STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 28, 2014

Equity [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

Rights Offering

In January 2012, Pilgrim's commenced the Rights Offering for stockholders of record as of January 17, 2012 (the “Record Date”). The basic subscription privilege gave stockholders the option to purchase 0.2072 shares of Pilgrim's common stock, rounded up to the next largest whole number, at a subscription price of $4.50 per share for each share of Pilgrim's common stock they owned as of the Record Date. The multiplier was determined by dividing the 44,444,444 shares being offered in the Rights Offering by the total number of shares owned by all stockholders on the Record Date. Those stockholders that exercised their basic subscription privilege in full also received an over-subscription privilege that afforded them the opportunity to purchase additional shares at the subscription price of $4.50 per share from a pool of the shares left over had all stockholders not elected to exercise their basic subscription privileges in full. JBS USA committed to participate in the Rights Offering and exercise its basic and over-subscription privileges in full. The last day a stockholder could exercise either their basic subscription rights or their over-subscription rights was February 29, 2012. On March 7, 2012, the Company issued 44,444,444 shares of common stock to stockholders that exercised their basic subscription privileges and over-subscription privileges under the Rights Offering. Gross proceeds received under the Rights Offering totaled $200.0 million. The Company incurred costs directly attributable to the Rights Offering of $1.7 million that it deferred and charged against the proceeds of the Rights Offering in Additional Paid-in Capital on the Consolidated Balance Sheet. The Company used the net proceeds of $198.3 million for additional working capital to improve its capital position and for general corporate purposes. Pilgrim's also used a portion of the net proceeds to repay the outstanding principal amount of $50.0 million, plus accrued interest, of its subordinated debt owed to JBS USA and to repay indebtedness under the U.S. Credit Facility.

Accumulated Other Comprehensive Loss

The following tables provide information regarding the changes in accumulated other comprehensive loss during 2014 and 2013:

	2014									2013
	Losses Related to Pension and Other Postretirement Benefits			Unrealized Holding Gains on Available-for-Sale Securities			Total			Losses Related to Pension and Other Postretirement Benefits			Unrealized Holding Gains on Available-for-Sale Securities		Total
	(In thousands)
Balance, beginning of year	$	(45,797	)	$	62		$	(45,735	)	$	(68,511	)	$	—	$	(68,511	)
Other comprehensive income (loss) before reclassifications	(16,810		)	319			(16,491		)	21,713			62		21,775
Amounts reclassified from      accumulated other comprehensive      loss to net income	35			(350		)	(315		)	1,001			—		1,001
Net current year other      comprehensive income (loss)	(16,775		)	(31		)	(16,806		)	22,714			62		22,776
Balance, end of year	$	(62,572	)	$	31		$	(62,541	)	$	(45,797	)	$	62	$	(45,735	)

(a) All amounts are net of tax. Amounts in parentheses indicate debits.

Details about Accumulated Other Comprehensive Loss Components	Amount Reclassified from Accumulated Other Comprehensive Loss(a)							Affected Line Item in the Consolidated Statements of Operations
	2014			2013
	(In thousands)
Realized gain on sale of securities	$	562		$	—			Selling, general and administrative expense
Amortization of pension and other postretirement plan actuarial losses:
Union employees pension plan(b)	—			(36		)	(d)	Cost of goods sold
Legacy Gold Kist plans(c)	(56		)	(965		)	(d)	Selling, general and administrative expense
Total before tax	506			(1,001		)
Tax benefit (expense)	(191		)	—
Total reclassification for the period	$	315		$	(1,001	)

(a) Amounts in parentheses represent debits to results of operations.

(b) The Company sponsors the Union Plan, a qualified defined benefit pension plan covering certain locations or work groups with collective bargaining agreements.

(c) The Company sponsors the GK Pension Plan, a qualified defined benefit pension plan covering certain eligible U.S. employees who were employed at locations that the Company purchased through its acquisition of Gold Kist in 2007, the SERP Plan, a nonqualified defined benefit retirement plan covering certain former Gold Kist executives, the Directors’ Emeriti Plan, a nonqualified defined benefit retirement plan covering certain former Gold Kist directors and the Retiree Life Plan, a defined benefit postretirement life insurance plan covering certain retired Gold Kist employees (collectively, the “Legacy Gold Kist Plans”).

(d) These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. See “Note 12. Pension and Other Postretirement Benefits” to the Consolidated Financial Statements.

Special Cash Dividend

On January 15, 2015, the Company announced that its Board of Directors had approved the declaration of a special cash dividend of $5.77 per share. The total amount of the special cash dividend payment will be approximately $1.5 billion based on the current number of shares outstanding. The special cash dividend is payable on February 17, 2015, to stockholders of record on January 30, 2015. The Company intends to use proceeds from the 2015 U.S. Credit Facility to fund, along with cash on hand, the special cash dividend.

Set forth below is the Condensed Unaudited Pro Forma Consolidated Balance Sheet as of December 28, 2014, which gives effect to the special cash dividend and the borrowings necessary to fund the special cash dividend as if they occurred on December 28, 2014. The assumptions on which the pro forma financial information is based are further described in the Notes to Condensed Unaudited Pro Forma Consolidated Balance Sheet. Management of the Company believes that the assumptions used provide a reasonable basis on which to present the Condensed Unaudited Pro Forma Consolidated Balance Sheet. The pro forma financial information does not purport to be indicative of the financial position that would actually have resulted if the special cash dividend and the related borrowings necessary to fund the special cash dividend had been completed as of such date or that may result in the future. The pro forma financial information should be read in conjunction with the accompanying notes thereto, the Consolidated Financial Statements and the Notes to Consolidated Financial Statements.

PILGRIM’S PRIDE CORPORATION

CONDENSED UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET

	December 28, 2014		Special Cash Dividend				December 28, 2014
	(In thousands)
Cash and cash equivalents	$	576,143	$	1,196,000		(a)	$	267,786
			(1,500,000		)	(b)
			(4,357		)	(c)
Trade accounts and other receivables, less allowance for doubtful accounts	378,890		—				378,890
Inventories	790,305		—				790,305
Other	139,741		—				139,741
Total current assets	1,885,079		(308,357		)		1,576,722
Property, plant and equipment, net	1,182,795		—				1,182,795
Other	51,189		4,357			(c)	55,546
Total assets	$	3,119,063	$	(304,000	)		$	2,815,063
Total current liabilities	$	744,858	$	—			$	744,858
Long-term debt, less current maturities	3,980		1,196,000			(a)	1,199,980
Deferred tax liabilities	76,216		—				76,216
Other long-term liabilities	97,208		—				97,208
Total stockholders’ equity	2,196,801		(1,500,000		)	(b)	696,801
Total liabilities and stockholders' equity	$	3,119,063	$	(304,000	)		$	2,815,063

The accompanying notes are an integral part of this Condensed Unaudited Pro Forma Consolidated Balance Sheet.

Notes to Condensed Unaudited Pro Forma Consolidated Balance Sheet

1. Basis of Presentation

The following summary of pro forma adjustments is based on available information and various estimates and assumptions. Management of the Company believes that these assumptions provide a reasonable basis for presenting all of the significant effects of the following transactions and events and that the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the Condensed Unaudited Pro Forma Consolidated Balance Sheet.

The Condensed Unaudited Pro Forma Consolidated Balance Sheet gives effect to the transactions described below:

• Payment of a special cash dividend to stockholders of approximately $1.5 billion, which will be funded by approximately $300.0 million of cash and cash equivalents on hand and proceeds of approximately $1.2 billion from additional long-term debt.

• Payment and capitalization of approximately $4.4 million in financing fees related thereto.

The Condensed Unaudited Pro Forma Balance Sheet as of December 28, 2014 gives effect to the transactions as if they occurred on December 28, 2014.

2. Condensed Unaudited Pro Forma Consolidated Balance Sheet

(a) To reflect cash from additional borrowings of long-term debt used to pay the special cash dividend to stockholders.

(b) To reflect the payment of the special cash dividend to stockholders.

(c) To reflect the payment and capitalization of financing fees.