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03 May, 2018 -
Washington DC, U.S.
16 May, 2018 -
JBS, the Brazilian giant meat packer, has posted a much larger than expected loss for the first-quarter of 2016 and announces a major corporate reorganisation to bring together its international operations.
JBS posted a loss of BRL2.741 billion (US$769 million) on currency hedging costs and poor results on the company’s U.S. cattle operations in Q1 2016, well over the estimated BRL1.1 billion (US$308 million).
The company says it expects to avoid further losses in the second-quarter with reduced hedging position as of late March, and improving conditions in the U.S. cattle cycle.
The Group is to create JBS Foods International, an Ireland-based company whose assets will encompass its global operations, including its beef plant at Brooks, Alta, and the Brazil-based food processing firm Seara Alimentos.
A separate publicly-traded company, JBS Brazil, is to continue to hold JBS’s Brazilian beef, biodiesel, collagen and carrier businesses as well as its global leather business, JBS Couros.
Through this reorganisation, JBS hopes to improve access to international equity and debt capital markets, allowing the company to raise further financing to support operations while lowering its cost of capital.
No further acquisitions are expected in 2016 and JBS is said to concentrate on consolidating its recent purchases and reducing leverage closer to two times its earnings before interest, taxes, depreciation and amortisation (EBITDA).
Source: Reuterscomments powered by Disqus