PILGRIMS PRIDE CORPPPC
PILGRIMS PRIDE CORP Fair Value Disclosure
FAIR VALUE MEASUREMENTS
Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Assets and liabilities measured at fair value must be categorized into one of three different levels depending on the assumptions (i.e., inputs) used in the valuation:
| Level 1 | Unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date; | |||||||
| Level 2 | Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or | |||||||
| Level 3 | Unobservable inputs, such as discounted cash flow models or valuations. | |||||||
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement in its entirety.
As of December 28, 2025 and December 29, 2024, the Company held fixed income securities, derivative assets and derivative liabilities that were required to be measured at fair value on a recurring basis. Fixed income securities consist of investments, such as money market funds and commercial paper. Derivative assets and liabilities consist of long and short positions on exchange-traded commodity futures instruments, commodity options instruments, sales contracts instruments, foreign currency instruments to manage translation and remeasurement risk.
The following items were measured at fair value on a recurring basis:
| December 28, 2025 | December 29, 2024 | ||||||||||||||||||||||||||||||||||
| Level 1 | Level 2 | Total | Level 1 | Level 2 | Total | ||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||
| Fixed income securities | $ | 520,899 | $ | — | $ | 520,899 | $ | 1,712,917 | $ | — | $ | 1,712,917 | |||||||||||||||||||||||
| Commodity derivative assets | 9,509 | — | 9,509 | 6,598 | — | 6,598 | |||||||||||||||||||||||||||||
| Foreign currency derivative assets | 95 | — | 95 | 755 | — | 755 | |||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||
| Commodity derivative liabilities | (1,343) | — | (1,343) | (2,494) | — | (2,494) | |||||||||||||||||||||||||||||
| Foreign currency derivative liabilities | (205) | — | (205) | (1,397) | — | (1,397) | |||||||||||||||||||||||||||||
| Sales contract derivative liabilities | — | (2,638) | (2,638) | — | (778) | (778) | |||||||||||||||||||||||||||||
See “Note 4. Derivative Financial Instruments” and “Note 7. Investments in Securities” for additional information.
The valuation of financial assets and liabilities classified in Level 1 is based upon unadjusted quoted prices for identical assets or liabilities in active markets. The valuation of financial assets and liabilities in Level 2 is determined using a market approach based upon quoted prices for similar assets and liabilities in active markets or other inputs that are observable for substantially the full term of the financial instrument. The valuation of financial assets in Level 3 is determined using an income approach based on unobservable inputs such as discounted cash flow models or valuations. For each class of assets and liabilities not measured at fair value in the Consolidated Balance Sheets but for which fair value is disclosed, the Company is not required to provide the quantitative disclosure about significant unobservable inputs used in fair value measurements categorized within Level 3 of the fair value hierarchy.
In addition to the fair value disclosure requirements related to financial instruments carried at fair value, accounting standards require interim disclosures regarding the fair value of all of the Company’s financial instruments. The methods and significant assumptions used to estimate the fair value of financial instruments and any changes in methods or significant assumptions from prior periods are also required to be disclosed. There were no changes to methods or significant assumptions from prior periods.
The carrying amounts and estimated fair values of our debt obligations recorded in the Consolidated Balance Sheets consisted of the following:
| December 28, 2025 | December 29, 2024 | ||||||||||||||||||||||
| Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
Fixed-rate senior notes payable at 3.50%, at Level 2 inputs | $ | (899,600) | $ | (831,572) | $ | (900,000) | $ | (777,033) | |||||||||||||||
Fixed-rate senior notes payable at 4.25%, at Level 2 inputs | (791,946) | (775,458) | (850,342) | (789,304) | |||||||||||||||||||
Fixed-rate senior notes payable at 6.25%, at Level 2 inputs | (917,852) | (988,878) | (974,381) | (1,001,178) | |||||||||||||||||||
Fixed-rate senior notes payable at 6.875%, at Level 2 inputs | (492,251) | (555,740) | (491,329) | (533,650) | |||||||||||||||||||
Live Oak CHP Project Pace Loan 5.15%, at Level 3 inputs | (19,163) | (18,376) | (20,599) | (18,569) | |||||||||||||||||||
See “Note 13. Debt” for additional information.
The carrying amounts of our cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, accounts payable and certain other liabilities approximate their fair values due to their relatively short maturities. Derivative assets were recorded at fair value based on quoted market prices and are included in the line item Prepaid expenses and other current assets on the Consolidated Balance Sheets. Derivative liabilities were recorded at fair value based on quoted market prices and are included in the line item Accrued expenses and other current liabilities on the Consolidated Balance Sheets. The
fair values of the Company’s Level 2 fixed-rate debt obligations were based on the quoted market price at December 28, 2025 or December 29, 2024, as applicable.
In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records certain assets and liabilities at fair value on a nonrecurring basis. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges when required by U.S. GAAP. There were no significant fair value measurement losses recognized for such assets and liabilities in the periods reported.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 9, 2023 | |
| 2021 | Feb 18, 2022 | |
| 2020 | Feb 11, 2021 | |
| 2019 | Feb 21, 2020 | |
| 2018 | Feb 14, 2019 | |
| 2017 | Feb 16, 2018 | |
| 2016 | Feb 9, 2017 | |
| 2015 | Feb 12, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.