GLOBAL beef giant JBS’s Australian operations have enjoyed a strong start to the 2025 financial year, with solid rises in net sales value and pre-tax earnings.

First quarter results for the period ended 31 March were announced overnight, suggesting the overall company enjoyed one of its strongest first quarter results in history. Consolidated net sales rose 8.5pc and net profit jumped 50.5pc.

Driven by recent growth in production volume and exports, JBS’s Australian division encompassing beef, lamb, goatmeat, smallgoods and aquaculture was a strong contributor, recording net sales up 12 percent year-on-year to US$1.6 billion (GAAP terms, about $2.47b in Aussie currency). That was driven by a 6pc increase in volume sold and 5pc advance in average price.

Adjusted pre-tax earnings in Australian reached US$160.4 million, up 29pc on this time last year.

The strong growth in revenue from the Australian beef business, compared to the first quarter last year, reflected the higher volume sold in the export market, the company told shareholders.

“Despite the increase in the cost of cattle, which according to Meat & Livestock Australia increased by 7pc compared to the same period last year, the growth in profitability reflected the increase in processed volume, driven by the greater availability of animals, and operational efficiencies achieved through cost reduction initiatives,” JBS said.

The company’s Tasmanian aquaculture business reported a decline in net revenue in the quarter, due to lower sales prices, but this was partially offset by higher volume sold in the export market. Net revenue from the Australian pork business grew 4pc in the first quarter compared to the same period last year, as a result of higher volume sold.

Primo, JBS Australia’s prepared foods unit, reported a decline in net revenue in the quarter compared to the first quarter last year due to continued inflationary pressures that impacted consumer demand.

In Australia, the supply-demand cycle is expected to remain favorable in coming quarters, the company said.

“JBS begins 2025 with one of the strongest first-quarter results in its history – a remarkable performance in what is typically a softer quarter for the global protein industry,” global chief executive Gilberty Tomazoni told shareholders.

Following the completion of registration with the US Securities and Exchange Commission, JBS has also advanced its goal of a dual listing of JBS shares in both Brazil and the United States, Mr Tomazoni said.

“Once approved by our minority shareholders, this step will mark a new chapter in the company’s journey. We believe this dual listing will enhance our international visibility, attract new investors, and further strengthen our position as a global leader in food,” he said.

Poultry and pork businesses in Brazil and the US were the other standout performers last quarter. Seara and Pilgrim’s delivered record first quarter pre-tax earnings margins of 19.8pc and 14.8pc, respectively.

“Our strategy of geographic and protein diversification continues to yield positive results, even amid ongoing margin pressure for JBS Beef North America,” Mr Tomazoni said.

Cost of Goods Sold

The Cost of Goods Sold (COGS) breakdown for JBS’s various business units around the world tells the story of different supply, demand and operating cost challenges.

As can be seen in the graph above, raw material cost (essentially, cattle) in the JBS North American beef business has now reached a record high of 90.2pc. The figure in Australia (includes some lamb and swine purchase costs as well as beef) is 74.3pc, while Brazil is 89pc.

Labour cost is easily highest in Australia at 17.7pc, while North America beef sat at 5.7pc, and Brazil, 4.6pc. Processing costs (other ingredients and packaging) were highest in Australia at 8pc, with North American beef 4.2pc and Brazil, 6.4pc.