May 14, 2021

BRF Q1 profits below analysts' estimates

Major Brazilian food processor BRF SA posted a net profit of BRL 22.4 million (~US$4.22 million; BRL 1 = US$0.19) in the first quarter of this year, below analysts' estimates of BRL 112.7 million (~US$21.2 million), but higher than the BRL 38 million loss (~US$7.1 million) reported in the same period last year, Reuters reported.

The company said it sold 1.1 million tonnes of food products, stable compared to the first quarter of last year. But net revenue increased by an annual 18.4% to BRL 10.6 billion (~US$1.9 billion) due to 20% higher prices.

The majority of the company's food sales were in Brazil, where it faces surging feed costs that affected its gross margins last quarter. Brazil's economic weakness also affected its sales of processed foods, as the company reported a 20% drop in the segment's volumes compared to the previous quarter.

BRF's international results were boosted by a 9.6% annual increase in net sales to the Asian market at BRL 1.5 billion (~US$282 million). This offset a 3.1% decline in volumes sold to the Asian market during the first quarter.

BRF said there is growing demand for its chicken and pork products in China, with a 9% growth in sales volumes. But the company said its other Asian markets remained impacted by the COVID-19 pandemic.

BRF reported earnings before interest, tax, depreciation and amortisation (EBITDA) of BRL 1.234 billion (~US$232 million), above a consensus projection of BRL 1.218 million (~US$229 million).

- Reuters