Marfrig has reported higher quarterly profits as the Brazilian meat processor increased its focus on value-added products and disposals and lower financing costs boosted its bottom line.
Net income in the first quarter of 2012 rose 46.7% to BRL34.5m (US$17.3m), up from RBL23.5m in the comparable period of last year.
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The sale of a logistics unit within Marfrig subsidiary Keystone Foods, which the company said improved its cash position by US$390.1m.
During the fourth quarter of 2011, Marfrig’s results were hit by financial expenses of BRL686.4m and the group booked a net loss of BRL138.6m as a consequence. The company emphasised it has now gone some way to tackling this issue, which was largely linked to interest payments.
Financial expenses totalled BRL249.5m in the most recent quarter with lower financing costs resulting from efforts to deleverage the balance sheet. Marfrig’s pro-forma leverage decreased to 3.52x, versus 4.45x in the fourth-quarter of last year.
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EBITDA totalled BRL410.7m in the quarter, up 21.8% from BRL337.3m in the first quarter of 2011 but decreasing 21.8% from the fourth-quarter of last year.
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By GlobalDataSales were down slightly in the period, dipping to BRL5.23bn from BRL5.25bn last year. However, the group said that the proportion of higher-value processed food sales increased to 45% of total revenues, up from 36.4% in the first quarter of 2011.
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