March 7, 2012

Minerva posts record revenue in Q4, 2011

Minerva SA, a Brazilian beef integrator and pork and poultry processor, posted a record gross revenue of BRL1,166 million (US$663 million) in that fourth quarter of 2011, up 26.6% from a year ago.

The company recorded positive operating cash flow of BRL73.9 million (US$42 million) after interest payments, signaling that the company's operational and financial efficiency are already producing results after a period of major investments.

In 2011, gross revenue grew 19.2% from 2010 to end the year with record net revenue of nearly BRL4.3 billion (US$2.4 million). Domestic sales grew 53.8% in the year, accounting for 43.2% of the company's total sales in 2011.

EBITDA was BRL116.4 million (US$66.2 million) in 4Q11, up 36.8% in relation to 4Q10, and BRL347.2 million (US$ 197.4 million) in 2011, up 30.5% from 2010. EBITDA margin raised 0.9 percentage point from 2010 to reach 8.7% in 2011.

Minerva credited its consistent financial results improvement to its austere financial policy, efficient working capital management, excellence in risk management and continued maturation of investments.

Its market share of fresh beef exports came to 22.3% in 2011, up 2.1 percentage points from 2010. Minerva's capacity utilisation was constantly above the market average, reaching 74.3% in the year, which remains the industry benchmark, it said.

In the fourth quarter of 2011, average cattle price (quoted in arrobas) contracted in relation to the same period the previous year, and the trend should continue in 2012 first quarter. Minerva sees a turning point in supply as a result of cattle cycle curve's inversion, beginning with a period of higher cattle supply in the sector for the following years.

In February 2012, Minerva successfully concluded the issue of US$350 million in notes in the international market, maturing in 2022, whose proceeds will be used to settle the short and medium-term debt in order to lengthen their debt profile.