Smithfield Foods (SFD) investor relations material

Business transformation and strategic focus

• Shifted from a highly acquisitive, multi-brand structure to a streamlined, agile organization under the One Smithfield model, focusing on synergy and efficiency.

• Reduced vertical integration in hog production from 50% to a targeted 30%, optimizing supply and cost structure by rationalizing geographically inefficient operations.

• Repositioned all business segments to support packaged meats growth, emphasizing consumer-facing products and value-added offerings.

• Enhanced cost structure through automation, plant rationalization, and technology investments, improving flexibility and efficiency.

• Cross-functional talent integration and innovation have shifted the business away from commodity focus to higher-margin, branded, and value-added products.

Operational performance and market dynamics

• Achieved strong results and share gains in key categories, with notable volume and distribution growth in lunch meat and dry sausage.

• Maintained robust demand for protein, with pork positioned as a versatile, value-driven option across all price points and meal occasions.

• Executed a disciplined pricing and brand strategy, balancing branded and private label offerings to capture shifting consumer preferences.

• Innovation and mix shift have offset declines in traditional categories, driving growth in higher-margin, value-added products like Prime Fresh.

• Expanded food service and export channels, regaining lost domestic share and optimizing product utilization across the supply chain.

Cost management and supply chain optimization

• Proactively managed input costs and supply chain volatility through vertical integration, market-based transfer pricing, and network optimization.

• Reduced distribution miles and increased use of internal fleet and intermodal transport to mitigate freight and diesel cost pressures.

• Annual focus on offsetting inflation via automation, technology, and continuous process improvement.

• Maintained resilient margin profile despite commodity and transportation headwinds, with cost discipline embedded in operations.