São Paulo – Brazil’s processed food manufacturer BRF saw revenues go up 5.1% in quarter one (Q1) this year from Q1 2014, to R$ 7.048 billion (US$ 2.414 billion). In the Middle East and Africa, revenues reached R$ 1.5 billion (US$ 513.7 million), up 15.1% from Q1 2014. The financial statements issued by the company last Tuesday evening (28th), attributes the region’s higher revenues to “relevant markets” like the United Arab Emirates and Saudi Arabia, and says the company’s distributor buyout strategy for the region is already taking effect.
BRF also reported higher average product prices in the Middle East. Prices were up 23% in Brazilian reais and 1.5% in US dollars. Sales volume was down 6.4%. BRF has a processing plant in Abu Dhabi, UAE, and bought out distribution companies in Gulf countries last year.
Also on the international front, BRF saw higher revenues from sales to Asia, which were up 6.5% from Q1 2014 to R$ 744.7 million (US$ 255 million). In Europe, revenues dropped by 12.4% from Q1 2014 to R$ 622.1 million (US$ 213 million). In Latin America, revenues reached R$ 393.5 million (US$ 34.7 million), down 6%. Sales volume was down 23% due to the fact that Venezuela didn’t buy from BRF.
This Wednesday (29th), on presenting the statements to investors, company executives said higher revenues are partly the result of strategies such as the prioritization of the Gulf market. They also said BRF has grown despite a challenging international environment of instability in North Africa and Middle East countries and the lack of sales to Venezuela.
Domestically, the company posted net operating profit of R$ 3.8 billion (US$ ), up 5.9% from Q1 2014, chiefly as a result of a 9.8% increase in average prices. Earnings before interest, taxes, depreciation and amortization increased due to the US dollar’s appreciation against Brazil’s real, to R$ 462 million (US$ 158.2 million), up 42.8% from Q1 2014.
As of 1:20 pm this Wednesday, BRF common shares (with voting rights) listed at the São Paulo Stock Exchange (Bovespa) were up 8%, selling for R$ 64.53 (US$ 22.1).
*Translated by Gabriel Pomerancblum
