SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION

On December 15, 2010, the Company closed on the sale of 2018 Notes. The 2018 Notes are unsecured obligations of the Company and are fully and unconditionally guaranteed on a senior unsecured basis by Pilgrim's Pride Corporation of West Virginia, Inc., a wholly owned subsidiary of the Company (the “Guarantor”). In accordance with Rule 3-10 of Regulation S-X promulgated under the Securities Act of 1933, the following condensed consolidating financial statements present the financial position, results of operations and cash flows of the Company (referred to as “Parent” for the purpose of this note only) on a Parent-only basis, the Guarantor on a Guarantor-only basis, the combined non-Guarantor subsidiaries and elimination entries necessary to arrive at the information for the Parent, the Guarantor and non-Guarantor subsidiaries on a consolidated basis. Investments in subsidiaries are accounted for by the Company using the equity method for this presentation.

The tables below present the condensed consolidating balance sheets as of December 25, 2011 and December 26, 2010, the condensed consolidating statements of operations for the years ended 2011, 2010, Transition Period and 2009 and the condensed consolidating statements of cash flows the years ended 2011, 2010, Transition Period and 2009 based on the guarantor structure.



CONDENSED CONSOLIDATING BALANCE SHEETS December 25, 2011
(In thousands)
	Parent		Subsidiary Guarantor		Subsidiary Non-Guarantors		Eliminations/ Adjustments			Consolidation

Cash and cash equivalents	$	13,733	$	30	$	27,846	$	—		$	41,609
Restricted cash and cash equivalents	—		—		7,680		—			7,680
Investment in available-for-sale securities	—		—		157		—			157
Trade accounts and other receivables, less allowance for doubtful accounts	302,809		1,575		44,838		—			349,222
Account receivable from JBS USA, LLC	21,198		—		—		—			21,198
Inventories	766,227		21,144		91,723		—			879,094
Income taxes receivable	62,160		—		528		(3,621		)	59,067
Current deferred tax assets	—		4,003		1,478		(5,481		)	—
Prepaid expenses and other current assets	35,877		87		16,386		—			52,350
Assets held for sale	37,754		—		16,062		—			53,816
Total current assets	1,239,758		26,839		206,698		(9,102		)	1,464,193
Investment in available-for-sale securities	—		—		497		—			497
Intercompany receivable	50,064		33,978		—		(84,042		)	—
Investment in subsidiaries	304,395		—		—		(304,395		)	—
Deferred tax assets	75,392		—		7		(4,300		)	71,099
Other long-lived assets	57,460		—		180,461		(180,000		)	57,921
Identified intangible assets, net	31,384		—		12,699		—			44,083
Property, plant and equipment, net	1,090,376		49,336		105,928		(3,888		)	1,241,752
Total assets	$	2,848,829	$	110,153	$	506,290	$	(585,727	)	$	2,879,545
Accounts payable	$	270,538	$	13,033	$	45,293	$	—		$	328,864
Account payable to JBS USA, LLC	11,653		—		—		—			11,653
Accrued expenses and other current liabilities	226,016		17,193		38,588		—			281,797
Income taxes payable	—		—		3,621		(3,621		)	—
Current deferred tax liabilities	83,795		—		934		(5,481		)	79,248
Current maturities of long-term debt	15,611		—		—		—			15,611
Total current liabilities	607,613		30,226		88,436		(9,102		)	717,173
Long-term debt, less current maturities	1,433,001		—		—		(25,000		)	1,408,001
Note payable to JBS USA Holdings, Inc.	50,000		—		—		—			50,000
Intercompany payable	—		—		84,042		(84,042		)	—
Deferred tax liabilities	—		4,003		297		(4,300		)	—
Other long-term liabilities	289,697		—		11,675		(155,431		)	145,941
Total liabilities	2,380,311		34,229		184,450		(277,875		)	2,321,115
Total Pilgrim’s Pride Corporation stockholders’ equity	468,518		75,924		319,022		(307,852		)	555,612
Noncontrolling interest	—		—		2,818		—			2,818
Total stockholders’ equity	468,518		75,924		321,840		(307,852		)	558,430
Total liabilities and stockholders' equity	$	2,848,829	$	110,153	$	506,290	$	(585,727	)	$	2,879,545



CONDENSED CONSOLIDATING BALANCE SHEETS December 26, 2010
(In thousands)
	Parent		Subsidiary Guarantor		Subsidiary Non-Guarantors		Eliminations/ Adjustments			Consolidation

Cash and cash equivalents	$	67,685	$	—	$	38,392	$	—		$	106,077
Restricted cash and cash equivalents	—		—		60,953		—			60,953
Investment in available-for-sale securities	—		—		1,554		—			1,554
Trade accounts and other receivables, less allowance for doubtful accounts	267,348		1,779		52,173		—			321,300
Account receivable from JBS USA, LLC	465		—		—		—			465
Inventories	905,215		20,668		103,371		—			1,029,254
Income taxes receivable	62,117		—		—		(3,652		)	58,465
Current deferred tax assets	—		6,025		5,176		(7,725		)	3,476
Prepaid expenses and other current assets	66,178		345		14,727		—			81,250
Assets held for sale	24,741		—		22,930		—			47,671
Total current assets	1,393,749		28,817		299,276		(11,377		)	1,710,465
Investment in available-for-sale securities	—		—		11,595		—			11,595
Intercompany receivable	60,882		23,724		—		(84,606		)	—
Investment in subsidiaries	337,762		—		—		(337,762		)	—
Deferred tax assets	27,023		—		—		(4,414		)	22,609
Other long-lived assets	64,371		—		182,772		(180,000		)	67,143
Identified intangible assets, net	35,308		—		13,642		—			48,950
Property, plant and equipment, net	1,199,495		45,872		116,657		(3,888		)	1,358,136
Total assets	$	3,118,590	$	98,413	$	623,942	$	(622,047	)	$	3,218,898
Accounts payable	$	265,940	$	7,398	$	56,442	$	—		$	329,780
Account payable to JBS USA, LLC	7,212		—		—		—			7,212
Accrued expenses and other current liabilities	185,897		26,394		85,649		—			297,940
Income taxes payable	—		—		10,466		(3,652		)	6,814
Current deferred tax liabilities	46,470		—		—		(7,725		)	38,745
Current maturities of long-term debt	58,144		—		—		—			58,144
Total current liabilities	563,663		33,792		152,557		(11,377		)	738,635
Long-term debt, less current maturities	1,306,160		—		—		(25,000		)	1,281,160
Intercompany payable	—		—		84,606		(84,606		)	—
Deferred tax liabilities	—		4,117		3,773		(4,414		)	3,476
Other long-term liabilities	269,844		—		2,187		(155,000		)	117,031
Total liabilities	2,139,667		37,909		243,123		(280,397		)	2,140,302
Total Pilgrim’s Pride Corporation stockholders’ equity	978,923		60,504		374,886		(341,650		)	1,072,663
Noncontrolling interest	—		—		5,933		—			5,933
Total stockholders’ equity	978,923		60,504		380,819		(341,650		)	1,078,596
Total liabilities and stockholders' equity	$	3,118,590	$	98,413	$	623,942	$	(622,047	)	$	3,218,898



CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS Twelve Months Ended December 25, 2011
(In thousands)
	Parent			Subsidiary Guarantor		Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Net sales	$	6,135,319		$	458,932	$	1,225,128		$	(283,681	)	$	7,535,698
Cost of sales	6,239,493			430,343		1,291,080			(283,681		)	7,677,235
Gross profit (loss)	(104,174		)	28,589		(65,952		)	—			(141,537		)
Selling, general and administrative expense	175,544			—		30,449			—			205,993
Administrative restructuring charges, net	18,974			—		7,087			—			26,061
Total costs and expenses	6,434,011			430,343		1,328,616			(283,681		)	7,909,289
Operating income (loss)	(298,692		)	28,589		(103,488		)	—			(373,591		)
Other expenses (income):
Interest expense	110,940			—		592			—			111,532
Interest income	(363		)	—		(1,102		)	—			(1,465		)
Foreign currency transaction losses (gains)	(31		)	—		12,632			—			12,601
Miscellaneous, net	59,661			3,818		(98,360		)	25,748			(9,133		)
Total other expenses	170,207			3,818		(86,238		)	25,748			113,535
Income (loss) from continuing operations before income taxes	(468,899		)	24,771		(17,250		)	(25,748		)	(487,126		)
Income tax expense (benefit)	(14,139		)	9,351		13,352			—			8,564
Income (loss) before equity in earnings of consolidated subsidiaries	(454,760		)	15,420		(30,602		)	(25,748		)	(495,690		)
Equity in earnings of consolidated subsidiaries	(9,334		)	—		—			9,334			—
Net income (loss)	(464,094		)	15,420		(30,602		)	(16,414		)	(495,690		)
Less: Net income attributable to noncontrolling interest	—			—		1,082			—			1,082
Net income (loss) attributable to Pilgrim’s Pride	$	(464,094	)	$	15,420	$	(31,684	)	$	(16,414	)	$	(496,772	)



CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS Twelve Months Ended December 26, 2010
(In thousands)
	Parent			Subsidiary Guarantor			Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Net sales	$	5,623,958		$	470,649		$	1,173,766		$	(386,744	)	$	6,881,629
Costs and expenses:
Cost of sales	5,183,274			449,358			1,170,430			(386,744		)	6,416,318
Operational restructuring charges, net	4,318			—			—			—			4,318
Gross profit (loss)	436,366			21,291			3,336			—			460,993
Selling, general and administrative expense	176,589			(279		)	33,234			—			209,544
Administrative restructuring charges, net	59,136			—			6,886			—			66,022
Total costs and expenses	5,423,317			449,079			1,210,550			(386,744		)	6,696,202
Operating income (loss)	200,641			21,570			(36,784		)	—			185,427
Other expenses (income):
Interest expense	103,735			—			1,818			—			105,553
Interest income	(580		)	—			(3,225		)	—			(3,805		)
Loss on early extinguishment of debt	11,726			—			—			—			11,726
Foreign currency transaction losses (gains)	315			—			(102		)	—			212
Miscellaneous, net	91,575			4,241			(110,261		)	1,156			(13,288		)
Total other expenses	206,771			4,241			(111,770		)	1,156			100,398
Income (loss) from continuing operations before reorganization	(6,130		)	17,329			74,986			(1,156		)	85,029
Reorganization items, net	18,348			—			193			—			18,541
Income (loss) from continuing operations before income taxes	(24,478		)	17,329			74,793			(1,156		)	66,488
Income tax expense (benefit)	(15,266		)	6,542			(15,114		)	—			(23,838		)
Income (loss) before equity in earnings of consolidated subsidiaries	(9,212		)	10,787			89,907			(1,156		)	90,326
Equity in earnings of consolidated subsidiaries	65,544			—			—			(65,544		)	—
Net income (loss)	56,332			10,787			89,907			(66,700		)	90,326
Less: Net income attributable to noncontrolling interest	—			—			3,185			—			3,185
Net income (loss) attributable to Pilgrim’s Pride	$	56,332		$	10,787		$	86,722		$	(66,700	)	$	87,141



CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS Three Months Ended December 27, 2009
(In thousands)
	Parent			Subsidiary Guarantor		Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Net sales	$	1,329,292		$	106,930	$	257,002		$	(90,490	)	$	1,602,734
Costs and expenses:
Cost of sales	1,258,139			100,701		262,754			(90,490		)	1,531,104
Operational restructuring charges, net	2,877			—		—			—			2,877
Gross profit (loss)	68,276			6,229		(5,752		)	—			68,753
Selling, general and administrative expense	50,357			301		11,865			—			62,523
Administrative restructuring charges, net	—			—		(1,359		)	—			(1,359		)
Total costs and expenses	1,311,373			101,002		273,260			(90,490		)	1,595,145
Operating income (loss)	17,919			5,928		(16,258		)	—			7,589
Other expenses (income):
Interest expense	43,419			—		1,254			—			44,673
Interest income	(1		)	—		(479		)	—			(480		)
Foreign currency transaction losses (gains)	14			—		608			—			622
Miscellaneous, net	15,907			5,589		(23,240		)	238			(1,506		)
Total other expenses	59,339			5,589		(21,857		)	238			43,309
Income (loss) from continuing operations before reorganization	(41,420		)	339		5,599			(238		)	(35,720		)
Reorganization items, net	32,127			23		576			—			32,726
Income (loss) from continuing operations before income taxes	(73,547		)	316		5,023			(238		)	(68,446		)
Income tax expense (benefit)	(120,167		)	119		17,677			—			(102,371		)
Income (loss) before equity in earnings of consolidated subsidiaries	46,620			197		(12,654		)	(238		)	33,925
Equity in earnings of consolidated subsidiaries	(6,249		)	—		—			6,249			—
Net income (loss)	40,371			197		(12,654		)	6,011			33,925
Less: Net income attributable to noncontrolling interest	—			—		312			—			312
Net income (loss) attributable to Pilgrim’s Pride	$	40,371		$	197	$	(12,966	)	$	6,011		$	33,613



CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS Twelve Months Ended September 26, 2009
(In thousands)
	Parent			Subsidiary Guarantor		Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Net sales	$	6,192,607		$	252,255	$	1,031,954		$	(388,761	)	$	7,088,055
Costs and expenses:
Cost of sales	5,900,512			218,235		1,034,802			(388,761		)	6,764,788
Operational restructuring charges, net	12,464			—		—			—			12,464
Gross profit (loss)	279,631			34,020		(2,848		)	—			310,803
Selling, general and administrative expense	187,801			1,655		52,033			—			241,489
Goodwill impairment	—			—		—			—			—
Administrative restructuring charges, net	1,987			—		—			—			1,987
Total costs and expenses	6,102,764			219,890		1,086,835			(388,761		)	7,020,728
Operating income (loss)	89,843			32,365		(54,881		)	—			67,327
Other expenses (income):
Interest expense	156,573			—		5,356			—			161,929
Interest income	(2,306		)	—		(2,080		)	—			(4,386		)
Foreign currency transaction losses (gains)	112			—		1			—			113
Miscellaneous, net	57,594			19,568		(94,711		)	13,794			(3,755		)
Total other expenses	211,973			19,568		(91,434		)	13,794			153,901
Income (loss) from continuing operations before reorganization	(122,130		)	12,797		36,553			(13,794		)	(86,574		)
Reorganization items, net	83,985			159		3,131			—			87,275
Income (loss) from continuing operations before income taxes	(206,115		)	12,638		33,422			(13,794		)	(173,849		)
Income tax expense (benefit)	(29,720		)	4,771		3,363			—			(21,586		)
Income (loss) before equity in earnings of consolidated subsidiaries	(176,395		)	7,867		30,059			(13,794		)	(152,263		)
Equity in earnings of consolidated subsidiaries	30,564			—		—			(30,564		)	—
Income (loss) from operations	(145,831		)	7,867		30,059			(44,358		)	(152,263		)
Income (loss) from discontinued business, net of tax	—			—		599			—			599
Net income (loss)	(145,831		)	7,867		30,658			(44,358		)	(151,664		)
Less: Net income attributable to noncontrolling interest	—			—		(82		)	—			(82		)
Net income (loss) attributable to Pilgrim’s Pride	$	(145,831	)	$	7,867	$	30,740		$	(44,358	)	$	(151,582	)



CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS Twelve Months Ended December 25, 2011
(In thousands)
	Parent			Subsidiary Guarantor			Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Cash provided by (used in) operating activities	$	(91,621	)	$	8,973		$	(19,385	)	$	(26,958	)	$	(128,991	)

Cash flows from investing activities:
Acquisitions of property, plant and equipment	(115,791		)	(9,108		)	(11,069		)	—			(135,968		)
Purchases of investment securities	—			—			(4,596		)	—			(4,596		)
Proceeds from sale or maturity of investment securities	—			—			15,852			—			15,852
Proceeds from business dispositions to Swift Pork Company	—			—			13,000			—			13,000
Proceeds from business dispositions to JBS Trading International, Inc.	—			—			24,479			—			24,479
Proceeds from property sales and disposals	26,503			165			2,376			—			29,044
Cash used in investing activities	(89,288		)	(8,943		)	40,042			—			(58,189		)

Cash flows from financing activities:
Proceeds from note payable to JBS USA	50,000			—			—			—			50,000
Proceeds from long-term debt	965,689			—			—			—			965,689
Payments on long-term debt	(881,833		)	—			—			—			(881,833		)
Purchase of remaining interest in subsidiary	(2,504		)	—			—			—			(2,504		)
Payment of capitalized loan costs	(4,395		)	—			—			—			(4,395		)
Cash dividends paid	—			—			(25,000		)	25,000			—
Other financing activities	—			—			(2,065		)	1,958			(107		)
Cash provided by (used in) financing activities	126,957			—			(27,065		)	26,958			126,850
Effect of exchange rate changes on cash and cash equivalents	—			—			(4,138		)	—			(4,138		)
Increase (decrease) in cash and cash equivalents	(53,952		)	30			(10,546		)	—			(64,468		)
Cash and cash equivalents, beginning of period	67,685			—			38,392			—			106,077
Cash and cash equivalents, end of period	$	13,733		$	30		$	27,846		$	—		$	41,609



CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS Twelve Months Ended December 26, 2010
(In thousands)
	Parent			Subsidiary Guarantor			Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Cash provided by (used in) operating activities	$	22,412		$	3,496		$	(10,147	)	$	(1,156	)	$	14,605

Cash flows from investing activities:
Acquisitions of property, plant and equipment	(162,264		)	(3,273		)	(13,795		)	—			(179,332		)
Purchases of investment securities	—			—			(17,201		)	—			(17,201		)
Proceeds from sale or maturity of investment securities	—			—			68,100			—			68,100
Proceeds from property sales and disposals	9,640			(223		)	5,281			—			14,698
Cash used in investing activities	(152,624		)	(3,496		)	42,385			—			(113,735		)

Cash flows from financing activities:
Proceeds from long-term debt	2,438,855			—			—			—			2,438,855
Payments on long-term debt	(3,153,848		)	—			(43,551		)	—			(3,197,399		)
Proceeds from sale of common stock	800,000			—			—			—			800,000
Purchase of remaining interest in subsidiary	(7,637		)	—			—			—			(7,637		)
Payment of capitalized loan costs	(62,788		)	—			—			—			(62,788		)
Other financing activities	—			—			(1,667		)	1,156			(511		)
Cash provided by (used in) financing activities	14,582			—			(45,218		)	1,156			(29,480		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(1,613		)	—			(1,613		)
Increase (decrease) in cash and cash equivalents	(115,630		)	—			(14,593		)	—			(130,223		)
Cash and cash equivalents, beginning of period	183,315			—			52,985			—			236,300
Cash and cash equivalents, end of period	$	67,685		$	—		$	38,392		$	—		$	106,077



CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS Three Months Ended December 27, 2009
(In thousands)
	Parent			Subsidiary Guarantor			Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Cash provided by (used in) operating activities	$	(37,459	)	$	695		$	32,945		$	(238	)	$	(4,057	)

Cash flows from investing activities:
Acquisitions of property, plant and equipment	(27,456		)	(695		)	(2,312		)	—			(30,463		)
Purchases of investment securities	—			—			(6,024		)	—			(6,024		)
Proceeds from sale or maturity of investment securities	—			—			4,511			—			4,511
Proceeds from property sales and disposals	2,416			—			1,106			—			3,522
Cash used in investing activities	(25,040		)	(695		)	(2,719		)	—			(28,454		)

Cash flows from financing activities:
Proceeds from long-term debt	60,370			—			—			—			60,370
Payments on long-term debt	(10,144		)	—			—			—			(10,144		)
Proceeds from sale of common stock	12,743			—			(12,743		)	—			—
Other financing activities	(1,976		)	—			(238		)	238			(1,976		)
Cash provided by (used in) financing activities	60,993			—			(12,981		)	238			48,250
Effect of exchange rate changes on cash and cash equivalents	—			—			532			—			532
Increase (decrease) in cash and cash equivalents	(1,506		)	—			17,777			—			16,271
Cash and cash equivalents, beginning of period	184,821			—			35,208			—			220,029
Cash and cash equivalents, end of period	$	183,315		$	—		$	52,985		$	—		$	236,300



CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS Twelve Months Ended September 26, 2009
(In thousands)
	Parent			Subsidiary Guarantor			Subsidiary Non-Guarantors			Eliminations/ Adjustments			Consolidation

Cash flows provided by (used in) operating activities	$	191,421		$	1,561		$	(114,254	)	$	(13,794	)	$	64,934

Cash flows from investing activities:
Acquisitions of property, plant and equipment	(82,635		)	(1,561		)	(3,997		)	—			(88,193		)
Purchases of investment securities	—			—			(19,958		)	—			(19,958		)
Proceeds from sale or maturity of investment securities	—			—			18,946			—			18,946
Proceeds from property sales and disposals	80,079			—			5,657			—			85,736
Cash used in investing activities	(2,556		)	(1,561		)	648			—			(3,469		)

Cash flows from financing activities:
Proceeds from short-term notes payable	430,817			—			—			—			430,817
Payments on short-term notes payable	(430,817		)	—			—			—			(430,817		)
Proceeds from long-term debt	833,424			—			—			—			833,424
Payments on long-term debt	(719,762		)	—			—			—			(719,762		)
Proceeds from sale of common stock	(155,483		)	—			155,483			—			—
Change in outstanding cash management obligations	(2,131		)	—			(9,041		)	—			(11,172		)
Other financing activities	—			—			(15,131		)	13,794			(1,337		)
Cash provided by (used in) financing activities	(43,952		)	—			131,311			13,794			101,153
Effect of exchange rate changes on cash and cash equivalents	—			—			(4,142		)	—			(4,142		)
Increase (decrease) in cash and cash equivalents	144,913			—			13,563			—			158,476
Cash and cash equivalents, beginning of period	39,908			—			21,645			—			61,553
Cash and cash equivalents, end of period	$	184,821		$	—		$	35,208		$	—		$	220,029