JBS - the world’s largest meat processor - announced a slump in profits for the first quarter of 2023.
Revenues are down by 4.6% to BRL 86.7bn (€16.1bn), but the adjusted EBITDA (earnings before interest, taxation, depreciation and amortization) slumped by 79% to BRL2.2bn (€409m), with an adjusted EBITDA margin of 2.5% for the first quarter - down 8.6% on the same period last year.
All divisions of the business performed poorly compared with the first quarter in 2022.
Revenue in JBS beef, North America - the largest sector of the business - fell by under 6% to BRL27.4bn (€5.1bn), but the adjusted EBITDA slumped by over 97% to BRL116m (€21.6m).
JBS Australia was loss-making in the first quarter, with an adjusted EBITDA of BRL-18m (€-3.3m), while the pork business also recorded a slump in EBITDA of 81% to BRL1.4bn (€260m).
Performance in Brazil, where the company was founded and is headquartered, was also poor relative to last year.
Revenue is down 15% to BRL12.2bn (€2.3bn), with an EBITDA of BRL296.6m, or just over 2%.
Acknowledgement and outlook
The company's global CEO, Gilberto Tomazoni, acknowledged that 2023 has started with the company facing many challenges, but he is confident of improvement as the year progresses.
Tomazoni also highlighted that in the 12 years that the company has had a global platform, this is the first quarter where they faced adversities in almost every country in which they operate.
In the USA, the impact of high cattle prices squeezed margins, but “commercial and industrial performance fell below our expectations, which are issues that have already been addressed".
Being excluded from the Chinese markets for several weeks impacted JBS exports in quarter 1.
The USA CEO was replaced on 1 May 2023.
He is also positive about the impact of the expected improvement of cattle supply throughout 2023 and the reopening of China, which seriously disrupted exports in the fist quarter because of the BSE suspension.
Performance of the major global meat exporters is of interest to Irish farmers, in that their results give an insight to factory profitability even if their business operates on a larger scale than Irish factories and in different markets.
From this data, it is clear that the high USA cattle price (the equivalent of €5.60/kg for a carcase with a 60% trim) is squeezing profits, after processors enjoying exceptional record profits in 2021 and early 2022.
Read more
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JBS profit returns to normal
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JBS - the world’s largest meat processor - announced a slump in profits for the first quarter of 2023.
Revenues are down by 4.6% to BRL 86.7bn (€16.1bn), but the adjusted EBITDA (earnings before interest, taxation, depreciation and amortization) slumped by 79% to BRL2.2bn (€409m), with an adjusted EBITDA margin of 2.5% for the first quarter - down 8.6% on the same period last year.
All divisions of the business performed poorly compared with the first quarter in 2022.
Revenue in JBS beef, North America - the largest sector of the business - fell by under 6% to BRL27.4bn (€5.1bn), but the adjusted EBITDA slumped by over 97% to BRL116m (€21.6m).
JBS Australia was loss-making in the first quarter, with an adjusted EBITDA of BRL-18m (€-3.3m), while the pork business also recorded a slump in EBITDA of 81% to BRL1.4bn (€260m).
Performance in Brazil, where the company was founded and is headquartered, was also poor relative to last year.
Revenue is down 15% to BRL12.2bn (€2.3bn), with an EBITDA of BRL296.6m, or just over 2%.
Acknowledgement and outlook
The company's global CEO, Gilberto Tomazoni, acknowledged that 2023 has started with the company facing many challenges, but he is confident of improvement as the year progresses.
Tomazoni also highlighted that in the 12 years that the company has had a global platform, this is the first quarter where they faced adversities in almost every country in which they operate.
In the USA, the impact of high cattle prices squeezed margins, but “commercial and industrial performance fell below our expectations, which are issues that have already been addressed".
Being excluded from the Chinese markets for several weeks impacted JBS exports in quarter 1.
The USA CEO was replaced on 1 May 2023.
He is also positive about the impact of the expected improvement of cattle supply throughout 2023 and the reopening of China, which seriously disrupted exports in the fist quarter because of the BSE suspension.
Performance of the major global meat exporters is of interest to Irish farmers, in that their results give an insight to factory profitability even if their business operates on a larger scale than Irish factories and in different markets.
From this data, it is clear that the high USA cattle price (the equivalent of €5.60/kg for a carcase with a 60% trim) is squeezing profits, after processors enjoying exceptional record profits in 2021 and early 2022.
Read more
New CEO for JBS in USA
JBS profit returns to normal
Batista in the Baptist role
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