10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 29, 2012

COMMISSION FILE NUMBER 1-15321

SMITHFIELD FOODS, INC.

200 Commerce Street

Smithfield, Virginia 23430

(757) 365-3000

Virginia	52-0845861
(State of Incorporation)	(I.R.S. Employer Identification Number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o    No  x

At August 31, 2012, 149,479,148 shares of the registrant's Common Stock ($.50 par value per share) were outstanding.

SMITHFIELD FOODS, INC.

TABLE OF CONTENTS

		PAGE
	PART I-FINANCIAL INFORMATION
Item 1.	Financial Statements	3
	Consolidated Condensed Statements of Income—Three Months Ended July 29, 2012 and July 31, 2011	3
	Consolidated Condensed Statements of Comprehensive Income—Three Months Ended July 29, 2012 and July 31, 2011	4
	Consolidated Condensed Balance Sheets—July 29, 2012 and April 29, 2012	5
	Consolidated Condensed Statements of Cash Flows—Three Months Ended July 29, 2012 and July 31, 2011	6
	Notes to Consolidated Condensed Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33
	PART II-OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	35
Item 5.	Other Information	35
Item 6.	Exhibits	35
SIGNATURES		36

2

PART I—FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(in millions, except per share data)

	Three Months Ended
	July 29, 2012			July 31, 2011
	(unaudited)
Sales	$	3,091.3		$	3,094.2
Cost of sales	2,759.1			2,687.1
Gross profit	332.2			407.1
Selling, general and administrative expenses	201.1			238.7
Income from equity method investments	(0.7		)	(4.8		)
Operating profit	131.8			173.2
Interest expense	42.5			48.1
Loss on debt extinguishment	—			1.2
Income before income taxes	89.3			123.9
Income tax expense	27.6			41.8
Net income	$	61.7		$	82.1
Net income per share:
Basic	$	.40		$	.50
Diluted	$	.40		$	.49
Weighted average shares outstanding:
Basic	154.3			165.8
Effect of dilutive shares	1.0			1.2
Diluted	155.3			167.0

See Notes to Consolidated Condensed Financial Statements

3

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

	Three Months Ended
	July 29, 2012			July 31, 2011
	(unaudited)
Net income	$	61.7		$	82.1
Other comprehensive income (loss):
Foreign currency translation	(84.1		)	(44.3		)
Pension accounting	8.2			3.5
Hedge accounting	59.2			(28.1		)
Total other comprehensive loss	(16.7		)	(68.9		)
Total comprehensive income	$	45.0		$	13.2

See Notes to Consolidated Condensed Financial Statements

4

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED BALANCE SHEETS

(in millions, except share data)

	July 29, 2012			April 29, 2012
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	208.1		$	324.3
Accounts receivable, net	625.3			624.7
Inventories	2,152.7			2,072.4
Prepaid expenses and other current assets	343.2			277.6
Total current assets	3,329.3			3,299.0
Property, plant and equipment, net	2,233.8			2,277.2
Goodwill	759.3			768.2
Investments	502.4			522.6
Intangible assets, net	380.7			381.8
Other assets	166.8			173.4
Total assets	$	7,372.3		$	7,422.2
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	616.2		$	63.5
Accounts payable	397.9			415.8
Accrued expenses and other current liabilities	651.0			657.0
Total current liabilities	1,665.1			1,136.3
Long-term debt and capital lease obligations	1,372.9			1,900.9
Other liabilities	1,041.1			995.0
Redeemable noncontrolling interests	2.0			2.0
Commitments and contingencies
Equity:
Shareholders' equity:
Preferred stock, $1.00 par value, 1,000,000 authorized shares	—			—
Common stock, $.50 par value, 500,000,000 authorized shares; 150,319,326 and 157,408,077 issued and outstanding	75.2			78.7
Additional paid-in capital	1,491.3			1,561.0
Stock held in trust	(68.1		)	(67.9		)
Retained earnings	2,320.0			2,326.4
Accumulated other comprehensive loss	(527.6		)	(510.9		)
Total shareholders’ equity	3,290.8			3,387.3
Noncontrolling interests	0.4			0.7
Total equity	3,291.2			3,388.0
Total liabilities and equity	$	7,372.3		$	7,422.2

See Notes to Consolidated Condensed Financial Statements

5

SMITHFIELD FOODS, INC.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(in millions)

	Three Months Ended
	July 29, 2012			July 31, 2011
	(unaudited)
Cash flows from operating activities:
Net income	$	61.7		$	82.1
Adjustments to reconcile net cash flows from operating activities:
Depreciation and amortization	58.8			61.5
Loss (gain) on sale of property, plant and equipment, including breeding stock	3.9			(10.5		)
Income from equity method investments	(0.7		)	(4.8		)
Pension expense	24.0			14.3
Pension contributions	(8.6		)	(108.2		)
Changes in operating assets and liabilities and other, net	(71.8		)	(98.6		)
Net cash flows from operating activities	67.3			(64.2		)
Cash flows from investing activities:
Capital expenditures	(61.2		)	(62.9		)
Net (expenditures) proceeds from breeding stock transactions	(6.5		)	2.6
Proceeds from the sale of property, plant and equipment	6.5			1.3
Net cash flows from investing activities	(61.2		)	(59.0		)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	24.2			—
Principal payments on long-term debt and capital lease obligations	(4.2		)	(81.1		)
Net proceeds from revolving credit facilities and notes payable	6.5			23.8
Repurchase of common stock	(145.3		)	(34.1		)
Debt issuance costs and other	0.2			(8.8		)
Net cash flows from financing activities	(118.6		)	(100.2		)
Effect of foreign exchange rate changes on cash	(3.7		)	(1.4		)
Net change in cash and cash equivalents	(116.2		)	(224.8		)
Cash and cash equivalents at beginning of period	324.3			374.7
Cash and cash equivalents at end of period	$	208.1		$	149.9

See Notes to Consolidated Condensed Financial Statements

6

SMITHFIELD FOODS, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. You should read these statements in conjunction with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. The information reflects all normal recurring adjustments which we believe are necessary to present fairly the financial position and results of operations for all periods included.

Smithfield Foods, Inc., together with its subsidiaries (the “Company,” “we,” “us” or “our”), is the largest hog producer and pork processor in the world. We produce and market a wide variety of fresh meat and packaged meats products both domestically and internationally. We conduct our operations through four reportable segments: Pork, Hog Production, International and Corporate, each of which is comprised of a number of subsidiaries, joint ventures and other investments.

The three months ended July 29, 2012 correspond to the first quarter of fiscal 2013 and the three months ended July 31, 2011 correspond to the first quarter of fiscal 2012.

Net Income per Share

We present dual computations of net income per share. The basic computation is based on weighted average common shares outstanding during the period. The diluted computation reflects the potentially dilutive effect of common stock equivalents, such as stock options and convertible notes, during the period. We excluded stock options for approximately 2.1 million and 1.7 million shares for the three months ended July 29, 2012 and July 31, 2011, respectively, from the diluted computation because their effect would have been anti-dilutive.

Recently Issued Accounting Pronouncements

In July 2012, the Financial Accounting Standards Board (FASB) issued new accounting guidance on testing indefinite-lived intangible assets for impairment. The new guidance provides an entity the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount. If it is not, no further analysis is required. If it is, the previously prescribed test is required. The new guidance is effective for fiscal years beginning after September 15, 2012 with early adoption permitted. The adoption of this guidance is not expected to impact our consolidated condensed financial statements.

NOTE 2: INVENTORIES

Inventories consist of the following:

	July 29, 2012		April 29, 2012
	(in millions)
Livestock	$	1,015.4	$	962.8
Fresh and packaged meats	924.2		912.1
Grains	107.9		90.4
Manufacturing supplies	53.3		59.1
Other	51.9		48.0
Total inventories	$	2,152.7	$	2,072.4

7

NOTE 3: DERIVATIVE FINANCIAL INSTRUMENTS

Our meat processing and hog production operations use various raw materials, primarily live hogs, corn and soybean meal, which are actively traded on commodity exchanges. We hedge these commodities when we determine conditions are appropriate to mitigate price risk. While this hedging may limit our ability to participate in gains from favorable commodity fluctuations, it also tends to reduce the risk of loss from adverse changes in raw material prices. We attempt to closely match the commodity contract terms with the hedged item. We also periodically enter into interest rate swaps to hedge exposure to changes in interest rates on certain financial instruments and foreign exchange forward contracts to hedge certain exposures to fluctuating foreign currency rates.

We record all derivatives in the balance sheet as either assets or liabilities at fair value. Accounting for changes in the fair value of a derivative depends on whether it qualifies and has been designated as part of a hedging relationship. For derivatives that qualify and have been designated as hedges for accounting purposes, changes in fair value have no net impact on earnings, to the extent the derivative is considered perfectly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, until the hedged item is recognized in earnings (commonly referred to as the “hedge accounting” method). For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in current period earnings (commonly referred to as the “mark-to-market” method). We may elect either method of accounting for our derivative portfolio, assuming all the necessary requirements are met. We have in the past availed ourselves of either acceptable method and expect to do so in the future. We believe all of our derivative instruments represent economic hedges against changes in prices and rates, regardless of their designation for accounting purposes.

We do not offset the fair value of derivative instruments with cash collateral held with or received from the same counterparty under a master netting arrangement. As of July 29, 2012, prepaid expenses and other current assets included $72.5 million representing cash on deposit with brokers to cover losses on our open derivative instruments and accrued expenses and other current liabilities included $70.9 million representing cash deposits received from brokers to cover gains on our open derivative instruments. Changes in commodity prices could have a significant impact on cash deposit requirements under our broker and counterparty agreements. Additionally, certain of our derivative contracts contain credit risk related contingent features, which would require us to post additional cash collateral to cover net losses on open derivative instruments if our credit rating was downgraded. As of July 29, 2012, the net liability position of our open derivative instruments that are subject to credit risk related contingent features was not material.  

We are exposed to losses in the event of nonperformance or nonpayment by counterparties under financial instruments. Although our counterparties primarily consist of financial institutions that are investment grade, there is still a possibility that one or more of these companies could default. However, a majority of our financial instruments are exchange traded futures contracts held with brokers and counterparties with whom we maintain margin accounts that are settled on a daily basis, thereby limiting our credit exposure to non-exchange traded derivatives. Determination of the credit quality of our counterparties is based upon a number of factors, including credit ratings and our evaluation of their financial condition. As of July 29, 2012, we had credit exposure of $39.7 million on non-exchange traded derivative contracts, excluding the effects of netting arrangements. As a result of netting arrangements, our credit exposure was reduced to $33.7 million as of July 29, 2012. No significant concentrations of credit risk existed as of July 29, 2012. 

The size and mix of our derivative portfolio varies from time to time based upon our analysis of current and future market conditions. All derivative contracts are recorded in prepaid expenses and other current assets or accrued expenses and other current liabilities within the consolidated condensed balance sheets, as appropriate.

8

The following table presents the fair values of our open derivative financial instruments in the consolidated condensed balance sheets on a gross basis.

	Assets				Liabilities
	July 29, 2012		April 29, 2012		July 29, 2012		April 29, 2012
	(in millions)				(in millions)
Derivatives using the "hedge accounting" method:
Grain contracts	$	102.6	$	35.3	$	15.3	$	9.6
Livestock contracts	3.6		22.9		5.9		—
Foreign exchange contracts	0.9		1.9		0.7		—
Total	107.1		60.1		21.9		9.6
Derivatives using the "mark-to-market" method:
Grain contracts	21.1		9.1		34.2		1.0
Livestock contracts	2.7		7.4		2.0		7.2
Energy contracts	1.7		—		6.0		12.2
Foreign exchange contracts	0.3		2.4		0.4		0.7
Total	25.8		18.9		42.6		21.1
Total fair value of derivative instruments	$	132.9	$	79.0	$	64.5	$	30.7

Hedge Accounting Method

Cash Flow Hedges 

We enter into derivative instruments, such as futures, swaps and options contracts, to manage our exposure to the variability in expected future cash flows attributable to commodity price risk associated with the forecasted sale of live hogs and fresh pork, and the forecasted purchase of corn and soybean meal. In addition, we enter into interest rate swaps to manage our exposure to changes in interest rates associated with our variable interest rate debt, and we enter into foreign exchange contracts to manage our exposure to the variability in expected future cash flows attributable to changes in foreign exchange rates associated with the forecasted purchase or sale of assets denominated in foreign currencies. As of July 29, 2012, we had no cash flow hedges for forecasted transactions beyond April 2013. 

When cash flow hedge accounting is applied, derivative gains or losses are recognized as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. Derivative gains and losses, when reclassified into earnings, are recorded in cost of sales for grain contracts, sales for lean hog contracts, interest expense for interest rate contracts and selling, general and administrative expenses for foreign exchange contracts. Gains and losses on derivatives designed to hedge price risk associated with fresh pork sales are recorded in the Hog Production segment. 

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments designated in cash flow hedging relationships was as follows:

	Minimum	Maximum	Metric
Commodities:
Corn	30,885,000	56,730,000	Bushels
Soybean meal	303,886	553,854	Tons
Lean hogs	—	421,040,000	Pounds
Foreign currency (1)	39,968,781	69,266,888	U.S. Dollars

——————————————

⁽¹⁾  Amounts represent the U.S. dollar equivalent of various foreign currency contracts.

9

The following table presents the effects on our consolidated condensed financial statements of pre-tax gains and losses on derivative instruments designated in cash flow hedging relationships for the fiscal periods indicated:

	Gains (Losses) Recognized in Other Comprehensive Income (Loss) on Derivative (Effective Portion)						Gains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings (Effective Portion)						Gains (Losses) Recognized in Earnings on Derivative (Ineffective Portion)
	Three Months Ended						Three Months Ended						Three Months Ended
	July 29, 2012			July 31, 2011			July 29, 2012			July 31, 2011			July 29, 2012		July 31, 2011
	(in millions)						(in millions)						(in millions)
Commodity contracts:
Grain contracts	$	133.9		$	(14.0	)	$	2.7		$	43.8		$	2.7	$	(0.1	)
Lean hog contracts	0.3			8.0			32.2			(1.7		)	0.1		(0.1		)
Interest rate contracts	—			—			—			(1.8		)	—		—
Foreign exchange contracts	(1.8		)	0.3			(0.2		)	0.2			—		—
Total	$	132.4		$	(5.7	)	$	34.7		$	40.5		$	2.8	$	(0.2	)

For the fiscal periods presented, foreign exchange contracts were determined to be highly effective. We have excluded from the assessment of effectiveness differences between spot and forward rates, which we have determined to be immaterial. 

During the first quarter of fiscal 2012, we discontinued cash flow hedge accounting on a number of grain contracts as it became probable that the original forecasted transactions would not transpire. As a result of this change, the table above for the three months ended July 31, 2011 includes gains of $12.0 million on grain contracts de-designated from hedging relationships that were reclassified from accumulated other comprehensive loss into earnings in the first quarter of fiscal 2012.

As of July 29, 2012, there were deferred net gains of $110.4 million, net of tax of $70.2 million, in accumulated other comprehensive loss. We expect to reclassify $82.0 million ($50.1 million net of tax) of deferred net gains on closed commodity contracts into earnings within the next twelve months. We are unable to estimate the gains or losses to be reclassified into earnings within the next twelve months related to open contracts as their values are subject to change. 

Fair Value Hedges 

We enter into derivative instruments (primarily futures contracts) that are designed to hedge changes in the fair value of live hog inventories and firm commitments to buy grains. When fair value hedge accounting is applied, derivative gains and losses are recognized in earnings currently along with the change in fair value of the hedged item attributable to the risk being hedged. The gains or losses on the derivative instruments and the offsetting losses or gains on the related hedged items are recorded in cost of sales for commodity contracts.

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments designated in fair value hedging relationships was as follows:

	Minimum	Maximum	Metric
Commodities:
Lean hogs	—	286,800,000	Pounds
Corn	3,015,000	12,975,000	Bushels

The following table presents the effects on our consolidated condensed statements of income of gains and losses on derivative instruments designated in fair value hedging relationships and the related hedged items for the fiscal periods indicated:

	Gains (Losses) Recognized in Earnings on Derivative					Gains (Losses) Recognized in Earnings on Related Hedged Item
	Three Months Ended					Three Months Ended
	July 29, 2012			July 31, 2011		July 29, 2012		July 31, 2011
	(in millions)					(in millions)
Commodity contracts	$	(26.4	)	$	9.7	$	20.3	$	(3.6	)

10

We recognized gains of $3.4 million and $5.9 million for the three months ended July 29, 2012 and July 31, 2011, respectively, on closed commodity derivative contracts as the underlying cash transactions affected earnings. 

For fair value hedges of inventory, we elect to exclude from the assessment of effectiveness differences between the spot and futures prices. These differences are recorded directly into earnings as they occur. These differences resulted in losses of $6.3 million and gains of $5.7 million for the three months ended July 29, 2012 and July 31, 2011, respectively.

Mark-to-Market Method

Derivative instruments that are not designated as a hedge, have been de-designated from a hedging relationship, or do not meet the criteria for hedge accounting are marked-to-market with the unrealized gains and losses together with actual realized gains and losses from closed contracts being recognized in current period earnings. Under the mark-to-market method, gains and losses are recorded in cost of sales for commodity contracts, and selling, general and administrative expenses for foreign exchange contracts.

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments using the “mark-to-market” method was as follows:

	Minimum	Maximum	Metric
Commodities:
Lean hogs	320,000	94,800,000	Pounds
Corn	4,825,000	22,960,000	Bushels
Soybean meal	40,314	105,102	Tons
Soybeans	235,000	695,000	Bushels
Wheat	—	2,000,000	Bushels
Natural gas	10,580,000	11,030,000	Million BTU
Diesel	—	2,016,000	Gallons
Crude oil	18,000	31,000	Barrels
Foreign currency (1)	43,255,205	100,186,869	U.S. Dollars

——————————————

⁽¹⁾  Amounts represent the U.S. dollar equivalent of various foreign currency contracts.

The following table presents the amount of gains and losses recognized in the consolidated condensed statements of income on derivative instruments using the “mark-to-market” method by type of derivative contract for the fiscal periods indicated:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Commodity contracts	$	(8.2	)	$	20.8
Foreign exchange contracts	4.6			1.3
Total	$	(3.6	)	$	22.1

The table above reflects gains and losses from both open and closed contracts including, among other things, gains and losses related to contracts designed to hedge price movements that occur entirely within a quarter. The table includes amounts for both realized and unrealized gains and losses. The table is not, therefore, a simple representation of unrealized gains and losses recognized in the income statement during any period presented.

11

NOTE 4: INVESTMENTS

Investments consist of the following:

Equity Investment	% Owned	July 29, 2012		April 29, 2012
		(in millions)
Campofrío Food Group (CFG)	37%	$	367.6	$	385.2
Mexican joint ventures	50%	108.3		111.2
Other	Various	26.5		26.2
Total investments		$	502.4	$	522.6

Each quarter, we review the carrying value of our investments and consider whether indicators of impairment exist. Examples of impairment indicators include a history or expectation of future operating losses and declines in a quoted share price, among other factors. If an impairment indicator exists, we must evaluate the fair value of our investment to determine if a loss in value, which is other than temporary, has occurred. We are required to recognize a loss in value of our investment if that loss is considered to be other than temporary.

As of July 29, 2012, we held 37,811,302 shares of CFG common stock. Shares of CFG are publicly traded on the Bolsa de Madrid exchange (Madrid Exchange). As the table below shows, the carrying value of our investment in CFG was above the quoted market price on the Madrid Exchange as of July 29, 2012, indicating a possible impairment of our investment in CFG. However, we do not believe the quoted share price on the Madrid Exchange is, by itself, reflective of the fair value of our investment in CFG for the following reasons:

▪ the minority shares traded on the Madrid Exchange confer no special rights or privileges to buyers. In contrast, the shares comprising our 37% stake in CFG contractually entitle us to two seats on CFG's 9-person board of directors, giving us the ability to exert significant influence over the strategic and operational decisions of our investee.

▪ the stock is very thinly traded. CFG is a closely held company, with the three largest shareholders owning approximately 74% of the outstanding shares. We are CFG's largest shareholder, with a 37% stake.

The average daily trading volume during the first quarter of fiscal 2013 represents just 0.01% of the total outstanding shares (average trading volume of 10,586 shares while the total number of shares outstanding is in excess of 102 million). The lack of an active market can cause significant fluctuations and volatility in the stock price that are not commensurate with fundamental changes in the underlying business and the fair value of our holding in CFG. Shares trading on the Madrid Exchange have ranged from a high of €7.20 ($9.47) to a low of €5.28 ($7.35) per share during the last 12 months, with upward and downward fluctuations in between.

The table below shows CFG's intra-day high share price and Smithfield's carrying value, expressed in euro per share, on various dates relevant to our disclosures.

Date	Share Price		Carrying Value
February 17, 2012	€	7.20	€	7.54
July 29, 2012 (1)	€	5.85	€	7.89
August 23, 2012	€	6.20	€	7.80

——————————————

⁽¹⁾  Share prices on quarter end date reflect the last trading day in the quarter.

As noted above, we do not consider the share price on the Madrid Exchange, by itself, to be determinative of fair value. In assessing the fair value of our investment, we considered a variety of information, including an independent third party valuation report, which incorporates generally accepted valuation techniques, CFG's history of positive cash flows, expectations about the future cash flows of CFG, market multiples for comparable businesses, and an influence premium applied to the market price of CFG's shares on the Madrid Exchange to adjust for our contractual right to two board seats and our ability to exert significant influence over the operational and strategic decisions of the company.

12

Based on an evaluation of all these factors, we concluded the fair value of our investment in CFG as of July 29, 2012, exceeded its carrying amount.

Income from equity method investments consists of the following:

		Three Months Ended
Equity Investment	Segment	July 29, 2012			July 31, 2011
		(in millions)
CFG (1)	International	$	(0.1	)	$	(0.2	)
Mexican joint ventures	International	0.4			(3.0		)
All other equity method investments	Various	(1.0		)	(1.6		)
Income from equity method investments		$	(0.7	)	$	(4.8	)

——————————————

⁽¹⁾  CFG prepares its financial statements in accordance with International Financial Reporting Standards. Our share of CFG’s results reflects U.S. GAAP adjustments and thus, there may be differences between the amounts we report for CFG and the amounts reported by CFG.

NOTE 5: DEBT

In the first quarter of fiscal 2013, we reclassified our outstanding 7.75% senior unsecured notes due May 2013 totaling $160.0 million (2013 Notes) and our outstanding 4% senior unsecured convertible notes due June 2013 totaling $378.7 million, net of unamortized discounts of $21.3 million, from long-term debt and capital lease obligations to current portion of long-term debt and capital lease obligations on the consolidated condensed balance sheet.

Working Capital Facilities

As of July 29, 2012, we had aggregate credit facilities and credit lines totaling $1.3 billion, including an inventory-based revolving credit facility totaling $925.0 million (the Inventory Revolver), an accounts receivable securitization facility totaling $275.0 million (the Securitization Facility) and international credit facilities totaling $99.0 million. Our unused capacity under these credit facilities and credit lines was $1.1 billion.

As part of the Securitization Facility agreement, all accounts receivable of our major Pork segment subsidiaries are sold to a wholly-owned “bankruptcy remote” special purpose vehicle (SPV). The SPV pledges the receivables as security for loans and letters of credit. The SPV is included in our consolidated financial statements and therefore, the accounts receivable owned by it are included in our consolidated balance sheet. However, the accounts receivable owned by the SPV are separate and distinct from our other assets and are not available to our other creditors should we become insolvent. As of July 29, 2012, the SPV held $408.1 million of accounts receivable and we had no outstanding borrowings on the Securitization Facility.

NOTE 6: GUARANTEES

As part of our business, we are a party to various financial guarantees and other commitments as described below. These arrangements involve elements of performance and credit risk that are not included in the consolidated condensed balance sheets. We could become liable in connection with these obligations depending on the performance of the guaranteed party or the occurrence of future events that we are unable to predict. If we consider it probable that we will become responsible for an obligation, we will record the liability on our consolidated balance sheet. 

We (together with our joint venture partners) guarantee debt borrowed by Agroindustrial del Noroeste (Norson), an unconsolidated joint venture, of up to $87.0 million, of which $62.0 million was outstanding as of July 29, 2012. The covenants in the guarantee relating to Norson’s debt incorporate our covenants under the Inventory Revolver. In addition, we continue to guarantee $11.1 million of leases that were transferred to JBS S.A. in connection with the sale of Smithfield Beef, Inc. Some of these lease guarantees may be released in the near future and others may remain in place until the leases expire through February 2022.

NOTE 7: INCOME TAXES

Our effective tax rate was 31% and 34% for the three months ended July 29, 2012 and July 31, 2011, respectively. The decrease in the effective tax rate is primarily driven by a higher mix of foreign earnings in the current year, which have lower effective tax rates.

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NOTE 8: PENSION PLANS

The components of net periodic pension cost consist of:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Service cost	$	11.8		$	9.3
Interest cost	18.7			19.0
Expected return on plan assets	(19.7		)	(19.9		)
Net amortization	13.2			5.9
Net periodic pension cost	$	24.0		$	14.3

NOTE 9: SHAREHOLDERS’ EQUITY 

Share Repurchase Program

In June 2012 (fiscal 2013), we announced that our board of directors had approved a new share repurchase program authorizing us to buy up to $250.0 million of our common stock over the next 24 months in addition to the $250.0 million authorized during fiscal 2012 (Share Repurchase Program). In July 2012 (fiscal 2013), our board of directors approved an increase of $100.0 million to the authorized amount under the Share Repurchase Program. Share repurchases may be made on the open market, or in privately negotiated transactions. The number of shares repurchased, and the timing of any buybacks, will depend on corporate cash balances, business and economic conditions, and other factors, including investment opportunities. The program may be discontinued at any time.

During the three months ended July 29, 2012, we repurchased 7,421,231 shares of our common stock for $145.3 million, including related fees. The price of the repurchased shares has been allocated between common stock, additional paid-in capital and retained earnings in our consolidated condensed balance sheet in accordance with applicable accounting guidance.

Since the inception of the Share Repurchase Program in June 2011 (fiscal 2012) and through August 31, 2012, we have repurchased 17,448,215 shares of our common stock for $350.6 million, including related fees, at an average price of $20.07. All share repurchases were funded from cash on hand.

Stock Options and Performance Share Units

During the three months ended July 29, 2012, we issued 18,107 shares of common stock upon the exercise of stock options and 314,373 shares of common stock for vested performance share units. In fiscal 2012, we issued 87,262 shares of common stock upon exercise of stock options and 417,288 shares of common stock for vested performance share units.

NOTE 10: FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We are required to consider and reflect the assumptions of market participants in fair value calculations. These factors include nonperformance risk (the risk that an obligation will not be fulfilled) and credit risk, both of the reporting entity (for liabilities) and of the counterparty (for assets). 

We use, as appropriate, a market approach (generally, data from market transactions), an income approach (generally, present value techniques), and/or a cost approach (generally, replacement cost) to measure the fair value of an asset or liability.  These valuation approaches incorporate inputs, such as observable, independent market data, that management believes are predicated on the assumptions market participants would use to price an asset or liability. These inputs may incorporate, as applicable, certain risks such as nonperformance risk and credit risk. 

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The FASB has established a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The fair value hierarchy gives the highest priority to quoted market prices (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of inputs used to measure fair value are as follows: 

▪ Level 1—quoted prices in active markets for identical assets or liabilities accessible by the reporting entity.

▪ Level 2—observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

▪ Level 3—unobservable for an asset or liability. Unobservable inputs should only be used to the extent observable inputs are not available.

We have classified assets and liabilities measured at fair value based on the lowest level of input that is significant to the fair value measurement.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables set forth, by level within the fair value hierarchy, our non-pension financial assets and liabilities that were measured at fair value on a recurring basis as of July 29, 2012 and April 29, 2012:

	July 29, 2012								April 29, 2012
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(in millions)								(in millions)
Assets
Derivatives:
Commodity contracts	$	87.6	$	33.4	$	—	$	121.0	$	52.0	$	1.3	$	—	$	53.3
Foreign exchange contracts	—		1.2		—		1.2		—		4.3		—		4.3
Open-ended mutual funds	11.6		—		—		11.6		12.2		—		—		12.2
Insurance contracts	—		50.9		—		50.9		—		51.3		—		51.3
Total	$	99.2	$	85.5	$	—	$	184.7	$	64.2	$	56.9	$	—	$	121.1
Liabilities
Derivatives:
Commodity contracts	$	51.8	$	0.9	$	—	$	52.7	$	—	$	8.6	$	—	$	8.6
Foreign exchange contracts	—		1.1		—		1.1		—		0.7		—		0.7
Total	$	51.8	$	2.0	$	—	$	53.8	$	—	$	9.3	$	—	$	9.3

The following are descriptions of the valuation methodologies and key inputs used to measure financial assets and liabilities recorded at fair value on a recurring basis:

▪ Derivatives—Derivatives classified within Level 1 are valued using quoted market prices. In some cases where quoted market prices are not available, we value the derivatives using pricing models based on the net present value of estimated future cash flows to calculate fair value, in which case the measurements are classified within Level 2. These valuation models make use of market-based observable inputs, including market prices and rates, yield curves, credit curves, and measures of volatility.

▪ Open-ended mutual funds—Open-ended mutual funds are valued at their net asset value (NAV), which approximates fair value, and classified as Level 1.

▪ Insurance contracts—Insurance contracts are valued at their cash surrender value using the daily asset unit value (AUV) which is based on the quoted market price of the underlying securities and classified within Level 2.

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Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain assets and liabilities are measured at fair value on a nonrecurring basis after initial recognition; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, for example, when there is evidence of impairment. During the three months ended July 29, 2012, we had no significant assets or liabilities that were measured and recorded at fair value on a nonrecurring basis.

Other Financial Instruments

We determine the fair value of public debt using Level 2 inputs based on quoted market prices. The carrying amount of all other debt approximates fair value as those instruments are based on variable interest rates. The following table presents the fair value and carrying value of long-term debt, including the current portion of long-term debt as of July 29, 2012 and April 29, 2012.

	July 29, 2012				April 29, 2012
	Fair Value		Carrying Value		Fair Value		Carrying Value
	(in millions)
Long-term debt, including current portion	$	2,121.7	$	1,962.3	$	2,176.5	$	1,937.3

The carrying amounts of cash and cash equivalents, accounts receivable, notes payable and accounts payable approximate their fair values because of the relatively short-term maturity of these instruments.

NOTE 11: CONTINGENCIES

Litigation

Other than the following matters, there have been no significant developments regarding litigation disclosed in Note 16 of our Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012, nor have any significant new matters arisen during the three months ended July 29, 2012.

Missouri Litigation

Premium Standard Farms, Inc. (PSF), the Company and certain of our other subsidiaries are parties to litigation in Missouri involving a number of claims alleging that hog farms owned or under contract with the defendants interfered with the plaintiffs' use and enjoyment of their properties.

During fiscal 2012 and continuing in fiscal 2013, we engaged in global settlement negotiations with counsel representing nearly all of the plaintiffs in the nuisance litigation and numerous carriers of commercial general liability and pollution liability policies. The parties to the litigation have reached an agreement and consummated a global settlement that resolves substantially all of the nuisance litigation. Pursuant to the agreement, all pending cases previously disclosed, with one minor exception, will be dismissed with prejudice. In addition, we have agreements with the insurance carriers under which we receive payments that we contribute to pay a portion of the settlement, most of which were contingent on the consummation of the global settlement.

Our policy for establishing accruals and disclosures for contingent liabilities is contained in Note 1—Summary of Significant Accounting Policies in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. We established an accrual with respect to the Missouri nuisance suits on the opening balance sheet for our acquisition of PSF in fiscal 2008 and we have periodically adjusted that accrual as developments have occurred. The accrual, as adjusted from time to time, represents our best estimate of the probable loss for these suits.

The global settlement, which was consummated after the end of the first quarter of fiscal 2013, is not materially different than the accrual we maintained for the settled litigation and, therefore, will not materially affect our profits or losses in future periods. Payments made by us under the global settlement and payments we receive from the insurance carriers will impact our cash flows for future periods; however, such impact is not expected to be material to our overall financial position or liquidity.

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NOTE 12: REPORTABLE SEGMENTS

We conduct our operations through four reportable segments: Pork, Hog Production, International and Corporate, each of which is comprised of a number of subsidiaries, joint ventures and other investments. The Pork segment consists mainly of our three wholly-owned U.S. fresh pork and packaged meats subsidiaries. The Hog Production segment consists of our hog production operations located in the U.S. The International segment is comprised mainly of our meat processing and distribution operations in Poland, Romania and the United Kingdom, our interests in meat processing operations, mainly in Western Europe and Mexico, our hog production operations located in Poland and Romania and our interests in hog production operations in Mexico. The Corporate segment provides management and administrative services to support our other segments.

The following table presents sales and operating profit (loss) by segment for the fiscal periods indicated:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Sales:
Segment sales—
Pork	$	2,599.6		$	2,597.3
Hog Production	728.8			749.8
International	346.8			375.0
Total segment sales	3,675.2			3,722.1
Intersegment sales—
Pork	(8.4		)	(9.4		)
Hog Production	(567.3		)	(611.6		)
International	(8.2		)	(6.9		)
Total intersegment sales	(583.9		)	(627.9		)
Consolidated sales	$	3,091.3		$	3,094.2
Operating profit (loss):
Pork	$	118.6		$	136.7
Hog Production	23.1			69.7
International	15.8			—
Corporate	(25.7		)	(33.2		)
Consolidated operating profit	$	131.8		$	173.2

NOTE 13: SUBSEQUENT EVENTS

Debt Refinancing

In July 2012 (fiscal 2013), we initiated an underwritten public offering to issue $1.0 billion aggregate principal amount of 6.625% senior unsecured notes due August 2022 (2022 Notes). We received net proceeds of $981.2 million, after underwriting discounts and commissions and offering expenses, upon settlement of the 2022 Notes in August 2012 (fiscal 2013).

In conjunction with the issuance of the 2022 Notes, we commenced a tender offer to purchase any and all of our 2013 Notes and any and all of our outstanding 10% senior secured notes due July 2014 (2014 Notes) (the July 2012 Tender Offer). The July 2012 Tender Offer expired in August 2012. As a result of the July 2012 Tender Offer, we paid $649.4 million to repurchase 2013 Notes and 2014 Notes with face values of $105.0 million and $456.6 million, respectively. Also in August 2012 (fiscal 2013), we exercised the redemption feature available under our 2014 Notes and paid $155.5 million to repurchase the remaining $132.8 million of our 2014 Notes. Net proceeds from the issuance of the 2022 Notes were used to make all of the repurchases of the 2013 Notes and 2014 Notes. As a result of these repurchases, we will recognize losses on debt extinguishment of approximately $121 million in the second quarter of fiscal 2013, including the write-off of related unamortized discounts, premiums and debt issuance costs.

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ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following information in conjunction with the unaudited consolidated condensed financial statements and the related notes in this Quarterly Report and the audited financial statements and the related notes as well as Management’s Discussion and Analysis of Financial Condition and Results of Operation contained in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012.

EXECUTIVE OVERVIEW

We are the largest hog producer and pork processor in the world. We are also the leader in numerous packaged meats categories with popular brands including Farmland®, Smithfield®, Eckrich®, Armour® and John Morrell®. We are committed to providing good food in a responsible way and maintaining robust animal care, community involvement, employee safety, environmental, and food safety and quality programs.

We produce and market a wide variety of fresh meat and packaged meats products both domestically and internationally. We operate in a cyclical industry and our results are significantly affected by fluctuations in commodity prices for livestock (primarily hogs) and grains. Some of the factors that we believe are critical to the success of our business are our ability to:

▪ maintain and expand market share, particularly in packaged meats,

▪ develop and maintain strong customer relationships,

▪ continually innovate and differentiate our products,

▪ manage risk in volatile commodities markets, and

▪ maintain our position as a low cost producer of live hogs, fresh pork and packaged meats.

We conduct our operations through four reportable segments: Pork, Hog Production, International and Corporate, each of which is comprised of a number of subsidiaries, joint ventures and other investments. The Pork segment consists mainly of our three wholly-owned U.S. fresh pork and packaged meats subsidiaries. The Hog Production segment consists of our hog production operations located in the U.S. The International segment is comprised mainly of our meat processing and distribution operations in Poland, Romania and the United Kingdom, our interests in meat processing operations, mainly in Western Europe and Mexico, our hog production operations located in Poland and Romania and our interests in hog production operations in Mexico. The Corporate segment provides management and administrative services to support our other segments.

First Quarter of Fiscal 2013 Summary

Net income was $61.7 million, or $.40 per diluted share, in the first quarter of fiscal 2013 compared to net income of $82.1 million, or $.49 per diluted share, in the same quarter last year. The following summarizes the results of each of our reportable segments and other significant changes impacting net income for the first quarter of fiscal 2013 compared to the first quarter of fiscal 2012:

▪ Pork segment operating profit decreased to $118.6 million from $136.7 million as higher pork supplies pressured margins.

▪ Hog Production segment operating profit decreased $46.6 million primarily as a result of higher feed costs.

▪ International segment operating profit increased by $15.8 million driven by positive hog production fundamentals, higher meat volumes and higher unit sales prices in our Eastern European operations.

▪ Corporate segment results improved by $7.5 million. The prior year included $5.7 million in professional fees associated with the potential acquisition of a controlling interest in Campofrío Food Group (CFG). In June 2011 (fiscal 2012), we terminated negotiations to purchase the additional interest.

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Debt Refinancing

In August 2012 (fiscal 2013), we issued $1.0 billion aggregate principal amount of ten year, 6.625% senior unsecured notes at a price equal to 99.5% of their face value. We used $804.9 million of the $981.2 million in net proceeds from the debt offering to repurchase the remaining $589.4 million of our 10% senior secured notes due July 2014 (2014 Notes) and $105.0 million of our 7.75% senior unsecured notes due May 2013 (2013 Notes). As a result of these repurchases, we will recognize losses on debt extinguishment of approximately $121 million in the second quarter of fiscal 2013, including the write-off of related unamortized discounts, premiums, and debt issuance costs. We also extended the maturity date of our $200.0 million term loan from June 2016 (fiscal 2017) to May 2018 (fiscal 2019). These activities have significantly improved our debt maturity profile, removed the early maturity trigger on our inventory-based revolving credit facility (the Inventory Revolver), and released the encumbrances of our real estate and fixed assets. With the exception of the $400.0 million aggregate principal amount of our 4% senior unsecured convertible notes due June 2013 (fiscal 2014), we have no substantial debt obligations coming due until fiscal 2018 as a result of these refinancing activities.

Share Repurchase Program

In June 2012 (fiscal 2013), we announced that our board of directors had approved a new share repurchase program authorizing us to buy up to $250.0 million of our common stock over the next 24 months in addition to the $250.0 million authorized during fiscal 2012 (the Share Repurchase Program). In July 2012 (fiscal 2013), our board of directors approved an increase of $100.0 million to the authorized amount under the Share Repurchase Program. Share repurchases may be made on the open market, or in privately negotiated transactions. The number of shares repurchased, and the timing of any buybacks, will depend on corporate cash balances, business and economic conditions, and other factors, including investment opportunities. The program may be discontinued at any time.

Since the inception of the Share Repurchase Program in June 2011 (fiscal 2012) and through August 31, 2012, we have repurchased 17,448,215 shares of our common stock for $350.6 million, including related fees, at an average price of $20.07 per share. As of August 31, 2012, we had approximately $250 million available for future repurchases under the Share Repurchase Program.

Strategies for Growth

We are focused on top and bottom line growth in our base business. Our strategies for growth include:

▪ Focus On Twelve Core Brands—In connection with our Pork segment restructuring, which was completed in fiscal 2011, we rationalized our large brand portfolio and began to focus our marketing support on twelve major brand names: Smithfield, Farmland, John Morrell, Gwaltney, Armour, Eckrich, Margherita, Carando, Kretschmar, Cook’s, Curly's and Healthy Ones. Approximately three-quarters of our domestic retail packaged meats sales are branded products, with nearly 90% of those branded sales being core brands.

▪ Invest in Advertising to Activate Brands—We have begun to invest more heavily in marketing talent and advertising campaigns to drive consumer awareness. In December 2011 (fiscal 2012), we entered into a multi-year sponsorship agreement with the Richard Petty Motorsports NASCAR team to help activate our brands with consumer-focused marketing.

▪ Build a Strong Innovation Pipeline—We are driving consumer relevant product innovation by focusing on delivering convenience oriented products such as our Smithfield marinated pork products, convenient packaging such as our Smithfield bacon pouch pack and healthier, reduced sodium products. In fiscal 2012, we opened a 37,000 square foot research and development center with three state of the art kitchens, a dedicated cutting room, multimedia technology, and a pilot plant that simulates full scale manufacturing processes. This facility allows us to co-develop prototypes with customers and make quick product modifications for speed to the market.

▪ Coordinated Sales and Marketing Team—In connection with our Pork segment restructuring plan, we merged two independent fresh pork sales forces and consolidated our international sales organizations for our U.S. pork companies into one group responsible for exports. The restructured sales groups provide for a more coordinated and focused strategy to access markets and service customers.

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Outlook

The commodity markets affecting our business are often volatile and fluctuate on a daily basis. In this unpredictable operating environment, it is very difficult to make meaningful forecasts of industry trends and conditions. The outlook statements that follow must be viewed in this context.

▪ Pork—The first quarter is a seasonally weak period for fresh pork. Fresh pork margins suffered from high pork supplies and sluggish retail demand during the quarter. However, margins have shown considerable improvement as we begin to emerge from the seasonally weak period. Looking forward, we believe the fundamentals support solid profitability in fresh pork for the full fiscal year. Lower supplies of competing proteins, continued strength in export demand and relatively high pork prices around the world should support healthy fresh pork profitability within the normalized range of $3-$7 per head for fiscal 2013.

We achieved record operating margins in our packaged meats business in the first quarter of fiscal 2013, benefiting from lower raw material costs, an enhanced product mix, a more coordinated and focused sales strategy and increased investment in marketing talent and consumer advertising. At the same time, we grew packaged meats volumes by 4%, driven by core brand volume growth of 7%. We are executing our strategy to grow our packaged meats business by continuing to utilize our coordinated sales and marketing team approach, focus on our twelve core brands, invest in consumer-focused advertising and build a strong product innovation pipeline to grow market share and distribution.

In summary, we are optimistic about our packaged meats business for fiscal 2013 and beyond. We expect packaged meats operating margins to be at the high end of the normalized range of $.12 to $.17 per pound with 2-3% volume growth in fiscal 2013.

▪ Hog Production—Live hog market prices averaged $66 per hundredweight in the first quarter of fiscal 2013. As we move into the second quarter of fiscal 2013, hog prices are expected to move seasonally lower before recovering in the second half of the fiscal year. Industry sow slaughter rates have turned noticeably positive over the past six weeks and supplies of other proteins are expected to contract, which should be supportive of healthy hog prices going forward.

Raising costs averaged $67 per hundredweight in the first quarter of fiscal 2013, up 6% from the prior year. Drought conditions in the United States have recently caused sharp increases in feed grain prices. However, we expect hedge positions placed prior to the run-up in grain prices will mitigate, to a meaningful extent, the negative impact on our raising costs. We expect our raising costs to average in the mid $60s per hundredweight throughout fiscal 2013, as the blended effect of hedge gains and higher spot corn prices are averaged into cost over the course of the year.

In summary, the current hog production environment is difficult, but our risk management strategy should dampen the effects of higher priced grain for the balance of the fiscal year. Consequently, we expect to produce results that are better than the industry average. Profitability is expected to range from a marginal loss to a marginal profit for the full fiscal year in the Hog Production segment.

▪ International—Our International segment generated $15.8 million of operating profit in the first quarter of fiscal 2013 compared to break even profitability in the same period a year ago. Our European hog production operations should continue to benefit from tightening hog supplies on the continent. Industry forecasters predict higher feed costs combined with heightened environmental and welfare regulations in Europe will cause producers to contract, improving an already favorable production environment for our Polish and Romanian hog farms. Our Mexican hog production joint ventures are currently operating in a challenging production environment. We expect modest improvements for the balance of fiscal 2013. However, before meaningful contributions to segment profitability can be expected, additional improvements in live hog prices and/or feed grain cost will be needed.

On the meat processing side of our international business, we expect improved results from our Polish meat operations for the balance of fiscal 2013. Recent approval to export pork products out of Romania to European Union member countries should continue to benefit results from our Romanian meat operations. We also expect modest contributions from our Mexican meat operations.

Finally, in the third quarter of fiscal 2012, CFG announced a multi-year comprehensive plan to consolidate and streamline its manufacturing operations, which should improve operating results over the long-term. In the near-term, we expect only modest positive contributions from CFG.

In total, we anticipate operating profits from this segment will be in the upper half of the normalized range of $50 million to $125 million for fiscal 2013.

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RESULTS OF OPERATIONS

Significant Events Affecting Results of Operations

Missouri Litigation

Premium Standard Farms, Inc. (PSF), the Company and certain of our other subsidiaries are parties to litigation in Missouri involving a number of claims alleging that hog farms owned or under contract with the defendants interfered with the plaintiffs' use and enjoyment of their properties.

During fiscal 2012 and continuing in fiscal 2013, we engaged in global settlement negotiations with counsel representing nearly all of the plaintiffs in the nuisance litigation and numerous carriers of commercial general liability and pollution liability policies. In fiscal 2012, based on these negotiations, we recognized $22.2 million in net charges associated with the Missouri litigation in selling, general and administrative expenses in the Hog Production segment, including $39.0 million in charges during the first quarter of fiscal 2012. The parties to the litigation have reached an agreement and consummated a global settlement that resolves substantially all of the nuisance litigation. Pursuant to the agreement, all pending cases previously disclosed, with one minor exception, will be dismissed with prejudice. In addition, we have agreements with the insurance carriers under which we receive payments that we contribute to pay a portion of the settlement, most of which were contingent on the consummation of the global settlement.

The global settlement, which was consummated after the end of the first quarter of fiscal 2013, is not materially different than the accrual we maintained for the settled litigation and, therefore, will not materially affect our profits or losses in future periods. Payments made by us under the global settlement and payments we receive from the insurance carriers will impact our cash flows for future periods; however, such impact is not expected to be material to our overall financial position or liquidity.

Consolidated Results of Operations

The tables presented below compare our results of operations for the three months ended July 29, 2012 and July 31, 2011.

Sales and cost of sales

	Three Months Ended
	July 29, 2012			July 31, 2011			%  Change
	(in millions)
Sales	$	3,091.3		$	3,094.2		—	%
Cost of sales	2,759.1			2,687.1			3
Gross profit	$	332.2		$	407.1		(18	)%
Gross profit margin	11		%	13		%

The following items explain the significant changes in sales and gross profit:

▪ Sales in the current year were comparable to the prior year as higher volumes in our domestic and international meat processing operations were offset by lower selling prices in the Pork segment and the effects of foreign currency translation.

▪ The decline in gross profit margin was primarily caused by higher raising costs in the Hog Production segment.

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Selling, general and administrative expenses (SG&A)

	Three Months Ended
	July 29, 2012		July 31, 2011		%  Change
	(in millions)
Selling, general and administrative expenses	$	201.1	$	238.7	(16	)%

The following items explain the significant changes in SG&A:

▪ The prior year included a charge of $39.0 million related to the Missouri litigation, which is more fully described under "Significant Events Affecting Results of Operations."

▪ The prior year included $5.7 million in professional fees associated with the potential acquisition of a controlling interest in Campofrío Food Group (CFG). In June 2011 (fiscal 2012), we terminated negotiations to purchase the additional interest.

▪ Pension and other postretirement benefit expense increased approximately $7 million.

Income from Equity Method Investments

	Three Months Ended
	July 29, 2012			July 31, 2011			% Change
	(in millions)
CFG	$	(0.1	)	$	(0.2	)	(50	)%
Mexican joint ventures	0.4			(3.0		)	(113	)
All other equity method investments	(1.0		)	(1.6		)	(38	)
Income from equity method investments	$	(0.7	)	$	(4.8	)	(85	)%

The decline in results from our Mexican joint ventures was primarily driven by higher feed costs.

Interest expense

	Three Months Ended
	July 29, 2012		July 31, 2011		% Change
	(in millions)
Interest expense	$	42.5	$	48.1	(12	)%

Interest expense decreased primarily due to the repurchase of $137.5 million of our senior unsecured and secured notes during fiscal 2012.

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Loss on debt extinguishment

	Three Months Ended
	July 29, 2012		July 31, 2011		% Change
	(in millions)
Loss on debt extinguishment	$	—	$	1.2	(100	)%

We recognized a loss on debt extinguishment of $1.2 million in the prior year associated with the refinancing of our working capital facilities.

Income tax expense

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Income tax expense	$	27.6		$	41.8
Effective tax rate	31		%	34		%

The decrease in the effective tax rate is primarily driven by a higher mix of foreign earnings in the current year, which have lower effective tax rates.

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Segment Results

The following information reflects the results from each respective segment prior to the elimination of inter-segment sales. 

Pork Segment

	Three Months Ended
	July 29, 2012			July 31, 2011		% Change
	(in millions, unless indicated otherwise)
Sales:
Fresh pork (1)	$	1,261.0		$	1,254.2	1	%
Packaged meats	1,338.6			1,343.1		—
Total	$	2,599.6		$	2,597.3	—	%
Operating profit (loss): (2)
Fresh pork (1)	$	(12.0	)	$	35.4	(134	)%
Packaged meats	130.6			101.3		29
Total	$	118.6		$	136.7	(13	)%
Sales volume:
Fresh pork						5	%
Packaged meats						4	%
Total						4	%
Average unit selling price:
Fresh pork						(4	)%
Packaged meats						(4	)%
Total						(4	)%
Hogs processed						3	%
Average domestic live hog prices (per hundredweight) (3)	$	66.47		$	68.98	(4	)%

——————————————

⁽¹⁾  Includes by-products and rendering.

⁽²⁾  Fresh pork and packaged meats operating profits represent management's estimated allocation of total Pork segment operating profit.

⁽³⁾  Represents the average live hog market price as quoted by the Iowa-Southern Minnesota hog market.

In addition to the information provided in the table above, the following items explain the significant changes in Pork segment sales and operating profit:

▪ Sales were positively impacted by higher sales volumes as hog slaughter levels increased.

▪ Sales and operating profit were negatively impacted by lower average unit selling prices resulting from higher pork supplies.

▪ Fresh pork operating results decreased to a loss of $2 per head from profit of $6 per head as higher pork supplies and sluggish retail demand decreased fresh meat prices.

▪ Packaged meats operating profit improved to a record $.21 per pound for the first quarter from $.17 per pound benefiting from lower raw material costs.

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Hog Production Segment

	Three Months Ended
	July 29, 2012		July 31, 2011		%  Change
	(in millions, unless indicated otherwise)
Sales	$	728.8	$	749.8	(3	)%
Operating profit	$	23.1	$	69.7	(67	)%
Head sold	3.62		3.80		(5	)%
Average domestic live hog prices (per hundredweight) (1)	$	66.47	$	68.98	(4	)%
Domestic raising costs (per hundredweight) (2)	$	66.93	$	62.88	6	%

——————————————

⁽¹⁾  Represents the average live hog market price as quoted by the Iowa-Southern Minnesota hog market. These prices do not reflect premiums we receive or the impact of hedging on our actual sales price.

⁽²⁾  Includes the effects of grain derivative contracts designated in hedging relationships. Does not include the effects of grain derivative contracts that are not designated in hedging relationships for accounting purposes. 

In addition to the information provided in the table above, the following items explain the significant changes in Hog Production segment sales and operating profit:

▪ Sales were negatively impacted by lower volume resulting from temporary disruptions from our cost savings initiative.

▪ Raising costs increased as a result of higher feed costs.

▪ Operating profit in the prior year included a charge of $39.0 million related to the Missouri litigation, which is more fully described under "Significant Events Affecting Results of Operations."

25

International Segment

	Three Months Ended
	July 29, 2012			July 31, 2011			%  Change
	(in millions, unless indicated otherwise)
Sales:
Poland	$	262.4		$	292.1		(10	)%
Romania	63.5			57.6			10
Other	20.9			25.3			(17	)
Total	$	346.8		$	375.0		(8	)%
Operating profit (loss):
Poland	$	14.1		$	2.6		442	%
Romania	4.9			(4.6		)	207
Other (1)	(3.2		)	2.0			(260	)
Total	$	15.8		$	—		NM
Poland:
Sales volume (2)							6	%
Average unit selling price (2)							—	%
Hogs processed							16	%
Raising costs (per hundredweight) (3)							2	%
Romania:
Sales volume (2)							22	%
Average unit selling price (2)							13	%
Hogs processed							22	%
Raising costs (per hundredweight) (3)							—	%

——————————————

⁽¹⁾  Includes our equity method investments in Mexico and the results from our investment in CFG.

⁽²⁾  Excludes the sale of live hogs and the impact of foreign currency translation.

⁽³⁾  Excludes the impact of foreign currency translation.

In addition to the information provided in the table above, the following items explain the significant changes in International segment sales and operating profit:

▪ The effect of foreign currency translation decreased sales $61.9 million, or 17%.

▪ Sales volumes in our Polish operations increased primarily due to a 16% increase in hogs processed. Unit sales prices in our Polish operations increased in several key product categories; however, higher volumes of lower value by-products that resulted from more processed hogs effectively diminished the overall average unit selling price in the current year.

▪ Sales and operating profit improved significantly in our Romanian meat processing operations benefiting from the approval to export pork products to European Union member countries beginning in the fourth quarter of fiscal 2012.

▪ Operating results from our Mexican joint ventures were hindered by higher feed costs.

26

Corporate Segment

	Three Months Ended
	July 29, 2012			July 31, 2011			%  Change
Operating loss	$	(25.7	)	$	(33.2	)	23	%

The prior year included $5.7 million of professional fees related to the potential acquisition of a controlling interest in CFG. In June 2011 (fiscal 2012), we terminated negotiations to purchase the additional interest.

LIQUIDITY AND CAPITAL RESOURCES

Summary

Our cash requirements consist primarily of the purchase of raw materials used in our hog production and pork processing operations, long-term debt obligations and related interest, lease payments for real estate, machinery, vehicles and other equipment, and expenditures for capital assets, other investments and other general business purposes. Our primary sources of liquidity are cash we receive as payment for the products we produce and sell, as well as our credit facilities.

We believe that our current liquidity position is strong and that our cash flows from operations and availability under our credit facilities will be sufficient to meet our working capital needs and financial obligations for at least the next twelve months. As of July 29, 2012, our liquidity position was approximately $1.3 billion, comprised of approximately $1.1 billion in availability under our credit facilities and $208.1 million in cash and cash equivalents.

In August 2012 (fiscal 2013), we issued $1.0 billion aggregate principal amount of ten year, 6.625% senior unsecured notes at a price equal to 99.5% of their face value. We used $804.9 million of the $981.2 million in net proceeds from the debt offering to repurchase the remaining $589.4 million of our 10% senior secured notes due July 2014 (2014 Notes) and $105.0 million of our 7.75% senior unsecured notes due May 2013 (2013 Notes). As a result of these repurchases, we will recognize losses on debt extinguishment of approximately $121 million in the second quarter of fiscal 2013, including the write-off of related unamortized discounts, premiums, and debt issuance costs. We also extended the maturity date of our $200.0 million term loan from June 2016 (fiscal 2017) to May 2018 (fiscal 2019). These activities have significantly improved our debt maturity profile, removed the early maturity trigger on the Inventory Revolver, and released the encumbrances of our real estate and fixed assets. With the exception of the $400.0 million aggregate principal amount of our 4% senior unsecured convertible notes due June 2013 (fiscal 2014), we have no substantial debt obligations coming due until fiscal 2018 as a result of these refinancing activities.

Sources of Liquidity

We have available a variety of sources of liquidity and capital resources, both internal and external. These resources provide funds required for current operations, acquisitions, integration costs, debt retirement and other capital requirements. 

Accounts Receivable and Inventories

The meat processing industry is characterized by high sales volume and rapid turnover of inventories and accounts receivable. Because of the rapid turnover rate, we consider our meat inventories and accounts receivable highly liquid and readily convertible into cash. In addition, although inventory turnover in the Hog Production segment is slower, mature hogs are readily convertible into cash. Borrowings under our credit facilities are used, in part, to finance increases in the levels of inventories and accounts receivable resulting from seasonal and other market-related fluctuations in raw material costs.

27

Credit Facilities

	July 29, 2012
Facility	Capacity		Borrowing Base Adjustment			Outstanding Letters of Credit			Outstanding Borrowings			Amount Available
	(in millions)
Inventory Revolver	$	925.0	$	—		$	—		$	—		$	925.0
Securitization Facility	275.0		(1.9		)	(101.0		)	—			172.1
International facilities	99.0		—			—			(67.4		)	31.6
Total credit facilities	$	1,299.0	$	(1.9	)	$	(101.0	)	$	(67.4	)	$	1,128.7

Securities

We have a shelf registration statement filed with the Securities and Exchange Commission to register sales of debt, stock and other securities from time to time. We would use the net proceeds from the possible sale of these securities for repayment of existing debt or general corporate purposes. 

Cash Flows

Operating Activities

	Three Months Ended
	July 29, 2012		July 31, 2011
	(in millions)
Net cash flows from operating activities	$	67.3	$	(64.2	)

The following items explain the significant changes in cash flows from operating activities: 

▪ We contributed $8.6 million to our qualified and non-qualified pension plans in fiscal 2013 compared to $108.2 million, including a $100.0 million voluntary contribution, in fiscal 2012.

▪ Net cash receipts related to domestic income taxes increased $77.1 million due to a significant refund in the current year.

▪ Cash paid for grain purchased by the Hog Production segment decreased approximately $12.1 million from the prior year.

▪ Cash paid to outside hog suppliers was lower due to a 4% decrease in average domestic live hog prices.

▪ Cash received for the settlement of derivative contracts and for margin requirements decreased $13.8 million in fiscal 2013.

▪ Cash received from customers decreased primarily as a result of lower selling prices.

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Investing Activities

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Capital expenditures	$	(61.2	)	$	(62.9	)
Net (expenditures) proceeds from breeding stock transactions	(6.5		)	2.6
Proceeds from the sale of property, plant and equipment	6.5			1.3
Net cash flows from investing activities	$	(61.2	)	$	(59.0	)

The following items explain the significant investing activities for the three months ended July 29, 2012 and July 31, 2011: 

Fiscal 2013

▪ Capital expenditures included $21.3 million related to our Kinston, North Carolina plant expansion project. The remaining capital expenditures primarily related to plant and hog farm improvement projects.

Fiscal 2012

▪ Capital expenditures primarily related to our plan to improve the cost structure and profitability of our domestic hog production operations and the replacement of gestation stalls with group pens, which is more fully explained under "Additional Matters Affecting Liquidity."

Financing Activities

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Proceeds from the issuance of long-term debt	$	24.2		$	—
Principal payments on long-term debt and capital lease obligations	(4.2		)	(81.1		)
Net proceeds from revolving credit facilities and notes payable	6.5			23.8
Repurchase of common stock	(145.3		)	(34.1		)
Debt issuance costs and other	0.2			(8.8		)
Net cash flows from financing activities	$	(118.6	)	$	(100.2	)

The following items explain the significant financing activities for the three months ended July 29, 2012 and July 31, 2011: 

Fiscal 2013

▪ We repurchased 7,421,231 shares of our common stock for $145.3 million as part of the Share Repurchase Program, which is more fully explained under "Additional Matters Affecting Liquidity."

Fiscal 2012

▪ We redeemed the remaining $77.8 million of our 7% senior unsecured notes due August 2011.

▪ We received $23.8 million from draws on credit facilities in the International segment.

▪ We repurchased 1,527,196 shares of our common stock for $34.1 million as part of the Share Repurchase Program, which is more fully explained under "Additional Matters Affecting Liquidity."

▪ We paid $10.8 million of debt issuance costs in connection with the refinancing of the ABL Credit Facility in the first quarter of fiscal 2012.

29

Interest Rate Spread

Although we had no borrowings on the Inventory Revolver or the Securitization Facility as of July 29, 2012, the applicable interest rates would have been LIBOR plus 2.5% and the lender's cost of funds of 0.26% plus 1.25%, respectively. Both interest rate spreads are based on pricing-level grids in the respective agreements and determined by our Funded Debt to EBITDA ratio (as defined in the Second Amended and Restated Credit Agreement).

Guarantees

As part of our business, we are a party to various financial guarantees and other commitments as described below. These arrangements involve elements of performance and credit risk that are not included in the consolidated condensed balance sheets. We could become liable in connection with these obligations depending on the performance of the guaranteed party or the occurrence of future events that we are unable to predict. If we consider it probable that we will become responsible for an obligation, we will record the liability on our consolidated balance sheet. 

We (together with our joint venture partners) guarantee debt borrowed by Agroindustrial del Noroeste (Norson), an unconsolidated joint venture, of up to $87.0 million, of which $62.0 million was outstanding as of July 29, 2012. The covenants in the guarantee relating to Norson’s debt incorporate our covenants under the Inventory Revolver. In addition, we continue to guarantee $11.1 million of leases that were transferred to JBS S.A. in connection with the sale of Smithfield Beef, Inc. Some of these lease guarantees may be released in the near future and others may remain in place until the leases expire through February 2022.

Additional Matters Affecting Liquidity

Capital Projects

As of July 29, 2012, we anticipate capital expenditures of $190 million to $210 million during the remainder of fiscal 2013, including approximately $38 million related to our Kinston, North Carolina plant expansion project. These capital expenditures are expected to be funded with cash flows from operations and/or borrowings under credit facilities.

Share Repurchase Program

In June 2012 (fiscal 2013), we announced that our board of directors had approved a new share repurchase program authorizing us to buy up to $250.0 million of our common stock over the next 24 months in addition to the $250.0 million authorized during fiscal 2012 (Share Repurchase Program). In July 2012 (fiscal 2013), our board of directors approved an increase of $100.0 million to the authorized amount under the Share Repurchase Program. Share repurchases may be made on the open market, or in privately negotiated transactions. The number of shares repurchased, and the timing of any buybacks, will depend on corporate cash balances, business and economic conditions, and other factors, including investment opportunities. The program may be discontinued at any time.

Since the inception of the Share Repurchase Program in June 2011 (fiscal 2012) and through August 31, 2012, we have repurchased 17,448,215 shares of our common stock for $350.6 million, including related fees. As of August 31, 2012, we had approximately $250 million available for future repurchases under the Share Repurchase Program.

Group Pens

In January 2007 (fiscal 2007), we announced a voluntary, ten-year program to phase out individual gestation stalls at our company-owed sow farms and replace the gestation stalls with group pens. We currently estimate the total cost of our transition to group pens to be approximately $300.0 million. This program represents a significant financial commitment and reflects our desire to be more animal friendly, as well as to address the concerns and needs of our customers. As of the end of calendar year 2011, we had completed conversions to group housing for over 30% of our sows on company-owned farms. We will continue the conversion as planned with the objective of completing conversions for all sows on company-owned farms by the end of 2017.

30

Risk Management Activities

We are exposed to market risks primarily from changes in commodity prices, and to a lesser degree, interest rates and foreign exchange rates. To mitigate these risks, we utilize derivative instruments to hedge our exposure to changing prices and rates, as more fully described under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Derivative Financial Instruments” in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. Our liquidity position may be positively or negatively affected by changes in the underlying value of our derivative portfolio. When the value of our open derivative contracts decreases, we may be required to post margin deposits with our brokers to cover a portion of the decrease. Conversely, when the value of our open derivative contracts increases, our brokers may be required to deliver margin deposits to us for a portion of the increase. During the three months ended July 29, 2012, margin deposits posted by us ranged from $(45.0) million to $30.5 million (negative amounts representing margin deposits we received from our brokers). The average daily amount on deposit with brokers during the three months ended July 29, 2012 was $1.9 million. As of July 29, 2012, the net amount on deposit with brokers was $1.6 million. 

The effects, positive or negative, on liquidity resulting from our risk management activities tend to be mitigated by offsetting changes in cash prices in our core business. For example, in a period of rising grain prices, gains resulting from long grain derivative positions would generally be offset by higher cash prices paid to farmers and other suppliers in spot markets. These offsetting changes do not always occur, however, in the same amounts or in the same period, with lag times of as much as twelve months.

Missouri Litigation

PSF, the Company and certain of our other subsidiaries are parties to litigation in Missouri involving a number of claims alleging that hog farms owned or under contract with the defendants interfered with the plaintiffs' use and enjoyment of their properties.

During fiscal 2012 and continuing in fiscal 2013, we engaged in global settlement negotiations with counsel representing nearly all of the plaintiffs in the nuisance litigation and numerous carriers of commercial general liability and pollution liability policies. The parties to the litigation have reached an agreement and consummated a global settlement that resolves substantially all of the nuisance litigation. Pursuant to the agreement, all pending cases previously disclosed, with one minor exception, will be dismissed with prejudice. In addition, we have agreements with the insurance carriers under which we receive payments that we contribute to pay a portion of the settlement, most of which were contingent on the consummation of the global settlement.

We established an accrual with respect to the Missouri nuisance suits on the opening balance sheet for our acquisition of PSF in fiscal 2008 and we have periodically adjusted that accrual as developments have occurred. The accrual, as adjusted from time to time, represents our best estimate of the probable loss for these suits.

The global settlement, which was consummated after the end of the first quarter of fiscal 2013, is not materially different than the accrual we maintained for the settled litigation and, therefore, will not materially affect our profits or losses in future periods. Payments made by us under the global settlement and payments we receive from the insurance carriers will impact our cash flows for future periods; however, such impact is not expected to be material to our overall financial position or liquidity.

31

CRITICAL ACCOUNTING POLICIES AND ESTIMATES 

The preparation of consolidated condensed financial statements requires us to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions are based on our experience and our understanding of the current facts and circumstances. Actual results could differ from those estimates. The following describes updates to our critical accounting policies and estimates, which are more fully described in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. 

Impairment Considerations of Equity Method Investments 

We review the carrying value of our equity method investments and consider whether indicators of impairment exist. Examples of impairment indicators include a history or expectation of future operating losses and declines in a quoted share price, among other factors. If an impairment indicator exists, we must evaluate the fair value of our investment to determine if a loss in value, which is other than temporary, has occurred. We are required to recognize a loss in value of our investment if that loss is considered to be other than temporary.

As of July 29, 2012, the carrying value of our investment in CFG exceeded the quoted market price on the Madrid exchange, indicating a possible impairment of our investment. However, CFG's share price is just one of several factors we consider in evaluating the fair value of our investment in CFG. Based on an evaluation all factors, including an independent third party valuation report, CFG's history of positive cash flows, expectations about the future cash flows of CFG, market multiples for comparable businesses, and an influence premium applied to the market price of CFG's shares, we concluded that the fair value of our investment in CFG was above the carrying value as of July 29, 2012. However, should our assessment yield a conclusion that suggests an inability to recover the carrying amount of the investment or inability of our investee to sustain an earnings capacity that would justify the carrying amount of the investment, then we would write down the carrying amount of our investment to its estimated fair value.

FORWARD-LOOKING STATEMENTS

This report contains “forward-looking” statements within the meaning of the federal securities laws. The forward-looking statements include statements concerning our outlook for the future, as well as other statements of beliefs, future plans and strategies or anticipated events, and similar expressions concerning matters that are not historical facts. Our forward-looking information and statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the statements. These risks and uncertainties include the availability and prices of live hogs, feed ingredients (including corn), raw materials, fuel and supplies, food safety, livestock disease, live hog production costs, product pricing, the competitive environment and related market conditions, risks associated with our indebtedness, including cost increases due to rising interest rates or changes in debt ratings or outlook, hedging risk, adverse weather conditions, operating efficiencies, changes in foreign currency exchange rates, access to capital, the cost of compliance with and changes to regulations and laws, including changes in accounting standards, tax laws, environmental laws, agricultural laws and occupational, health and safety laws, adverse results from on-going litigation, actions of domestic and foreign governments, labor relations issues, credit exposure to large customers, the ability to make effective acquisitions and successfully integrate newly acquired businesses into existing operations, our ability to effectively restructure portions of our operations and achieve cost savings from such restructurings and other risks and uncertainties described under "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. Readers are cautioned not to place undue reliance on forward-looking statements because actual results may differ materially from those expressed in, or implied by, the statements. Any forward-looking statement that we make speaks only as of the date of such statement, and we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

32

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For complete quantitative and qualitative disclosures about market risk affecting the Company, see “Item 7A. Qualitative and Quantitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. The following table presents the sensitivity of the fair value of our open commodity contracts and interest rate and foreign currency contracts to a hypothetical 10% change in market prices or in interest rates and foreign exchange rates, as of July 29, 2012 and April 29, 2012.

	July 29, 2012		April 29, 2012
	(in millions)
Grains	$	8.5	$	49.4
Livestock	27.1		18.0
Energy	4.9		3.3
Foreign currency	9.0		11.9

ITEM 4. CONTROLS AND PROCEDURES

An evaluation was performed under the supervision and with the participation of management, including the Chief Executive Officer (CEO) and the Chief Financial Officer (CFO), regarding the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended) as of July 29, 2012. Based on that evaluation, management, including the CEO and CFO, has concluded that our disclosure controls and procedures were effective as of July 29, 2012. 

There were no changes in our internal control over financial reporting during our first quarter of fiscal 2013 that have materially affected, or are reasonably likely to affect, our internal control over financial reporting.

33

PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Other than the following matters, there have been no material changes with respect to the legal proceedings disclosed in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012, nor have any significant new matters arisen during the three months ended July 29, 2012.

Missouri Litigation

As previously disclosed in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012, Premium Standard Farms (PSF), the Company and certain of our other subsidiaries are parties to litigation in Missouri involving a number of claims alleging that hog farms owned or under contract with the defendants interfered with the plaintiffs' use and enjoyment of their properties. During fiscal 2012 and continuing in fiscal 2013, we engaged in global settlement negotiations with counsel representing nearly all of the plaintiffs in the nuisance litigation and numerous carriers of commercial general liability and pollution liability policies. The parties to the litigation have reached an agreement and consummated a global settlement that resolves the vast majority of the nuisance litigation. Pursuant to the agreement, all pending cases previously disclosed, with one minor exception, will be dismissed with prejudice. In addition, we have agreements with the insurance carriers under which we receive payments that we contribute to pay a portion of the settlement, most of which were contingent on the consummation of the global settlement. The global settlement is not materially different than the accrual we maintained for the settled litigation. See “Part I, Item 1—Financial Statements—Note 11: Contingencies” for a further discussion.

ITEM 1A.  RISK FACTORS

There have been no material changes with respect to the risk factors disclosed in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Period	(a) Total Number of Shares Purchased		(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)
April 30, 2012 to May 30, 2012	1,807,744		$	20.13	1,807,744	$	24,518,773
May 31, 2012 to June 29, 2012	2,716,961	(2)	$	19.97	2,706,926	$	221,487,126
June 30, 2012 to July 29, 2012	2,906,561		$	18.84	2,906,561	$	265,504,605
Total	7,431,266		$	19.57	7,421,231	$	265,504,605

——————————————

⁽¹⁾  On June 16, 2011, we announced that our board of directors had approved a share repurchase program authorizing the Company to buy up to $150,000,000 of its common stock. In September 2011, our board of directors approved a $100,000,000 increase to the authorized amount. In June 2012 and July 2012, our board of directors approved an increase in the authorized amount of $250,000,000 and $100,000,000, respectively. This share repurchase program expires on June 13, 2014.

In connection with the Share Repurchase Program, we entered into an agreement with a broker (the Trading Plan) which authorized it to purchase our common stock on our behalf based on certain parameters, in accordance with the applicable requirements of Rule 10b5-1(c)(1)(i) and Rule 10b-18 under the Securities Exchange Act of 1934.

⁽²⁾  Purchases of 10,035 shares were made in open market transactions by Wells Fargo, as trustee, and these 10,035 shares are held in a rabbi trust for the benefit of participants in the Smithfield Foods, Inc. 2008 Incentive Compensation Plan director fee deferral program. The 2008 Incentive Compensation Plan was approved by our shareholders on August 27, 2008.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

34

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS

Exhibit 3.1	—	Articles of Amendment effective August 27, 2009 to the Amended and Restated Articles of Incorporation, including the Amended and Restated Articles of Incorporation of the Company, as amended to date (incorporated by reference to Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q filed with the SEC on September 11, 2009).
Exhibit 3.2	—	Amendment to the Bylaws effective June 16, 2010, including the Bylaws of the Company, as amended to date (incorporated by reference to Exhibit 3.2 to the Company's Annual Report on Form 10-K filed with the SEC on June 18, 2010).
Exhibit 4.1	—	Third Supplemental Indenture to the Indenture -Senior Debt Securities between the Company and U.S. Bank National Association, as trustee, dated as of August 1, 2012 regarding the issuance by the Company of the 2012 6.625% Senior Notes due 2022 (incorporated by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K filed with the SEC on August 1, 2012).
Exhibit 4.2	—	Form of 6.625% Senior Note Due 2022 (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed with the SEC on August 1, 2012).
Exhibit 10.1	—	Certain Compensation for Named Executive Officers for Fiscal 2013 (filed herewith).
Exhibit 10.2	—	Form of Smithfield Foods, Inc. 2008 Incentive Compensation Plan Performance Share Unit Award to certain Executive Officers granted June 2012 (filed herewith).
Exhibit 31.1	—	Certification of C. Larry Pope, President and Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
Exhibit 31.2	—	Certification of Robert W. Manly, IV, Executive Vice President and Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
Exhibit 32.1	—	Certification of C. Larry Pope, President and Chief Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
Exhibit 32.2	—	Certification of Robert W. Manly, IV, Executive Vice President and Chief Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
Exhibit 101	—	The following financial statements from Smithfield Foods, Inc.'s Quarterly Report on Form 10-Q for the quarter ended July 29, 2012, formatted in XBRL: (i) Consolidated Condensed Statements of Income, (ii) Consolidated Condensed Statements of Comprehensive Income, (iii) Consolidated Condensed Balance Sheets, (iv) Consolidated Condensed Statements of Cash Flows, and (v) the Notes to Consolidated Condensed Financial Statements (filed herewith).

35

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Smithfield Foods, Inc.

/s/    ROBERT W. MANLY, IV

Robert W. Manly, IV

Executive Vice President and Chief Financial Officer

/s/    KENNETH M. SULLIVAN     

Kenneth M. Sullivan

Senior Vice President, Finance and Chief Accounting Officer

Date: September 6, 2012

36

EX-10.1

Exhibit 10.1

Certain Compensation for Named Executive Officers

for Fiscal 2013

Name	Principal Position	Annual Base Salary		Annual Cash Incentive(1)
C. Larry Pope	President and Chief Executive Officer	$	1,100,000	(2)
Robert W. Manly, IV	Executive Vice President and Chief Financial Officer	$	750,000	(3)
George H. Richter	President and Chief Operating Officer, Pork Group	$	800,000	(4)
Joseph B. Sebring	President of John Morrell	$	735,000	(5)
Joseph W. Luter, IV	Executive Vice President, Sales and Marketing, Pork Group	$	700,000	(6)

_________

(1) For the annual cash incentive awards, “pre-tax profits” are generally defined as net income before deduction for income taxes and incentive payments to key employees.

(2) The annual cash incentive formula for Mr. Pope is equal to 1% of Company pre-tax profits subject to a cap of $8 million.

(3) The annual cash incentive formula for Mr. Manly is equal to 0.50% of Company pre-tax profits subject to a cap of $4 million.

(4) The annual cash incentive formula for Mr. Richter is equal to 0.50% of Pork Group pre-tax profits subject to a cap of $4 million.

(5) The annual cash incentive formula for Mr. Sebring is equal to 0.25% of Pork Group pre-tax profits subject to a cap of $2.94 million.

(6)    The annual cash incentive formula for Mr. Luter, IV is equal to:

• 0.13% of the Pork Group pre-tax profits, plus

• 0.5% of the International Group pre-tax profits, all subject to a cap of $2.8 million.

EX-10.2

Exhibit 10.2

Smithfield Foods, Inc.

2008 Incentive Compensation Plan
Performance Share Unit Award

You have been selected to receive a Performance Share Unit Award under the Smithfield Foods, Inc. 2008 Incentive Compensation Plan (the “Plan”), as specified below:

Participant:

Target Number of Performance Share Units (“Target Number”):

Performance Period: Fiscal 2013 – Fiscal 2015

Performance Measure: Total Shareholder Return Performance (as defined below)

THIS AGREEMENT, effective on ________, represents the grant of Performance Share Units by Smithfield Foods, Inc., a Virginia corporation (the “Company”), to the Participant named above, subject to the provisions of this agreement and the Plan. All capitalized terms shall have the meanings in the Plan. The parties agree as follows:

1.    Value of Performance Share Units. Each Performance Share Unit shall represent the right to receive, and have a value equal to, one share of Company Stock, subject to adjustment as provided in Section 16 of the Plan.

2.    Total Shareholder Return Performance. Total Shareholder Return Performance (“TSR Performance”) will determine the percentage of the Target Number of Performance Share Units that will be paid out, subject to vesting and the other terms and conditions of this award.  The percentage of the Target Number that will be paid out, if any, is based on the following table:

TSR Performance	Percentage of Target Number to be Paid
Greater than 90th percentile	200%
Greater than 50th but less than or equal to 90th percentile	100.01% - 200%
Equal to or greater than 25th but less than or equal to 50th percentile	50% - 100%
Less than 25th percentile	0%

#PageNum#

To the extent that the Company’s TSR Performance ranks in a percentile within one of the ranges of TSR Performance in the table above, the percentage of the Target Number will be interpolated between the top and bottom of the percentage of the Target Number for that range. The percentage of the Target Number shall be multiplied by the Target Number of Performance Share Units to determine the number of Performance Share Units to be paid (rounded down to the nearest whole number).

The TSR Performance will be measured based on the percentile where the Company’s total shareholder return during the Performance Period ranks in relation to the total shareholder returns of the Comparison Companies during such period. Total shareholder return for both the Company and the Comparison Companies consists of the difference between the value of a share of common stock from the beginning to the end of the Performance Period (using a beginning price equal to the trading volume weighted average price over the 20 trading days ending on the first day of the Company’s 2013 fiscal year and an ending price equal to the trading volume weighted average price over the 20 trading days ending on the last day of the Company’s 2015 fiscal year), plus the value of dividends paid as if reinvested in stock and other appropriate adjustments for such events as stock splits. As soon as practicable after the completion of the Performance Period, the total shareholder returns of the Company and the Comparison Companies will ranked from highest to lowest. The Company’s total shareholder return will then be ranked in terms of which percentile it would have placed in among the Comparison Companies. The Committee will approve the TSR Performance and the percentage of Target Number as soon as practicable after the end of the Performance Period, provided that the Committee may exercise negative discretion to reduce the percentage of Target Number for any reason.

The Comparison Companies are:

Campbell Soup Company	Kellogg Company
Chiquita Brands International, Inc.	Kraft Foods, Inc.
ConAgra Foods, Inc.	McCormick & Company, Inc.
Dean Foods, Inc.	Pilgrim’s Pride Corporation
General Mills, Inc.	Sanderson Farms, Inc.
H. J. Heinz Company	Sara Lee Corporation (Hillshire Brands Company)
Hershey Foods Corp.	Seaboard Corporation
Hormel Foods Corporation	Seneca Foods Corporation
J. M. Smucker Company, Inc.	Tyson Foods Inc.

#PageNum#

If a Comparison Company ceases to be a publicly traded entity other than due to bankruptcy, is acquired by another entity, or is merged out of existence during the Performance Period, the Comparison Company will be removed from the list of Comparison Companies and the TSR Performance will be calculated from the remaining Comparison Companies. If any of the Comparison Companies are no longer publicly traded at the end of the Performance Period due to bankruptcy, they will continue to be included in the relative TSR Performance calculation by ranking them at the bottom of the Comparison Companies.

3.    Vesting. The Payment Date will be a date selected by the Committee within 2.5 months following the end of the Performance Period. Except as provided in Section 4, the Participant shall become vested in the number of Performance Share Units, if any, earned as specified in Section 2, only if the Participant’s employment with the Company continues until the Payment Date when the Performance Share Units, if any, will be fully vested.

4.    Termination Provisions. If the Participant suffers a Disability or dies, or in the event of the Participant’s Retirement, the requirement that the Participant be employed by the Company through the Payment Date is waived. In such a case and subject to Section 11(a), the Participant (or in the event of the Participant’s death, the Participant’s beneficiary) shall be eligible to receive a pro rata portion of the number of Performance Share Units that the Participant would have received had his or her employment continued through the end of the Performance Period, based on the actual TSR Performance of the Company through the end of the Performance Period, multiplied by a fraction, the numerator of which is the number of whole and fractional calendar months of employment during the Performance Period and the denominator of which is thirty-six (36). Fractional months shall be calculated based on whole days during the month. Payment shall be made on the Payment Date.

In the event of the termination of the Participant’s employment by the Participant or the Company for any reason other than the Participant’s Disability, death or Retirement during the Performance Period, the Participant shall forfeit this Award in its entirety, with no payment to the Participant. The Participant’s transfer of employment to the Company or any Related Company from another Related Company or the Company during the Performance Period shall not constitute a termination of employment.

5.    Dividends. The Participant shall have no right to any dividends which may be paid with respect to shares of Company Stock until any such shares are delivered to the Participant on the Payment Date.

6.    Form and Timing of Payment of Performance Share Units. Payment of the vested Performance Share Units shall be made in Company Stock on the Payment Date.

7.    Tax Withholding. The Company shall have the power and the right to deduct or withhold Company Stock, or require the Participant or beneficiary to remit to the Company, an amount sufficient to satisfy federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Award.

#PageNum#

8.    Nontransferability. Performance Share Units may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution.

9.    Administration. This Award and the rights of the Participant hereunder are subject to all the terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for administration of the Plan. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Award, all of which shall be binding upon the Participant or any person claiming through the Participant. The Participant may designate a beneficiary to receive payment with respect to the award in the event of the Participant’s death on a form to be provided by the Committee. In the event the Participant fails to designate a beneficiary or the designated beneficiary fails to survive the Participant, the Participant’s beneficiary will be deemed to be the administrator of the Participant’s estate.

10.    Specific Restrictions Upon Shares. The Participant hereby agrees with the Company as follows:

(a) The Participant shall acquire the shares of Company Stock issuable with respect to the Performance Share Units granted hereunder for investment purposes only and not with a view to resale or other distribution thereof to the public in violation of the Securities Act of 1933, as amended (the “1933 Act”), and shall not dispose of any such Stock in transactions which, in the opinion of counsel to the Company, violate the 1933 Act, or the rules and regulations thereunder, or any applicable state securities or “blue sky” laws;

(b) If any shares of Company Stock acquired with respect to the Performance Share Units shall be registered under the 1933 Act, no public offering (otherwise than on a national securities exchange, as defined in the Exchange Act) of any such stock shall be made by the Participant under such circumstances that he or she (or such other person) may be deemed an underwriter, as defined in the 1933 Act; and

(c) The Company shall have the authority to endorse upon the certificate or certificates representing the shares acquired hereunder such legends referring to the foregoing restrictions.

11.    Miscellaneous.

(a) Change of Control. If both (i) a Qualifying Change of Control occurs prior to the end of the performance period and (ii) the Participant has not terminated employment for a reason other than death, Disability or Retirement prior to the date of the Qualifying Change of Control, then the maximum number of Performance Share Units shall be deemed to be earned under this Award, and

#PageNum#

shall be fully vested and payment for vested Performance Share Units shall be made immediately. The number of Performance Share Units deemed to be earned for a Participant who has terminated employment due to death, Disability or Retirement prior to the date of a Qualifying Change of Control shall be pro-rated by multiplying the maximum number of Performance Share Units by a fraction, the numerator of which is the number of whole and fractional calendar months during which the Participant was employed during the short performance period ending on the date of the Qualifying Change of Control, and the denominator of which is the total number of whole and fractional calendar months during such short performance period. Fractional months shall be calculated based on whole days during the month. The date of a Qualifying Change of Control shall be considered a Payment Date for purposes of this Agreement.

(b) Adjustments to Shares. Subject to Plan Section 16, in the event of any merger, reorganization, recapitalization, stock dividend, stock split, extraordinary distribution with respect to the Stock or other change in corporate structure affecting the Company Stock, the Committee or Board if Directors of the Company may make such substitution or adjustments in the aggregate number and kind of shares of Company Stock subject to this Performance Share Unit Award as it may determine, in its sole discretion, to prevent dilution or enlargement of rights.

(c) Notices. Any written notice required or permitted under this Award shall be deemed given when delivered personally, as appropriate, either to the Participant or to the Executive Compensation Department of the Company, or when deposited in a United States Post Office as registered mail, postage prepaid, addressed, as appropriate, either to the Participant at his or her address set forth above or such other address as he or she may designate in writing to the Company, or to the Attention: Corporate Secretary., at its headquarters office or such other address as the Company may designate in writing to the Participant.

(d) Failure To Enforce Not a Waiver. The failure of the Company to enforce at any time any provision of this Award shall in no way be construed to be a waiver of such provision or of any other provision hereof.

(e) Governing Law. All questions concerning the construction, validity and interpretation of this Award shall be governed by and construed according to the internal law, and not the law of conflicts, of the Commonwealth of Virginia, except that questions concerning the relative rights of the Company and the Participant with respect to Shares, shall be governed by the corporate law of the Commonwealth of Virginia.

(f) Provisions of Plan. The Performance Share Units provided for herein are

#PageNum#

granted pursuant to the Plan, and said Performance Share Units are in all respects governed by the Plan and subject to all of the terms and provisions thereof, whether such terms and provisions are incorporated in this Award solely by reference or expressly cited herein. If there is any inconsistency between the terms of this Award and the terms of the Plan, the Plan’s terms shall completely supersede and replace the conflicting terms of this Award.

(g) Tax Compliance. It is intended that this Award comply with section 409A of the Internal Revenue Code and that any payments pursuant to this Award to a Participant who is a “covered officer” within the meaning of section 162(m) of the Internal Revenue Code constitute “qualified performance-based compensation” within the meaning of section 1.162.27(e) of the Income Tax Regulations. To the maximum extent possible, this Award and the Plan shall be so interpreted and construed. No amounts in excess of the number of Performance Share Units earned under Section 3 of this Award shall be paid to the Participant.

(h) Section 16 Compliance. If required for compliance with Section 16 of the Exchange Act, except in the case of death or Disability, at least six months must elapse from the date of acquisition of the Performance Share Units granted hereunder to the date of the Participant’s disposition of such Performance Share Units or the underlying shares of Company Stock.

[ SIGNATURE PAGE FOLLOWS ]

#PageNum#

IN WITNESS WHEREOF, the Company has executed this Award in duplicate on this _____ days of ____________, 2012.

SMITHFIELD FOODS, INC.

By: _______________________

The undersigned hereby accepts, and agrees to, all terms and provisions of the forgoing Award.

__________________________

#PageNum#

EX-31.1

EXHIBIT 31.1

Certifications

I, C. Larry Pope, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Smithfield Foods, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: September 6, 2012

/s/C. LARRYPOPE        

C. Larry Pope

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certifications

I, Robert W. Manly, IV certify that:

1. I have reviewed this quarterly report on Form 10-Q of Smithfield Foods, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: September 6, 2012

/s/    ROBERTW. MANLY, IV

Robert W. Manly, IV

Executive Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Smithfield Foods, Inc. (the “Company”) on Form 10-Q for the period ended July 29, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, C. Larry Pope, President and Chief Executive Officer of the Company certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: September 6, 2012
	/s/C. LARRYPOPE
	C. Larry Pope President and Chief Executive Officer

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Smithfield Foods, Inc. (the “Company”) on Form 10-Q for the period ended July 29, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert W. Manly, IV, Executive Vice President and Chief Financial Officer of the Company certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: September 6, 2012
	/s/    ROBERTW. MANLY, IV
	Robert W. Manly, IV Executive Vice President and Chief Financial Officer

XML

DEBT Narrative (Details) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012
Senior Unsecured Convertible Notes, Four Percent, Due June 2013 [Member]
Debt Instrument [Line Items]
Long-term Debt, Current Maturities	$ 378.7
Debt Instrument, Unamortized Discount (Premium), Net	21.3
Senior Unsecured Notes, Seven Point Seven Five Percent, Due May 2013 [Member]
Debt Instrument [Line Items]
Long-term Debt, Current Maturities	$ 160.0

XML

REPORTABLE SEGMENT (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Segment Reporting Information [Line Items]
Segment sales	$ 3,675.2	$ 3,722.1
Intersegment sales	(583.9)	(627.9)
Sales	3,091.3	3,094.2
Operating profit	131.8	173.2
Pork Segment [Member]
Segment Reporting Information [Line Items]
Segment sales	2,599.6	2,597.3
Intersegment sales	(8.4)	(9.4)
Operating profit	118.6	136.7
Hog Production Segment [Member]
Segment Reporting Information [Line Items]
Segment sales	728.8	749.8
Intersegment sales	(567.3)	(611.6)
Operating profit	23.1	69.7
International Segment [Member]
Segment Reporting Information [Line Items]
Segment sales	346.8	375.0
Intersegment sales	(8.2)	(6.9)
Operating profit	15.8	0
Corporate Segment [Member]
Segment Reporting Information [Line Items]
Operating profit	$ (25.7)	$ (33.2)

XML

FAIR VALUE MEASUREMENTS Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis (Details) (Fair Value, Measurements, Recurring [Member], USD $) In Millions, unless otherwise specified	Jul. 29, 2012	Apr. 29, 2012
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Commodity Contracts, Asset, Fair Value Disclosure	$ 121.0	$ 53.3
Foreign Currency Contract, Asset, Fair Value Disclosure	1.2	4.3
Open-Ended Mutual Funds, Asset Fair Value Disclosure	11.6	12.2
Cash Surrender Value, Fair Value Disclosure	50.9	51.3
Assets, Fair Value Disclosure	184.7	121.1
Commodity Contracts, Liability, Fair Value Disclosure	52.7	8.6
Foreign Currency Contracts, Liability, Fair Value Disclosure	1.1	0.7
Liabilities, Fair Value Disclosure	53.8	9.3
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Commodity Contracts, Asset, Fair Value Disclosure	87.6	52.0
Foreign Currency Contract, Asset, Fair Value Disclosure	0	0
Open-Ended Mutual Funds, Asset Fair Value Disclosure	11.6	12.2
Cash Surrender Value, Fair Value Disclosure	0	0
Assets, Fair Value Disclosure	99.2	64.2
Commodity Contracts, Liability, Fair Value Disclosure	51.8	0
Foreign Currency Contracts, Liability, Fair Value Disclosure	0	0
Liabilities, Fair Value Disclosure	51.8	0
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Commodity Contracts, Asset, Fair Value Disclosure	33.4	1.3
Foreign Currency Contract, Asset, Fair Value Disclosure	1.2	4.3
Open-Ended Mutual Funds, Asset Fair Value Disclosure	0	0
Cash Surrender Value, Fair Value Disclosure	50.9	51.3
Assets, Fair Value Disclosure	85.5	56.9
Commodity Contracts, Liability, Fair Value Disclosure	0.9	8.6
Foreign Currency Contracts, Liability, Fair Value Disclosure	1.1	0.7
Liabilities, Fair Value Disclosure	2.0	9.3
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Commodity Contracts, Asset, Fair Value Disclosure	0	0
Foreign Currency Contract, Asset, Fair Value Disclosure	0	0
Open-Ended Mutual Funds, Asset Fair Value Disclosure	0	0
Cash Surrender Value, Fair Value Disclosure	0	0
Assets, Fair Value Disclosure	0	0
Commodity Contracts, Liability, Fair Value Disclosure	0	0
Foreign Currency Contracts, Liability, Fair Value Disclosure	0	0
Liabilities, Fair Value Disclosure	$ 0	$ 0

XML

DERIVATIVE FINANCIAL INSTRUMENTS Gains (Losses) Recognized in Earnings on Fair Value Hedges (Details) (Commodity Contract [Member], Cost of Sales [Member], Fair Value Hedging [Member], USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Commodity Contract [Member] | Cost of Sales [Member] | Fair Value Hedging [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Change in Unrealized Gain (Loss) on Fair Value Hedging Instruments	$ (26.4)	$ 9.7
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge	$ 20.3	$ (3.6)

XML

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Jul. 29, 2012

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

The following tables set forth, by level within the fair value hierarchy, our non-pension financial assets and liabilities that were measured at fair value on a recurring basis as of July 29, 2012 and April 29, 2012:

	July 29, 2012								April 29, 2012
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(in millions)								(in millions)
Assets
Derivatives:
Commodity contracts	$	87.6	$	33.4	$	—	$	121.0	$	52.0	$	1.3	$	—	$	53.3
Foreign exchange contracts	—		1.2		—		1.2		—		4.3		—		4.3
Open-ended mutual funds	11.6		—		—		11.6		12.2		—		—		12.2
Insurance contracts	—		50.9		—		50.9		—		51.3		—		51.3
Total	$	99.2	$	85.5	$	—	$	184.7	$	64.2	$	56.9	$	—	$	121.1
Liabilities
Derivatives:
Commodity contracts	$	51.8	$	0.9	$	—	$	52.7	$	—	$	8.6	$	—	$	8.6
Foreign exchange contracts	—		1.1		—		1.1		—		0.7		—		0.7
Total	$	51.8	$	2.0	$	—	$	53.8	$	—	$	9.3	$	—	$	9.3

Fair Value and Carrying Value of Debt [Table Text Block]

The following table presents the fair value and carrying value of long-term debt, including the current portion of long-term debt as of July 29, 2012 and April 29, 2012.

	July 29, 2012				April 29, 2012
	Fair Value		Carrying Value		Fair Value		Carrying Value
	(in millions)
Long-term debt, including current portion	$	2,121.7	$	1,962.3	$	2,176.5	$	1,937.3

XML

INCOME TAXES (Details)	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Income Tax Disclosure [Abstract]
Effective Income Tax Rate	31.00%	34.00%

XML

INVESTMENTS Equity Method Investments (Details) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012	Apr. 29, 2012
Schedule of Equity Method Investments [Line Items]
Investments	$ 502.4	$ 522.6
Campofrio Food Group [Member]
Schedule of Equity Method Investments [Line Items]
Ownership Percentage	37.00%
Investments	367.6	385.2
Mexican Joint Ventures [Member]
Schedule of Equity Method Investments [Line Items]
Ownership Percentage	50.00%
Investments	108.3	111.2
Other Equity Method Investments [Member]
Schedule of Equity Method Investments [Line Items]
Investments	$ 26.5	$ 26.2

XML

FAIR VALUE MEASUREMENTS Fair Value and Carrying Value of Debt (Details) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012	Apr. 29, 2012
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	$ 2,121.7	$ 2,176.5
Long-term Debt	$ 1,962.3	$ 1,937.3

XML

DERIVATIVE FINANCIAL INSTRUMENTS

3 Months Ended

Jul. 29, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES FINANCIAL INSTRUMENTS

DERIVATIVE FINANCIAL INSTRUMENTS

Our meat processing and hog production operations use various raw materials, primarily live hogs, corn and soybean meal, which are actively traded on commodity exchanges. We hedge these commodities when we determine conditions are appropriate to mitigate price risk. While this hedging may limit our ability to participate in gains from favorable commodity fluctuations, it also tends to reduce the risk of loss from adverse changes in raw material prices. We attempt to closely match the commodity contract terms with the hedged item. We also periodically enter into interest rate swaps to hedge exposure to changes in interest rates on certain financial instruments and foreign exchange forward contracts to hedge certain exposures to fluctuating foreign currency rates.

We record all derivatives in the balance sheet as either assets or liabilities at fair value. Accounting for changes in the fair value of a derivative depends on whether it qualifies and has been designated as part of a hedging relationship. For derivatives that qualify and have been designated as hedges for accounting purposes, changes in fair value have no net impact on earnings, to the extent the derivative is considered perfectly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, until the hedged item is recognized in earnings (commonly referred to as the “hedge accounting” method). For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in current period earnings (commonly referred to as the “mark-to-market” method). We may elect either method of accounting for our derivative portfolio, assuming all the necessary requirements are met. We have in the past availed ourselves of either acceptable method and expect to do so in the future. We believe all of our derivative instruments represent economic hedges against changes in prices and rates, regardless of their designation for accounting purposes.

We do not offset the fair value of derivative instruments with cash collateral held with or received from the same counterparty under a master netting arrangement. As of July 29, 2012, prepaid expenses and other current assets included $72.5 million representing cash on deposit with brokers to cover losses on our open derivative instruments and accrued expenses and other current liabilities included $70.9 million representing cash deposits received from brokers to cover gains on our open derivative instruments. Changes in commodity prices could have a significant impact on cash deposit requirements under our broker and counterparty agreements. Additionally, certain of our derivative contracts contain credit risk related contingent features, which would require us to post additional cash collateral to cover net losses on open derivative instruments if our credit rating was downgraded. As of July 29, 2012, the net liability position of our open derivative instruments that are subject to credit risk related contingent features was not material.  

We are exposed to losses in the event of nonperformance or nonpayment by counterparties under financial instruments. Although our counterparties primarily consist of financial institutions that are investment grade, there is still a possibility that one or more of these companies could default. However, a majority of our financial instruments are exchange traded futures contracts held with brokers and counterparties with whom we maintain margin accounts that are settled on a daily basis, thereby limiting our credit exposure to non-exchange traded derivatives. Determination of the credit quality of our counterparties is based upon a number of factors, including credit ratings and our evaluation of their financial condition. As of July 29, 2012, we had credit exposure of $39.7 million on non-exchange traded derivative contracts, excluding the effects of netting arrangements. As a result of netting arrangements, our credit exposure was reduced to $33.7 million as of July 29, 2012. No significant concentrations of credit risk existed as of July 29, 2012. 

The size and mix of our derivative portfolio varies from time to time based upon our analysis of current and future market conditions. All derivative contracts are recorded in prepaid expenses and other current assets or accrued expenses and other current liabilities within the consolidated condensed balance sheets, as appropriate.

The following table presents the fair values of our open derivative financial instruments in the consolidated condensed balance sheets on a gross basis.

	Assets				Liabilities
	July 29, 2012		April 29, 2012		July 29, 2012		April 29, 2012
	(in millions)				(in millions)
Derivatives using the "hedge accounting" method:
Grain contracts	$	102.6	$	35.3	$	15.3	$	9.6
Livestock contracts	3.6		22.9		5.9		—
Foreign exchange contracts	0.9		1.9		0.7		—
Total	107.1		60.1		21.9		9.6
Derivatives using the "mark-to-market" method:
Grain contracts	21.1		9.1		34.2		1.0
Livestock contracts	2.7		7.4		2.0		7.2
Energy contracts	1.7		—		6.0		12.2
Foreign exchange contracts	0.3		2.4		0.4		0.7
Total	25.8		18.9		42.6		21.1
Total fair value of derivative instruments	$	132.9	$	79.0	$	64.5	$	30.7

Hedge Accounting Method

Cash Flow Hedges 

We enter into derivative instruments, such as futures, swaps and options contracts, to manage our exposure to the variability in expected future cash flows attributable to commodity price risk associated with the forecasted sale of live hogs and fresh pork, and the forecasted purchase of corn and soybean meal. In addition, we enter into interest rate swaps to manage our exposure to changes in interest rates associated with our variable interest rate debt, and we enter into foreign exchange contracts to manage our exposure to the variability in expected future cash flows attributable to changes in foreign exchange rates associated with the forecasted purchase or sale of assets denominated in foreign currencies. As of July 29, 2012, we had no cash flow hedges for forecasted transactions beyond April 2013. 

When cash flow hedge accounting is applied, derivative gains or losses are recognized as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. Derivative gains and losses, when reclassified into earnings, are recorded in cost of sales for grain contracts, sales for lean hog contracts, interest expense for interest rate contracts and selling, general and administrative expenses for foreign exchange contracts. Gains and losses on derivatives designed to hedge price risk associated with fresh pork sales are recorded in the Hog Production segment. 

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments designated in cash flow hedging relationships was as follows:

	Minimum	Maximum	Metric
Commodities:
Corn	30,885,000	56,730,000	Bushels
Soybean meal	303,886	553,854	Tons
Lean hogs	—	421,040,000	Pounds
Foreign currency (1)	39,968,781	69,266,888	U.S. Dollars

——————————————

⁽¹⁾  Amounts represent the U.S. dollar equivalent of various foreign currency contracts.

The following table presents the effects on our consolidated condensed financial statements of pre-tax gains and losses on derivative instruments designated in cash flow hedging relationships for the fiscal periods indicated:

	Gains (Losses) Recognized in Other Comprehensive Income (Loss) on Derivative (Effective Portion)						Gains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings (Effective Portion)						Gains (Losses) Recognized in Earnings on Derivative (Ineffective Portion)
	Three Months Ended						Three Months Ended						Three Months Ended
	July 29, 2012			July 31, 2011			July 29, 2012			July 31, 2011			July 29, 2012		July 31, 2011
	(in millions)						(in millions)						(in millions)
Commodity contracts:
Grain contracts	$	133.9		$	(14.0	)	$	2.7		$	43.8		$	2.7	$	(0.1	)
Lean hog contracts	0.3			8.0			32.2			(1.7		)	0.1		(0.1		)
Interest rate contracts	—			—			—			(1.8		)	—		—
Foreign exchange contracts	(1.8		)	0.3			(0.2		)	0.2			—		—
Total	$	132.4		$	(5.7	)	$	34.7		$	40.5		$	2.8	$	(0.2	)

For the fiscal periods presented, foreign exchange contracts were determined to be highly effective. We have excluded from the assessment of effectiveness differences between spot and forward rates, which we have determined to be immaterial. 

During the first quarter of fiscal 2012, we discontinued cash flow hedge accounting on a number of grain contracts as it became probable that the original forecasted transactions would not transpire. As a result of this change, the table above for the three months ended July 31, 2011 includes gains of $12.0 million on grain contracts de-designated from hedging relationships that were reclassified from accumulated other comprehensive loss into earnings in the first quarter of fiscal 2012.

As of July 29, 2012, there were deferred net gains of $110.4 million, net of tax of $70.2 million, in accumulated other comprehensive loss. We expect to reclassify $82.0 million ($50.1 million net of tax) of deferred net gains on closed commodity contracts into earnings within the next twelve months. We are unable to estimate the gains or losses to be reclassified into earnings within the next twelve months related to open contracts as their values are subject to change. 

Fair Value Hedges 

We enter into derivative instruments (primarily futures contracts) that are designed to hedge changes in the fair value of live hog inventories and firm commitments to buy grains. When fair value hedge accounting is applied, derivative gains and losses are recognized in earnings currently along with the change in fair value of the hedged item attributable to the risk being hedged. The gains or losses on the derivative instruments and the offsetting losses or gains on the related hedged items are recorded in cost of sales for commodity contracts.

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments designated in fair value hedging relationships was as follows:

	Minimum	Maximum	Metric
Commodities:
Lean hogs	—	286,800,000	Pounds
Corn	3,015,000	12,975,000	Bushels

The following table presents the effects on our consolidated condensed statements of income of gains and losses on derivative instruments designated in fair value hedging relationships and the related hedged items for the fiscal periods indicated:

	Gains (Losses) Recognized in Earnings on Derivative					Gains (Losses) Recognized in Earnings on Related Hedged Item
	Three Months Ended					Three Months Ended
	July 29, 2012			July 31, 2011		July 29, 2012		July 31, 2011
	(in millions)					(in millions)
Commodity contracts	$	(26.4	)	$	9.7	$	20.3	$	(3.6	)

We recognized gains of $3.4 million and $5.9 million for the three months ended July 29, 2012 and July 31, 2011, respectively, on closed commodity derivative contracts as the underlying cash transactions affected earnings. 

For fair value hedges of inventory, we elect to exclude from the assessment of effectiveness differences between the spot and futures prices. These differences are recorded directly into earnings as they occur. These differences resulted in losses of $6.3 million and gains of $5.7 million for the three months ended July 29, 2012 and July 31, 2011, respectively.

Mark-to-Market Method

Derivative instruments that are not designated as a hedge, have been de-designated from a hedging relationship, or do not meet the criteria for hedge accounting are marked-to-market with the unrealized gains and losses together with actual realized gains and losses from closed contracts being recognized in current period earnings. Under the mark-to-market method, gains and losses are recorded in cost of sales for commodity contracts, and selling, general and administrative expenses for foreign exchange contracts.

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments using the “mark-to-market” method was as follows:

	Minimum	Maximum	Metric
Commodities:
Lean hogs	320,000	94,800,000	Pounds
Corn	4,825,000	22,960,000	Bushels
Soybean meal	40,314	105,102	Tons
Soybeans	235,000	695,000	Bushels
Wheat	—	2,000,000	Bushels
Natural gas	10,580,000	11,030,000	Million BTU
Diesel	—	2,016,000	Gallons
Crude oil	18,000	31,000	Barrels
Foreign currency (1)	43,255,205	100,186,869	U.S. Dollars

——————————————

⁽¹⁾  Amounts represent the U.S. dollar equivalent of various foreign currency contracts.

The following table presents the amount of gains and losses recognized in the consolidated condensed statements of income on derivative instruments using the “mark-to-market” method by type of derivative contract for the fiscal periods indicated:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Commodity contracts	$	(8.2	)	$	20.8
Foreign exchange contracts	4.6			1.3
Total	$	(3.6	)	$	22.1

The table above reflects gains and losses from both open and closed contracts including, among other things, gains and losses related to contracts designed to hedge price movements that occur entirely within a quarter. The table includes amounts for both realized and unrealized gains and losses. The table is not, therefore, a simple representation of unrealized gains and losses recognized in the income statement during any period presented.

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PENSION PLANS (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract]
Service cost	$ 11.8	$ 9.3
Interest cost	18.7	19.0
Expected return on plan assets	(19.7)	(19.9)
Net amortization	13.2	5.9
Pension expense	$ 24.0	$ 14.3

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DERIVATIVE FINANCIAL INSTRUMENTS Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Derivative [Line Items]
Derivative, Collateral, Right to Reclaim Cash	$ 72.5
Derivative, Collateral, Obligation to Return Cash	70.9
Credit Exposure on Non-Exchange Traded Derivative Contracts, Excluding the Effects of Netting Arrangements	39.7
Credit Exposure on Non-Exhange Traded Derivative Contracts, Including the Effects of Netting Arrangements	33.7
Gain (Loss) Recognized in Income as a Result of Cash Flow Hedge De-Designation		12.0
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax	110.4
Tax On Deferred Gains (Losses) in Accumulated Other Comprehensive Income (Loss)	70.2
Gains (Losses) Recognized on Closed Commodity Derivative Contracts As the Underlying Cash Transactions Affected Earnings	3.4	5.9
Gains (Losses) on Derivative Contracts Representing the Differences Between Spot and Futures Prices Which are Excluded from the Assessment of Effectiveness and Recorded Directly Into Earnings	(6.3)	5.7
Scenario, Forecast [Member] | Commodity Contract [Member]
Derivative [Line Items]
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months	82.0
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months, Net of Tax	$ 50.1

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INVENTORIES (Details) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012	Apr. 29, 2012
Inventory [Line Items]
Livestock	$ 1,015.4	$ 962.8
Fresh and packaged meats	924.2	912.1
Grains	107.9	90.4
Manufacturing supplies	53.3	59.1
Other	51.9	48.0
Total inventories	$ 2,152.7	$ 2,072.4

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SHAREHOLDERS' EQUITY Share Repurchase Program (Details) (USD $) In Millions, except Share data, unless otherwise specified	1 Months Ended		3 Months Ended		12 Months Ended	15 Months Ended
	Jul. 31, 2012	Jun. 30, 2012	Jul. 29, 2012	Jul. 31, 2011	Apr. 29, 2012	Aug. 31, 2012
Equity, Class of Treasury Stock [Line Items]
Stock Repurchase Program, Authorized Amount		$ 250.0			$ 250.0
Stock Repurchase Program, Increase to Authorized Amount	100.0
Stock Repurchase Program, Period in Force		24 months
Stock Repurchased During Period, Shares			7,421,231			17,448,215
Repurchase of common stock			$ 145.3	$ 34.1		$ 350.6
Stock Repurchased During Period, Average Price Per Share						$ 20.07

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DERIVATIVE FINANCIAL INSTRUMENTS Fair Value (Details) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012	Apr. 29, 2012
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	$ 132.9	$ 79.0
Derivative Liability, Fair Value, Gross Liability	64.5	30.7
Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	107.1	60.1
Derivative Liability, Fair Value, Gross Liability	21.9	9.6
Not Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	25.8	18.9
Derivative Liability, Fair Value, Gross Liability	42.6	21.1
Grain Contracts [Member] | Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	102.6	35.3
Derivative Liability, Fair Value, Gross Liability	15.3	9.6
Grain Contracts [Member] | Not Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	21.1	9.1
Derivative Liability, Fair Value, Gross Liability	34.2	1.0
Livestock Contracts [Member] | Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	3.6	22.9
Derivative Liability, Fair Value, Gross Liability	5.9	0
Livestock Contracts [Member] | Not Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	2.7	7.4
Derivative Liability, Fair Value, Gross Liability	2.0	7.2
Energy Contracts [Member] | Not Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	1.7	0
Derivative Liability, Fair Value, Gross Liability	6.0	12.2
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	0.9	1.9
Derivative Liability, Fair Value, Gross Liability	0.7	0
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	0.3	2.4
Derivative Liability, Fair Value, Gross Liability	$ 0.4	$ 0.7

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DERIVATIVE FINANCIAL INSTRUMENTS Notional Amounts (Details) (USD $)	3 Months Ended
	Jul. 29, 2012 bu
Cash Flow Hedging [Member] | Corn, in Bushels [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	30,885,000
Maximum Notional Volumes, Other Units	56,730,000
Cash Flow Hedging [Member] | Soybean Meal, in Tons [Member]
Derivative [Line Items]
Minimum Notional Volumes, Mass	303,886
Maximum Notional Volumes, Mass	553,854
Cash Flow Hedging [Member] | Lean Hogs, in Pounds [Member]
Derivative [Line Items]
Minimum Notional Volumes, Mass	0
Maximum Notional Volumes, Mass	421,040,000
Cash Flow Hedging [Member] | Foreign Exchange Contract [Member]
Derivative [Line Items]
Minimum Notional Volumes, Monetary	39,968,781
Maximum Notional Volumes, Monetary	69,266,888
Fair Value Hedging [Member] | Corn, in Bushels [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	3,015,000
Maximum Notional Volumes, Other Units	12,975,000
Fair Value Hedging [Member] | Lean Hogs, in Pounds [Member]
Derivative [Line Items]
Minimum Notional Volumes, Mass	0
Maximum Notional Volumes, Mass	286,800,000
Not Designated as Hedging Instrument [Member] | Corn, in Bushels [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	4,825,000
Maximum Notional Volumes, Other Units	22,960,000
Not Designated as Hedging Instrument [Member] | Soybean Meal, in Tons [Member]
Derivative [Line Items]
Minimum Notional Volumes, Mass	40,314
Maximum Notional Volumes, Mass	105,102
Not Designated as Hedging Instrument [Member] | Lean Hogs, in Pounds [Member]
Derivative [Line Items]
Minimum Notional Volumes, Mass	320,000
Maximum Notional Volumes, Mass	94,800,000
Not Designated as Hedging Instrument [Member] | Soybeans, in Bushels [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	235,000
Maximum Notional Volumes, Other Units	695,000
Not Designated as Hedging Instrument [Member] | Wheat, in Bushels [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	0
Maximum Notional Volumes, Other Units	2,000,000
Not Designated as Hedging Instrument [Member] | Natural Gas, in Million BTU [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	10,580,000
Maximum Notional Volumes, Other Units	11,030,000
Not Designated as Hedging Instrument [Member] | Diesel, in Gallons [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	0
Maximum Notional Volumes, Other Units	2,016,000
Not Designated as Hedging Instrument [Member] | Crude Oil, in Barrels [Member]
Derivative [Line Items]
Minimum Notional Volumes, Other Units	18,000
Maximum Notional Volumes, Other Units	31,000
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member]
Derivative [Line Items]
Minimum Notional Volumes, Monetary	43,255,205
Maximum Notional Volumes, Monetary	100,186,869

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INVENTORIES

3 Months Ended

Jul. 29, 2012

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

Inventories consist of the following:

	July 29, 2012		April 29, 2012
	(in millions)
Livestock	$	1,015.4	$	962.8
Fresh and packaged meats	924.2		912.1
Grains	107.9		90.4
Manufacturing supplies	53.3		59.1
Other	51.9		48.0
Total inventories	$	2,152.7	$	2,072.4

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DERIVATIVE FINANCIAL INSTRUMENTS Pretax Impact of Cash Flow Hedges on the Consolidated Condensed Statements of Income (Details) (Cash Flow Hedging [Member], USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net	$ 132.4	$ (5.7)
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	34.7	40.5
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net	2.8	(0.2)
Grain Contracts [Member] | Cost of Sales [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net	133.9	(14.0)
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	2.7	43.8
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net	2.7	(0.1)
Lean Hog Contracts [Member] | Sales [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net	0.3	8.0
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	32.2	(1.7)
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net	0.1	(0.1)
Interest Rate Swap [Member] | Interest Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net	0	0
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	0	(1.8)
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net	0	0
Foreign Exchange Contract [Member] | Operating Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net	(1.8)	0.3
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	(0.2)	0.2
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net	$ 0	$ 0

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DEBT Working Capital Facilities (Details) (USD $)	Jul. 29, 2012
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 1,300,000,000
Line of Credit Facility, Remaining Borrowing Capacity	1,100,000,000
Inventory Revolver [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	925,000,000
Securitization Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	275,000,000
Accounts Receivable Held By SPV	408,100,000
Line of Credit Facility, Amount Outstanding	0
International Credit Facilities [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 99,000,000

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CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Sales	$ 3,091.3	$ 3,094.2
Cost of sales	2,759.1	2,687.1
Gross profit	332.2	407.1
Selling, general and administrative expenses	201.1	238.7
Income from equity method investments	(0.7)	(4.8)
Operating profit	131.8	173.2
Interest expense	42.5	48.1
Loss on debt extinguishment	0	1.2
Income before income taxes	89.3	123.9
Income tax expense	27.6	41.8
Net income	$ 61.7	$ 82.1
Net income per share:
Basic (in dollars per share)	$ 0.40	$ 0.50
Diluted (in dollars per share)	$ 0.40	$ 0.49
Weighted average shares outstanding:
Basic (in shares)	154.3	165.8
Effect of dilutive shares (in shares)	1.0	1.2
Diluted (in shares)	155.3	167.0

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SHAREHOLDERS' EQUITY Share Based Compensation (Narrative) (Details)	3 Months Ended	12 Months Ended
	Jul. 29, 2012	Apr. 29, 2012
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period	18,107	87,262
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period	314,373	417,288

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CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Cash flows from operating activities:
Net income	$ 61.7	$ 82.1
Adjustments to reconcile net cash flows from operating activities:
Depreciation and amortization	58.8	61.5
Loss (gain) on sale of property, plant and equipment, including breeding stock	3.9	(10.5)
Income from equity method investments	(0.7)	(4.8)
Pension expense	24.0	14.3
Pension contributions	(8.6)	(108.2)
Changes in operating assets and liabilities and other, net	(71.8)	(98.6)
Net cash flows from operating activities	67.3	(64.2)
Cash flows from investing activities:
Capital expenditures	(61.2)	(62.9)
Net (expenditures) proceeds from breeding stock transactions	(6.5)	2.6
Proceeds from the sale of property, plant and equipment	6.5	1.3
Net cash flows from investing activities	(61.2)	(59.0)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	24.2	0
Principal payments on long-term debt and capital lease obligations	(4.2)	(81.1)
Net proceeds on revolving credit facilities and notes payable	6.5	23.8
Repurchase of common stock	(145.3)	(34.1)
Debt issuance costs and other	0.2	(8.8)
Net cash flows from financing activities	(118.6)	(100.2)
Effect of foreign exchange rate changes on cash	(3.7)	(1.4)
Net change in cash and cash equivalents	(116.2)	(224.8)
Cash and cash equivalents at beginning of period	324.3	374.7
Cash and cash equivalents at end of period	$ 208.1	$ 149.9

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INVESTMENTS Narrative (Details) (Campofrio Food Group [Member])	3 Months Ended	12 Months Ended
	Jul. 29, 2012	Jul. 29, 2012 USD ($)	Jul. 29, 2012 EUR (€)
Schedule of Equity Method Investments [Line Items]
Equity Method Investment, Shares Owned	37,811,302	37,811,302	37,811,302
Ownership Percentage	37.00%	37.00%	37.00%
Average Daily Trading Volume as a Percentage of Total Number of Shares Outstanding for Equity Mehod Investment	0.01%
Average Daily Trading Volume of Equity Method Investment's Stock	10,586
Total Number of Shares Outstanding for Equity Method Investment	102,000,000	102,000,000	102,000,000
High Market Value Per Share in Euros			€ 7.20
High Market Value Per Share, in USD		$ 9.47
Low Market Value Per Share in Euros			€ 5.28
Low Market Value Per Share in USD		$ 7.35

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DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Jul. 29, 2012

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

The following table presents the fair values of our open derivative financial instruments in the consolidated condensed balance sheets on a gross basis.

	Assets				Liabilities
	July 29, 2012		April 29, 2012		July 29, 2012		April 29, 2012
	(in millions)				(in millions)
Derivatives using the "hedge accounting" method:
Grain contracts	$	102.6	$	35.3	$	15.3	$	9.6
Livestock contracts	3.6		22.9		5.9		—
Foreign exchange contracts	0.9		1.9		0.7		—
Total	107.1		60.1		21.9		9.6
Derivatives using the "mark-to-market" method:
Grain contracts	21.1		9.1		34.2		1.0
Livestock contracts	2.7		7.4		2.0		7.2
Energy contracts	1.7		—		6.0		12.2
Foreign exchange contracts	0.3		2.4		0.4		0.7
Total	25.8		18.9		42.6		21.1
Total fair value of derivative instruments	$	132.9	$	79.0	$	64.5	$	30.7

Cash Flow Hedging [Member]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments designated in cash flow hedging relationships was as follows:

	Minimum	Maximum	Metric
Commodities:
Corn	30,885,000	56,730,000	Bushels
Soybean meal	303,886	553,854	Tons
Lean hogs	—	421,040,000	Pounds
Foreign currency (1)	39,968,781	69,266,888	U.S. Dollars

——————————————

⁽¹⁾  Amounts represent the U.S. dollar equivalent of various foreign currency contracts.

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]

The following table presents the effects on our consolidated condensed financial statements of pre-tax gains and losses on derivative instruments designated in cash flow hedging relationships for the fiscal periods indicated:

	Gains (Losses) Recognized in Other Comprehensive Income (Loss) on Derivative (Effective Portion)						Gains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings (Effective Portion)						Gains (Losses) Recognized in Earnings on Derivative (Ineffective Portion)
	Three Months Ended						Three Months Ended						Three Months Ended
	July 29, 2012			July 31, 2011			July 29, 2012			July 31, 2011			July 29, 2012		July 31, 2011
	(in millions)						(in millions)						(in millions)
Commodity contracts:
Grain contracts	$	133.9		$	(14.0	)	$	2.7		$	43.8		$	2.7	$	(0.1	)
Lean hog contracts	0.3			8.0			32.2			(1.7		)	0.1		(0.1		)
Interest rate contracts	—			—			—			(1.8		)	—		—
Foreign exchange contracts	(1.8		)	0.3			(0.2		)	0.2			—		—
Total	$	132.4		$	(5.7	)	$	34.7		$	40.5		$	2.8	$	(0.2	)

For the fiscal periods presented, foreign exchange contracts were determined to be highly effective. We have excluded from the assessment of effectiveness differences between spot and forward rates, which we have determined to be immaterial.

Fair Value Hedging [Member]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments designated in fair value hedging relationships was as follows:

	Minimum	Maximum	Metric
Commodities:
Lean hogs	—	286,800,000	Pounds
Corn	3,015,000	12,975,000	Bushels

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]

The following table presents the effects on our consolidated condensed statements of income of gains and losses on derivative instruments designated in fair value hedging relationships and the related hedged items for the fiscal periods indicated:

	Gains (Losses) Recognized in Earnings on Derivative					Gains (Losses) Recognized in Earnings on Related Hedged Item
	Three Months Ended					Three Months Ended
	July 29, 2012			July 31, 2011		July 29, 2012		July 31, 2011
	(in millions)					(in millions)
Commodity contracts	$	(26.4	)	$	9.7	$	20.3	$	(3.6	)

We recognized gains of $3.4 million and $5.9 million for the three months ended July 29, 2012 and July 31, 2011, respectively, on closed commodity derivative contracts as the underlying cash transactions affected earnings. 

For fair value hedges of inventory, we elect to exclude from the assessment of effectiveness differences between the spot and futures prices. These differences are recorded directly into earnings as they occur. These differences resulted in losses of $6.3 million and gains of $5.7 million for the three months ended July 29, 2012 and July 31, 2011, respectively.

Not Designated as Hedging Instrument [Member]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

During the three months ended July 29, 2012, the range of notional volumes associated with open derivative instruments using the “mark-to-market” method was as follows:

	Minimum	Maximum	Metric
Commodities:
Lean hogs	320,000	94,800,000	Pounds
Corn	4,825,000	22,960,000	Bushels
Soybean meal	40,314	105,102	Tons
Soybeans	235,000	695,000	Bushels
Wheat	—	2,000,000	Bushels
Natural gas	10,580,000	11,030,000	Million BTU
Diesel	—	2,016,000	Gallons
Crude oil	18,000	31,000	Barrels
Foreign currency (1)	43,255,205	100,186,869	U.S. Dollars

——————————————

⁽¹⁾  Amounts represent the U.S. dollar equivalent of various foreign currency contracts.

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]

The following table presents the amount of gains and losses recognized in the consolidated condensed statements of income on derivative instruments using the “mark-to-market” method by type of derivative contract for the fiscal periods indicated:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Commodity contracts	$	(8.2	)	$	20.8
Foreign exchange contracts	4.6			1.3
Total	$	(3.6	)	$	22.1

The table above reflects gains and losses from both open and closed contracts including, among other things, gains and losses related to contracts designed to hedge price movements that occur entirely within a quarter. The table includes amounts for both realized and unrealized gains and losses. The table is not, therefore, a simple representation of unrealized gains and losses recognized in the income statement during any period presented.

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INVESTMENTS CFG Stock Prices (Details) (Campofrio Food Group [Member], EUR €)	Aug. 23, 2012	Jul. 29, 2012	Feb. 17, 2012
Campofrio Food Group [Member]
Schedule of Equity Method Investments [Line Items]
Equtiy Method Investment, Market Value Per Share in Euros	€ 6.20	€ 5.85	€ 7.20
Equity Method Investment, Carrying Value Per Share in Euros	€ 7.80	€ 7.89	€ 7.54

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PENSION PLANS (Tables)

3 Months Ended

Jul. 29, 2012

Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract]

Schedule of Net Benefit Costs [Table Text Block]

The components of net periodic pension cost consist of:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Service cost	$	11.8		$	9.3
Interest cost	18.7			19.0
Expected return on plan assets	(19.7		)	(19.9		)
Net amortization	13.2			5.9
Net periodic pension cost	$	24.0		$	14.3

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Jul. 29, 2012

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. You should read these statements in conjunction with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. The information reflects all normal recurring adjustments which we believe are necessary to present fairly the financial position and results of operations for all periods included.

Smithfield Foods, Inc., together with its subsidiaries (the “Company,” “we,” “us” or “our”), is the largest hog producer and pork processor in the world. We produce and market a wide variety of fresh meat and packaged meats products both domestically and internationally. We conduct our operations through four reportable segments: Pork, Hog Production, International and Corporate, each of which is comprised of a number of subsidiaries, joint ventures and other investments.

The three months ended July 29, 2012 correspond to the first quarter of fiscal 2013 and the three months ended July 31, 2011 correspond to the first quarter of fiscal 2012.

Net Income per Share

We present dual computations of net income per share. The basic computation is based on weighted average common shares outstanding during the period. The diluted computation reflects the potentially dilutive effect of common stock equivalents, such as stock options and convertible notes, during the period. We excluded stock options for approximately 2.1 million and 1.7 million shares for the three months ended July 29, 2012 and July 31, 2011, respectively, from the diluted computation because their effect would have been anti-dilutive.

Recently Issued Accounting Pronouncements

In July 2012, the Financial Accounting Standards Board (FASB) issued new accounting guidance on testing indefinite-lived intangible assets for impairment. The new guidance provides an entity the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount. If it is not, no further analysis is required. If it is, the previously prescribed test is required. The new guidance is effective for fiscal years beginning after September 15, 2012 with early adoption permitted. The adoption of this guidance is not expected to impact our consolidated condensed financial statements.

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CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Net income	$ 61.7	$ 82.1
Other comprehensive income (loss):
Foreign currency translation	(84.1)	(44.3)
Pension accounting	8.2	3.5
Hedge accounting	59.2	(28.1)
Total other comprehensive loss	(16.7)	(68.9)
Total comprehensive income	$ 45.0	$ 13.2

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CONTINGENCIES

3 Months Ended

Jul. 29, 2012

Loss Contingency [Abstract]

CONTINGENCIES

CONTINGENCIES

Litigation

Other than the following matters, there have been no significant developments regarding litigation disclosed in Note 16 of our Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012, nor have any significant new matters arisen during the three months ended July 29, 2012.

Missouri Litigation

Premium Standard Farms, Inc. (PSF), the Company and certain of our other subsidiaries are parties to litigation in Missouri involving a number of claims alleging that hog farms owned or under contract with the defendants interfered with the plaintiffs' use and enjoyment of their properties.

During fiscal 2012 and continuing in fiscal 2013, we engaged in global settlement negotiations with counsel representing nearly all of the plaintiffs in the nuisance litigation and numerous carriers of commercial general liability and pollution liability policies. The parties to the litigation have reached an agreement and consummated a global settlement that resolves substantially all of the nuisance litigation. Pursuant to the agreement, all pending cases previously disclosed, with one minor exception, will be dismissed with prejudice. In addition, we have agreements with the insurance carriers under which we receive payments that we contribute to pay a portion of the settlement, most of which were contingent on the consummation of the global settlement.

Our policy for establishing accruals and disclosures for contingent liabilities is contained in Note 1—Summary of Significant Accounting Policies in our Annual Report on Form 10-K for the fiscal year ended April 29, 2012. We established an accrual with respect to the Missouri nuisance suits on the opening balance sheet for our acquisition of PSF in fiscal 2008 and we have periodically adjusted that accrual as developments have occurred. The accrual, as adjusted from time to time, represents our best estimate of the probable loss for these suits.

The global settlement, which was consummated after the end of the first quarter of fiscal 2013, is not materially different than the accrual we maintained for the settled litigation and, therefore, will not materially affect our profits or losses in future periods. Payments made by us under the global settlement and payments we receive from the insurance carriers will impact our cash flows for future periods; however, such impact is not expected to be material to our overall financial position or liquidity.

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DOCUMENT AND ENTITY INFORMATION	3 Months Ended
	Jul. 29, 2012	Aug. 31, 2012
Entity Information [Line Items]
Entity Registrant Name	SMITHFIELD FOODS INC
Entity Central Index Key	0000091388
Current Fiscal Year End Date	--04-28
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jul. 29, 2012
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		149,479,148

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REPORTABLE SEGMENT

3 Months Ended

Jul. 29, 2012

Segment Reporting [Abstract]

REPORTABLE SEGMENTS

REPORTABLE SEGMENTS

We conduct our operations through four reportable segments: Pork, Hog Production, International and Corporate, each of which is comprised of a number of subsidiaries, joint ventures and other investments. The Pork segment consists mainly of our three wholly-owned U.S. fresh pork and packaged meats subsidiaries. The Hog Production segment consists of our hog production operations located in the U.S. The International segment is comprised mainly of our meat processing and distribution operations in Poland, Romania and the United Kingdom, our interests in meat processing operations, mainly in Western Europe and Mexico, our hog production operations located in Poland and Romania and our interests in hog production operations in Mexico. The Corporate segment provides management and administrative services to support our other segments.

The following table presents sales and operating profit (loss) by segment for the fiscal periods indicated:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Sales:
Segment sales—
Pork	$	2,599.6		$	2,597.3
Hog Production	728.8			749.8
International	346.8			375.0
Total segment sales	3,675.2			3,722.1
Intersegment sales—
Pork	(8.4		)	(9.4		)
Hog Production	(567.3		)	(611.6		)
International	(8.2		)	(6.9		)
Total intersegment sales	(583.9		)	(627.9		)
Consolidated sales	$	3,091.3		$	3,094.2
Operating profit (loss):
Pork	$	118.6		$	136.7
Hog Production	23.1			69.7
International	15.8			—
Corporate	(25.7		)	(33.2		)
Consolidated operating profit	$	131.8		$	173.2

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CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012	Apr. 29, 2012
Current assets:
Cash and cash equivalents	$ 208.1	$ 324.3
Accounts receivable, net	625.3	624.7
Inventories	2,152.7	2,072.4
Prepaid expenses and other current assets	343.2	277.6
Total current assets	3,329.3	3,299.0
Property, plant and equipment, net	2,233.8	2,277.2
Goodwill	759.3	768.2
Investments	502.4	522.6
Intangible assets, net	380.7	381.8
Other assets	166.8	173.4
Total assets	7,372.3	7,422.2
Current liabilities:
Current portion of long-term debt and capital lease obligations	616.2	63.5
Accounts payable	397.9	415.8
Accrued expenses and other current liabilities	651.0	657.0
Total current liabilities	1,665.1	1,136.3
Long-term debt and capital lease obligations	1,372.9	1,900.9
Other liabilities	1,041.1	995.0
Redeemable noncontrolling interests	2.0	2.0
Commitments and contingencies
Shareholders' equity:
Preferred stock, $1.00 par value, 1,000,000 authorized shares	0	0
Common stock, $.50 par value, 500,000,000 authorized shares; 150,319,326 and 157,408,077 issued and outstanding	75.2	78.7
Additional paid-in capital	1,491.3	1,561.0
Stock held in trust	(68.1)	(67.9)
Retained earnings	2,320.0	2,326.4
Accumulated other comprehensive loss	(527.6)	(510.9)
Total shareholders’ equity	3,290.8	3,387.3
Noncontrolling interests	0.4	0.7
Total equity	3,291.2	3,388.0
Total liabilities and equity	$ 7,372.3	$ 7,422.2

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GUARANTEES

3 Months Ended

Jul. 29, 2012

Guarantees [Abstract]

GUARANTEES

GUARANTEES

As part of our business, we are a party to various financial guarantees and other commitments as described below. These arrangements involve elements of performance and credit risk that are not included in the consolidated condensed balance sheets. We could become liable in connection with these obligations depending on the performance of the guaranteed party or the occurrence of future events that we are unable to predict. If we consider it probable that we will become responsible for an obligation, we will record the liability on our consolidated balance sheet. 

We (together with our joint venture partners) guarantee debt borrowed by Agroindustrial del Noroeste (Norson), an unconsolidated joint venture, of up to $87.0 million, of which $62.0 million was outstanding as of July 29, 2012. The covenants in the guarantee relating to Norson’s debt incorporate our covenants under the Inventory Revolver. In addition, we continue to guarantee $11.1 million of leases that were transferred to JBS S.A. in connection with the sale of Smithfield Beef, Inc. Some of these lease guarantees may be released in the near future and others may remain in place until the leases expire through February 2022.

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DEBT

3 Months Ended

Jul. 29, 2012

Debt Disclosure [Abstract]

DEBT

DEBT

In the first quarter of fiscal 2013, we reclassified our outstanding 7.75% senior unsecured notes due May 2013 totaling $160.0 million (2013 Notes) and our outstanding 4% senior unsecured convertible notes due June 2013 totaling $378.7 million, net of unamortized discounts of $21.3 million, from long-term debt and capital lease obligations to current portion of long-term debt and capital lease obligations on the consolidated condensed balance sheet.

Working Capital Facilities

As of July 29, 2012, we had aggregate credit facilities and credit lines totaling $1.3 billion, including an inventory-based revolving credit facility totaling $925.0 million (the Inventory Revolver), an accounts receivable securitization facility totaling $275.0 million (the Securitization Facility) and international credit facilities totaling $99.0 million. Our unused capacity under these credit facilities and credit lines was $1.1 billion.

As part of the Securitization Facility agreement, all accounts receivable of our major Pork segment subsidiaries are sold to a wholly-owned “bankruptcy remote” special purpose vehicle (SPV). The SPV pledges the receivables as security for loans and letters of credit. The SPV is included in our consolidated financial statements and therefore, the accounts receivable owned by it are included in our consolidated balance sheet. However, the accounts receivable owned by the SPV are separate and distinct from our other assets and are not available to our other creditors should we become insolvent. As of July 29, 2012, the SPV held $408.1 million of accounts receivable and we had no outstanding borrowings on the Securitization Facility.

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INVESTMENTS (Tables)

3 Months Ended

Jul. 29, 2012

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Equity Method Investments [Table Text Block]

Investments consist of the following:

Equity Investment	% Owned	July 29, 2012		April 29, 2012
		(in millions)
Campofrío Food Group (CFG)	37%	$	367.6	$	385.2
Mexican joint ventures	50%	108.3		111.2
Other	Various	26.5		26.2
Total investments		$	502.4	$	522.6

Per Share Price for Equtiy Method Investment [Table Text Block]

The table below shows CFG's intra-day high share price and Smithfield's carrying value, expressed in euro per share, on various dates relevant to our disclosures.

Date	Share Price		Carrying Value
February 17, 2012	€	7.20	€	7.54
July 29, 2012 (1)	€	5.85	€	7.89
August 23, 2012	€	6.20	€	7.80

——————————————

⁽¹⁾  Share prices on quarter end date reflect the last trading day in the quarter.

Schedule of Equity in (Income) Loss of Equity Method Investments [Table Text Block]

consists of the following:

		Three Months Ended
Equity Investment	Segment	July 29, 2012			July 31, 2011
		(in millions)
CFG (1)	International	$	(0.1	)	$	(0.2	)
Mexican joint ventures	International	0.4			(3.0		)
All other equity method investments	Various	(1.0		)	(1.6		)
Income from equity method investments		$	(0.7	)	$	(4.8	)

——————————————

⁽¹⁾  CFG prepares its financial statements in accordance with International Financial Reporting Standards. Our share of CFG’s results reflects U.S. GAAP adjustments and thus, there may be differences between the amounts we report for CFG and the amounts reported by CFG.

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SUBSEQUENT EVENTS

3 Months Ended

Jul. 29, 2012

Subsequent Events [Abstract]

Subsequent Events [Text Block]

SUBSEQUENT EVENTS

Debt Refinancing

In July 2012 (fiscal 2013), we initiated an underwritten public offering to issue $1.0 billion aggregate principal amount of 6.625% senior unsecured notes due August 2022 (2022 Notes). We received net proceeds of $981.2 million, after underwriting discounts and commissions and offering expenses, upon settlement of the 2022 Notes in August 2012 (fiscal 2013).

In conjunction with the issuance of the 2022 Notes, we commenced a tender offer to purchase any and all of our 2013 Notes and any and all of our outstanding 10% senior secured notes due July 2014 (2014 Notes) (the July 2012 Tender Offer). The July 2012 Tender Offer expired in August 2012. As a result of the July 2012 Tender Offer, we paid $649.4 million to repurchase 2013 Notes and 2014 Notes with face values of $105.0 million and $456.6 million, respectively. Also in August 2012 (fiscal 2013), we exercised the redemption feature available under our 2014 Notes and paid $155.5 million to repurchase the remaining $132.8 million of our 2014 Notes. Net proceeds from the issuance of the 2022 Notes were used to make all of the repurchases of the 2013 Notes and 2014 Notes. As a result of these repurchases, we will recognize losses on debt extinguishment of approximately $121 million in the second quarter of fiscal 2013, including the write-off of related unamortized discounts, premiums and debt issuance costs.

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SHAREHOLDERS' EQUITY

3 Months Ended

Jul. 29, 2012

Stockholders' Equity Note [Abstract]

SHAREHOLDERS' EQUITY

SHAREHOLDERS’ EQUITY 

Share Repurchase Program

In June 2012 (fiscal 2013), we announced that our board of directors had approved a new share repurchase program authorizing us to buy up to $250.0 million of our common stock over the next 24 months in addition to the $250.0 million authorized during fiscal 2012 (Share Repurchase Program). In July 2012 (fiscal 2013), our board of directors approved an increase of $100.0 million to the authorized amount under the Share Repurchase Program. Share repurchases may be made on the open market, or in privately negotiated transactions. The number of shares repurchased, and the timing of any buybacks, will depend on corporate cash balances, business and economic conditions, and other factors, including investment opportunities. The program may be discontinued at any time.

During the three months ended July 29, 2012, we repurchased 7,421,231 shares of our common stock for $145.3 million, including related fees. The price of the repurchased shares has been allocated between common stock, additional paid-in capital and retained earnings in our consolidated condensed balance sheet in accordance with applicable accounting guidance.

Since the inception of the Share Repurchase Program in June 2011 (fiscal 2012) and through August 31, 2012, we have repurchased 17,448,215 shares of our common stock for $350.6 million, including related fees, at an average price of $20.07. All share repurchases were funded from cash on hand.

Stock Options and Performance Share Units

During the three months ended July 29, 2012, we issued 18,107 shares of common stock upon the exercise of stock options and 314,373 shares of common stock for vested performance share units. In fiscal 2012, we issued 87,262 shares of common stock upon exercise of stock options and 417,288 shares of common stock for vested performance share units.

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INCOME TAXES

3 Months Ended

Jul. 29, 2012

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

Our effective tax rate was 31% and 34% for the three months ended July 29, 2012 and July 31, 2011, respectively. The decrease in the effective tax rate is primarily driven by a higher mix of foreign earnings in the current year, which have lower effective tax rates.

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PENSION PLANS

3 Months Ended

Jul. 29, 2012

Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract]

PENSION PLANS

PENSION PLANS

The components of net periodic pension cost consist of:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Service cost	$	11.8		$	9.3
Interest cost	18.7			19.0
Expected return on plan assets	(19.7		)	(19.9		)
Net amortization	13.2			5.9
Net periodic pension cost	$	24.0		$	14.3

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FAIR VALUE MEASUREMENTS

3 Months Ended

Jul. 29, 2012

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We are required to consider and reflect the assumptions of market participants in fair value calculations. These factors include nonperformance risk (the risk that an obligation will not be fulfilled) and credit risk, both of the reporting entity (for liabilities) and of the counterparty (for assets). 

We use, as appropriate, a market approach (generally, data from market transactions), an income approach (generally, present value techniques), and/or a cost approach (generally, replacement cost) to measure the fair value of an asset or liability.  These valuation approaches incorporate inputs, such as observable, independent market data, that management believes are predicated on the assumptions market participants would use to price an asset or liability. These inputs may incorporate, as applicable, certain risks such as nonperformance risk and credit risk. 

The FASB has established a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The fair value hierarchy gives the highest priority to quoted market prices (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of inputs used to measure fair value are as follows: 

▪ Level 1—quoted prices in active markets for identical assets or liabilities accessible by the reporting entity.

▪ Level 2—observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

▪ Level 3—unobservable for an asset or liability. Unobservable inputs should only be used to the extent observable inputs are not available.

We have classified assets and liabilities measured at fair value based on the lowest level of input that is significant to the fair value measurement.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables set forth, by level within the fair value hierarchy, our non-pension financial assets and liabilities that were measured at fair value on a recurring basis as of July 29, 2012 and April 29, 2012:

	July 29, 2012								April 29, 2012
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(in millions)								(in millions)
Assets
Derivatives:
Commodity contracts	$	87.6	$	33.4	$	—	$	121.0	$	52.0	$	1.3	$	—	$	53.3
Foreign exchange contracts	—		1.2		—		1.2		—		4.3		—		4.3
Open-ended mutual funds	11.6		—		—		11.6		12.2		—		—		12.2
Insurance contracts	—		50.9		—		50.9		—		51.3		—		51.3
Total	$	99.2	$	85.5	$	—	$	184.7	$	64.2	$	56.9	$	—	$	121.1
Liabilities
Derivatives:
Commodity contracts	$	51.8	$	0.9	$	—	$	52.7	$	—	$	8.6	$	—	$	8.6
Foreign exchange contracts	—		1.1		—		1.1		—		0.7		—		0.7
Total	$	51.8	$	2.0	$	—	$	53.8	$	—	$	9.3	$	—	$	9.3

The following are descriptions of the valuation methodologies and key inputs used to measure financial assets and liabilities recorded at fair value on a recurring basis:

▪ Derivatives—Derivatives classified within Level 1 are valued using quoted market prices. In some cases where quoted market prices are not available, we value the derivatives using pricing models based on the net present value of estimated future cash flows to calculate fair value, in which case the measurements are classified within Level 2. These valuation models make use of market-based observable inputs, including market prices and rates, yield curves, credit curves, and measures of volatility.

▪ Open-ended mutual funds—Open-ended mutual funds are valued at their net asset value (NAV), which approximates fair value, and classified as Level 1.

▪ Insurance contracts—Insurance contracts are valued at their cash surrender value using the daily asset unit value (AUV) which is based on the quoted market price of the underlying securities and classified within Level 2.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain assets and liabilities are measured at fair value on a nonrecurring basis after initial recognition; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, for example, when there is evidence of impairment. During the three months ended July 29, 2012, we had no significant assets or liabilities that were measured and recorded at fair value on a nonrecurring basis.

Other Financial Instruments

We determine the fair value of public debt using Level 2 inputs based on quoted market prices. The carrying amount of all other debt approximates fair value as those instruments are based on variable interest rates. The following table presents the fair value and carrying value of long-term debt, including the current portion of long-term debt as of July 29, 2012 and April 29, 2012.

	July 29, 2012				April 29, 2012
	Fair Value		Carrying Value		Fair Value		Carrying Value
	(in millions)
Long-term debt, including current portion	$	2,121.7	$	1,962.3	$	2,176.5	$	1,937.3

The carrying amounts of cash and cash equivalents, accounts receivable, notes payable and accounts payable approximate their fair values because of the relatively short-term maturity of these instruments.

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DERIVATIVE FINANCIAL INSTRUMENTS Gains (Losses) Recognized in Earnings on Mark-to-Market Contracts (Details) (Not Designated as Hedging Instrument [Member], USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Income, Net	$ (3.6)	$ 22.1
Commodity Contract [Member] | Cost of Sales [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Income, Net	(8.2)	20.8
Foreign Exchange Contract [Member] | Operating Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Income, Net	$ 4.6	$ 1.3

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INVENTORIES (Tables)

3 Months Ended

Jul. 29, 2012

Inventory Disclosure [Abstract]

Schedule of Inventory, Current [Table Text Block]

Inventories consist of the following:

	July 29, 2012		April 29, 2012
	(in millions)
Livestock	$	1,015.4	$	962.8
Fresh and packaged meats	924.2		912.1
Grains	107.9		90.4
Manufacturing supplies	53.3		59.1
Other	51.9		48.0
Total inventories	$	2,152.7	$	2,072.4

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REPORTABLE SEGMENT (Tables)

3 Months Ended

Jul. 29, 2012

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

The following table presents sales and operating profit (loss) by segment for the fiscal periods indicated:

	Three Months Ended
	July 29, 2012			July 31, 2011
	(in millions)
Sales:
Segment sales—
Pork	$	2,599.6		$	2,597.3
Hog Production	728.8			749.8
International	346.8			375.0
Total segment sales	3,675.2			3,722.1
Intersegment sales—
Pork	(8.4		)	(9.4		)
Hog Production	(567.3		)	(611.6		)
International	(8.2		)	(6.9		)
Total intersegment sales	(583.9		)	(627.9		)
Consolidated sales	$	3,091.3		$	3,094.2
Operating profit (loss):
Pork	$	118.6		$	136.7
Hog Production	23.1			69.7
International	15.8			—
Corporate	(25.7		)	(33.2		)
Consolidated operating profit	$	131.8		$	173.2

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SUBSEQUENT EVENTS Narrative (Details) (USD $)	3 Months Ended			1 Months Ended				1 Months Ended
	Jul. 29, 2012	Jul. 31, 2011	Aug. 31, 2012 Subsequent Event [Member] Tender Offer to Repurchase Debt [Member]	Aug. 31, 2012 Senior Unsecured Notes, Six Point Six Two Five Percent, Due August 2022 [Member] Subsequent Event [Member] Issuance of Debt [Member]	Aug. 31, 2012 Senior Unsecured Notes, Seven Point Seven Five Percent, Due May 2013 [Member] Subsequent Event [Member] Tender Offer to Repurchase Debt [Member]	Aug. 31, 2012 Senior Secured Notes, Ten Percent, Due July 2014 [Member] Subsequent Event [Member] Tender Offer to Repurchase Debt [Member]	Aug. 31, 2012 Senior Secured Notes, Ten Percent, Due July 2014 [Member] Subsequent Event [Member] Repayment of Debt [Member]	Aug. 31, 2012 Scenario, Forecast [Member] Subsequent Event [Member]
Subsequent Event [Line Items]
Debt Instrument, Face Amount				$ 1,000,000,000
Proceeds from Issuance of Long-term Debt, Net of Debt Issuance Costs				981,200,000
Debt Instrument, Repurchase Amount			649,400,000				155,500,000
Debt Instrument, Repurchased Face Amount					105,000,000	456,600,000	132,800,000
Gains (Losses) on Extinguishment of Debt	$ 0	$ 1,200,000						$ 121,000,000

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GUARANTEES (Details) (USD $) In Millions, unless otherwise specified	Jul. 29, 2012
Agroindustrial del Noroeste [Member] | Financial Guarantee [Member]
Guarantor Obligations [Line Items]
Guarantor Obligations, Maximum Exposure, Undiscounted	$ 87.0
Guarantor Obligations, Current Carrying Value	62.0
Smithfield Beef [Member] | Property Lease Guarantee [Member]
Guarantor Obligations [Line Items]
Guarantor Obligations, Current Carrying Value	$ 11.1

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CONSOLIDATED CONDENSED BALANCE SHEETS (PARENTHETICAL) (Parentheticals) (USD $)	Jul. 29, 2012	Apr. 29, 2012
Shareholders' equity:
Preferred stock, par value (in dollars per share)	$ 1.00	$ 1.00
Preferred stock, authorized shares (in shares)	1,000,000	1,000,000
Common stock, par value (in dollars per share)	$ 0.50	$ 0.50
Common stock, authorized shares (in shares)	500,000,000	500,000,000
Common stock, shares issued (in shares)	150,319,326	157,408,077
Common stock, shares outstanding (in shares)	150,319,326	157,408,077

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INVESTMENTS

3 Months Ended

Jul. 29, 2012

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENTS

INVESTMENTS

Investments consist of the following:

Equity Investment	% Owned	July 29, 2012		April 29, 2012
		(in millions)
Campofrío Food Group (CFG)	37%	$	367.6	$	385.2
Mexican joint ventures	50%	108.3		111.2
Other	Various	26.5		26.2
Total investments		$	502.4	$	522.6

Each quarter, we review the carrying value of our investments and consider whether indicators of impairment exist. Examples of impairment indicators include a history or expectation of future operating losses and declines in a quoted share price, among other factors. If an impairment indicator exists, we must evaluate the fair value of our investment to determine if a loss in value, which is other than temporary, has occurred. We are required to recognize a loss in value of our investment if that loss is considered to be other than temporary.

As of July 29, 2012, we held 37,811,302 shares of CFG common stock. Shares of CFG are publicly traded on the Bolsa de Madrid exchange (Madrid Exchange). As the table below shows, the carrying value of our investment in CFG was above the quoted market price on the Madrid Exchange as of July 29, 2012, indicating a possible impairment of our investment in CFG. However, we do not believe the quoted share price on the Madrid Exchange is, by itself, reflective of the fair value of our investment in CFG for the following reasons:

▪ the minority shares traded on the Madrid Exchange confer no special rights or privileges to buyers. In contrast, the shares comprising our 37% stake in CFG contractually entitle us to two seats on CFG's 9-person board of directors, giving us the ability to exert significant influence over the strategic and operational decisions of our investee.

▪ the stock is very thinly traded. CFG is a closely held company, with the three largest shareholders owning approximately 74% of the outstanding shares. We are CFG's largest shareholder, with a 37% stake.

The average daily trading volume during the first quarter of fiscal 2013 represents just 0.01% of the total outstanding shares (average trading volume of 10,586 shares while the total number of shares outstanding is in excess of 102 million). The lack of an active market can cause significant fluctuations and volatility in the stock price that are not commensurate with fundamental changes in the underlying business and the fair value of our holding in CFG. Shares trading on the Madrid Exchange have ranged from a high of €7.20 ($9.47) to a low of €5.28 ($7.35) per share during the last 12 months, with upward and downward fluctuations in between.

The table below shows CFG's intra-day high share price and Smithfield's carrying value, expressed in euro per share, on various dates relevant to our disclosures.

Date	Share Price		Carrying Value
February 17, 2012	€	7.20	€	7.54
July 29, 2012 (1)	€	5.85	€	7.89
August 23, 2012	€	6.20	€	7.80

——————————————

⁽¹⁾  Share prices on quarter end date reflect the last trading day in the quarter.

As noted above, we do not consider the share price on the Madrid Exchange, by itself, to be determinative of fair value. In assessing the fair value of our investment, we considered a variety of information, including an independent third party valuation report, which incorporates generally accepted valuation techniques, CFG's history of positive cash flows, expectations about the future cash flows of CFG, market multiples for comparable businesses, and an influence premium applied to the market price of CFG's shares on the Madrid Exchange to adjust for our contractual right to two board seats and our ability to exert significant influence over the operational and strategic decisions of the company.

Based on an evaluation of all these factors, we concluded the fair value of our investment in CFG as of July 29, 2012, exceeded its carrying amount.

Income from equity method investments consists of the following:

		Three Months Ended
Equity Investment	Segment	July 29, 2012			July 31, 2011
		(in millions)
CFG (1)	International	$	(0.1	)	$	(0.2	)
Mexican joint ventures	International	0.4			(3.0		)
All other equity method investments	Various	(1.0		)	(1.6		)
Income from equity method investments		$	(0.7	)	$	(4.8	)

——————————————

⁽¹⁾  CFG prepares its financial statements in accordance with International Financial Reporting Standards. Our share of CFG’s results reflects U.S. GAAP adjustments and thus, there may be differences between the amounts we report for CFG and the amounts reported by CFG.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Narrative (Details) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	2.1	1.7

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INVESTMENTS Equity in (Income) Loss of Equity Method Investments (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jul. 29, 2012	Jul. 31, 2011
Schedule of Equity Method Investments [Line Items]
Income from equity method investments	$ (0.7)	$ (4.8)
Campofrio Food Group [Member]
Schedule of Equity Method Investments [Line Items]
Income from equity method investments	(0.1)	(0.2)
Segment	International
Mexican Joint Ventures [Member]
Schedule of Equity Method Investments [Line Items]
Income from equity method investments	0.4	(3.0)
Segment	International
Other Equity Method Investments [Member]
Schedule of Equity Method Investments [Line Items]
Income from equity method investments	$ (1.0)	$ (1.6)
Segment	Various

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Jul. 29, 2012

Accounting Policies [Abstract]

Reportable Segments

Smithfield Foods, Inc., together with its subsidiaries (the “Company,” “we,” “us” or “our”), is the largest hog producer and pork processor in the world. We produce and market a wide variety of fresh meat and packaged meats products both domestically and internationally. We conduct our operations through four reportable segments: Pork, Hog Production, International and Corporate, each of which is comprised of a number of subsidiaries, joint ventures and other investments.

Fiscal Period

The three months ended July 29, 2012 correspond to the first quarter of fiscal 2013 and the three months ended July 31, 2011 correspond to the first quarter of fiscal 2012.

Earnings Per Share, Policy [Policy Text Block]

Net Income per Share

We present dual computations of net income per share. The basic computation is based on weighted average common shares outstanding during the period. The diluted computation reflects the potentially dilutive effect of common stock equivalents, such as stock options and convertible notes, during the period. We excluded stock options for approximately 2.1 million and 1.7 million shares for the three months ended July 29, 2012 and July 31, 2011, respectively, from the diluted computation because their effect would have been anti-dilutive.