MILWAUKEE (AP) -- Pilgrim's Pride Corp., the nation's largest chicken producer, said Monday it has reached another agreement to temporarily extend its credit facilities through the end of November.
The company's previous credit waiver extension was set to expire on Tuesday. It had been given an extension in late September, after it said it wouldn't meet debt obligations for its current loans.
The newest extension for the Pittsburg, Texas-based company runs through Nov. 26.
The company, like many food makers, has been hampered by high costs for key ingredients like corn and oil. It hedged some of its purchases but as prices moderated, it lost money on those hedges. The company said in late September it would post a "significant loss" in the fourth quarter, largely on those bad hedges.
Pilgrim's Pride said in a statement Monday it has been making progress developing a response to the industry's woes. Further hurting the industry is weak demand -- partially caused by slow sales in restaurants as consumers turn to eating at home more. An oversupply on the market has also been keeping prices down. But Pilgrim's Pride said certain trends -- such as a decline in the number of egg sets, or the eggs being laid that will turn into chickens, and lower feed prices bode well for the company and the industry.
"Lenders have been constructive and supportive throughout this challenging period and we believe that like us, they are encouraged by recent industry egg set data and the continued decline in grain and other feed ingredient prices," the company said.
The company said it's poised to see benefits from the lower grain prices. It said the annualized benefit of the current feed ingredient prices, relative to prices effective in late July, is about $1.1 billion.
Pilgrim's Pride also said it will exercise its 30-day grace period in making a $25.7 million interest payment due Nov. 3 on its senior notes.
Shares of Pilgrim's Pride rose 32 cents, or 15 percent, to $2.49 in morning trading Monday.