Brazilian meat and poultry processor JBS posted a net profit of BRL70 million (US$31 million) in the first quarter of 2014, a 69 percent drop from the first quarter of 2013. JBS increased its net revenues by 35.3 percent when compared to the first quarter of 2013, but added expenses, including currency hedging costs and recent acquisitions, hurt profits.
Net revenues for business segments JBS Merosul, JBS USA Pork and JBS USA Beef improved, while net revenues for JBS USA Chicken and JBS Foods decreased.
JBS USA Chicken, which includes Pilgrim’s operations in the U.S., Mexico and Puerto Rico, recorded net revenues of $2.02 billion, a 0.9 percent decrease when compared to the first quarter of 2013. The company attributed the change to a decrease in sales prices in the U.S., partially offset by an increase in sales volumes both in the U.S. and Mexico. Pilgrim’s in 2013 produced 138.33 million pounds of ready-to-cook chicken, according to the WATTAgNet World's Top Poultry Companies database.
JBS USA Pork improved its net revenues to $897 million, an improvement of 6.5 percent. This result is due to a 12.2 percent increase in sales prices in the domestic market, and a 6.8 percent increase in export volumes.
JBS Mercosul, the business unit that includes beef, hides, leather and related businesses in Brazil, Argentina, Paraguay and Uraguay, saw its net revenues reach BRL6.3 billion (US$2.9 billion), a 5.5 percent increase. An increase in sales prices powered by a strong demand for beef helped JBS Mercosul improve its net revenues. Net revenues for JBS USA Beef increased 4.8 percent to $4.5 billion, also based on higher prices and strong demand for beef.
JBS Foods, the company’s newest business segment that includes poultry, pork and prepared foods in Brazil, posted net revenues of BRL2.78 billion (US$1.26 billion) in the quarter, a 3.9 percent decline from the previous quarter, but a 1.9 percent improvement in gross profit. The segment, which has only existed for two quarters, unifies the operations of Seara Brasil, acquired in September 2013, with JBS Poultry operations and other new acquisitions.