Value added focus in dairy, spreads boosts Vigor Q3

Value added focus in dairy, spreads boosts Vigor Q3

Brazilian dairy group Vigor Alimentos benefited from its strategy to focus on value-added dairy and spread products in the third quarter of the year, with EBITDA rising by almost one half.

Vigor said EBITDA totalled BRL86.2m (US$33.7m), up 47.1% on the year. The group said its EBITDA margin rose 1.4 percentage points, climbing to 7.5% of sales. Net income increased 19.9%, climbing to BRL29.9m in the three months to 30 September.

The company said its result was boosted by a focus on higher-value products and an increase in sales. Revenue rose to BRL11.5bn, up 19.2% on last year.

"Vigor continues its strategy of consolidating markets where it already has a strong presence, combined with geographic expansion into new regions through strategic categories and the continued focus on innovation processes," CEO Gilberto Xandó said.

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Revenue increased by 29.4%, with Gross Margin of 34.8% and 
EBITDA Margin of 10.9% in the Parent Company in 3Q14 

Consolidated Net Revenue amounted to R$1.2 billion in 3Q14 

3Q14 Highlights:

  • Volume of 217.5 thousand tonnes sold (+9.9%) 
    - Parent Company: 104.3 thousand tonnes sold (+21.7%)

  • Net Revenue of R$1,150.8 million (+19.2%)
    - Parent Company: R$496.0 million (+29.4%)

  • Gross Profit of R$310.2 million (+25.9%) and Gross Margin of 27.0% (+1.4p.p.)
    - Parent Company: R$172.6 million (+50.8% increase) and Margin of 34.8% (+4.9p.p.)

  • EBITDA totaled R$86.2 million (+47.1%) and EBITDA Margin of 7.5% (+1.4p.p.)
    - Parent Company: R$54.3 million (+144.7%) and Margin EBITDA of 10.9% (+5.2p.p.)

  • Net Income of R$29.9 million (+2.3x) in 3Q14 and Net Margin of 2.6% (+1.3p.p.) 
    - Parent Company: R$16.3 million (+5.6x) and Net Margin of 3.3% (+2.5p.p.)

  • Net Debt: reduction of R$92.3 million in 3Q14 to R$801.6 million, equivalent to 2.6x Consolidated LTM EBITDA (compared to 4.1x in Dec/13 and 3.1x in June/14)

Original source: Vigor Alimentos