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· JBS has a 64% drop in net income for the 3rd quarter
… JBS cites that it is investigated in seven "criminal proceedings… The company reported a pre-interest income, taxes, depreciation and amortization (Ebitda) adjusted of 4.32 billion reais, up 37 percent year-on-year, driven by better results from poultry, beef and pork divisions in the United States…
· JBS Earnings Beat Shows Meat Operations Unscathed by Scandal
… better-than-expected third-quarter profit… JBS USA Beef, the Brazilian company’s biggest unit with operations spanning Australia and Canada as well as the U.S., saw its Ebitda margin expand to 7.3 percent from 5 percent…
JBS has a 64% drop in net income for the 3rd quarter
By Alberto Alerigi Jr., Reuters
via Extra/Globo (Brazil) - 11/13/17
With Google Translate
SÃO PAULO, Brazil (Reuters) - JBS posted net income of R $ 323 million in the third quarter, a 64 percent drop on a year earlier, impacted by its adherence to a debt refinancing program and a decline in its performance in Brazil , according to the meat processor's report released late Monday.
The company, whose controlling shareholders are in jail and owns brands such as Seara, Friboi and Swift, reported that the results in Brazil were not accompanied by a review by an independent auditor since the company awaits the end of the investigations related to the leniency agreement between the J & F holding company and the Federal Public Ministry.
Despite this, the company says that the balance of its units abroad, which make up 75 percent of the group's consolidated revenue, were audited.
In the balance sheet, JBS cites that it is investigated in seven "criminal proceedings", Federal Police operations - Greenfield, Sepsis, Cui Bono, Bullish, Weak Meat, Asphalt Mud and Achilles Tendon. In addition, the company is cited in two CPIs in Congress and four popular lawsuits and a corporation opened by BNDES and Caixa Econômica Federal.
According to JBS, the company would have net profit of 1.9 billion reais in the third quarter, were it not to join the 4.2 billion reais program of refinancing of the Union's tax debts. The company said last week that this would have a negative impact on third quarter net income of 2.3 billion reais and a total savings of 1.1 billion.
In the third quarter of last year, JBS had earned 887 million reais.
The company reported a pre-interest income, taxes, depreciation and amortization (Ebitda) adjusted of 4.32 billion reais, up 37 percent year-on-year, driven by better results from poultry, beef and pork divisions in the United States, and in processed foods and Seara birds.
But cattle operations in Brazil fell by almost 79 percent on Ebitda, with revenue falling 24 percent. The company said in the balance sheet that the performance was caused by sales of beef operations in Argentina, Paraguay and Uruguay, as well as a 17 percent reduction in the volume of processed animals in Brazil compared to the third quarter of last year. In addition, there was a reduction in the volume of exports.
"The company has focused on the most profitable channels and cuts, valuing the product mix, which has led to an 11.7 percent increase in the average selling price of fresh meat," JBS said.
Earlier, rival Marfrig said it ended the third quarter with a loss of 58 million reais, down from a negative result of 156 million a year earlier. The company cited acceleration of expansion of units in Brazil, including some that had been previously closed.
JBS ended September with a net debt ratio of 3.42 times Ebitda versus 4.16 times at the end of June. A year earlier, the leverage disclosed was 4.32 times.
Net debt fell nearly 5 billion reais from the second to the third quarter, with the company closing the sale of Moy Park in Europe to its US unit Pilgrim's Pride for 1 billion dollars in September.
The percentage of short-term debt in relation to total debt was 27 percent in the third quarter, of which 73 percent are lines backed by Brazilian unit exports.
JBS Earnings Beat Shows Meat Operations Unscathed by Scandal
Strong demand helps third-quarter Ebitda to exceeds estimates
Brazilian company reports lower debt after it sells assets
By Gerson Freitas Jr, Bloomberg
November 13, 2017
JBS SA reported better-than-expected third-quarter profit, showing that the world’s largest meatpacker’s operations have been left largely unscathed by the corruption scandal that has sent its owners to jail.
Adjusted earnings before interest, taxes, depreciation and amortization rose to a record 4.32 billion reais ($1.3 billion), compared with 3.14 billion reais a year earlier, the Sao Paulo-based company said Monday in a statement after markets closed. That exceeded all of the the six analysts’ estimates compiled by Bloomberg.
Meat operations in the U.S., which account for more than two-thirds of JBS’s revenues, have benefited from rising demand both at home and abroad, while the cost of feeding livestock and poultry remains low after farmers harvested back-to-back bumper corn crops. JBS and peers including Tyson Foods Inc. have had profitable margins on beef and pork-processing for much of the year, HedgersEdge data show.
JBS USA Beef, the Brazilian company’s biggest unit with operations spanning Australia and Canada as well as the U.S., saw its Ebitda margin expand to 7.3 percent from 5 percent. Ebitda at Pilgrim’s Pride Corp., JBS’s U.S. chicken unit, almost doubled from a year earlier, the company said last week. Seara, the company’s Brazil chicken unit, saw margins rise to 11 percent from 7.3 percent.
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