• Adjusted Operating Profit: $326 million, an 86% increase from $176 million in Q1 2024.

• Adjusted Operating Profit Margin: 8.6%, up from 5.1% in Q1 2024.

• Consolidated Sales: $3.8 billion, a 9.5% increase year-over-year.

• Adjusted Net Income: $227 million, compared to $123 million in Q1 2024.

• Adjusted EPS: $0.58 per share, up from $0.32 per share in Q1 2024.

• Packaged Meats Segment Operating Profit: $266 million with a 13.1% margin.

• Fresh Pork Segment Operating Profit: $82 million with a 4% margin.

• Hog Production Segment Profit: $1 million, a turnaround from a $174 million loss in Q1 2024.

• Net Debt to Adjusted EBITDA Ratio: 0.7 times.

• Liquidity: $3.2 billion, including $928 million in cash and cash equivalents.

• Capital Expenditures: $79 million, down from $92 million in Q1 2024.

• Dividend: $0.25 per share, with an expected annual dividend of $1 per share.

• Warning! GuruFocus has detected 5 Warning Signs with SFD.

Release Date: April 29, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Smithfield Foods Inc (NASDAQ:SFD) reported a record first quarter with an adjusted operating profit of $326 million, marking an 86% increase from the previous year.

• The Packaged Meats segment delivered an impressive adjusted operating profit margin of 13.1%, driven by increased sales of higher-margin products like packaged lunch meats and dry sausage.

• The Hog Production segment achieved a significant turnaround, reporting a profit of over $1 million compared to a loss of $174 million in the first quarter of 2024.

• Smithfield Foods Inc (NASDAQ:SFD) maintained a strong balance sheet with a net debt to adjusted EBITDA ratio of 0.7 times, providing financial flexibility for growth strategies.

• The company continues to prioritize innovation and product mix improvements, particularly in the Packaged Meats segment, with a focus on higher-margin categories such as lunch meats and dry sausage.

Negative Points

• The Fresh Pork segment experienced a decline in operating profit due to a compressed industry market spread, with hog prices rising faster than USDA cutout values.

• Higher raw material input costs, particularly for bellies and trim, posed challenges for the Packaged Meats segment, impacting profit margins.

• The company faces ongoing tariff risks, particularly with China, which could affect export demand and overall revenue.

• Consumer trading down to less expensive alternatives and private labels could impact branded product sales and profit margins.

• The Hog Production segment remains cautious due to potential revenue volatility from tariffs and seasonal market fluctuations.