Adds details from the earnings statement
SAO PAULO, Nov 10 (Reuters) – Brazil’s JBS SA BRFS3.SA posted third-quarter net income that exceeded analysts‘ expectations on the strength of its United States meat business and higher domestic food sales, according to a financial statement on Wednesday.
JBS profited 7.58 billion reais ($1.83 billion) as net revenue rose 32% to 92.62 billion reais in the quarter. The company showed double-digit margins in its U.S.-based beef, poultry and pork units, and also at its Seara unit in Brazil.
JBS said adjusted earnings before interest, tax, depreciation and amortization – a measure of operating income known as EBITDA, came in at 13.92 billion reais, above the average of analysts’ estimates at 12.21 billion reais.
At Seara, which processes pork and poultry, net revenue soared 38% as sales volumes rose and the company increased the average price of products sold by almost 15%, allowing it to partly offset higher grain prices weighing meat packers globally.
Meanwhile, in the United States the availability of cattle remained stable, but cattle prices rose by up to 22% compared to the same quarter last year, pressuring costs on its biggest market by sales.
Still, demand for beef continues to grow in North American markets and COVID-19 vaccinations accelerated the reopening and rebuilding of the restaurant channels, at the same time as other retail sales remained strong, JBS said. On the other hand, operating costs in the region rose due to increases in labor costs and benefits.
Margins of JBS’ beef business were the highest among all divisions, at 21.8% last quarter.
JBS’ accumulated net profit in 2021 reached 14 billion reais, meaning the company will be able to pay a minimum dividend of around 3.5 billion reais in 2022, the statement said.
(Reporting by Ana Mano and Nayara Figueiredo; editing by Grant McCool)
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