Smithfield Foods Reports Strong Q1 Earnings and Reaffirms FY25 Outlook

Smithfield Foods, Inc., a leading American food company, announced a significant increase in its first-quarter net income compared to the previous year. The company’s net income attributable to Smithfield rose to $224 million from $156 million, with earnings per share (EPS) increasing to $0.57 from $0.30. On an adjusted basis, net income from continuing operations climbed to $227 million from $123 million, and adjusted EPS reached $0.58 from $0.32. These results surpassed analysts’ expectations, who had anticipated a profit of $0.47 per share.

The company’s revenue for the quarter increased by 9.5% to $3.77 billion, up from $3.44 billion in the same period last year. This growth was driven by strong demand for its packaged meats and fresh pork products. Smithfield Foods operates through three main segments: Packaged Meats, Fresh Pork, and Hog Production. The Packaged Meats segment, which includes brands like Smithfield, Eckrich, and Nathan’s Famous, saw a 1.2% increase in sales. Fresh pork sales rose by 4.9%.

Despite challenges such as cautious consumer spending and higher raw material costs, Smithfield Foods managed to improve its operating margin to 8.5% from 4.7% in Q1 2024. The company’s operating profit soared 97% year-over-year to $321 million. Segment-wise, the Packaged Meats segment reported an operating profit of $266 million with a 13.1% margin, while the Fresh Pork segment achieved $82 million in operating profit. The Hog Production segment experienced a significant turnaround, moving from a loss of $174 million to a profit of $1 million.

Smithfield Foods maintains strong liquidity, with $3.23 billion in total liquidity, including $928 million in cash. The company reaffirmed its fiscal 2025 outlook, projecting low-to-mid-single-digit sales growth and total adjusted operating profit between $1.1 billion and $1.3 billion. The quarterly dividend remains at $0.25 per share, targeting an annual rate of $1.00 per share for fiscal 2025.

With a market capitalization of $8.05 billion and a price-to-earnings ratio of 9.87, Smithfield Foods continues to be a key player in the Consumer Staples sector, focusing on delivering high-quality meat products to consumers.