JBS N.V. Q4 FY2025 earnings call

• Gilberto Tamazoni mentioned closing 2025 with consistent performance, record sales in fourth quarter and full year, and a diversified multi-protein and multi-geography platform as a strength. - Guilherme Cavalcanti walked through financial results in detail, including net sales, adjusted earnings, net income, free cash flow, leverage, and debt profile. - Discussed performance in different regions and business units like Australia, Brazil, US, Friboi, Seara, Pilgrims, etc., highlighting growth, margin expansion, and brand diversification. - Completed dual listing process, becoming a NYSE-listed company, improving market valuation and liquidity.

In the fourth quarter, revenue was $23 billion with an EBITDA margin of 17.4%. Full year revenue reached $86 billion, a company record, with a consolidated EBITDA margin of 7.9%. Net income was $515 million in the quarter and $2 billion for the year, up 15% year-over-year. Free cash flow was $990 million in the quarter and $400 million for the year. Return on equity was 25% and return on investment capital was 17%. Australia had strong EBITDA growth and margin expansion, with top line growth of 30% year over year in the fourth quarter. Brazil's beef business had strong export and domestic demand, with fourth quarter top line sales growing 26% year over year and a record beef processing volume of around 42 million heads. Friboi had solid results with growth in export and domestic sales. Seara strengthened brands and expanded high-value-added products. In the US, chicken business benefited from strong demand, with Pilgrims having volume growth above industry average and Just Buyer surpassing $1 billion in retail sales. US pork business had stable performance with solid margins.

• For 2026, assumed capital expenditures of $2.4 billion ( $1.3 billion for expansion, $1.1 billion for maintenance), interest expenses of $1.15 billion, leasing expenses of $500 million, and a consolidated effective tax rate of 25%. - Mentioned it's early to estimate working capital and biological assets variation. - Announced payment of $1 per share in dividends to be paid on June 17th.

• Q: Update on business environment for PPC in US, status of Russellville plants, market prices.

A: Completed transformation of Pilgrims' plants, demand for chicken meat in US is high, balanced supply and demand. - Q: Update on US beef operations, recovery of beef spreads, Greeley situation.

A: First quarter tough, market volatile, had a good deal with unions, hope Greeley situation resolves soon. - Q: Balance between chicken supply and demand in Brazil, capacity adjustments in US beef.

A: Chicken supply-demand balance unclear, many tools to manage supply; hard to comment on other companies' capacity adjustments. - Q: Export environment for Brazil beef, Australia's export quota to China, derivatives on P&L, working capital.

A: Australia not worried about export quota to China, Freeboy focused on new markets; derivatives not related to operations; early to estimate working capital. - Q: Justification for US Beef strong quarter performance, margin rebound, Seara margin.

A: Volatility in market, positioning, and margin of international chicken higher than domestic prepared food in Seara. - Q: Working capital details, consumer behavior in Seara domestic market, grain inventories and feed costs.

A: Deferred livestock and inventory rebuild; consumer market starts weak then recovers; corn cost expected higher, soybean meal price stable. - Q: Mexico cattle imports reopening, Seara investment cycle and volume growth.

A: Difficult to forecast Mexico cattle imports reopening; Seara investments to be completed this year, volume growth around 10%-13%. - Q: CapEx projects, M&A opportunities.

A: CapEx projects include Pilgrims' expansion, Oman project, Paraguay plant, Cactus Texas; no imminent M&A opportunities. - Q: Volumes and growth regions, impact of Middle East conflict on freight.

A: Strong demand in Europe, Asia, Middle East, US; Middle East conflict impacts freight costs, but flow of product still there. - Q: Pockets of improved market fundamentals and beef cycles.

A: All business units have improvement opportunities; seeing herd rebuild in US, middle cycle in Australia, Brazil has opportunities. - Q: US beef demand resilience, value-added products performance, US government bill.

A: Beef demand remains strong; focus on value-added products; US government bill not a concern. - Q: Geographic diversification, table eggs business.

A: US benefits from import meat from Brazil and Australia; table eggs business is important, excited about growth. - Q: US pork business disease impact, NYSE listing benefits and index inclusion.

A: Disease impact on US pork business variable; NYSE listing has increased liquidity and valuation, potential for index inclusion. - Q: Seara shipment resumption to China, margin improvements.

A: Resumption of shipments to China helped profitability, impact from volume, price, and fixed cost dilution. - Q: Capital allocation, dividend and share repurchase.

A: Plan to pay $1 billion in dividends this year; share repurchase depends on cash generation; callable bonds have low interest rates, opportunities for liability management. - Q: Value add in North America, egg industry opportunities.

A: Greenfield projects make sense for value add; look at egg industry opportunities based on accretive acquisitions.