Financial Data and Key Metrics Changes - The company reported net revenue of R2.1 billion, resulting in an EBITDA margin of approximately 16% [22] - Free cash flow performance was R$844 million, and the financial cycle was reduced to 4.7 days, three days less than the same period last year [22] - Inventory turnover reached a historic low of 75 days, and leverage was at 1.45x EBITDA, the lowest in eight years [22][6] Business Line Data and Key Metrics Changes - In agriculture, feed conversion for poultry and pork decreased by 2.9% and 0.6%, respectively, while chicken mortality fell by 1% and pork by 0.7% [5] - Factory output increased by over 3.6%, and logistics improvements led to reduced returns and significantly raised service levels in Brazil [5] - The halal market saw growth due to Ramadan, with new product launches contributing to performance [4] Market Data and Key Metrics Changes - The international market showed healthy margins, with an EBITDA margin increase of 6% compared to the previous quarter, driven by recovery in export rates and strong performance in Turkey and GCC [4] - The company expanded its business alternatives with 25 new licenses for various markets, maximizing prices [23] Company Strategy and Development Direction - The company is focused on continuous improvement through the BRF+ program, which has become part of its culture and operational strategy [9] - There is an emphasis on capturing commercial opportunities in both domestic and export markets, leveraging strong brand recognition [10] - The company aims to maintain a balance between growth and profitability, with a clear strategy for sustainable and responsible growth [100] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the market's resilience and the company's ability to capitalize on opportunities, particularly in exports [10][11] - The company is closely monitoring cost dynamics, especially regarding grains, and expects stable feed costs in the short term [90] - Management highlighted improvements in operational efficiency and the potential for further gains as the BRF+ program continues [117] Other Important Information - The company has initiated a fundraising campaign to support communities affected by recent events, demonstrating its commitment to social responsibility [20] - The company reported a significant improvement in employee engagement, reflecting effective management practices [25] Q&A Session Summary Question: What is the expectation regarding costs and efficiency? - Management indicated that the efficiency program is ongoing, with expectations for continuous improvement in performance indicators [14] Question: How does the company view the international market, particularly China? - The company noted a shift in export dynamics, with a decrease in poultry exports to China compared to previous years, but overall expectations for growth in Asia remain positive [51] Question: What are the plans for capital allocation and shareholder returns? - Management emphasized a focus on reducing gross debt while considering shareholder returns through dividends and buyback programs [48][49] Question: How is the company addressing logistics challenges? - Management confirmed that logistics operations have improved, with a focus on maintaining production flow despite recent disruptions [42] Question: What is the outlook for processed products and market share? - The company reported a stable market share in processed products and highlighted the potential for growth in categories like cold cuts [74] Question: How does the company plan to balance growth and profitability? - Management reiterated the importance of sustainable growth, emphasizing that growth should not come at the expense of profitability [100]
BRF(BRFS) - 2024 Q1 - Earnings Call Transcript