What changed in this filing

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Item 1. Financial Statements

2025-04-29 compared with 2016-10-26 · 717 added, 357 removed, 122 unchanged (90% of the section changed)

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(in millions and unaudited)

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except for share and per share data, and unaudited)

Three Months Ended

Nine Months Ended

September 27,

2025 March 31,

Sales $ 3,771 $ 3,444

Cost of sales 3,262 3,083

Gross profit 510 362

Selling, general and administrative expenses 197 199

Income from equity method investments

Operating gains ( 9 ) ( 1 )

Operating profit 321 163

Interest expense

Non-operating loss

Income before income taxes

Interest expense, net 11 16

Non-operating (gains) losses 6 ( 4 )

Income from continuing operations before income taxes 304 152

Income tax expense 72 39

See Notes to Consolidated Condensed Financial Statements

Loss from equity method investments 5 1

Net income from continuing operations 227 112

Net income (loss) from continuing operations attributable to noncontrolling interests 4 ( 2 )

Net income from continuing operations attributable to Smithfield 224 114

Income from discontinued operations before income taxes — 54

Income tax expense from discontinued operations — 12

Net income from discontinued operations — 42

Net income from discontinued operations attributable to noncontrolling interests — —

Net income from discontinued operations attributable to Smithfield — 42

Net income 227 154

Net income (loss) attributable to noncontrolling interests 4 ( 1 )

Net income attributable to Smithfield $ 224 $ 156

Net income per common share attributable to Smithfield:

Basic and diluted:

Continuing operations $ 0.57 $ 0.30

Discontinued operations — 0.11

Total $ 0.57 $ 0.41

Weighted-average shares outstanding:

Basic 388,812,663 380,069,232

Diluted 389,064,212 380,069,232

See Notes to Condensed Consolidated Financial Statements

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions and unaudited)

Three Months Ended

Nine Months Ended

September 27,

2025 March 31,

Net income $ 227 $ 154

Other comprehensive income (loss), net of tax:

4 unchanged sentences

Comprehensive income 270 109

See Notes to Consolidated Condensed Financial Statements

Comprehensive income attributable to noncontrolling interests 3 4

Comprehensive income attributable to Smithfield $ 267 $ 105

See Notes to Condensed Consolidated Financial Statements

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED BALANCE SHEETS

(in millions, except share data)

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share data, and unaudited)

2025 December 29,

Current assets:

1 unchanged sentence

Accounts receivable, net 759 558

Inventories, net 2,385 2,412

Prepaid expenses and other current assets 262 290

1 unchanged sentence

Property, plant and equipment, net 3,153 3,176

Goodwill 1,613 1,613

Intangible assets, net 1,264 1,266

Operating lease assets 327 335

Equity method investments 197 202

Other assets 258 260

Total assets $ 11,146 $ 11,054

LIABILITIES AND EQUITY

Current liabilities:

Current portion of long-term debt and capital lease obligations

Accounts payable 447 777

Current portion of long-term debt and finance lease obligations 3 3

Current portion of operating lease obligations 55 56

Accrued expenses and other current liabilities 889 871

Total current liabilities 1,393 1,706

Long-term debt and capital lease obligations

Long-term debt and finance lease obligations 2,000 1,999

Long-term operating lease obligations 277 286

Deferred income taxes, net 523 518

Net long-term pension obligation 277 279

Other liabilities 207 208

Redeemable noncontrolling interests 243 225

Commitments and contingencies

Shareholder's equity:

Common stock, no par value, 1,000 shares authorized;

1,000 issued and outstanding

Commitments and contingencies (Note 18)

Shareholders’ equity:

Preferred stock, no par value;

100,000,000 shares authorized;

no shares issued and outstanding

Common stock, no par value;

5,000,000,000 shares authorized;

393,112,711 shares issued and outstanding as of March 30, 2025 and 380,069,232 shares issued and outstanding as of December 29, 2024

Additional paid-in capital 3,325 3,102

1 unchanged sentence

Accumulated other comprehensive loss ( 408 ) ( 452 )

Total shareholder's equity

Noncontrolling interests

Total shareholders’ equity 6,225 5,834

Total liabilities and equity $ 11,146 $ 11,054

See Notes to Consolidated Condensed Financial Statements

See Notes to Condensed Consolidated Financial Statements

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions and unaudited)

Nine Months Ended

September 27,

Three Months Ended

2025 March 31,

Cash flows from operating activities:

Adjustments to reconcile net cash flows from operating activities:

Net income $ 227 $ 154

Net income from discontinued operations — ( 42 )

Net income from continuing operations $ 227 $ 112

Adjustments to reconcile net income from continuing operations to net cash flows used in operating activities of continuing operations:

Depreciation and amortization 83 82

Stock-based compensation expense

Income from equity method investments

Changes in operating assets and liabilities and other, net

Net cash flows from operating activities

Changes in operating and other assets and liabilities, net ( 541 ) ( 360 )

Other 64 ( 54 )

Net cash flows used in operating activities of continuing operations ( 166 ) ( 219 )

Cash flows from investing activities:

Proceeds from sale of equity interest in Campofrio Food Group

Capital expenditures ( 79 ) ( 92 )

Net expenditures from breeding stock transactions ( 7 ) ( 25 )

Net cash flows from investing activities

Other 1 ( 3 )

Net cash flows used in investing activities of continuing operations ( 85 ) ( 119 )

Cash flows from financing activities:

Proceeds from the issuance of long-term debt

Principal payments on long-term debt and capital lease obligations

Proceeds from Securitization Facility

Payments on Securitization Facility

Net proceeds (payments) on revolving credit facilities

Net proceeds from issuance of common stock 236 —

Principal payments on long-term debt and finance lease obligations — ( 19 )

Payment of dividends — ( 88 )

Net cash flows from financing activities

Effect of foreign exchange rate changes on cash

Net change in cash and cash equivalents

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

See Notes to Consolidated Condensed Financial Statements

Other — ( 2 )

Net cash flows from (used in) financing activities of continuing operations 236 ( 109 )

Effect of foreign exchange rate changes on cash from continuing operations — 2

Cash flows from discontinued operations

Net cash flows from operating activities of discontinued operations — 43

Net cash flows used in investing activities of discontinued operations — ( 111 )

Net cash flows used in financing activities of discontinued operations — ( 4 )

Effect of foreign exchange rate changes on cash from discontinued operations ( 4 )

Net change in cash and cash equivalents of discontinued operations — ( 77 )

Net change in cash, cash equivalents and restricted cash ( 15 ) ( 522 )

Cash, cash equivalents and restricted cash at beginning of period (including discontinued operations) 943 751

Cash, cash equivalents and restricted cash at end of period (including discontinued operations) 928 229

Cash, cash equivalents and restricted cash attributable to discontinued operations at end of period — ( 25 )

Cash, cash equivalents and restricted cash at end of period $ 928 $ 204

See Notes to Condensed Consolidated Financial Statements

SMITHFIELD FOODS, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY

(in millions and unaudited)

Three Months Ended March 30, 2025

Comprehensive

Shareholders’

Balance, December 29, 2024 $ 3,102 $ 3,184 $ ( 452 ) $ 5,834

Dividend — ( 99 ) — ( 99 )

Net proceeds from issuance of common stock 236 — — 236

Adjustment to redeemable noncontrolling interests ( 15 ) — — ( 15 )

Stock compensation expense 2 — — 2

Comprehensive income:

Net income attributable to Smithfield — 224 — 224

Other comprehensive income, net of tax — — 43 43

Balance, March 30, 2025 $ 3,325 $ 3,308 0 $ ( 408 ) $ 6,225

Three Months Ended March 31, 2024

Comprehensive

Shareholders’

Balance, December 31, 2023 $ 4,152 $ 3,588 $ ( 500 ) $ 7,241

Dividend — ( 88 ) — ( 88 )

Adjustment to redeemable noncontrolling interests ( 11 ) — — ( 11 )

Other ( 1 ) — — ( 1 )

Comprehensive income:

Net income attributable to Smithfield — 156 — 156

Other comprehensive loss, net of tax — — ( 51 ) ( 51 )

Balance, March 31, 2024 $ 4,140 $ 3,656 0 $ ( 550 ) $ 7,246

See Notes to Condensed Consolidated Financial Statements

SMITHFIELD FOODS, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Smithfield Foods, Inc., together with its subsidiaries ("Smithfield," "the Company," "we," "us" or "our"), is the largest hog producer and pork processor in the world.

We produce and market a wide variety of fresh meat and packaged meats products both domestically and internationally.

We conduct our operations through five reportable segments:

Fresh Pork, Packaged Meats, Hog Production, International and Corporate.

Smithfield Foods, Inc., together with its subsidiaries (“Smithfield,” “the Company,” “we,” “us” or “our”) produces a wide variety of fresh pork and packaged meats products primarily in the United States (“U.S.”) and markets them both domestically and internationally.

We operate in a cyclical industry and our results are significantly affected by fluctuations in commodity prices for meat, livestock (primarily hogs) and grains.

We are an indirect, majority owned subsidiary of Hong Kong-based WH Group Limited (“WH Group”).

Basis of Presentation

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.

You should read these statements and notes in conjunction with the audited consolidated financial statements and the related notes included in our report on Form 10-K for the twelve months ended January 3, 2016 .

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S.

(“GAAP”), which require us to make estimates and use assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes.

It is possible that actual results could differ materially from those estimates.

The information reflects all normal recurring adjustments, which we believe are necessary to present fairly the financial position and results of operations for all periods included.

The three and nine months ended October 2, 2016 correspond to the third quarter of 2016 , and the three and nine months ended September 27, 2015 correspond to the third quarter of 2015 .

Totals and percentages may be affected by rounding.

Certain prior period amounts have been reclassified to conform to the current period presentation.

These statements and notes should be read in conjunction with the audited consolidated financial statements and related notes for the year ended December 29, 2024, which include a comprehensive description of our significant accounting policies and other information that is not included in our interim condensed consolidated financial statements.

Our elected fiscal year is the 52-week or 53-week period which ends on the Sunday nearest to December 31.

Unless otherwise noted, all references to the first quarter of 2025 and the three months ended March 30, 2025 are to the 13-week period ended March 30, 2025.

All references to the first quarter of 2024 and the three months ended March 31, 2024 are to the 13-week period ended March 31, 2024.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of all wholly owned subsidiaries, as well as majority-owned subsidiaries and other entities for which we have a controlling financial interest.

We evaluate contractual, equity and other variable interests in entities that may be deemed variable interest entities (“VIE”).

We consolidate a VIE if we determine that we are the VIE’s primary beneficiary.

A VIE’s primary beneficiary has both (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.

All intercompany transactions and accounts have been eliminated.

Stock-Based Compensation

In connection with our initial public offering (“IPO”), we adopted an incentive plan, under which eligible individuals may be granted equity-based incentive awards, including stock options and restricted stock units (“RSUs”), among others.

We estimate the fair value of stock options on the grant date using the Black-Scholes option pricing model.

RSUs are measured at fair value as if they were vested and issued on the grant date.

We recognize stock-based compensation expense for stock options and RSUs granted to our employees using the straight-line method over the requisite service period.

We recognize forfeitures as they occur.

Stock-based compensation expense is included in selling, general and administrative expenses (“SG&A”) in the condensed consolidated statements of income.

Sales and profitability as well as cash flow generation and use are impacted on a quarterly basis by the seasonal nature of our business.

Generally, our sales and profitability are higher in the fourth quarter due to the Thanksgiving and Christmas holidays.

In addition, the timing of the Easter holiday can impact the comparability of our first and second quarters both on a quarter-to-quarter and year-over-year basis.

Our cash use is highest in the first quarter due to working capital needs related to payments to certain suppliers that are typically deferred in the fourth quarter.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09).

The standard outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance.

The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The ASU applies to all contracts with customers, except those that are within the scope of other topics in the FASB Accounting Standards Codification.

Compared with current GAAP, the ASU also requires significantly expanded disclosures about revenue recognition.

In August 2015, the FASB issued Accounting Standards Update 2015-14, Revenue from Contracts with Customers (Topic 606):

Deferral of the Effective Date (ASU 2015-14) which defers the effective date by one year to fiscal year and interim periods within those years beginning after December 15, 2017.

Early adoption is permitted as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within those annual periods.

The guidance is not currently effective for us and has not been applied in this Form 10-Q.

We are currently in the process of evaluating the potential impact of future adoption but at this time do not anticipate it will have a material impact on our consolidated financial statements.

In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (Topic 842) (ASU 2016-02).

ASU 2016-02 requires that a lessee should recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on the balance sheet and to disclose qualitative and quantitative information about lease transactions, such as information about variable lease payments and options to renew and terminate leases.

The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2018 with early adoption permitted.

The guidance is not currently effective for us and has not been applied in this Form 10-Q.

We are currently in the process of evaluating the impact of adoption on our consolidated financial statements, however, the primary effect will be to record assets and obligations for current operating leases.

In March 2016, the FASB issued Accounting Standards update 2016-09, Compensation - Stock Compensation (Topic 718):

Improvements to Employee Share-Based Payment Accounting (ASU 2016-09).

ASU 2016-09 addresses several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.

The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2016 with early adoption permitted.

The guidance is not currently

effective for us and has not been applied in this Form 10-Q.

We are currently in the process of evaluating the impact of adoption on our consolidated financial statements.

In June 2016, the FASB issued Accounting Standards update 2016-13, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments (ASU 2016-13).

ASU 2016-13 will impact how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income.

The ASU replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and

requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.

The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2019 with early adoption permitted beginning in the first quarter of 2019.

We are currently in the process of evaluating the potential impact of adoption but at this time do not anticipate it will have a material impact on our consolidated financial statements.

In August 2016, the FASB issued Accounting Standards update 2016-15, Statement of Cash Flows (Topic 230):

Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15) .

ASU 2016-15 is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows.

The ASU provides additional clarification guidance on the classification of certain cash receipts and payments in the statement of cash flows.

The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2017 with early adoption permitted.

We are currently in the process of evaluating the potential impact of future adoption but at this time do not anticipate it will have a material effect on the presentation of our consolidated statements of cash flow.

Inventories consist of the following:

New Accounting Pronouncements Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The standard requires enhanced rate reconciliation disclosures, including disclosure of specific categories and additional information for reconciling items that meet a quantitative threshold.

The standard also requires companies to disaggregate income taxes paid by federal, state and foreign taxes.

The update is effective for our annual report on Form 10-K for fiscal year 2025, with early adoption permitted.

The standard will not impact our financial position, results of operations or cash flows.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses .

The new guidance is intended to provide investors more disaggregated information about certain line items presented in the consolidated statement of income.

The update is effective for fiscal year 2027, with early adoption permitted.

The new disclosures are required to be applied prospectively with the option for retrospective application.

The standard will not impact our financial position, results of operations or cash flows but may have an impact on the presentation of certain items.

REPORTABLE SEGMENTS

Our reportable segments are determined on the basis of our organizational structure and information that is regularly reviewed by our Chief Operating Decision Maker (“CODM”) for the purpose of making operating and resource allocation decisions and assessing the performance of the operating segments of our business.

Our CODM is our Chief Executive Officer.

Our CODM reviews assets at a consolidated level;

not by reportable segment.

Therefore, we do not disclose assets by reportable segment.

The measure of segment profit reviewed by our CODM is operating profit, which represents the operating results of our operating segments with the exception of certain gains, losses and other expenses which are not allocated to our segments.

Our CODM uses operating profit to assess segment performance, compensate employees and allocate capital, personnel and other resources to each segment.

We recently removed income from equity method investments from the measure of segment profit reviewed by our CODM.

Accordingly, the historical segment results presented herein have been retrospectively adjusted to remove income from equity method investments.

Following the carve-out and distribution of our European operations (see “Note 3:

Discontinued Operations”), we conduct our operations through three reportable segments:

Packaged Meats, Fresh Pork and Hog Production.

Packaged Meats

The Packaged Meats segment consists of our U.S.

operations that process fresh meat into a wide variety of packaged meats products, including bacon, sausage, hot dogs, deli and lunch meats, dry sausage products (such as pepperoni and genoa salami), ham products, ready-to-eat products and prepared foods (such as pre-cooked entrees, bacon and sausage).

Approximately 80 % of the Packaged Meats segment’s raw materials are sourced from our Fresh Pork segment.

We market our domestic packaged meats products under a strategic set of core brands, which include:

Smithfield, Eckrich, Nathan’s Famous, Farmland, Armour, Farmer John, Kretschmar, Krakus, John Morrell, Cook’s, Gwaltney, Carando, Margherita, Curly’s and Smithfield Culinary.

We also sell a sizeable portion of our packaged

meats products as private label products.

The majority of the Packaged Meats segment’s products are sold to retail and foodservice customers in the U.S.

The Fresh Pork segment consists of our U.S.

operations that process live hogs into a wide variety of primal, sub-primal and offal products, such as bellies, butts, hams, loins, picnics and ribs.

In the first quarter of 2025, the Fresh Pork segment sourced approximately 40 % of its raw materials from our Hog Production segment, compared to approximately 50 % in the first quarter of 2024, with the remainder from third-party farmers with whom we partner across the U.S.

Approximately one-third of our fresh pork products, including the majority of hams, bellies and trimmings, is transferred to our Packaged Meats segment.

Externally, we sell our fresh pork products to domestic retail, foodservice and industrial customers, as well as to export markets, including, among others, China, Mexico, Japan, South Korea and Canada.

Hog Production

The Hog Production segment consists of our hog production operations in the U.S.

, which produce and raise our hogs on numerous company-owned farms and farms that are owned and operated by third-party contract farmers.

Nearly all of the hogs produced by this segment are processed by our Fresh Pork segment.

The Hog Production segment also sells grains and feed to external customers.

The following table provides certain financial information by reportable segment with a reconciliation to the consolidated totals.

Three Months Ended March 30, 2025

Packaged Meats Fresh Pork Hog Production Other (1)

Corporate (2)

Unallocated (3)

Intersegment Consolidated

(in millions)

Sales 2,024 2,033 932 104 — — ( 1,322 ) $ 3,771

Cost of sales 1,665 1,906 919 84 — 9 ( 1,322 ) 3,262

Selling, general and administrative expenses 93 46 12 6 29 12 — 197

Operating gains — — — — — ( 9 ) — ( 9 )

Operating profit (loss) 266 82 1 14 ( 29 ) ( 12 ) — 321

Interest expense, net 11 11

Non-operating losses 6 6

Income from continuing operations before income taxes 304

Other segment data:

Depreciation and amortization 32 27 15 6 — 2 — 83

Capital expenditures 40 24 11 2 3 — — 79

Three Months Ended March 31, 2024

Packaged Meats Fresh Pork Hog Production Other (1)

Corporate (2)

Unallocated (3)

Intersegment Consolidated

(in millions)

Sales $ 1,999 $ 1,938 $ 706 $ 114 $ — $ — $ ( 1,314 ) $ 3,444

Cost of sales 1,621 1,782 868 116 — 10 ( 1,314 ) 3,083

Selling, general and administrative expenses 92 47 12 7 32 9 — 199

Operating gains — — — — — ( 1 ) — ( 1 )

Operating profit (loss) 286 110 ( 174 ) ( 8 ) ( 32 ) ( 18 ) — 163

Interest expense, net 16 16

Non-operating gains ( 4 ) ( 4 )

Income from continuing operations before income taxes 152

Other segment data:

Depreciation and amortization 30 28 16 8 — — — 82

Capital expenditures 41 29 11 3 8 — — 92

________________

(1) Includes our Mexico and Bioscience operations.

Our Mexico operations include the raising of hogs and production of pork products that are sold primarily to customers in Mexico.

Our Bioscience operations use raw materials from hogs that we harvest to manufacture heparin products, including an active pharmaceutical ingredient that mitigates the risk of blood clots.

(2) Represents general corporate expenses for management and administration of the business.

(3) Includes certain items that we do not allocate to our segments.

The following table disaggregates our sales to customers by reportable segment and by major distribution channel.

Three Months Ended March 30, 2025

Foodservice (2)

Industrial (4)

Other / Unallocated (5)

Total External Sales (6)

Intersegment Consolidated

(in millions)

Packaged Meats $ 1,284 $ 597 $ 31 $ 110 $ 2 $ 2,024 $ — $ 2,024

Fresh Pork 483 59 435 266 3 1,246 787 2,033

Hog Production — — — — 397 397 535 932

— — — — 104 104 — 104

Intersegment — — — — — — ( 1,322 ) ( 1,322 )

Total $ 1,767 $ 657 $ 466 $ 376 $ 505 $ 3,771 $ — $ 3,771

Three Months Ended March 31, 2024

Foodservice (2)

Industrial (4)

Other / Unallocated (5)

Total External Sales (6)

Intersegment Consolidated

(in millions)

Packaged Meats $ 1,318 $ 553 $ 31 $ 95 $ 2 $ 1,999 $ — $ 1,999

Fresh Pork 471 53 423 255 2 1,203 735 1,938

Hog Production — — — — 128 128 578 706

— — — — 114 114 — 114

Intersegment — — — — — — ( 1,314 ) ( 1,314 )

Total $ 1,789 $ 606 $ 454 $ 350 $ 245 $ 3,444 $ — $ 3,444

________________

(1) Includes national and regional retailers in the U.S.

such as grocery supermarket chains, independent grocers and club stores.

(2) Includes foodservice distributors, fast food and other restaurant operators, hotel chains and other institutional customers in the U.S.

(3) Includes exports from the U.S.

to international retailers and wholesale distributors primarily in North America, Asia, Latin America and other emerging markets.

(4) Includes sales to industrial customers who use our raw materials in their finished goods production, including prepared meals, pharmaceutical production and pet food.

(5) Includes sales of grain, oilseeds, feed, breeding stock and market hogs, among others, in addition to external sales from our Mexico and Bioscience operations.

(6) Includes external sales from our Mexico operations of $ 99 million and $ 106 million in the three months ended March 30, 2025 and March 31, 2024, respectively.

All other external sales are sourced from our U.S.

(7) Includes our Mexico and Bioscience operations.

DISCONTINUED OPERATIONS

On August 26, 2024, we completed a carve-out and distribution of our European operations to WH Group.

The European carve-out represents a strategic shift in our geographical footprint.

Accordingly, where applicable, the historical results of operations, assets and liabilities, and cash flows of the European operations have been condensed into separate line items and presented in the condensed consolidated statements of income, the condensed consolidated balance sheets and the condensed consolidated statements of cash flows as discontinued operations.

The following table presents the major components of net income from discontinued operations included in the condensed consolidated statements of income.

Three Months Ended

2025 March 31,

(in millions)

Sales $ — $ 810

Cost of sales — 713

Gross profit — 97

Selling, general and administrative expenses — 50

Operating gains

Operating profit — 55

Non-operating losses — 1

Income from discontinued operations before income taxes — 54

Income tax on discontinued operations — 12

Net income from discontinued operations $ — $ 42

Acquisition within our Discontinued Operations

Prior to the carve-out and distribution of our European operations, we completed the following acquisition, which is included in discontinued operations.

On March 28, 2024, our former European operations purchased a 50.1 % stake in Argal Alimentacíon, S.A.

(“Argal”), a Spanish producer of packaged meats products with approximately 1,480 employees, for € 91 million ($ 98 million), subject to post-closing adjustments.

The amount paid at closing was € 82 million ($ 88 million) with the remaining balance due upon finalization of the purchase price.

In August 2024, an additional € 8 million ($ 9 million) was paid, which resulted in a final purchase price of € 90 million ($ 97 million).

ACQUISITION AND DISPOSITION

On July 30, 2024, we acquired a dry sausage production facility located in Nashville, Tennessee from Cargill Meat Solutions Corporation for $ 38 million.

The acquisition is part of our strategy to grow our value-added packaged meats business and serve the growing demand for high-quality pepperoni, deli, charcuterie and other dry sausage products.

The total cost of the asset acquisition was allocated based on the relative fair value of the assets acquired.

The allocated fair values of the assets acquired are as follows:

equipment valued at $ 17 million, buildings valued at $ 11 million, inventory valued at $ 5 million and land valued at $ 5 million.

On August 30, 2024, we closed our Altoona, Iowa ham boning facility and consolidated production volume into other locations to improve manufacturing efficiencies.

Costs associated with closing the plant primarily include operating lease assets and equipment that we disposed of prior to the expiration of the lease term or end of the asset’s useful life.

The charges associated with the closing were not material.

Altoona was accounted for in the Fresh Pork segment.

OPERATING GAINS AND NON-OPERATING (GAINS) LOSSES

The following table provides details of operating gains and non-operating (gains) losses.

Three Months Ended

March 30, 2025 March 31, 2024

(in millions)

Operating gains:

Insurance recoveries (1)

Gain on disposal of assets ( 2 ) —

Other operating gains ( 1 ) ( 1 )

Total operating gains

$ ( 9 ) $ ( 1 )

Non-operating (gains) losses:

Net pension and postretirement benefits cost (2)

(Gain) loss on nonqualified retirement plan assets 2 ( 6 )

Total non-operating (gains) losses

________________

(1) Represents a gain from an insurance recovery in connection with a fire at our Tar Heel, North Carolina rendering facility that occurred in 2021.

(2) Includes the components of net pension and postretirement benefits cost other than service cost, which is included in operating profit.

These components consist of interest cost, expected return on plan assets, amortization of actuarial gains/losses and prior service costs/credits, and curtailment gains.

RESTRUCTURING

Hog Production Reform

Beginning in 2023, we undertook a number of actions to optimize the size of our Hog Production segment’s operations and improve its cost structure, including ceasing certain farm operations, terminating certain agreements with underperforming contract farmers and reducing the size of our hog production business (“Hog Production Reform”).

In the fourth quarter of fiscal year 2024, we became a member of a North Carolina-based company, Murphy Family Farms LLC (“Murphy Family Farms”), by contributing $ 3 million in cash in exchange for a 25 % minority interest.

We additionally sold approximately 150,000 sows and related inventories located on company-owned and contract

farms in North Carolina to Murphy Family Farms.

Subsequent to the end of fiscal year 2024, on December 30, 2024, we sold the commercial hog inventories associated with such sows to Murphy Family Farms.

Murphy Family Farms is now a hog supplier to us and will supply approximately 3.2 million hogs annually.

We will supply animal feed and other supplies and provide certain support services to Murphy Family Farms.

On February 24, 2025, we became a member of a North Carolina-based company, VisionAg Hog Production, LLC (“VisionAg”), by contributing $ 450,000 in cash in exchange for a 9 % minority interest.

We additionally sold approximately 28,000 sows and the associated commercial hog inventories located on certain company-owned and contract farms in North Carolina to VisionAg.

VisionAg is now a hog supplier to us and will supply approximately 600,000 hogs annually.

In addition, we will supply animal feed and provide certain support services to VisionAg.

In the first quarters of 2025 and 2024, we recognized charges totaling $ 1 million and $ 10 million, respectively, associated with Hog Production Reform in cost of sales in the condensed consolidated statements of income.

The following table details the charges by major type of cost.

Three Months Ended Cumulative

March 30, 2025 March 31, 2024 March 30, 2025

(in millions)

Accelerated depreciation $ 1 $ — $ 172

Contract termination costs — 8 57

Employee termination benefits — 2 32

Loss on asset disposals — — 9

Other exit costs — — 110

Total $ 1 $ 10 $ 379

Workforce Reduction

In the first quarter of 2025, we implemented a reduction in workforce initiative to streamline our operations and reduce operating expenses.

We eliminated certain corporate and plant positions and recognized employee termination benefit costs totaling $ 9 million in the condensed consolidated statement of income in the first quarter of 2025 with $ 6 million classified in SG&A and $ 2 million classified in cost of sales.

ACCOUNTS RECEIVABLE

Accounts receivable, net is comprised of both receivables from contracts with customers and other receivables.

Our receivables from contracts with customers were $ 680 million and $ 494 million as of March 30, 2025 and December 29, 2024, respectively.

We monitor the credit risk associated with our accounts receivable and establish an allowance for credit losses expected to be incurred over the life of the receivable, which is recorded net of this allowance.

We calculate this allowance based on our history of write-offs, future economic conditions, level of past due accounts, the financial health of our customers and historical experience.

Our allowance for credit losses was not material for the periods presented.

Inventories, net consist of the following:

2025 December 29,

(in millions)

Fresh and packaged meats $ 1,164 $ 1,006

Livestock 787 949

Grains 182 208

Maintenance parts 117 115

Manufacturing supplies 113 115

Total inventories

Inventories, net

$ 2,385 $ 2,412

DERIVATIVE FINANCIAL INSTRUMENTS

Our meat processing and hog production operations use various raw materials, primarily live hogs, corn and soybean meal, which are actively traded on commodity exchanges.

Our pork production operations use various raw materials, primarily live hogs, corn, soybean meal and wheat, which are actively traded on commodity exchanges.

We also use fuel and other energy commodities in our operations.

We hedge these commodities when we determine conditions are appropriate to mitigate price risk.

While this hedging may limit our ability to participate in gains from favorable commodity fluctuations, it also tends to reduce the risk of loss from adverse changes in raw material prices.

While this hedging may limit our ability to participate in gains from favorable commodity fluctuations, it also reduces the risk of loss from adverse changes in raw material prices.

We attempt to closely match the commodity contract terms with the hedged item.

We also periodically enter into interest rate swaps to hedge exposure to changes in interest rates on certain financial instruments and foreign exchange forward contracts to hedge certain exposures to fluctuating foreign currency rates.

We record all derivatives as either assets or liabilities at fair value in the balance sheet, with the exception of normal purchase and normal sale contracts that are expected to result in physical delivery.

Accounting for changes in the fair value of a derivative depends on whether it qualifies and has been designated as part of a hedging relationship.

For derivatives that qualify and have been designated as hedges for accounting purposes, changes in fair value have no net impact on earnings, to the extent the derivative is considered perfectly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, until the hedged item is recognized in earnings (commonly referred to as the "hedge accounting" method).

For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in current period earnings (commonly referred to as the "mark-to-market" method).

We may elect either method of accounting for our derivative portfolio, assuming all the necessary requirements are met.

We have in the past availed ourselves of either acceptable method and expect to do so in the future.

We believe all of our derivative instruments represent economic hedges against changes in prices and rates, regardless of their designation for accounting purposes.

Changes in commodity prices could have a significant impact on cash deposit requirements under our broker and counter-party agreements.

Additionally, certain of our derivative contracts contain credit risk-related contingent features, which would require us to post additional cash collateral to cover net losses on open derivative instruments if our credit rating was downgraded.

As of October 2, 2016 , the net liability position of our open derivative instruments that are subject to credit risk-related contingent features was not material.

We are exposed to losses in the event of nonperformance or nonpayment by counter parties under financial instruments.

Although our counter parties primarily consist of financial institutions that are investment grade, there is still a possibility that one or more of these companies could default.

However, a majority of our financial instruments are exchange traded futures contracts held with brokers and counter parties with whom we maintain margin accounts that are settled on a daily basis, thereby limiting our credit exposure to non-exchange traded derivatives.

Determination of the credit quality of our counter parties is based upon a number of factors, including credit ratings and our evaluation of their financial condition.

As of October 2, 2016 , we had gross credit exposure of $27.6 million on non exchange-traded derivative contracts.

After taking into account the effect of netting arrangements, we had credit exposure of $6.8 million on non-exchange traded derivative contracts.

The size and mix of our derivative portfolio varies from time to time based upon our analysis of current and future market conditions.

All derivative contracts are recorded in prepaid expenses and other current assets or accrued expenses and other current liabilities within the consolidated condensed balance sheets, as appropriate.

Changes in commodity prices could have a significant impact on cash deposit requirements under our broker and counterparty agreements.

As of March 30, 2025, the net liability position of our open derivative instruments that are subject to credit risk-related contingent features was not material.

The size and mix of our derivative portfolio vary from time to time based upon our analysis of current and future market conditions.

The following table presents the fair values of our open derivative financial instruments on a gross basis.

(in millions)

Assets Liabilities

2025 December 29,

2024 March 30,

2025 December 29,

(in millions)

Derivatives using the “hedge accounting” method:

Grain contracts

Livestock contracts

Interest rate swaps

Foreign exchange contracts

Commodity contracts $ 34 $ 13 $ 7 $ 37

Derivatives using the “mark-to-market” method:

Grain contracts

Livestock contracts

Energy contracts

Foreign exchange contracts

Commodity contracts 13 2 4 7

Total fair value of derivative instruments $ 47 $ 15 $ 11 $ 44

The majority of our derivatives are exchange traded futures contracts held with brokers, subject to netting arrangements that are enforceable during the ordinary course of business.

Additionally, we have a smaller portfolio of over-the-counter derivatives that are held by counterparties under netting arrangements found in typical master netting agreements.

These agreements legally allow for net settlement in the event of bankruptcy.

We offset the fair values of derivative assets and liabilities, along with the related cash collateral, that are executed with the same counterparty under these arrangements in the consolidated balance sheets.

The following tables reconcile the gross amounts of derivative assets and liabilities to the net amounts presented in our consolidated condensed balance sheets and the related effects of cash collateral under netting arrangements that provide a legal right of offset of assets and liabilities.

October 2, 2016

Gross Amount of Derivative Assets/ Liabilities

Netting of Derivative Assets/ Liabilities

Net Derivative Assets/Liabilities

Cash Collateral

Net Amount Presented in the Condensed Consolidated Balance Sheet

The following tables reconcile the gross amounts of derivative assets and liabilities to the net amounts presented in our consolidated balance sheets and the related effects of cash collateral under netting arrangements that provide a legal right of offset of assets and liabilities.

March 30, 2025

Gross Amount of Derivative Assets/ Liabilities Netting of Derivative Assets/ Liabilities Net Derivative Assets/Liabilities Netting of Derivative and Cash Collateral Net Amount Presented in the Consolidated Balance Sheet (1)

(in millions)

Foreign exchange contracts

Interest rate swaps

Foreign exchange contracts

January 3, 2016

Gross Amount of Derivative Assets/ Liabilities

Netting of Derivative Assets/ Liabilities

Net Derivative Assets/Liabilities

Cash Collateral

Net Amount Presented in the Condensed Consolidated Balance Sheet

Commodities $ 47 $ ( 9 ) $ 38 $ ( 1 ) $ 37

Commodities 11 ( 9 ) 3 — 3

________________

(1) Net derivative assets are recorded in prepaid expenses and other current assets.

Net derivative liabilities are recorded in accrued expenses and other current liabilities.

Cash collateral balances were not material.

December 29, 2024

(in millions)

Foreign exchange contracts

Interest rate swaps

Foreign exchange contracts

See Note 7—Fair Value Measurements for additional information about the fair value of our derivatives.

Commodities $ 15 $ ( 13 ) $ 2 $ 37 $ 39

Commodities 44 ( 13 ) 31 ( 23 ) 8

________________

(1) Net derivative assets are recorded in prepaid expenses and other current assets.

Net derivative liabilities are recorded in accrued expenses and other current liabilities.

These balances include $ 60 million of cash collateral paid to and held by one of our brokers, $ 37 million of which represents the initial margin and exceeded the related open derivative liability position.

Hedge Accounting Method

Cash Flow Hedges

We enter into derivative instruments, such as futures, swaps and options contracts, to manage our exposure to the variability in expected future cash flows attributable to commodity price risk associated with the forecasted sale of live hogs and fresh pork, and the forecasted purchase of corn, wheat and soybean meal.

In addition, we enter into interest rate swaps to manage our exposure to changes in interest rates associated with our variable interest rate debt, and we enter into foreign exchange contracts to manage our exposure to the variability in expected future cash flows attributable to changes in foreign exchange rates associated with the forecasted purchase or sale of assets denominated in foreign currencies.

As of October 2, 2016 , we had no commodity-related cash flow hedges for forecasted transactions beyond December 2018 .

When cash flow hedge accounting is applied, derivative gains or losses are recognized as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings.

The ineffective portion of derivative gains and losses is recognized as part of current period earnings.

Derivative gains and losses, when reclassified into earnings, are recorded in cost of sales for grain contracts, sales for lean hog contracts, interest expense for interest rate contracts, and sales and selling, general and administrative expenses (SG&A) for foreign exchange

Gains and losses on derivatives designed to hedge price risk associated with fresh pork sales are recorded in the Hog Production segment.

During the nine months ended October 2, 2016 , the range of notional volumes associated with open derivative instruments designated in cash flow hedging relationships was as follows:

1,515,800,000

Interest rate

Foreign currency (1)

——————————————

Amounts represent the U.S.

dollar equivalent of various foreign currency contracts.

The following table presents the effects on our consolidated condensed financial statements of pre-tax gains and losses on derivative instruments designated in cash flow hedging relationships for the periods indicated:

Gains (Losses) Recognized in Other Comprehensive Income (Loss) on Derivative (Effective Portion)

Gains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings (Effective Portion)

Gains (Losses) Recognized in Earnings on Derivative (Ineffective Portion)

Three Months Ended

September 27,

(in millions)

Commodity contracts:

Grain contracts

Lean hog contracts

Interest rate swaps

Foreign exchange contracts

Nine Months Ended

September 27,

(in millions)

We enter into derivative instruments, such as futures, swaps and options contracts, to manage our exposure to the variability in expected future cash flows attributable to commodity price risk associated with the forecasted sale of fresh pork and the forecasted purchase of grains, hogs, and energy.

In addition, we enter into interest rate swaps to manage our exposure to changes in interest rates associated with our variable interest rate debt and the forecasted issuance of fixed rate debt.

Lastly, we enter into foreign exchange contracts to manage our exposure to the variability in expected future cash flows attributable to changes in foreign exchange rates associated with the forecasted purchase or sale of assets denominated in foreign currencies.

As of March 30, 2025, substantially all of our commodity-related cash flow hedges were for transactions forecasted through December 2025.

As of March 30, 2025, the notional volumes associated with open derivative instruments designated in cash flow hedging relationships were as follows:

Volume Metric

Lean hogs 722,379,000 Pounds

Corn 37,180,000 Bushels

Soybean meal 615,000 Tons

4,880,000 Million BTU

Diesel 6,804,000 Gallons

The following table presents the effects on our condensed consolidated financial statements of pre-tax gains and losses on derivative instruments designated in cash flow hedging relationships for the periods indicated:

Gains (Losses) Recognized in Other Comprehensive Income (Loss) on Derivative Gains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings

Three Months Ended Three Months Ended

2025 March 31,

2024 March 30,

2025 March 31,

(in millions)

Commodity contracts $ 45 $ ( 61 ) $ ( 10 ) $ ( 3 )

Grain contracts

Lean hog contracts

Interest rate swaps

Foreign exchange contracts

For the periods presented, foreign exchange contracts were determined to be highly effective.

We have excluded from the assessment of effectiveness differences between spot and forward rates, which we have determined to be immaterial.

As of October 2, 2016 , there were deferred gains of $66.2 million , net of tax of $41.8 million , in accumulated other comprehensive income.

We expect to reclassify $17.1 million ( $10.4 million net of tax) of deferred gains on closed commodity contracts into earnings within the next twelve months.

We are unable to estimate the amount of unrealized gains or losses to be reclassified into earnings within the next twelve months related to open contracts as their values are subject to change.

The amounts associated with option contracts as of and for the three months ended March 30, 2025 were not material.

In the three months ended March 31, 2024, we recognized $ 15 million in expenses for option premiums, which are excluded from the assessment of hedge effectiveness.

As of March 31, 2024, accumulated other comprehensive income included $ 12 million of net gains associated with options for which the underlying hedged transactions had not yet impacted earnings.

This amount represents the difference between the change in the fair value of the options and the amount of option premiums amortized through earnings.

Deferred losses on closed derivative contracts included in accumulated other comprehensive loss as of March 30, 2025 were not material.

We are unable to estimate the amount of deferred gains or losses related to open derivative contracts to be reclassified into earnings within the next twelve months as their values are subject to change.

Fair Value Hedges

We enter into derivative instruments (primarily futures contracts) that are designed to hedge changes in the fair value of live hog inventories and firm commitments to buy grains.

When fair value hedge accounting is applied, derivative gains and losses are recognized in earnings currently along with the change in fair value of the hedged item attributable to the risk being hedged.

The gains or losses on the derivative instruments and the offsetting losses or gains on the related hedged items are recorded in cost of sales for commodity contracts.

During the nine months ended October 2, 2016 , the range of notional volumes associated with open derivative instruments designated in fair value hedging relationships was as follows:

The following table presents the effects on our consolidated condensed statements of income of gains and losses on derivative instruments designated in fair value hedging relationships and the related hedged items for the periods indicated:

Gains Recognized in Earnings on Derivative

Losses Recognized in Earnings on Related Hedged Item

Three Months Ended

September 27,

(in millions)

Commodity contracts

Nine Months Ended

September 27,

(in millions)

Commodity contracts

We recognized gains of $1.0 million for the three months ended October 2, 2016 and gains of $3.4 million and $1.4 million for the nine months ended October 2, 2016 and September 27, 2015 , respectively, on closed commodity derivative contracts as the underlying cash transactions affected earnings.

We enter into derivative instruments (primarily futures contracts) that are designed to hedge changes in the fair value of firm commitments to buy grains and hogs.

As of March 30, 2025, the notional volumes associated with open derivative instruments designated in fair value hedging relationships were as follows:

Volume Metric

Lean hogs 30,640,000 Pounds

Corn 3,635,000 Bushels

Soybeans 420,000 Bushels

The carrying values of hedged firm commitments designated in fair value hedge relationships as of March 30, 2025 and December 29, 2024 were not material.

When the underlying inventories are acquired, the hedge relationship is discontinued and the fair value hedge adjustment is reclassified to inventories.

The amount of fair value hedge gains remaining in inventories for which hedge accounting has been discontinued was $ 1 million and $ 3 million as of March 30, 2025 and December 29, 2024, respectively.

Mark-to-Market Method

Derivative instruments that are not designated as a hedge, have been de-designated from a hedging relationship, or do not meet the criteria for hedge accounting are marked-to-market with the unrealized gains and losses together with actual realized gains and losses from closed contracts being recognized in current period earnings.

Under the mark-to-market method, gains and losses are recorded in cost of sales for commodity contracts and SG&A for foreign exchange contracts.

During the nine months ended October 2, 2016 , the range of notional volumes associated with open derivative instruments using the "mark-to-market" method was as follows:

Foreign currency (1)

——————————————

Amounts represent the U.S.

dollar equivalent of various foreign currency contracts.

The following table presents the amount of gains (losses) recognized in the consolidated condensed statements of income on derivative instruments using the "mark-to-market" method by type of derivative contract for the periods indicated:

As of March 30, 2025, the notional volumes associated with open derivative instruments using the “mark-to-market” method were as follows:

Volume Metric

Lean hogs 8,746,000 Pounds

Corn 19,322,000 Bushels

Soybean meal 70,000 Tons

Soybeans 2,995,000 Bushels

Natural gas 106,000 Million BTU

Diesel 756,000 Gallons

Derivative Impact on the Consolidated Statements of Income

The following table presents the effect of derivatives on the condensed consolidated statements of income for the periods indicated.

Three Months Ended

Nine Months Ended

September 27,

(in millions)

2025 March 31,

(in millions)

Commodity contracts

Foreign exchange contracts

The table above reflects gains and losses from both open and closed contracts including, among other things, gains and losses related to contracts designed to hedge price movements that occur entirely within a quarter.

The table includes amounts for both realized and unrealized gains and losses.

The table is not, therefore, a simple representation of unrealized gains and losses recognized in the income statement during any period presented.

Working Capital Facilities

As of October 2, 2016 , we had aggregate credit facilities totaling approximately $1.5 billion , including an inventory-based revolving credit facility totaling $1.025 billion (the Inventory Revolver), an accounts receivable securitization facility totaling $275.0 million (the Securitization Facility) and international credit facilities totaling $169.5 million .

As of October 2, 2016 , our unused capacity under these credit facilities was $1.3 billion .

As part of the Securitization Facility agreement, all accounts receivable of our major Fresh Pork and Packaged Meats subsidiaries are sold to a wholly owned "bankruptcy remote" special purpose vehicle (SPV).

The SPV pledges the receivables as security for loans and letters of credit.

The SPV is included in our consolidated financial statements and therefore, the accounts receivable owned by it are included in our consolidated balance sheets.

Cash flow hedging - commodity contracts $ ( 9 ) $ 1

Mark to market - commodity contracts 7 ( 13 )

Total derivative loss recognized sales ( 2 ) ( 12 )

Cost of Sales

Cash flow hedging - commodity contracts ( 2 ) ( 4 )

Fair value hedging - commodity contracts

Change in fair value of open derivatives 2 ( 1 )

Change in fair value of related hedged items ( 1 ) 1

Gain on closed derivatives (1)

Mark to market - commodity contracts 4 ( 5 )

Total derivative gain (loss) recognized in cost of sales 4 ( 5 )

Selling, general and administrative expenses

Mark to market - foreign exchange contracts

Total derivative gain (loss) $ 2 $ ( 16 )

________________

(1) Represents the amount of fair value hedge adjustment applied to the carrying amount of hedged assets that is recognized in cost of sales as the underlying hedged assets are relieved from inventories and charged to cost of sales.

EQUITY METHOD INVESTMENTS

Murphy Family Farms and VisionAg

On December 27, 2024, we became a member of a North Carolina-based company, Murphy Family Farms, by contributing $ 3 million in cash in exchange for a 25 % minority interest.

We account for Murphy Family Farms under the equity method of accounting.

On February 24, 2025, we became a member of a North Carolina-based company, VisionAg, by contributing $ 450,000 in cash in exchange for a 9 % minority interest.

We account for VisionAg under the equity method of accounting as we have the ability to exercise significant influence over operating and financial policies through our representation on its board of directors.

Restructuring” for more information on Murphy Family Farms and VisionAg.

Monarch Sale Notice

On January 16, 2025, TPG Rise Climate (“TPG”), one of the other two equal joint venture partners in Monarch Bio Energy, LLC (“Monarch”), delivered a sale notice under the joint venture agreement, pursuant to which Monarch must pursue a sale of the joint venture.

In the event that a sale of Monarch is not consummated before January 17, 2026, TPG may require that Monarch purchase TPG’s ownership interests in Monarch.

Senior Unsecured Revolving Credit Facility

In February 2025, we refinanced our $ 2,100 million senior unsecured revolving credit facility (“Senior Revolving Credit Facility”) extending the maturity date from May 21, 2027 to February 12, 2030, with the option to extend the maturity date for up to two one-year periods, subject to obtaining the lenders’ consent and satisfaction of certain other conditions.

The Senior Revolving Credit Facility capacity remains at $ 2,100 million.

As part of the new agreement, there are no longer any subsidiary guarantors under the Senior Revolving Credit Facility which also released the subsidiary guarantors from our Senior Unsecured Notes.

The Senior Revolving Credit Facility bears interest at the Secured Overnight Financing Rate plus a margin ranging from 0.875 % to 1.50 % per annum, or, at our election, at a base rate plus a margin ranging from 0.00 % to 0.50 % per annum, in each case depending on our senior unsecured debt ratings.

The Senior Revolving Credit Facility also contains financial maintenance covenants requiring us to maintain a maximum total consolidated leverage ratio (ratio of consolidated funded debt to consolidated capitalization, each as defined in the Senior Revolving Credit Facility) of 0.50 to 1.00 (which we may elect to increase to 0.55 to 1.00 with respect to any fiscal quarter in which a material acquisition is consummated and the immediately following three consecutive fiscal quarters, subject to certain restrictions) and a minimum interest coverage ratio (“ratio of earnings before interest, taxes, depreciation and amortization (“EBITDA”) to consolidated interest expense, each as defined in the Senior Revolving Credit Facility”) of 3.50 to 1.00.

Our Senior Revolving Credit Facility contains customary covenants, including, but not limited to, restrictions on our ability and that of our subsidiaries to merge and consolidate with other companies, incur indebtedness, grant liens or security interests on assets subject to their security interest, make acquisitions, loans, advances or investments, pay dividends, sell or otherwise transfer assets, optionally prepay or modify terms of any junior indebtedness or enter into transactions with affiliates, each subject to certain exceptions as set forth therein.

We are currently in compliance with the covenants under our Senior Revolving Credit Facility.

Accounts Receivable Securitization Facility

We maintain a $ 225 million accounts receivable securitization facility (“Securitization Facility”), which matures in November 2027.

As part of the Securitization Facility, certain accounts receivable of our major domestic meat processing subsidiaries are sold to a wholly owned “bankruptcy remote” special purpose vehicle (“SPV”).

The SPV pledges all such accounts receivable not otherwise sold pursuant to the Monetization Facility (as defined below) as security for loans made, and letters of credit issued, by participating lenders under the Securitization Facility.

The SPV is included in our condensed consolidated financial statements and therefore the accounts receivable owned by

it are included in our condensed consolidated balance sheets.

However, the accounts receivable owned by the SPV are separate and distinct from our other assets and are not available to our other creditors should we become insolvent.

As of October 2, 2016 , the SPV held $503.9 million of accounts receivable.

PENSION PLANS

The components of net periodic pension cost consist of:

As of March 30, 2025, the SPV held $ 432 million of accounts receivable.

We must maintain certain ratios related to the collection of our receivables as a condition of the Securitization Facility agreement.

As of March 30, 2025, we had $ 22 million in letters of credit issued under the Securitization Facility.

None of the letters of credit were drawn upon.

Monetization Facility

In addition to the Securitization Facility, we maintain an uncommitted $ 250 million accounts receivable monetization facility (“Monetization Facility”).

At Smithfield’s election and subject to the purchasing banks’ approval, certain accounts receivable may be sold by the SPV to purchasing banks, so long as the uncollected outstanding amount of accounts receivable sold pursuant to the Monetization Facility does not exceed $ 250 million in the aggregate at any time, among other limitations.

In the event of a sale, the purchasing banks assume all credit risk related to the receivables while we maintain risk associated with customer disputes.

We account for the sale of receivables to a purchasing bank by derecognizing the receivables from our condensed consolidated balance sheet upon transfer of control to the purchasing bank, and recognizing a discount on the sale in SG&A in the condensed consolidated statement of income.

The proceeds from the sale of receivables are included in net cash flows from operating activities in the condensed consolidated statement of cash flows.

On behalf of the purchasing banks, we continue to service all receivables sold under the Monetization Facility.

As of March 30, 2025, the uncollected balance of receivables that had been sold to purchasing banks was $ 240 million.

We had no servicing asset or liability outstanding as of March 30, 2025.

In the first quarter of 2023, we sold $ 227 million of accounts receivable at a discount and received proceeds totaling $ 225 million.

We reinvested $ 785 million and $ 821 million of cash collections from customers in the revolving sale of accounts receivable to purchasing banks in the three months ended March 30, 2025 and March 31, 2024, respectively.

We recognized charges totaling $ 3 million and $ 3 million in the first quarters of 2025 and 2024, respectively, attributable to the discount on the sale of accounts receivable in SG&A in the condensed consolidated statement of income.

Smithfield and certain other joint venture partners in Monarch joint and severally guarantee Monarch’s debt, interest and fees.

As of March 30, 2025, the maximum amount of loans that could be outstanding under Monarch’s debt agreements was $ 61 million and the loans mature in June 2025.

Monarch’s outstanding debt was $ 56 million as of March 30, 2025.

The guarantee involves elements of performance and credit risk and is not included in the condensed consolidated balance sheets.

We could become liable in connection with Monarch’s obligation depending on the ability of Monarch to perform on its obligation.

If we consider it probable that we will become responsible for the obligation, we would record the liability on our condensed consolidated balance sheet.

PENSION AND OTHER RETIREMENT PLANS

The following table presents the components of the net periodic pension cost for the periods indicated.

Three Months Ended

Nine Months Ended

September 27,

(in millions)

March 30, 2025 March 31, 2024

(in millions)

Interest cost $ 25 $ 25

Amortization 5 5

Service cost 3 3

Expected return on plan assets ( 26 ) ( 28 )

Net amortization

Net periodic pension cost $ 7 $ 5

In 2016, we have made $225.0 million in voluntary contributions to fund our qualified pension plans.

The components of net periodic pension cost other than service cost, which is included in operating profit, are included in non-operating (gains) losses in the condensed consolidated statements of income.

REDEEMABLE NONCONTROLLING INTERESTS

Certain noncontrolling interest holders have the right to exercise a put option that would obligate us to redeem a portion or all of their interest.

These noncontrolling interests are classified as redeemable noncontrolling interests outside of equity on our condensed consolidated balance sheets.

At the end of each period we adjust the value of redeemable noncontrolling interests, if necessary, to the redemption value (as defined in the subsidiary’s operating agreement) through additional paid-in capital.

The following table presents the changes in redeemable noncontrolling interests for our continuing operations for the periods presented.

Three Months Ended

March 30, 2025 March 31, 2024

(in millions)

Beginning balance $ 225 $ 246

Attribution of net income (loss) 4 ( 2 )

Attribution of comprehensive income (loss) ( 1 ) 5

Adjustment to redemption value (1)

Ending balance $ 243 $ 260

_______________

(1) See “Note 17:

Fair Value Measurements” for a discussion of the assessment of redemption value.

On January 17, 2025, the Company’s board of directors and shareholder approved a 380,069.232 -for-one stock split of its issued and outstanding shares of common stock, resulting in issued and outstanding shares of common stock of 380,069,232 , which was effected through filing of an amendment to the Company’s articles of incorporation on January 17, 2025.

As part of the amendment, the number of authorized shares of common stock was revised to 5,000,000,000 , the par value of which was not adjusted, and 100,000,000 shares of preferred stock were authorized.

All share and per share amounts for all periods presented in the accompanying financial statements have been adjusted retroactively to reflect this stock split.

Initial Public Offering

On January 29, 2025, we completed our initial public offering (“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 shareholder.

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 that option and purchased 2,506,936 additional shares of common stock from our existing shareholder.

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

Stock-Based Compensation

In connection with the IPO, we granted to certain of our directors and employees and certain directors and employees of WH Group:

(1) options to purchase 9,822,467 shares with an exercise price equal to the IPO price of $ 20.00 per share option and (2) 1,527,000 RSUs.

The options and substantially all RSUs vest over a five year period, with 20 % vesting each year.

We recognized compensation expense totaling $2 million associated with these equity instruments in the first quarter of 2025.

Unrecognized compensation expense totaled $ 45 million as of March 30, 2025, which is expected to be recognized on a straight-line basis over the remaining vesting period of 4.8

No compensation expense was recognized for stock options and RSUs granted to directors and employees of WH Group.

Such awards will be accounted for as a dividend upon issuance of the shares based on the grant-date fair value.

Accumulated Other Comprehensive Loss

The following tables present the beginning and ending balances of accumulated other comprehensive gain (loss) by component.

Three Months Ended March 30, 2025

Foreign Currency Translation Pension Accounting Hedge Accounting Accumulated Other Comprehensive Loss

(in millions)

Balance, December 30, 2024 $ ( 8 ) $ ( 418 ) $ ( 26 ) $ ( 452 )

Other comprehensive loss, net of tax ( 1 ) 3 41 43

Balance, March 30, 2025 $ ( 9 ) $ ( 414 ) $ 15 $ ( 408 )

Three Months Ended March 31, 2024

Foreign Currency Translation Pension Accounting Hedge Accounting Accumulated Other Comprehensive Loss

(in millions)

Balance, December 31, 2023 $ ( 134 ) $ ( 373 ) $ 8 $ ( 500 )

Other comprehensive loss, net of tax ( 11 ) 3 ( 43 ) ( 51 )

Balance, March 31, 2024 $ ( 144 ) $ ( 370 ) $ ( 36 ) $ ( 550 )

Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income (loss) and the related effects on net income of amounts reclassified out of other comprehensive income (loss).

The following table presents the details of other comprehensive income (loss).

Three Months Ended

October 2, 2016

September 27, 2015

March 30, 2025 March 31, 2024

Before Tax Tax After Tax Before Tax Tax After Tax

(in millions)

Continuing operations:

Foreign currency translation:

Translation adjustment arising during the period

Pension accounting:

Actuarial gain

Amortization of actuarial losses and prior service credits reclassified to cost of sales

Amortization of actuarial losses and prior service credits reclassified to SG&A

Hedge accounting:

Translation gains (losses) (1)

$ ( 1 ) $ — $ ( 1 ) $ 15 $ — $ 15

Retirement benefits:

Amortization of actuarial losses and prior service credits reclassified to non-operating (gains) losses

4 ( 1 ) 3 4 ( 1 ) 3

Gains (losses) arising during the period 45 ( 11 ) 33 ( 61 ) 16 ( 45 )

Gains reclassified to sales

Losses (gains) reclassified to cost of sales

Losses reclassified to SG&A

Losses reclassified to interest expense

Total other comprehensive income (loss)

Nine Months Ended

October 2, 2016

September 27, 2015

(in millions)

Foreign currency translation:

Translation adjustment arising during the period

Translation losses reclassified to non-operating loss

Pension accounting:

Actuarial gain

Amortization of actuarial losses and prior service credits reclassified to cost of sales

Amortization of actuarial losses and prior service credits reclassified to SG&A

Hedge accounting:

Gains arising during the period

Gains reclassified to sales

(Gains) losses reclassified to sales 9 ( 2 ) 6 ( 1 ) — ( 1 )

Losses reclassified to cost of sales 2 — 1 4 ( 1 ) 3

Losses reclassified to SG&A

Losses reclassified to interest expense

Total other comprehensive income (loss) from continuing operations $ 58 $ ( 15 ) $ 43 $ ( 38 ) $ 14 $ ( 24 )

Discontinued operations:

Foreign currency translation:

Translation losses (1)

— — — ( 21 ) — ( 21 )

Total other comprehensive loss from discontinued operations $ — $ — $ — $ ( 21 ) $ — $ ( 21 )

Total other comprehensive income (loss)

We paid dividends totaling $375.9 million for the nine months ended October 2, 2016 to our parent company, recorded as a reduction to retained earnings.

$ 58 $ ( 15 ) $ 43 $ ( 59 ) $ 14 $ ( 45 )

Other comprehensive income attributable to noncontrolling interest — — — 5 — 5

Other comprehensive income (loss) attributable to Smithfield $ 59 $ ( 15 ) $ 43 $ ( 64 ) $ 14 $ ( 51 )

________________

(1) We consider the earnings in our non-U.S.

subsidiaries to be indefinitely reinvested, and accordingly, record no deferred income taxes on such amounts.

The three months ended March 31, 2024 included $ 5 million of translation gains attributable to noncontrolling interests, which are included in redeemable noncontrolling interests on the condensed consolidated balance sheet.

EARNINGS PER SHARE

The computation of basic earnings per share (“EPS”) is based on the weighted-average shares of common stock outstanding during the period.

Diluted EPS adjusts basic EPS for the dilutive effect of stock options and RSUs.

The incremental shares from stock options and RSUs are computed using the treasury stock method.

There were no adjustments to the numerator in the computations of earnings per share for the periods presented.

The following table provides the weighted-average shares used in the denominator for those computations.

Three Months Ended

March 30, 2025 March 31, 2024

Basic weighted-average shares outstanding 388,812,663 380,069,232

Dilutive effect of stock options and RSUs 251,549 —

Diluted weighted-average shares outstanding (1)

389,064,212 380,069,232

__________________

(1) Approximately 5.3 million stock options were excluded from the computation of diluted weighted-average shares outstanding for the three months ended March 30, 2025 because their effect would have been anti-dilutive.

FAIR VALUE MEASUREMENTS

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Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables set forth, by level within the fair value hierarchy, our financial assets and liabilities, including assets held in a rabbi trust used to fund our non-qualified defined benefit plan, that were measured at fair value on a recurring basis as of October 2, 2016 and January 3, 2016 :

October 2, 2016

January 3, 2016

(in millions)

March 30, 2025 December 29, 2024

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

(in millions)

Commodity contracts $ 38 $ 9 $ — $ 47 $ 9 $ 6 $ — $ 15

Foreign exchange contracts

Mutual funds (1)

69 — — 80 74 — — 84

Insurance contracts — 105 — 105 — 104 — 104

Total $ 108 $ 114 $ — $ 232 $ 83 $ 110 $ — $ 202

Commodity contracts 5 6 — 11 32 12 — 44

Interest rate swaps

Foreign exchange contracts

Total $ 5 $ 6 $ — $ 11 $ 32 $ 12 $ — $ 44

__________________

(1) Institutional funds that are not publicly traded are estimated at fair value using the net asset value (“NAV”) per share of the investment as a practical expedient and are not categorized in the fair value hierarchy.

Therefore, the sum of the values categorized in the fair value hierarchy above do not agree to the total.

The following are descriptions of the valuation methodologies and key inputs used to measure financial assets and liabilities recorded at fair value on a recurring basis:

2 unchanged sentences

These valuation models make use of market-based observable inputs, including exchange traded prices and rates, yield curves, credit curves and measures of volatility.

Level 3 derivatives are valued based on diesel fuel prices and use both observable and unobservable inputs.

There is a lack of price transparency with respect to forward prices for diesel fuel.

Such unobservable inputs are significant to the diesel fuel derivative contract valuation methodology.

• Mutual funds— Mutual funds consist of publicly traded funds and other institutional funds that are not publicly traded.

Publicly traded mutual funds are measured at fair value using quoted market prices and are categorized in Level 1 within the fair value hierarchy.

• Insurance contracts— Insurance contracts are valued at their cash surrender value using the daily asset unit value which is based on the quoted market price of the underlying securities and classified within Level 2.

2 unchanged sentences

that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, for example, when there is evidence of impairment.

During the nine months ended October 2, 2016 , we had no significant assets or liabilities that were measured and recorded at fair value on a nonrecurring basis.

For the three months ended March 30, 2025 and March 31, 2024, respectively, we had no significant assets or liabilities that were measured and recorded at fair value on a nonrecurring basis after initial recognition.

Redeemable Noncontrolling Interest

The redemption value for the noncontrolling interest in Granjas Carroll de Mexico, S.

de C.V., (“Altosano”) is fair value.

We estimate the redemption value of Altosano using an income and a market approach.

Under the income approach, fair value is determined by using the projected discounted cash flows.

Under the market approach, the fair value is determined by reference to guideline companies that are reasonably comparable;

the fair value is estimated based on the valuation multiples of EBITDA.

The significant unobservable inputs used in the determination of the fair value have an inherent measurement uncertainty that if changed could result in higher or lower fair value measurements as of the reporting date.

The following table provides the significant unobservable level 3 inputs used in the valuation.

Unobservable Inputs March 30, 2025 December 29, 2024

Weighted-average cost of capital 9 % 9 %

Growth rate 3 % 3 %

EBITDA multiple 9.5 x 10 x

Control premium 25 % 25 %

Other Financial Instruments

We determine the fair value of public debt using Level 2 inputs based on quoted market prices.

We determine the fair value of fixed-rate debt using Level 2 inputs based on quoted market prices.

The carrying amount of all other debt approximates fair value as those instruments are based on variable interest rates.

The following table presents the fair value and carrying value of long-term debt, including the current portion of long-term debt as of October 2, 2016 and January 3, 2016 .

October 2, 2016

January 3, 2016

Carrying Value

The following table presents the fair value and carrying value of total debt.

March 30, 2025 December 29, 2024

Fair Value Carrying Value Fair Value Carrying Value

(in millions)

Long-term debt, including current portion

Debt $ 1,856 $ 1,983 $ 1,821 $ 1,983

The carrying amounts of cash and cash equivalents, accounts receivable, notes payable and accounts payable approximate their fair values because of the relatively short-term maturity of these instruments.

CONTINGENCIES

Like other participants in our industry, we are subject to various laws and regulations administered by federal, state and other government entities, including the United States Environmental Protection Agency (EPA) and corresponding state agencies, as well as the United States Department of Agriculture, the Grain Inspection, Packers and Stockyard Administration, the United States Food and Drug Administration, the United States Occupational Safety and Health Administration, the Commodities and Futures Trading Commission and similar agencies in foreign countries.

Concentrations of Credit Risk

Our financial instruments exposed to concentrations of credit risk consist primarily of cash and cash equivalents, accounts and notes receivable and derivatives.

We may be exposed to losses in the event of nonperformance by our banks, customers, brokers or other counterparties.

We have significant concentrations of credit risk associated with our cash and cash equivalents.

However, our cash and cash equivalents are held by numerous major financial institutions that maintain certain minimum investment grade credit ratings.

Concentrations of credit risk with respect to accounts and notes receivable are limited due to our large number of customers.

We perform periodic credit evaluations of our customers’ financial condition and generally do not require collateral.

As of March 30, 2025, we had accounts and notes receivable from Murphy Family Farms totaling $ 195 million.

This balance is secured by the breeding stock and inventories owned by Murphy Family Farms.

We have an agreement to purchase 3.2 million market hogs annually from Murphy Family Farms, which further mitigates our exposure to potential credit risk.

Our derivative counterparties primarily consist of financial institutions that are investment grade.

A portion of our financial instruments are exchange traded derivative contracts held with brokers and counterparties with whom we maintain margin accounts that are settled on a daily basis, thereby limiting our credit exposure to non-exchange traded derivatives.

Determination of the credit quality of our counterparties is based upon a number of factors, including credit ratings and our evaluation of their financial condition.

As of March 30, 2025, we had gross credit exposure of $ 6 million on non-exchange traded derivative contracts.

After taking into account the effect of netting arrangements, we had $ 2 million of credit exposure on non-exchange traded derivative contracts.

REGULATION AND CONTINGENCIES

Like other participants in our industry, we are subject to various laws and regulations administered by federal, state and other government entities, including the U.S.

Environmental Protection Agency and corresponding state agencies, as well as the U.S.

Department of Agriculture, the Grain Inspection, Packers and Stockyard Administration, the U.S.

Food and Drug Administration, the U.S.

Occupational Safety and Health Administration, the Commodity and Futures Trading Commission and similar agencies in foreign countries.

We, from time-to-time, receive notices and inquiries from regulatory authorities and others asserting that we are not in compliance with such laws and regulations.

1 unchanged sentence

In addition, individuals may initiate litigation against us.

North Carolina Nuisance Litigation

As previously disclosed in our Report on Form 10-K for the twelve months ended January 3, 2016, in July, August and September 2013, 25 complaints were filed in the Superior Court of Wake County, North Carolina by 479 individual plaintiffs against Smithfield and our wholly owned subsidiary, Murphy-Brown alleging causes of action for nuisance and related claims.

All 25 complaints were dismissed without prejudice in September and October 2014.

In August, September and October 2014, 25 complaints were filed in the Eastern District of North Carolina by 515 individual plaintiffs against our wholly owned subsidiary, Murphy-Brown, alleging causes of action for nuisance and related claims.

The complaints stemmed from the nuisance cases previously filed in the Superior Court of Wake County.

On February 23, 2015, all 25 complaints were amended, one complaint was severed into two separate actions, and several additional plaintiffs were joined, bringing the total number of plaintiffs to 541.

On June 29, 2015, the Court granted Murphy-Brown's motion to strike certain allegations in the complaints, and plaintiffs subsequently amended all 26 complaints pursuant to the Court's order.

Ten plaintiffs dismissed their claims without prejudice.

Murphy-Brown filed its answers and affirmative defenses to all 26 complaints on August 31, 2015, and the parties are engaging in discovery.

During discovery, several additional plaintiffs dismissed their claims.

The 26 currently pending complaints include claims on behalf of 511 plaintiffs and relate to approximately 14 company-owned and 75 contract farms.

All 26 complaints include causes of action for temporary nuisance and negligence and seek recovery of an unspecified amount of compensatory, special and punitive damages.

The Company believes that the claims are unfounded and intends to defend the suits vigorously.

Our policy for establishing accruals and disclosures for contingent liabilities is contained in Note 1—Summary of Significant Accounting Policies in our report on Form 10-K for the twelve months ended January 3, 2016.

We established a reserve for our estimated expenses to defend against these and similar potential claims in 2013.

Consequently, future expenses associated with these claims will not affect our profits or losses unless our reserve proves to be insufficient or excessive.

However, legal expenses incurred in our and our subsidiaries’ defense of these claims and any payments made to plaintiffs through unfavorable verdicts or otherwise will negatively impact our cash flows and our liquidity position.

Given that these matters are in the preliminary stages and given the inherent uncertainty of the outcome for these and similar potential claims, we cannot estimate the reasonably possible loss or range of loss for these loss contingencies outside the expenses we will incur to defend against these claims.

We will continue to review whether an additional accrual is necessary and whether we have the ability to estimate the reasonably possible loss or range of loss for these matters.

REPORTABLE SEGMENTS

Our operating segments are determined on the basis of how we internally report and evaluate financial information used to make operating decisions and assess performance.

For external reporting purposes, we aggregate operating segments which have similar economic characteristics, products, production processes, types or classes of customers and distribution methods into reportable segments based on a combination of factors, including products produced and geographic areas of operations.

Our reportable segments are Fresh Pork, Packaged Meats, Hog Production, International and Corporate.

The Fresh Pork segment consists of our U.S.

fresh pork operations.

The Packaged Meats segment consists of our U.S.

packaged meats operations.

The Hog Production segment consists of our U.S.

hog production operations.

The International segment is comprised mainly of our meat processing and distribution operations in Poland, Romania and the United Kingdom, our interests in meat processing operations in Mexico, our hog production operations located in Poland and Romania, our interests in hog production operations in Mexico, and our former investment in Campofrío Food Group.

The Corporate segment provides management and administrative services to support our other segments.

The following table presents sales and operating profit (loss) by segment for the periods indicated:

Three Months Ended

Nine Months Ended

September 27,

(in millions)

Segment sales—

Packaged Meats

Hog Production

International

Total segment sales

Intersegment sales—

Packaged Meats

Hog Production

International

Total intersegment sales

Consolidated sales

Operating profit (loss):

Packaged Meats

Hog Production

International

Consolidated operating profit

SUBSEQUENT EVENT

On September 21, 2016, we issued a notice to our bondholders to call $250.0 million principal of our bonds maturing August 1, 2018, at 101%.

The redemption of the bonds on October 21, 2016, together with the premium and accrued, but unpaid interest, was funded entirely with cash.

Accordingly, this debt has been reclassified as a current liability as of October 2, 2016.

We expect to recognize a loss on debt extinguishment of $4.6 million in the fourth quarter of 2016 as a result of the redemption.

As of March 30, 2025 and December 29, 2024, we had contingent liabilities totaling $ 141 million in accrued expenses and other current liabilities on the condensed consolidated balance sheets related to litigation matters, including those described below.

We did not record any significant charges for litigation matters in the three months ended March 30, 2025 and March 31, 2024, respectively.

These matters will not affect our profits or losses in future periods unless our accruals prove to be insufficient or excessive.

It is reasonably possible that a change in our estimates may occur in the near term and that our accruals could be insufficient.

We are unable to estimate the amount of possible loss in excess of our accruals, which could be material.

Additionally, legal expenses incurred in our and our subsidiaries’ defense of these claims and any payments made to plaintiffs through unfavorable verdicts or otherwise could negatively impact our cash flows and our liquidity position.

Antitrust Price-Fixing Litigation

The Company has been named as one of 16 defendants in a series of class actions filed in 2018 in the U.S.

District Court for the District of Minnesota alleging antitrust violations in the pork industry.

The class cases were filed by three different groups of plaintiffs.

In all of these cases, the plaintiffs alleged that starting in 2009 and continuing through at least June of 2018, the defendant pork producers agreed to reduce the supply of hogs in the U.S.

to raise the price of hogs and all pork products.

The plaintiffs in all of these cases also challenged the defendant pork producers’ use of benchmarking reports from defendant Agri Stats, Inc., alleging that the reports allowed the pork producers to share proprietary information and monitor each producer’s compliance with the supposed agreement to reduce supply.

Payments in the aggregate amount of $ 194 million were made by us to settle all class claims.

In addition to the class actions, the Company has been named as a defendant in similar antitrust lawsuits and related claims brought by a number of individual parties who opted out of the classes.

The plaintiffs in the non-class cases assert the same or similar antitrust claims as the plaintiffs in the class actions.

The Company has entered into negotiations with many of these claimants and has settled certain of these cases.

Currently, 22 of these cases are pending against the Company.

The Attorneys General for the states of New Mexico and Alaska and the Commonwealth of Puerto Rico have filed similar complaints on behalf of their respective states, territories, agencies and citizens.

The Company has settled all of these cases.

The Company intends to vigorously defend against the remaining claims.

Antitrust Wage-Fixing Litigation

On November 11, 2022, Smithfield Foods, Inc.

and our wholly owned subsidiary, Smithfield Packaged Meats Corp., were named as two of the numerous defendants in a purported class action complaint filed in the U.S.

District Court for the District of Colorado alleging wage-fixing violations in the red meat industry.

The plaintiffs allege that the defendants, most of whom operate beef or pork processing plants, conspired to suppress wages paid to plant workers in the U.S.

in violation of the antitrust laws.

The plaintiffs sought damages on behalf of all employees of defendants and their subsidiaries from January 1, 2014, to the present.

The plaintiffs also sought treble damages and attorneys’ fees.

The defendants filed motions to dismiss the complaint, which were largely denied by the court on September 27, 2023.

The plaintiffs subsequently amended their complaint adding additional defendants, including our wholly owned subsidiary, Murphy-Brown of Missouri, LLC (which has been dismissed voluntarily), and expanding the class period back to 2000.

Since the case was filed, several defendants have settled.

On April 5, 2024, the remaining defendants moved to dismiss the amended complaint.

On March 26, 2025, the court granted in part defendants’ motion to dismiss the amended complaint and held that certain of plaintiffs’ new allegations are barred by the statute of limitations, Defendants’ answers to the remaining claims are due on May 9, 2025.

We intend to vigorously defend against these claims.

Maxwell Foods Litigation

On August 13, 2020, Maxwell Foods, LLC (“Maxwell”) filed a complaint against Smithfield Foods, Inc.

in the General Court of Justice, Superior Court Division for Wayne County, North Carolina.

The complaint alleged that Smithfield breached the Production Sales Agreement (“PSA”) between the parties (as well as the duty of good faith and fair dealing):

(1) by failing to provide Maxwell with the same pricing as other major hog suppliers in violation of a purported “Most-Favored-Nation Provision” found in a December 6, 1994 letter to Maxwell, (2) by failing to comply with an implicit duty to negotiate the PSA to provide alternative pricing to Maxwell when the Iowa-Southern Minnesota market allegedly ceased to be viable;

and (3) by failing to purchase Maxwell’s entire output of hogs since April 2020.

Smithfield filed a notice of removal to the U.S.

District Court of the Eastern District of North Carolina.

Smithfield also filed a motion to dismiss several of Maxwell’s claims.

On February 22, 2021, the U.S.

District Court granted Maxwell’s motion to remand the case to the Superior Court of Wayne County and left Smithfield’s partial motion to dismiss the complaint for consideration by the state court in Wayne County.

On March 1, 2021, Maxwell filed an amended complaint, which added a claim under the North Carolina Unfair and Deceptive Trade Practices Act (“UDTPA”).

Smithfield filed a notice of designation seeking assignment of the case to the North Carolina Business Court.

Maxwell objected to such designation, and on April 13, 2021 the Business Court overruled Maxwell’s objection.

The Business Court also dismissed two of Maxwell’s claims:

the implied duty to negotiate claim and the UDTPA claim.

Maxwell subsequently filed another amended complaint adding a fraudulent concealment claim and a new breach of contract claim, as well as a request for punitive damages.

The court dismissed the fraudulent concealment claim and the request for punitive damages.

The three remaining claims, all for breach of contract, are:

(1) the claim under the “Most-Favored-Nation Provision,” (2) the claim that Smithfield failed to purchase Maxwell’s entire output of hogs since April 2020, and (3) the claim that from time to time, Smithfield would calculate Maxwell’s payment for a delivery of hogs using an average of the preceding week’s weight rather than the actual weights of the hogs being delivered.

The parties filed cross-motions for summary judgment and related motions to exclude expert testimony, which were fully briefed on November 17, 2023.

The parties filed cross-motions for summary judgment, and on December 30, 2024, the Business Court entered an order and opinion on the parties’ motions for summary judgment.

The Business Court held that:

(1) Maxwell’s claim for breach of a “Most-Favored-Nation Provision” was dismissed except as it relates to pricing given to one particular supplier;

(2) Smithfield is liable for breaching an output provision in the parties’ contract, with damages to be determined at trial;

and (3) Maxwell’s claim that Smithfield breached the pricing term of the parties’ contract by using live-weight pricing shall proceed to trial based on the allegation that Smithfield did not pay the correct live- weight price for certain deliveries, but not based on the allegation that use of live-weight pricing itself breaches the contract.

The Business Court has set a trial date of June 9, 2025.

We intend to vigorously defend against the remaining claims.

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-Q

Item 1. Financial Statements