© Reuters. Logos of Brazilian meatpacking company BRF SA are seen at the headquarters in Curitiba, Brazil, October 1, 2019. REUTERS/Rodolfo Buhrer
By Ana Mano
SAO PAULO (Reuters) -BRF SA, the Brazilian pork and poultry processor, widened its loss in the third quarter from the same period a year earlier as it continues to grapple with an oversupply of chicken while trying to control grain prices, he said Monday. .
BRF reported a net loss of 262 million reais ($53.37 million) in the third quarter, wider than the 136.7 million loss a year ago but slightly better than an LSEG consensus forecast for a loss. of 279 million reais.
Despite the impact, BRF said improvements in the company’s operational performance were already paying off.
Management hailed a double-digit earnings before interest, taxes, depreciation and amortization (EBITDA) margin of 11.9%, “close to historical profitability levels,” despite pricing pressure in the automotive segment. fresh meat.
BRF also said net income was 13.8 billion reais in the quarter, almost the same as the same period a year earlier.
As for recurring cost pressure from corn, which is used as animal feed, management said the worst may be over.
“This quarter the drop in the cost of grains begins to impact the company’s results as we had anticipated,” CEO Miguel Gularte said in a statement accompanying the results.
“Our predictive models, as well as grain purchasing strategy, are a competitive differentiator for BRF and are proving to be highly efficient,” he added.
BRF’s results, however, still reflect the pain of dealing with a global glut of chicken supply, which has depressed prices in some markets and hurt the broader sector, including rivals such as JBS SA (MILITARY CADET BODIES:).
In comments to reporters, management said chicken production has shown signs of slowing in large suppliers such as the United States and Brazil, while on the demand side, prices are recovering in some markets, bolstering the outlook for company export.
BRF said EBITDA came in at 1.2 billion reais ($244.45 million), slightly above LSEG consensus estimates of 1.17 billion reais.
($1 = 4.9089 reais)
