Brazilian meat group Marfrig has booked an increase in its first-quarter losses amid lower sales and the impact on the wider industry of a probe into allegations of corruption that rocked the country’s meat sector.
The group’s net loss deepened to BRL233.2m compared to a loss of BRL106m in the corresponding period last year. Marfrig said the result “reflected the operating performance influenced by the 20% depreciation of the US dollar, and the non-recurring expenses with the repurchase of bonds”.
Consolidated net revenue was down 16% over the year-ago period to BRL4.1bn (US$1.3bn). Marfrig pointed to a 20% depreciation of the US dollar on sales from international operations and to the performance of the group’s beef division amid the Carne Fraca investigation into alleged bribes by a number of the country’s meat processors.
EBITDA was down to BRL296m compared to BRL424.1m in the previous year’s first quarter. EBIT fell from BRL299m in the year-ago period to BRL187.5m.
Marfrig said in addition to “seasonally weaker demand”, Brazil’s Carne Fraca investigation had “adversely affected the operations of poultry, beef, pork and processed foods.” At the time the allegations were announced, Marfrig said it was not one of the companies under investigation.