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Item 5. Market for Registrant’s Common Equity

2025-03-25 compared with 2016-03-29 · 26 added, 97 removed, 2 unchanged (98% of the section changed)

1 unchanged sentence

Market Information

Prior to the Merger, our common stock was listed on the New York Stock Exchange under the symbol "SFD." As a result of the Merger, our common stock ceased to be traded on the New York Stock Exchange after close of market on September 26, 2013.

Smithfield Foods, Inc.

is wholly owned by a subsidiary of WH Group.

During 2015 , we paid a $30.0 million dividend to WH Group.

Subject to the limitations in certain of our debt agreements, we expect to continue to pay dividends to WH Group based on a certain percentage of our net income.

The terms of certain of our debt agreements limit the payment of cash dividends on our common stock.

We only pay cash dividends from assets legally available for that purpose.

SELECTED FINANCIAL DATA

On September 26, 2013, we were acquired by an indirect subsidiary of WH Group in a merger transaction accounted for as a business combination.

Unless the context otherwise requires, all references to “Successor” refer to Smithfield Foods, Inc.

and all its subsidiaries for the period subsequent to the Merger.

All references to “Predecessor” refer to Smithfield Foods, Inc.

and all its subsidiaries for all periods prior to the Merger.

In addition, the Merger was accounted for under the acquisition method of accounting, which resulted in purchase price allocations that affect the comparability of results of operations for periods before and after the Merger.

The following table shows selected consolidated financial data and other operational data for each of the periods indicated.

This financial data has been derived from our audited consolidated financial statements.

The financial data for the eight months ended December 29, 2013 ( the Transition Period ) have been derived from our audited consolidated financial statements, but have not been audited.

You should read the information in conjunction with “Item 8.

Financial Statements and Supplementary Data” and “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations."

As a result of the Merger, all outstanding common stock of the Company during the Predecessor period was retired and all of the outstanding shares of Merger Sub were converted to 1,000 shares of common stock of the Company, no par value, and such shares are owned by a wholly owned subsidiary of WH Group.

There are no other shares of stock outstanding in the Company;

therefore we have not reported earnings per share.

Twelve Months Ended

January 3, 2016

December 28, 2014

September 27 - December 29, 2013

April 29 - September 26, 2013

April 28, 2013

April 29, 2012

(in millions)

Statement of Income Data:

Cost of sales

Selling, general and administrative expenses

Gain on fire insurance recovery

Merger related costs

(Income) loss from equity method investments

Operating profit

Interest expense

Non-operating (gain) loss

Income before income taxes

Income tax expense

January 3, 2016

December 28, 2014

December 29, 2013

April 28, 2013

April 29, 2012

(in millions)

Balance Sheet Data:

Working capital

Long-term debt and capital lease obligations

Shareholder's equity

Twelve Months Ended

January 3, 2016

December 28, 2014

The Transition Period

April 28, 2013

April 29, 2012

(in millions)

Other Consolidated Operational Data:

Total hogs processed (1)

Packaged meats sales (pounds) (2)

Fresh meats sales (pounds) (1)

Total hogs sold (3)

—————————————

Comprised of Fresh Pork and International.

Comprised of Packaged Meats and International.

Comprised of Hog Production and International and includes intercompany hog sales.

Notes to Selected Financial Data:

Twelve Months Ended January 3, 2016

Includes gain of $12.0 million on the sale of our product label printing business in Kansas City.

Includes losses of $12.8 million on debt extinguishments.

Twelve Months Ended December 28, 2014

Three Months Ended December 29, 2013

Includes $23.9 million of professional fees related to the Merger.

Includes $17.3 million of debt issuance costs for a financing arrangement entered into by Merger Sub.

We recognized these costs in interest expense upon termination of the financing arrangement following the Merger.

Five Months Ended September 26, 2013

Includes $18.0 million of professional fees related to the Merger.

Twelve Months Ended April 28, 2013

Includes losses of $120.7 million on debt extinguishment.

Twelve Months Ended April 29, 2012

Includes our share of charges related to the CFG Consolidation Plan , as defined in "Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations—Significant Events Affecting Results of Operations," of $38.7 million.

Includes net charges of $22.2 million related to the litigation in Missouri that involved a number of claims alleging that hog farms owned by us or operated under hog raising contracts with third parties interfered with the plaintiffs' use and enjoyment of their properties (the Missouri Litigation).

Includes losses of $12.2 million on debt extinguishment.

Includes accelerated depreciation charges associated with the idling of certain Missouri hog farm assets of $8.2 million .

Includes accelerated depreciation and other charges associated with the planned closure of our Portsmouth facility of $4.7 million .

Includes $3.1 million of charges related to our plan to improve the cost structure and profitability of our domestic hog production operations (the Cost Savings Initiative).

Twelve Months Ended May 1, 2011

Includes an involuntary conversion gain on fire insurance recovery of $120.6 million .

Includes losses of $92.5 million on debt extinguishment.

Includes $28.0 million of charges related to the Cost Savings Initiative.

Includes a net benefit of $19.1 million related to the Missouri Litigation.

Includes net gains of $18.7 million on the sale of hog farms.

On January 28, 2025, our common stock began trading on the Nasdaq Global Select Market under the symbol “SFD.” Prior to that, there was no public market for our common stock.

Smithfield is a majority-owned subsidiary of Hong Kong-based WH Group.

WH Group is listed on the Hong Kong Exchange.

As of March 5, 2025, there were approximately two record holders of the Company’s common stock and approximately 5,995 holders whose shares were held in street name by brokerage firms and financial institutions.

Issuer Purchases of Equity Securities

We have historically paid dividends to WH Group annually, along with special dividends in some years.

On March 24, 2025, our Board declared a quarterly cash dividend of $0.25 per share of common stock, which is payable on April 22, 2025, to shareholders of record on April 10, 2025.

We anticipate the remaining quarterly dividends in fiscal 2025 will be $0.25 per share, resulting in an annual dividend rate in fiscal 2025 of $1.00 per share.

The declaration of dividends is subject to the discretion of our Board and depends on various factors, including our net income, financial condition, cash requirements, business prospects, and other factors that our Board deems relevant to its analysis and decision making.

Securities Authorized for Issuance under Equity Compensation Plans

For information relating to securities authorized for issuance under equity compensation plans, see Part III, Item 12 of this Form 10-K.

Use of Proceeds

On January 21, 2025, our Registration Statement on Form S-1, as amended (File 333-284141), was declared effective.

On January 29, 2025, we completed our IPO of 26,086,958 shares of common stock, which represents 7% of the total outstanding shares, at a price of $20.00 per share.

We issued 13,043,479 shares of common stock bringing the total number of outstanding shares to 393,112,711.

The remaining 13,043,479 shares of common stock were sold by our existing shareholders.

Our existing shareholder granted the underwriters a 30-day option to purchase up to 3,913,042 additional shares of our common stock.

On February 20, 2025, the underwriters partially exercised such option and purchased 2,506,936 additional shares of common stock from our existing shareholder.

The acting representatives for the underwriters were Morgan Stanley & Co.

LLC, BofA Securities, Inc.

and Goldman Sachs & Co.LLC.

We received net proceeds from the IPO of approximately $236 million after deducting underwriting discounts, commissions and fees of $13 million.

Upon receipt, the net proceeds from the initial public offering were held in cash and cash equivalents and marketable securities.

There has been no material change in the planned use of proceeds from our IPO from that described in our Prospectus on Form 424B 4, filed with the SEC on January 29, 2025.

Shareholder Return Performance Graph

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity