SAO PAULO (Reuters) – Meat processor JBS SA’s fourth-quarter profit rose 65% from a year earlier, boosted by strong food sales in China and the United States and a sharp devaluation of Brazil’s real currency, the company said in a securities filing on Wednesday.
For full-year 2020 its profit was 4.6 billion reais, 87% of which came in the fourth quarter.
In the final quarter of 2020, when food sales are traditionally strong, JBS registered net revenue of 76 billion reais, a 33% rise from the fourth quarter in 2019, with growth in local currency terms registered across all business units.
For full-year 2020, JBS boosted net revenue by 32% to 270 billion reais. In the same filing, JBS said it plans to pay 1 real per share in dividends in 2021, corresponding to a record 2.5 billion reais.
JBS said in the United States, where the company derives most of its revenue, beef industry fundamentals remained solid, helping overall financial performance.
Even as JBS grappled with production cuts in the first half of the year related to the coronavirus pandemic, cattle availability and consumer demand bolstered U.S. beef operations, it said.
On the other hand, the U.S. pork division, which also suffered production cuts amid the pandemic, had a 5 percentage-point fall in EBITDA margins to 9.1% in the fourth quarter. And as cattle availability remained low in Australia, JBS reported a sharp reduction of its beef production and margins there last year.
China continues as a main sales driver for JBS’s operations in both Brazil and the United States. Overall, the Asian country is the destination of 31% of JBS’s meat exports which totaled $13.6 billion in 2020.
Last year, JBS accounted for more than 50% of total beef exports to China from the United States. At the same time, revenue from exports to China and Hong Kong from JBS’s Brazil beef division rose by 60% in the fourth quarter.
($1 = 5.6274 reais)
(Reporting by Ana Mano and Nayara Figueiredo in Sao Paulo; Editing by Leslie Adler and Matthew Lewis)