JBS earnings continue descent

JBS earnings continue descent

Brazilian meat group JBS has reported a drop in core earnings in 2011 on the back of losses from its chicken operations, despite a jump in revenue.

Net sales were up almost 13% due to higher revenue from its beef and pork units in the US.

However, the appreciation of the Brazilian real and an EBITDA loss of US$149.8m at the group's Pilgrim's Pride US chicken business in 2011 dented earnings at the world's largest meat group. In 2010, the Pilgrim's Pride business had generated positive EBITDA of $481.9m. As a consequence, JBS's EBITDA fell 16.3% in 2011, totalling BRL3.52bn.

Its consolidated net revenue totalled BRL61.7bn (US$33.8bn), up 12.9% from BRL54.7bn booked during 2012. This sales jump was primarily driven by the performance of its beef and pork units in the US, which increased prices by an average of 20% in the year, the company said.

JBS's bottom line improved despite the company recording a net loss of BRL75.7m. Net losses from Pilgrim's Pride were $495.7m.

In 2010, JBS made a loss of BRL292.8m thanks to a penalty fee due to its delayed IPO in the US.

Excluding Pilgrim's Pride, JBS would have made a net profit in 2011 of around BRL482.6m.