Seaboard(SEB) - 2024 Q4 - Annual Report

Business Segments - Seaboard operates in six reportable segments: Pork, CT&M, Marine, Liquid Fuels, Power, and Turkey, with significant operations in over 45 countries[15]. - The Pork segment is ranked third in hog production and fourth in pork processing in the U.S., processing approximately six million hogs annually at its Iowa plant[27][17]. - Seaboard's sugar and alcohol production facility in Argentina has an annual capacity to crush approximately three million metric tons of sugarcane, producing up to 250,000 metric tons of sugar or 33 million gallons of alcohol[24]. - The Marine segment has completed two new dual-fueled vessels in 2024, with six more under construction, expected to be completed in 2025, primarily fueled by liquefied natural gas[20]. - Seaboard's Liquid Fuels segment produces biodiesel and renewable diesel, generating environmental credits such as RINs and LCFS credits based on production volumes[21]. - The Turkey segment had two retail customers that represented approximately 30% of its total sales in 2024[26]. - The CT&M segment sources and markets approximately 14 million metric tons of agricultural commodities annually, impacting supply and demand dynamics[35]. Financial Performance - Seaboard's net sales for 2024 were $9.1 billion, a decrease of$500 million compared to $9.6 billion in 2023, primarily due to a$422 million decrease in the CT&M segment sales[129]. - Operating income for 2024 was $156 million, an increase of$243 million compared to a loss of $87 million in 2023, driven by a$475 million increase in the Pork segment[130]. - Seaboard's long-term debt was $1.0 billion as of December 31, 2024, including a Term Loan due 2033 of$963 million[120]. - Cash generated from operating activities was $519 million for 2024, down from$710 million in 2023, primarily due to changes in working capital[121]. - Seaboard's available borrowing capacity under lines of credit was $985 million as of December 31, 2024[119]. - The company reported a net cash used in investing activities of$484 million in 2024, compared to $273 million in 2023[192]. Market and Economic Factors - Seaboard's operations and financial performance are significantly linked to commodity prices, which have historically been cyclical and volatile[64]. - The cost of feed, a major component for the Pork and Turkey segments, is influenced by fluctuations in corn and soybean meal prices[64]. - Seaboard's international operations may face risks such as changes in foreign currency exchange rates and trade barriers, potentially affecting revenues and cash flows[58]. - The ongoing conflict between Russia and Ukraine has impacted global commodity prices, which could negatively affect Seaboard's business[60]. - The company is subject to extensive environmental regulations, which may lead to increased compliance costs and operational changes[76]. Operational Risks - Cybersecurity breaches pose a risk to Seaboard's operations, potentially impacting sales and financial condition[60]. - The Marine segment's operations are vulnerable to disruptions from hurricanes and adverse weather, which could significantly delay cargo recovery[69]. - The Turkey segment has the capacity to produce approximately one billion pounds of turkey annually, but changes in consumer preferences and brand perception could adversely affect sales volumes and prices[8]. - The Liquid Fuels segment is experiencing increasing competition in foreign markets, which could impact sales volume and pricing[81]. - Seaboard's decentralized operations may slow decision-making and response to compliance issues, posing risks to business operations[74]. Segment-Specific Insights - The Pork segment's retention rate was approximately 80$37 million in 2024, down 57% from $87 million in 2023, and down 16$103 million in 2022[161]. Capital Expenditures and Investments - Seaboard invested $511 million in property, plant, and equipment in 2024, with$299 million allocated to the Pork segment for renewable biogas recovery projects[122]. - The company plans approximately $630 million in capital expenditures for 2025, with$290 million in the Marine segment and $215 million in the Pork segment[124]. - Seaboard's investments in renewable biogas recovery facilities may not yield expected returns due to operational challenges and external variables[77]. Stock and Shareholder Information - Seaboard's common stock is closely held, with the Bresky family owning approximately 73$125 million for 2024, down from $103 million in 2023, as the credits expired at the end of 2024[155].