MBRF posts net profit of R$94m in first earnings report

The company’s net revenue reached R$41.8 billion, up 9.2% year over year, driven by a 3.7% increase in total sales volume to 2.1 million tonnes, a record for the group.

Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) came in at R$3.5 billion, down 8.6% from a year earlier, while the adjusted EBITDA margin fell to 8.4%, from 10% in the third quarter of 2024. Gross profit totaled R$5.1 billion, a 3% decrease, with a gross margin of 12.3%, compared to 13.9% a year earlier.

According to the company, the figures were compared to Marfrig’s consolidated results, which have included BRF’s data since 2022, when Marfrig became the controlling shareholder. Previously, Marfrig recorded net income attributable to the controlling interest based on its ownership stake in BRF. Following the merger on September 22, Marfrig began to consolidate 100% of BRF’s net profit.

Since the merger occurred near the end of the third quarter, that effect was only partially reflected in the results. If the combination had been in effect for the entire quarter, MBRF’s net income between July and September would have been close to R$200 million, according to sources familiar with the matter.

The report also showed that financial leverage, measured by the ratio of net debt to adjusted EBITDA, stood at 3.09x, essentially flat compared with 3.07x in the same period of 2024.

The consolidated results reflect the performance of the company’s three main business segments. BRF accounted for 39% of total revenue, with a 5.4% increase in net sales but a 14.9% drop in EBITDA. The South American division represented 14% of revenue, with a 31.8% increase in EBITDA, while the North American division accounted for 47% of revenue, up 12.2% year on year.

According to José Ignácio, MBRF’s vice president of finance and investor relations, the lower profit reflects a temporary fluctuation. “The main driver of the decline in net income was BRF’s operational performance, which, although still at very strong and healthy levels, saw a slight year-over-year contraction,” he said in an interview.

Among the factors weighing on BRF’s performance, Mr. Ignácio cited the closure of key export markets for Brazilian poultry, including China, following confirmation of an avian influenza case at a commercial farm in Montenegro, Rio Grande do Sul, in May. With China’s market reopening last Friday, MBRF expects an improvement in BRF’s results in the coming months.

MBRF CEO Miguel Gularte said the quarter was marked by strong commercial performance, with record sales volume and revenue, up 3.7% and 9.2%, respectively. “The quarterly results reinforce MBRF’s potential,” he added.

In Brazil, growth was driven by processed products, with sales volume up 7%. In South America, sales grew nearly 18% year over year, while in the United States, performance remained solid despite a challenging environment. “We maintained strong results in North America, with efficient management of the cattle cycle and stable margins, even amid tighter cattle supply,” said Mr. Ignácio.