December 1, 2004
By Barbara Young
The final piece in Pilgrim’s Pride’s current growth strategy for its chicken and turkey business is in place. Let the games begin.
As the nation’s consumers gear up for the final major spending spree of the year in December, product marketers scrutinize company initiatives for a reading on past performance. Some encounter less-than-ideal results, to be sure. Others, such as Pittsburg, TX-based Pilgrim’s Pride Corporation, earned the right to celebrate a year of good fortune. Its 40,000 employee-partners, stationed in 71 cities in the United States and Mexico, received their final collective grade for 2004 on October 2 – double-digit growth. That revelation coincided with Pilgrim’s fiscal year-end results, which also pinpointed a record year of earnings and net sales.
“This marked our eighth consecutive year of growth in sales,” notes O.B. Goolsby, president and chief operating officer. “This was due to the successful integration of the ConAgra chicken division acquisition and the benefits of pursuing a growth strategy centered on our prepared foods business, which grew more than twenty-five percent on a pro-forma basis over the past fiscal year.”
Pilgrim’s Pride ranks as the second-largest poultry company (chicken and turkey) in the United States and Mexico generating $5.36 billion in annual sales. The firm owns and operates 27 processing plants, nine prepared foods plants, 25 feed mills, 32 hatcheries, and 30 distribution centers, and partners with 4,000 U.S. and Mexican farmers, who supply its turkey and chicken livestock.
The company began as a single farm supply store in 1946, growing into a global publicly-held enterprise by 1986. Its 2001 acquisition of Virginia-based WLR Foods marked its entry into the turkey business. The company doubled in size with its 2003 acquisition of the chicken division of ConAgra Foods, which added employees, sales, and locations.
Asked to pinpoint milestones of the year, Goolsby quips “integration, integration, integration,” referring to the work involved with merging two companies of comparable size and financial strength. “It is a challenge, to say the least, in what it takes,” he continues. “It’s almost like starting over, but at the end of a very successful year, we believe we are better positioned than ever before to continue to grow and reach new targets.”
Other notable achievements include steady growth in prepared foods and a synergistic windfall valued at more than $55 million, an amount generated three years earlier than anticipated. “We were able to reach this level in a single year because of the teamwork and dedication of our people,” boasts Goolsby. “We plan to stay focused on our growth strategy and continuing to find synergies with the ConAgra integration.”
Future prospects are high, he says. “Responding to the growing demand for high-quality, convenient meat proteins from our customers remains a key priority for us going forward,” Goolsby reports. “Looking ahead, we expect the continuation of favorable consumer trends, rising export demand, and projections for a further drop in commodity grain prices to create a positive growth environment enabling us to continue delivering value to our shareholders.” NP