Perdigao reports third-quarter net loss
Despite strong third quarter sales, the Brazilian meat and poultry producer experienced a net loss for the quarter.
Perdigao posted a net loss of 25.4 million reais ($11.6 million) in the third quarter of 2008, compared with a net profit of 90.2 million reais in the same period last year.
The meat and poultry producer is among several Brazilian companies in the export sector to post losses due to hedging and speculative positions held on the currency markets.
Perdigao ended the third quarter 2008 with gross sales of R$ 3.5 billion, 80.4% higher than the same period in 2007. The sales growth resulted from strength in the domestic and export markets as well as the incorporation of the new businesses (Eleva, Plusfood and Cotoches).
However, like other Brazilian producers, Perdigao struggled with swings in the prices of commodities and key raw materials in addition to a marked devaluation of the Real in relation to the dollar during the course of the quarter.
The company reported EBITDA of R$ 274.9 million, 20.7% higher than the third quarter 2007, the result of the reduction in expenses and better sales performance, in addition to consolidation of acquisitions made in the past year.
Exports were up by 70% in revenues (about R$ 1.4 billion) and 46.7% in volume (304.5 thousand tons). The company said it experienced improved margins for exports.
Sales of meats accounted for 97.6% of export revenues. Average prices in this market posted an increase of 32.7% in US dollars-FOB compared with the third quarter 2007, and 7.8% on a quarter-on-quarter basis. Average prices for meats in Reais improved by 15%, with the average cost 22% higher against the same quarter last year.Domestic market sales were R$ 2.0 billion, equivalent to an increase of 88% in relation to the third quarter 2007. The meat business reported growth of 28.7% in volumes during the quarter, accounting for 51.7% of sales to the Brazilian market. Dairy products represented 35.3% of sales while the remaining 13% was generated from sales of other products.