Minerva Foods (BEEF3) net profit remains stable in the third quarter, at R$141 million

Minerva Foods (BEEF3), the largest beef exporter in South America, ended the third quarter with a net profit of R$141 million, 0.3% lower than in the same period in 2022. Earnings before interest, taxes, Depreciation and amortization (EBITDA) fell 11.5% in comparison, to R$713.7 million, and revenue fell 16.2%, to R$7.068 billion.

The declines in EBITDA and revenue were basically determined by the fall in meat prices, driven by the decline in cattle prices. The reduction was greater than that in export prices to markets such as China, the main destination for Brazilian beef shipments. But, in general, the company works with a positive scenario for South American shipments.

This is because the United States continues to have a reduced supply of cattle, which limits its beef shipments. And, with El Niño, the climate is not favorable in the country, in the same way that it is harming the segment in Australia, another major protein exporting country. The scenario, as reinforced by Fernando Queiroz, CEO of Minerva, opens up more space for exports from South America.

“And we are optimistic about China’s recovery,” said the executive.

Edison Ticle, CFO of Minerva, highlighted that one of the main highlights of the third quarter was the generation of free cash, which reached R$608.1 million and reached around R$1.2 billion in the 12-month period ended in September . Leverage (net debt/EBITDA) remained stable at 2.8 times during the period.

In the 12-month period ended in September, Minerva’s net profit totaled R$350 million, a drop of 57.9% compared to the same period in 2022. Ebitda fell 13.5%, to R$2.564 billion, and the net revenue decreased 12.9%, to R$27.565 billion.

Of the accumulated gross revenue of R$ 29.46 billion (a drop of 12.2%), R$ 18.813 billion was obtained in the foreign market (a drop of 18.6%) and R$ 10.647 billion in the markets where the company is present with production structures (down 1.9%) – Brazil, Argentina, Colombia, Uruguay, Paraguay and Australia.

In the third quarter, Minerva closed an agreement to acquire 16 plants from Marfrig, for R$7.5 billion, a transaction that still depends on Cade’s approval, and moved forward with the completion of the purchase of the subsidiary BPU Meet, in Uruguay. With an eye on the transaction with Marfrig, Minerva recently raised US$1 billion with bonds.

In August, the company also paid interim dividends totaling R$114 million (R$0.19 per share). In the last 12 months, the company distributed approximately R$322.6 million in dividends (R$0.55/share).