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Brazil's BRF posts higher earnings, beating analysts' forecasts

Credit: REUTERS/RODOLFO BUHRER

Brazil's largest chicken processor, BRF SA, posted third-quarter net income that beat analysts estimates, helping the company keep its upward momentum driven by strong domestic and international demand for meat products.

Adds details from the earnings statement

SAO PAULO, Nov 8 (Reuters) - Brazil's largest chicken processor, BRF SA BRFS3.SA, posted third-quarter net income that beat analysts estimates, helping the company keep its upward momentum driven by strong domestic and international demand for meat products.

In an earnings statement on Friday, BRF said net income from continuing operations came in at 446 million reais ($109 million) in the period,as net revenue rose by 8.4% to 8.4 billion reais from a year ago.

Analysts had expected net income around 171.35 million reais.

Sales volumes in FRB's Brazil segment increased by 8% from the second quarter of 2019, virtually reaching the same level of last year, the company said.

After demand peaked during the Ramadan season in the second quarter, BRF noted a slight decrease in volumes and margins in the third. Still, the company said sales volumes in key Middle East markets were similar compared with the same year-ago quarter.

Meanwhile in other international markets, volumes rose by some 5% from the third quarter in 2018, driven by strong demand in Asia after a deadly pig disease decimated local herds, creating a meat supply imbalance and boosting prices.

According to the earnings statement, average sales prices grew significantly on these markets, by 32% year-on-year and by 7% quarter-on-quarter, bolstering BRF's adjusted EBITDA margin to 23% in the international segment.

BRF also said adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization - a measure of operating income - came in at 1.6 billion reais last quarter, also beating analysts' estimates of 1.190 billion reais.

($1 = 4.1004 reais)

(Reporting by Ana Mano; Editing by Jan Harvey and Steve Orlofsky)

((ana.mano@thomsonreuters.com; Tel: +55-11-5644-7704; Mob: +55-119-4470-4529; Reuters Messaging: ana.mano.thomsonreuters.com@reuters.net))

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