JBS bounces back in second quarter

By Aidan Fortune contact

- Last updated on GMT

JBS bounces back in second quarter

Related tags: Beef, Pork, Poultry

International meat processing business JBS has seen a turnaround in fortunes in its second quarter results.

In the second quarter of 2019, the business recorded a net income of R$2.2bn, a significant reversal compared to the same period of 2018, when it posted a net loss of R$911m.

 In the first six months of 2019, JBS reported net income of R$3.3bn. Its EBITDA reached R$5.1bn in the quarter, up 20.3% over the previous year. The company's net revenue in the quarter reached R$50.8bn, an increase of 12.5% ​​compared to a year ago. Gross profit increased 13.6%, from R$6.9 bn in the second quarter of 2018 to R$7.9bn in 2Q19.

“Two years after defining our priorities focused on operational efficiency, organic growth, investment in innovation and quality, deleveraging and a robust global compliance program, we are delighted to announce record results that reflect the success of our strategy, the company's operational excellence, and the execution capacity of our team,”​ said Gilberto Tomazoni, JBS Global CEO.

The business reported that its Seara division in Brazil posted an 11.1% EBITDA margin despite price increases in processed foods locally, as well as higher prices and volumes in the export market.

Its Pilgrim’s Pride division announced a US$349m EBITDA for the quarter, an increase of 24% year-on-year, “reflecting a more balanced supply demand scenario”​. In the pork segment, despite higher raw material costs and increased supply of pork, EBITDA margin was 8.2%, improving on the second quarter of 2018.

He said JBS was in a position to capitalise on the growing market. “JBS is in an excellent moment to accelerate its growth. The global protein market grows at a rate of 2% p.a., supported by an increase in population and income per capita primarily in Asia.

“With all the liability management efforts, we are in a very comfortable position to analyze potential growth opportunities that present synergies with our businesses and drive sustainable development, by leveraging our value added and brand strategy, without compromising our debt and leverage objectives.”

Tomanzoni also mentioned African Swine Fever, value-added and plant-based as drivers of growth for JBS. “In previous quarters, we have already seen significant growth in protein consumption in Asia, and the event of African Swine Fever in many countries is contributing towards increased export flows and opens opportunities to accelerate the growth of our value-added businesses,” ​he explained.

“As leaders in this industry, we aim to anticipate trends and new possibilities, investing in innovation and value added products. Recently, we launched three options of flexitarian sausages and products that combine meats and vegetables at our Primo brand in Australia, the market leader in the region. At Seara, we have launched the Incredible Burger, our first product made with vegetable protein, already available in the retail and foodservice channels.”

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