August 19, 2009

Brazil's Sadia Q2 profit surges on domestic market sales

Brazilian meat processor Sadia saw its second-quarter net profit jump 124 percent on Friday (Aug 14), partially due to its positive domestic market sales.


Sadia posted second-quarter profit of BRL346 million (US$186 million), compared with BRL154 million (US$82.8 million) in the same quarter of 2008.


Operating revenue was down slightly from BRL2.6 billion (US$1.4 billion) in 2008 to BRL2.57 billion (US$1.38 billion) in the second-quarter of 2009. EBITDA was also down 14 percent to BRL248 million (US$133.3 million).


Sales in Sadia's domestic market accounted for 58.5 percent of the company's total revenues in the quarter, compared to 51.2 percent in 2008.


The devaluation of the dollar for the second quarter in relation to the first quarter was around 13 percent and had an effect on the better financial result for the second quarter of 2009.


In May, Perdigao agreed to take over Sadia to create a global food industry leader with annual sales topping BRL22 billion (US$11.8 billion). However, Brazilian antitrust regulators must approve the merger.


According to the agreement, Perdigao will change its name to Brasil Foods and Sadia will operate as a subsidiary of the enlarged group through a share-swap deal.