U. S. Premium Beef (USPB) 10-Q 4 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 25, 2016	Jul. 30, 2016
Entity Registrant Name	U. S. Premium Beef, LLC
Entity Central Index Key	1,289,237
Document Type	10-Q
Document Period End Date	Jun. 25, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-26
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,016
Class A Units [Member]
Entity Common Stock, Shares Outstanding		735,385
Class B Units [Member]
Entity Common Stock, Shares Outstanding		755,385

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 25, 2016	Dec. 26, 2015
Current assets:
Cash and cash equivalents	$ 88,686	$ 85,220
Due from affiliates	106	137
Other current assets	19	8
Total current assets	88,811	85,365
Property, plant, and equipment, at cost	223	223
Less accumulated depreciation	182	175
Net property, plant, and equipment	41	48
Investment in National Beef Packing Company, LLC	140,253	132,628
Other assets	147	196
Total assets	229,252	218,237
Current liabilities:
Accounts payable - trade	2	14
Accrued compensation and benefits	1,027	1,066
Other accrued expenses and liabilities	189	179
Patronage notices payable	21	90
Total current liabilities	1,239	1,349
Long-term liabilities:
Other liabilities	4,911	5,118
Total long-term liabilities	4,911	5,118
Total liabilities	6,150	6,467
Commitments and contingencies
Capital shares and equities:
Members' capital, 735,385 Class A units and 755,385 Class B units authorized, issued and outstanding	223,102	211,770
Total capital shares and equities	223,102	211,770
Total liabilities and capital shares and equities	$ 229,252	$ 218,237

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - shares	Jun. 25, 2016	Dec. 26, 2015
Class A Units [Member]
Members' capital, units authorized	735,385	735,385
Members' capital, units issued	735,385	735,385
Members' capital, units outstanding	735,385	735,385
Class B Units [Member]
Members' capital, units authorized	755,385	755,385
Members' capital, units issued	755,385	755,385
Members' capital, units outstanding	755,385	755,385

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 25, 2016	Jun. 27, 2015	Jun. 25, 2016	Jun. 27, 2015
Net sales
Costs and expenses:
Cost of sales
Selling, general, and administrative expenses	804	380	1,555	1,185
Depreciation and amortization	4	1	7	2
Total costs and expenses	808	381	1,562	1,187
Operating loss	(808)	(381)	(1,562)	(1,187)
Other income (expense):
Interest income	11	11	24	23
Interest expense	(3)	(3)	(6)	(6)
Equity interest in net income (loss) of National Beef Packing Company, LLC	9,391	(1,451)	12,530	(6,505)
Other, net	8		346
Income (loss) before taxes	8,599	(1,824)	11,332	(7,675)
Income tax expense
Net income (loss)	$ 8,599	$ (1,824)	$ 11,332	$ (7,675)
Class A Units [Member]
Income (loss) per unit:
Basic	$ 1.17	$ (0.25)	$ 1.54	$ (1.04)
Diluted	$ 1.17	$ (0.25)	$ 1.54	$ (1.04)
Outstanding weighted-average Class A and Class B units:
Basic	735,385	735,385	735,385	735,385
Diluted	735,385	735,385	735,385	735,385
Class B Units [Member]
Income (loss) per unit:
Basic	$ 10.25	$ (2.17)	$ 13.50	$ (9.14)
Diluted	$ 10.25	$ (2.17)	$ 13.50	$ (9.14)
Outstanding weighted-average Class A and Class B units:
Basic	755,385	755,385	755,385	755,385
Diluted	755,385	755,385	755,385	755,385

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 25, 2016	Jun. 27, 2015
Cash flows from operating activities:
Net income (loss)	$ 11,332	$ (7,675)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization	7	2
Equity in net (income) loss of National Beef Packing Company, LLC	(12,530)	6,505
Changes in assets and liabilities:
Due from affiliates	31	(12)
Other assets	39	40
Accounts payable	(12)	20
Due to affiliates		8
Accrued compensation and benefits	(246)	(646)
Other accrued expenses and liabilities	10	(22)
Net cash used in operating activities	(1,369)	(1,780)
Cash flows from investing activities:
Capital expenditures		(21)
Distribution from National Beef Packing Company, LLC	4,904
Net cash provided by (used in) investing activities	4,904	(21)
Cash flows from financing activities:
Change in overdraft balances	(69)
Net cash used in financing activities	(69)
Net increase (decrease) in cash	3,466	(1,801)
Cash and cash equivalents at beginning of the period	85,220	92,344
Cash and cash equivalents at end of the period	$ 88,686	$ 90,543

Interim Financial Statements

Interim Financial Statements	6 Months Ended
	Jun. 25, 2016
Quarterly Financial Information Disclosure [Abstract]
Interim Financial Statements	(1) Interim Financial Statements Basis of Presentation The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP), for interim financial information; therefore, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included using management’s best estimates and judgments where appropriate. These estimates and judgments affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ materially from these estimates and judgments. For further information, refer to the audited Consolidated Financial Statements and Notes to Consolidated Financial Statements, which are included in the Company’s Annual Report on Form 10-K on file with the Securities and Exchange Commission (SEC), for the fiscal year ended December 26, 2015. The results of operations for the interim periods presented are not necessarily indicative of the results for a full fiscal year. USPB’s 15.0729% investment in NBP is accounted for using the equity method of accounting as the Company has the ability to exercise significant influence, but does not have financial or operational control.

Members' Capital

Members' Capital	6 Months Ended
	Jun. 25, 2016
Members' Equity [Abstract]
Members' Capital	(2) Members’ Capital The following table represents a reconciliation of Members’ Capital for the twenty-six week period ended June 25, 2016 (thousands of dollars). Balance at December 26, 2015 $ 211,770 Net income for the twenty-six week period ended June 25, 2016 11,332 Balance at June 25, 2016 $ 223,102

Income (Loss) Attributable to U

Income (Loss) Attributable to USPB Per Unit	6 Months Ended
	Jun. 25, 2016
Limited Liability Company (LLC) Members' Equity [Abstract]
Income (Loss) Attributable to USPB Per Unit	(3) Income (Loss) Attributable to USPB Per Unit Under the LLC structure, earnings of the Company are to be allocated to unitholders based on their proportionate share of underlying equity, and, as a result, income attributable to USPB per unit (EPU) has been presented in the accompanying Statements of Operations and in the table that follows. Basic EPU excludes dilution and is computed by first allocating a portion of net income (loss) attributable to USPB to Class A units and the remainder is allocated to Class B units. For the thirteen week and twenty-six week periods ended June 25, 2016 and June 27, 2015, net income (loss) was allocated 10% to the Class A’s and 90% to the Class B’s. The net income (loss) allocated to the Class A and Class B units is then divided by the weighted-average number of Class A and Class B units outstanding for the period to determine the basic EPU for each respective class of unit. Diluted EPU reflects the potential dilution that could occur to the extent that any outstanding dilutive Class A or Class B units were exercised. There are no potentially dilutive Class A or Class B units outstanding. Income (Loss) Per Unit Calculation 13 weeks ended 13 weeks ended 26 weeks ended 26 weeks ended (thousands of dollars, except unit and per unit data) June 25, 2016 June 27, 2015 June 25, 2016 June 27, 2015 Basic earnings per unit Net income (loss) attributable to USPB available to unitholders (numerator) Class A $ 860 $ (182) $ 1,133 $ (768) Class B $ 7,739 $ (1,642) $ 10,199 $ (6,907) Weighted average outstanding units (denominator) Class A 735,385 735,385 735,385 735,385 Class B 755,385 755,385 755,385 755,385 Per unit amount Class A $ 1.17 $ (0.25) $ 1.54 $ (1.04) Class B $ 10.25 $ (2.17) $ 13.50 $ (9.14) Diluted earnings per unit: Net income (loss) attributable to USPB available to unitholders (numerator) Class A $ 860 $ (182) $ 1,133 $ (768) Class B $ 7,739 $ (1,642) $ 10,199 $ (6,907) Weighted average outstanding Class A units 735,385 735,385 735,385 735,385 Effect of dilutive securities - Class A unit options - - - - Units (denominator) 735,385 735,385 735,385 735,385 Weighted average outstanding Class B units 755,385 755,385 755,385 755,385 Effect of dilutive securities - Class B unit options - - - - Units (denominator) 755,385 755,385 755,385 755,385 Per unit amount Class A $ 1.17 $ (0.25) $ 1.54 $ (1.04) Class B $ 10.25 $ (2.17) $ 13.50 $ (9.14)

Investment in National Beef Pac

Investment in National Beef Packing Company, LLC	6 Months Ended
	Jun. 25, 2016
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]
Investment in National Beef Packing Company, LLC	(4) Investment in National Beef Packing Company, LLC USPB’s investment in NBP is accounted for using the equity method of accounting as the Company has the ability to exercise significant influence, but does not have financial or operational control. Below is a summary of the results of operations for NBP for the thirteen and twenty-six week periods ended June 25, 2016 and June 27, 2015 (thousands of dollars): 13 weeks ended 13 weeks ended 26 weeks ended 26 weeks ended June 25, 2016 June 27, 2015 June 25, 2016 June 27, 2015 Net sales $ 1,797,383 $ 1,994,486 $ 3,428,753 $ 3,846,795 Costs and expenses: Cost of sales 1,690,908 1,961,499 3,260,373 3,809,657 Selling, general, and administrative expenses 17,914 16,156 34,894 31,397 Depreciation and amortization 22,785 22,082 45,411 43,868 Total costs and expenses 1,731,607 1,999,737 3,340,678 3,884,922 Operating income (loss) 65,776 (5,251) 88,075 (38,127) Other income (expense): Interest income 63 - 63 17 Interest expense (3,796) (4,300) (7,763) (8,716) Other, net 813 151 3,890 3,841 Income (loss) before taxes 62,856 (9,400) 84,265 (42,985) Income tax expense (552) (226) (1,135) (172) Net income (loss) 62,304 (9,626) 83,130 (43,157) NBP's net income (loss) attributable to USPB $ 9,391 $ (1,451) $ 12,530 $ (6,505)

Members' Capital (Tables)

Members' Capital (Tables)	6 Months Ended
	Jun. 25, 2016
Members' Equity [Abstract]
Schedule of Reconciliation of Members' Capital	The following table represents a reconciliation of Members’ Capital for the twenty-six week period ended June 25, 2016 (thousands of dollars). Balance at December 26, 2015 $ 211,770 Net income for the twenty-six week period ended June 25, 2016 11,332 Balance at June 25, 2016 $ 223,102

Income (Loss) Attributable to11

Income (Loss) Attributable to USPB Per Unitt (Tables)	6 Months Ended
	Jun. 25, 2016
Limited Liability Company (LLC) Members' Equity [Abstract]
Schedule of Income (Loss) Per Unit Calculation	Income (Loss) Per Unit Calculation 13 weeks ended 13 weeks ended 26 weeks ended 26 weeks ended (thousands of dollars, except unit and per unit data) June 25, 2016 June 27, 2015 June 25, 2016 June 27, 2015 Basic earnings per unit Net income (loss) attributable to USPB available to unitholders (numerator) Class A $ 860 $ (182) $ 1,133 $ (768) Class B $ 7,739 $ (1,642) $ 10,199 $ (6,907) Weighted average outstanding units (denominator) Class A 735,385 735,385 735,385 735,385 Class B 755,385 755,385 755,385 755,385 Per unit amount Class A $ 1.17 $ (0.25) $ 1.54 $ (1.04) Class B $ 10.25 $ (2.17) $ 13.50 $ (9.14) Diluted earnings per unit: Net income (loss) attributable to USPB available to unitholders (numerator) Class A $ 860 $ (182) $ 1,133 $ (768) Class B $ 7,739 $ (1,642) $ 10,199 $ (6,907) Weighted average outstanding Class A units 735,385 735,385 735,385 735,385 Effect of dilutive securities - Class A unit options - - - - Units (denominator) 735,385 735,385 735,385 735,385 Weighted average outstanding Class B units 755,385 755,385 755,385 755,385 Effect of dilutive securities - Class B unit options - - - - Units (denominator) 755,385 755,385 755,385 755,385 Per unit amount Class A $ 1.17 $ (0.25) $ 1.54 $ (1.04) Class B $ 10.25 $ (2.17) $ 13.50 $ (9.14)

Investment in National Beef P12

Investment in National Beef Packing Company, LLC (Tables)	6 Months Ended
	Jun. 25, 2016
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]
Schedule of Operations for NBP	Below is a summary of the results of operations for NBP for the thirteen and twenty-six week periods ended June 25, 2016 and June 27, 2015 (thousands of dollars): 13 weeks ended 13 weeks ended 26 weeks ended 26 weeks ended June 25, 2016 June 27, 2015 June 25, 2016 June 27, 2015 Net sales $ 1,797,383 $ 1,994,486 $ 3,428,753 $ 3,846,795 Costs and expenses: Cost of sales 1,690,908 1,961,499 3,260,373 3,809,657 Selling, general, and administrative expenses 17,914 16,156 34,894 31,397 Depreciation and amortization 22,785 22,082 45,411 43,868 Total costs and expenses 1,731,607 1,999,737 3,340,678 3,884,922 Operating income (loss) 65,776 (5,251) 88,075 (38,127) Other income (expense): Interest income 63 - 63 17 Interest expense (3,796) (4,300) (7,763) (8,716) Other, net 813 151 3,890 3,841 Income (loss) before taxes 62,856 (9,400) 84,265 (42,985) Income tax expense (552) (226) (1,135) (172) Net income (loss) 62,304 (9,626) 83,130 (43,157) NBP's net income (loss) attributable to USPB $ 9,391 $ (1,451) $ 12,530 $ (6,505)

Interim Financial Statements (D

Interim Financial Statements (Details Narrative)	Jun. 25, 2016
Quarterly Financial Information Disclosure [Abstract]
Remaining membership interests in National Beef Packing Company, LLC (NBP)	15.0729%

Members' Capital (Details)

Members' Capital (Details) $ in Thousands	6 Months Ended
	Jun. 25, 2016USD ($)
Members' Equity [Abstract]
Beginning balance	$ 211,770
Net income for the twenty-six week period ended June 25, 2016	11,332
Ending balance	$ 223,102

Income (Loss) Attributable to15

Income (Loss) Attributable to USPB Per Unit (Details Narrative)	6 Months Ended
	Jun. 25, 2016	Jun. 27, 2015
Class A Units [Member]
Class of Stock [Line Items]
Ownership percentage	10.00%	10.00%
Class B Units [Member]
Class of Stock [Line Items]
Ownership percentage	90.00%	90.00%

Income (Loss) Attributable to16

Income (Loss) Attributable to USPB Per Unit (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 25, 2016	Jun. 27, 2015	Jun. 25, 2016	Jun. 27, 2015
Basic earnings per unit
Net income (loss) attributable to USPB available to unitholders (numerator)			$ 11,332
Class A Units [Member]
Basic earnings per unit
Net income (loss) attributable to USPB available to unitholders (numerator)	$ 860	$ (182)	$ 1,133	$ (768)
Weighted average outstanding units (denominator)	735,385	735,385	735,385	735,385
Per unit amount	$ 1.17	$ (0.25)	$ 1.54	$ (1.04)
Diluted earnings per unit:
Net income (loss) attributable to USPB available to unitholders (numerator)	$ 860	$ (182)	$ 1,133	$ (768)
Weighted average outstanding
Weighted average outstanding units (denominator)	735,385	735,385	735,385	735,385
Effect of dilutive securities
Units (denominator)	735,385	735,385	735,385	735,385
Per unit amount	$ 1.17	$ (0.25)	$ 1.54	$ (1.04)
Class B Units [Member]
Basic earnings per unit
Net income (loss) attributable to USPB available to unitholders (numerator)	$ 7,739	$ (1,642)	$ 10,199	$ (6,907)
Weighted average outstanding units (denominator)	755,385	755,385	755,385	755,385
Per unit amount	$ 10.25	$ (2.17)	$ 13.50	$ (9.14)
Diluted earnings per unit:
Net income (loss) attributable to USPB available to unitholders (numerator)	$ 7,739	$ (1,642)	$ 10,199	$ (6,907)
Weighted average outstanding
Weighted average outstanding units (denominator)	755,385	755,385	755,385	755,385
Effect of dilutive securities
Units (denominator)	755,385	755,385	755,385	755,385
Per unit amount	$ 10.25	$ (2.17)	$ 13.50	$ (9.14)

Investment in National Beef P17

Investment in National Beef Packing Company, LLC (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 25, 2016	Jun. 27, 2015	Jun. 25, 2016	Jun. 27, 2015
Schedule of Investments [Line Items]
Net sales
Costs and expenses:
Cost of sales
Selling, general, and administrative expenses	804	380	1,555	1,185
Depreciation and amortization	4	1	7	2
Total costs and expenses	808	381	1,562	1,187
Operating income (loss)	(808)	(381)	(1,562)	(1,187)
Other income (expense):
Interest income	11	11	24	23
Interest expense	(3)	(3)	(6)	(6)
Other, net	8		346
Income (loss) before taxes	8,599	(1,824)	11,332	(7,675)
Income tax expense
National Beef Packing Company, LLC [Member]
Schedule of Investments [Line Items]
Net sales	1,797,383	1,994,486	3,428,753	3,846,795
Costs and expenses:
Cost of sales	1,690,908	1,961,499	3,260,373	3,809,657
Selling, general, and administrative expenses	17,914	16,156	34,894	31,397
Depreciation and amortization	22,785	22,082	45,411	43,868
Total costs and expenses	1,731,607	1,999,737	3,340,678	3,884,922
Operating income (loss)	65,776	(5,251)	88,075	(38,127)
Other income (expense):
Interest income	63		63	17
Interest expense	(3,796)	(4,300)	(7,763)	(8,716)
Other, net	813	151	3,890	3,841
Income (loss) before taxes	62,856	(9,400)	84,265	(42,985)
Income tax expense	(552)	(226)	(1,135)	(172)
Net income (loss)	62,304	(9,626)	83,130	(43,157)
NBP's net income (loss) attributable to USPB	$ 9,391	$ (1,451)	$ 12,530	$ (6,505)