Q2 2024 Marfrig Global Foods SA Earnings Call Transcript
Key Points
- Marfrig Global Foods SA (MRRTY) reported a consolidated net revenue of BRL34.8 billion for Q2 2024, marking a 16.5% increase compared to the same period in 2023.
- The company achieved a consolidated adjusted EBITDA of BRL3.4 billion, which is 64.8% higher than the previous year, with a margin increase of 285 basis points.
- Free cash flow was positive at BRL419 million, and the company reported a net income of BRL75 million, a significant turnaround from a loss of BRL784 million in the same period last year.
- Marfrig Global Foods SA (MRRTY) has been successful in its sustainability efforts, achieving 100% compliance in audits related to livestock in the Amazon for the 12th consecutive year.
- The company has made strategic investments in BRF and a diversified business model, focusing on value-added products, which contributed to a strong EBITDA performance.
- The North American operation experienced a 41.3% decline in EBITDA compared to the previous year, with margins impacted by higher cattle prices and lower drop values.
- In South America, the adjusted EBITDA margin contracted by 1.4% due to economic challenges in Argentina, affecting the fresh meat operation.
- The company faces challenges in the North American market with lower fed cattle supplies expected to reduce capacity utilization and margins in the second half of 2024.
- Despite strong beef demand, the North American operation anticipates lower profitability in Q3, traditionally a weaker quarter after the barbecue season.
- Argentina's economic situation, including high inflation and smaller cattle supply, continues to pose challenges for Marfrig Global Foods SA (MRRTY)'s operations in the region.
Good afternoon. Thank you for waiting. Welcome to Marfrig's Q2 2024 earnings call. We would like to inform you that this is being recorded and interpreted to both languages. (Operator Instructions)
We have Mr. Marcos Molina, Founder and Chairman of the Board; Mr. Tim Klein, CEO of North American Operations; Rui Mendonca, South American CEO; Tang David, CFO and IR Director; Jose Ignacio Scoseria, Corporate Finance Director; Mr. Paulo Pianez, Sustainability Director; and finally, IR Director, Mr. Eduardo Puzziello.
(Operator Instructions) Before we proceed, we'd like to say that any forward-looking statements are related to the business perspectives of Marfrig Global Foods or its projections based on the company's premises as well as currently available information for Marfrig Global Foods S.A.
Forward-looking statements are not any guarantee of performance because they relate to future events that may or may not occur. Investors and analysts should understand that overall economic conditions, among other operational factors may impact Marfrig's results that will lead to results
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