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UPDATE 1-BRF Brasil Foods doubles first-quarter profit, beats estimates
April 29, 2013 / 11:11 PM / 5 years ago

UPDATE 1-BRF Brasil Foods doubles first-quarter profit, beats estimates

* Falling feed costs, rising sales boost earnings

* Profit of 359 mln reais beats forecasts of 309 mln reais

SAO PAULO, April 29 (Reuters) - BRF Brasil Foods SA , the world’s largest poultry exporter, doubled its profits in the first quarter from a year earlier due to lower feed costs and higher sales.

The company, known as BRF, reported net income of 359 million reais ($179 million) in a securities filing on Monday, above the average forecast of 309 million reais in a Reuters poll and well beyond the 153 million reais a year earlier.

Costs of corn and soybeans, the main ingredients in livestock feed, fell in the first three months of this year as Brazil started harvesting record soy and corn crops, offsetting drought losses in the United States last season. That, combined with improving domestic sales of meat products and more exports to emerging markets overseas, improved BRF’s profit margins.

The company’s earnings were still lower than the net income of 563 million reais posted in the last quarter of 2012. Profits quadrupled in the fourth quarter, when earnings are normally strongest due to strong sales during the holidays.

Earnings before interest, taxes, depreciation and amortization, a gauge of operating profit known as EBITDA, rose 59 percent to 804 million reais from a year ago, beating an average estimate of 755 million reais in the Reuters poll.

These were the first earnings posted since BRF shareholders elected retail tycoon Abilio Diniz as chairman on April 9, bringing in a seasoned dealmaker who could help speed up international expansion and push for higher domestic prices.

BRF’s shares closed up 0.4 percent on Sao Paulo’s Bovespa index, which ended up 1.17 percent, before posting earnings.

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