BRF Brasil Foods SA : Release - 2Q12 Results
08/14/2012| 04:12am US/Eastern
Recommend:
Acceleration in grain price increases and implementation of
the
Performance Commitment Agreement - TCD squeeze margins
BRF ended the second quarter of 2012 reporting net sales of
R$ 6.8 billion, a growth of 8.7% compared with the same
period in 2011. Net income was R$ 6.4 million, the Company
recording EBITDA of R$ 565 million, corresponding to 8.3% of
net sales.
Sales volumes in the period totaled 1.4 million tons, a 4.9%
improvement. However, to date, price increases have been
insufficient to neutralize costs arising from spiraling grain
prices.
In addition to a challenging economic scenario, quarterly
results were impacted by the implementation of the complex
initiatives needed to comply with the agreement signed with
the Brazilian anti-trust Administrative Council for Economic
Defense (CADE). The implementation of the agreement implies
transitory costs as well as a temporary fall in the
efficiency of the Company's operations.
These initiatives - which involve the temporary suspension of
some categories as well as the divestment of plants and
distribution centers - are being executed on time and
according to the plan set forth in the agreement signed in
June 2011 approving the merger.
During the period, we concluded a ten-year overseas notes
offering for a total of US$ 750 million and at historically
low costs. This offering has enabled the Company to refinance
its 2012 maturities and at the same time lengthening its debt
profile and reinforcing liquidity.
MARKET PERFORMANCE
Export revenues from the overseas market 11% year-on-year to
R$ 2.8 billion. If compared with the first quarter of 2012,
export business was up by 13.6% Compared with the second
quarter of 2011, however, margins narrowed due to the
performance of certain key markets such as the Middle East
and the Far East where a situation of oversupply has
persisted since last year.
The domestic market continues to report a positive trend in
sales revenue with year-on-year growth of 7%. However,
rapidly spiraling increases in costs caused some erosion in
operating results when compared with the first quarter of
2012.
Sales revenue also rose in the Dairy Products and Food
Service segments, amounting respectively for increases of
9.2% to R$ 702
million and 9.3% to R$ 353 million compared with the second
quarter of the previous fiscal year.
Through the medium of its principal brands, between May and
June of this year, BRF launched 168 products in its various
channels of operations (Brazilian retailing, food service,
international market), both in the meats segment as well as
dairy products. In this way the Company meets the objectives
to bolster its product lines with added value items and to
adjust its market focus.
2Q12
R$ million
|
|
2012
|
2011
|
Ch.%
|
|
Net Sales
|
6,842
|
6,294
|
9
|
|
Domestic Market
|
3,970
|
3,700
|
7
|
|
Exports
|
2,872
|
2,594
|
11
|
|
Gross Profit
|
1,489
|
1,561
|
(5)
|
|
Gross Margin
|
21.8%
|
24.8%
|
(3.0 p.p)
|
|
EBIT
|
281
|
513
|
(45)
|
|
Net Income
|
6
|
498
|
(99)
|
|
Net Margin
|
0.1%
|
7.9%
|
(7.8 p.p)
|
|
EBITDA
|
565
|
786
|
(28)
|
|
EBITDA Margin
|
8.3%
|
12.5%
|
(4.2 p.p)
|
|
Earnings per share*
|
0.01
|
0.57
|
(99)
|
(*) Consolidated earnings per share (in R$), excluding
treasury shares.
1H12
R$ million
|
|
2012
|
2011
|
Ch. %
|
|
Net Sales
|
13,179
|
12,315
|
7
|
|
Domestic Market
|
7,886
|
7,292
|
8
|
|
Exports
|
5,293
|
5,023
|
5
|
|
Gross Profit
|
2,833
|
3,106
|
(9)
|
|
Gross Margin
|
21.5%
|
25.2%
|
(3.7 p.p)
|
|
EBIT
|
549
|
1,038
|
(47)
|
|
Net Income
|
160
|
881
|
(82)
|
|
Net Margin
|
1.2%
|
7.2%
|
(6.0 p.p)
|
|
EBITDA
|
1,097
|
1,602
|
(32)
|
: . .
.·..
EBITDA Margin
8.3%
13%
Earnings per share* 0.18
1.01
(*) Conso/idated earnings per share (in R$)/
excluding treasury shares.
distributed by
|
|
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