Investment in National Beef Packing Company, LLC

6 Months Ended

Jun. 25, 2022

Equity Method Investments and Joint Ventures [Abstract]

Investment in National Beef Packing Company, LLC

(6) Investment in National Beef Packing Company, LLC

USPB’s 15.0729% investment in NBP is accounted for using the equity method of accounting as the Company has the ability to exercise significant influence, but does not have financial or operational control. The table below summarizes the changes to USPB’s investment in NBP for the thirteen and twenty-six week periods ended June 25, 2022 and June 26, 2021 (thousands of dollars):

Investment at December 25, 2021	$	213,290
Equity in net income for thirteen-week period		62,606
Distributions		(52,755	)
Investment at March 26, 2022	$	223,141
Equity in net income for thirteen-week period		52,779
Distributions		(82,907	)
Investment at June 25, 2022	$	193,013
Investment at December 26, 2020	$	131,494
Equity in net income for thirteen-week period		36,559
Distributions		(21,402	)
Investment at March 27, 2021	$	146,651
Equity in net income for thirteen-week period		103,198
Distributions		(61,157	)
Investment at June 26, 2021	$	188,692

The difference between USPB’s percentage ownership share of NBP earnings and the recorded amount of Equity in income of National Beef Packing Company, LLC is attributable to the amortization of a basis difference related to the purchase accounting for NBP’s acquisition of Ohio Beef in 2019.

Below is a summary of the results of operations for NBP for the thirteen and twenty-six week periods ended June 25, 2022 and June 26, 2021 (thousands of dollars):

	13 weeks ended						26 weeks ended
	June 25, 2022			June 26, 2021			June 25, 2022			June 26, 2021
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Net sales	$	2,949,870		$	2,948,388		$	5,973,624		$	5,264,003
Costs and expenses:
Cost of sales		2,540,322			2,210,339			5,095,022			4,233,893
Selling, general, and administrative expenses		23,849			22,052			45,220			40,917
Depreciation and amortization		29,873			28,004			59,309			55,673
Total costs and expenses		2,594,044			2,260,395			5,199,551			4,330,483
Operating income		355,826			687,993			774,073			933,520
Other income (expense):
Interest income		40			12			67			98
Interest expense		(2,212	)		(2,396	)		(3,688	)		(4,796	)
Income before taxes		353,654			685,609			770,452			928,822
Income tax expense		(1,497	)		(952	)		(2,940	)		(1,616	)
Net income	$	352,157		$	684,657		$	767,512		$	927,206