GLOBAL animal protein company JBS has reported record high sales for tis third quarter ended September 30, while earnings contrasted sharply on either side of the Pacific.
Within the overall company operations extending across beef, chicken, pork and other assets in North and South American and Australia, net sales for the quarter were record high, up 13pc year on year to US$22.6 billion, while adjusted earnings were down 15pc to $1.83b.
Sales growth across all business units, underscored the strength and diversification of JBS’s global multi-protein platform, global chief executive Gilberto Tomazoni told shareholders.
Net income was down $112 million or 16pc on last year to US$581m.
Australia continued to stand out in the results.
In the company’s Australian operations encompassing beef, lamb, pork, value-adding/smallgoods and aquaculture, year-on-year net sales were up 22.9pc to US$2.192b, and up 18.5pc for the nine months ended 31 September. Australia’s adjusted EBITDA was US$249m, up 42.7pc on a year earlier.
Meanwhile JBS’s US beef operations (measured in USGAAP terms) continue to struggle under the weight of drought-starved cattle supply. While net sales were 14.8pc higher at $7.248b, supported by robust beef demand in the US, gross profit was down 50.2pc to $170m and adjusted EBITDA, negative $46m due to record high livestock prices.
For comparison, JBS Brazil saw net sales 27.7pc higher than last year at US$4.16b, while EBITDA was down 15.6pc to US$312m.
“Despite cutout prices reaching all-time highs, US domestic consumption remained resilient, Mr Tomazoni said. “The US industry continues to navigate a challenging cattle cycle, with limited cattle availability for processing. With cattle supplies at historically low levels, live cattle prices have remained high, pressuring profitability,” he said.
JBS Australia’s net sales growth was primarily driven by higher prices during the period, both in the domestic and export markets, Mr Tomazoni said.
“The beef segment was the main driver of Australia’s year-on-year improvement in profitability. Strong commercial dynamics, with higher prices and increased volumes in both domestic sales and exports, combined with continued operational efficiency gains, more than offset the 26pc increase in cattle costs in the third quarter, versus the same time last year, according to Meat & Livestock Australia.
- A second report will follow after next week’s JBS investor analysts briefing.