Sao Paulo | Reuters — JBS SA, the world’s biggest meatpacker, reported an 86 per cent drop in third-quarter net income compared to a year ago on Monday, sliding to around 573 million reais (C$166.3 million).
Net income was under the LSEG consensus forecast of 724 million reais, and far below the whopping four billion-real gain in the third quarter of 2022.
In a financial statement, the company said adjusted earnings before interest, tax, depreciation and amortization (EBITDA) came in at 5.4 billion reais, above consensus estimates of 5.15 billion reais.
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JBS felt pain across key business divisions and posted net revenues of 91.4 billion reais, down 7.6 per cent year-on-year.
In the U.S., the company’s biggest market by sales revenue, beef margins fell sharply as reduced cattle herds limited the availability of animals for slaughter and raised costs, a situation also affecting rival Tyson Foods.
Citing USDA, JBS said U.S. beef exports were down 19 per cent year-on-year through end-September, mainly due to supply restrictions combined with lower Asian demand, which hurt the firm. The three main destinations of U.S. beef exports remain South Korea, Japan and China, it added.
Also in the U.S., wholesale pork prices fell about seven per cent in the quarter from a year ago, as companies made an effort to reduce stock levels, according to JBS.
The silver lining for pork was the international market, as JBS cited data from the USDA showing a 12 per cent increase in pork exports, especially to Mexico and Canada, from January to September.
In its local Seara processed foods divisions, revenues dropped 13.3 per cent year-on-year to 10.2 billion reais as export sales plunged on a persistent global chicken oversupply.
Seara’s exports in dollars slid 14 per cent from the year-ago quarter to $1 billion on lower export prices in the currency. This was partially offset by a rise in the volumes sold by the division, JBS noted.
— Reporting for Reuters by Ana Mano and Roberto Samora.
