumers are increasingly transitioned from bone-in to boneless offerings. When this factor is considered with the existing supply, the value for daily walks continue to be below the five-year average impacting our sales. Moving forward, We'll continue to evaluate our production mix and ensure if sufficient flexibility exists to meet market demand. In addition, we will explore alternatives to revigorate the category through promotional investments and innovation, especially with our key customers. The recent inclusion in the Farm Bill that hot rotisserie will be included in the SNAP eligibility also provides a significant opportunity for the category. During the quarter, many sites were impacted by weather-related events, resulting in unplanned downtime and reducing service levels. When these factors are combined with weakened commodity market fundamentals, impact of our growth projects and small board daily values, DOS fresh sales and profitability was reduced compared to last year. In prepared foods, our growth accelerated as we drove the highest retail volume in any quarter. JustBear continues to lead growth in the frozen fully cooked category as retail sales rose nearly 40% compared to last year from increased distribution and improved velocity. In food service, our business continues to expand through growth in branded offerings along with increased distribution in schools and national accounts. Our efforts to support further growth through a construction of our new facility in the Walker County, Georgia remains on schedule. In the interim, we continue to rely on our network of co-packers to support the strong demand for our products. In Europe, our diversified portfolio drove steady volumes and margins compared to last year. Given persistent inflation, consumers increasingly migrated toward value and convenience. As such, our poultry and meal offerings resonated through groceries, and each category grew faster than the overall channels. While fresh pork experienced similar growth, bacon and sausage categories declined. In our branded portfolio, rollover benefited from marketing investments and grew faster than the category average, whereas frigerators maintained its presence in snacking. Margins for the Richmond remained strong. However, volumes were challenged as promotional activity intensified and consumers changed to more private label offerings. their growth in the category will continue to drive our investments in marketing and innovation, given Richmond's growth potential and market positioning. In food service, challenges exist as consumers increasingly opted away from dining out and reduced visits to QSRs. Nonetheless, our poultry business remained strong as affordability and limited time offerings resonated throughout the marketplace. Even with poultry's performance, overall volumes declined as demand for beef fell in Europe, limiting our growth. Moving forward, we will continue to drive distribution through new offerings and promotional support. Our operational excellence efforts make progress as we exceeded our budgeted improvement targets. We will continue to focus on improvements in productivity, yields, and overall costs. In Mexico, we continue to drive our strategies for profitable growth and reduced volatility. To that end, our fresh branded offerings continue to gain traction as sales increased double digits compared to last year. Just Bear led this growth as volume rose over 80%. In Prepare, sales rose nearly 9% compared to last year, further diversifying our portfolio. Like Fresh, our value-added branded offerings grew as sales from Pilgrims rose 14%. While we've made progress in transforming our portfolio, elevated supply levels in the live commodity market and import pressures persisted throughout the quarter, reducing margins and overall profitability compared to last year. Our expansion efforts remain on track, with expansions to different regions in the South and Peninsula parts of the country, and our prepared expansion in Port Veneer. Based on these investments, we can improve our ability to grow with key customers, reduce operational risk, and further diversify our portfolio. Turning to sustainability, we continue to drive accountability and ownership down the organization to each of our plants. Based on this approach, with investments and operational improvements, we have surpassed our 2025 reduction targets against scope one and two emissions intensity set at our sustainable linked bonds. This achievement reflects our team's mindset and ability to leverage sustainability as a means to create a more efficient operation. With that, I would like to ask our CFO, Matt Galvanone, to discuss our financial results.