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JBS S.A.
1Q08 Results
May 15, 2008
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Presenters
Rodrigo Gagliardi
Investor Relations Manager
1
Sérgio Longo
Finance and IR Director
Joesley Mendonça Batista
CEO
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In the 1Q08 JBS's net revenue grew by 439.4% when compared to the 1Q07,
from R$1,086.1 (1Q07) to R$5,859.1 million (1Q08).
JBS's consolidated EBITDA margin for the 1Q08 was 3.0%, a 85.9% jump
compared to the previous quarter.
JBS USA's gross margin (including JBS Australia) increased by 3.2% to 5.0% in
the 1Q08, compared with the 4Q07.
JBS USA (including JBS Australia) had an EBITDA margin of 0.6% in the 1Q08,
up from the -1.4% margin on the 4Q07.
JBS USA (including JBS Australia) had a 20.3% gain in net revenue in the 1Q08
versus the 1Q07 figure.
JBS MERCOSUL's result was negatively impacted by the European Union
restrictions on its activities and by the economic conjuncture in Argentina.
With operations in four important production and distribution platforms (USA,
MERCOSUL, Australia and Europe), JBS shall capture strong advantages in
comparison to its regional competitors, taking into consideration the current
momentum of increase in demand and low protein offer, in addition to the
scenario of convergence of margins due to the highest globalization of the
industry.
2
Highlights
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CONSOLIDATED RESULTS
RESULTS BY BUSINESS UNITS
MARKET SCENARIO
QUESTIONS AND ANSWERS
AGENDA
3
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345.1
564.9
591.1
94.8
176.3
3.0%
4.2%
1.4%
14.2%
9.6%
12M05
12M06
12M07
4Q07
1Q08
5,859.1
6,650.7
14,141.6
3,967.6
3,577.1
12M05
12M06
12M07
4Q07
1Q08
JBS CONSOLIDATED RESULTS ­ Net Revenue,
EBITDA and EBITDA Margin
Net Revenue (R$ million)
EBITDA and EBITDA Margin
EBITDA Margin (%)
10.9%
256.4%
63.7%
4.6%
Source: JBS
Without considering the acquisitions of National Beef, Smithfield Beef and Tasman.
4
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159.3
591.1
564.9
345.1
286.8
9.1%
9.6%
4.2%
14.2%
2.9%
12M04
12M05
12M06
12M07
1Q08
5,554.2
14,141.6
3,967.6
3,577.1
3,158.0
12M04
12M05
12M06
12M07
1Q08
EVOLUTION OF THE GUIDANCE PUBLISHED IN
01/27/2008 (Without considering the INALCA
and recent acquisitions)
Net Revenue (R$ million)
EBITDA and EBITDA Margin
EBITDA Margin (%)
10.9%
256.4%
63.7%
4.6%
13.3%
20.3%
25,500.0
1,275.0
Source: JBS
Without considering the acquisitions of Inalca, National Beef, Smithfield Beef and Tasman.
22%
12%
5
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JBS CONSOLIDATED
Net Debt over EBITDA
Net Debt/EBITDA*
(R$ million)
· Consolidated Pro-forma LTM
Source: JBS
1,474
1,413
2,329
2,368
2,083
2.9x
3.7x
3.3x
2.3x
2.5x
1Q07
2Q07
3Q07
2007
1Q08
6
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JBS CONSOLIDATED ­ Sales Distribution
Source: JBS
Beef USA
44%
Beef Brazil
21%
Pork USA
15%
Beef
Australia
12%
Beef
Argentina
2%
Beef Italy
5%
Sales Distribution by Division 1Q08
Domestic
Market
66%
Exports
34%
Sales Distribution by Market 1Q08
Impacted by the
USA domestic
market
Source: JBS
7
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JBS CONSOLIDATED ­ Exports Distribution
E.U.
18%
Mexico
12%
Russia
7%
Others
19%
USA
6%
Taiwan
3%
Hong Kong
5%
Canada
5%
South Korea
5%
China
6%
Japan
14%
Exports Distribution 1Q08
Source: JBS
JBS Exports 1Q08: US$ 1.2 billion
8
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JBS ­ PERFORMANCE BY BUSINESS UNITS
5,461
5,579
5,604
1,865
1,634
FY05 FY06 FY07 4Q07 1Q08
Net Revenue
(US$ million)
EBITDA (US$ mi)
EBITDA Margin
-21.8
-99.3
-65.1
-97.1
-19.8
-1.3%
-5.3%
-0.4%
-1.7%
-1.2%
FY05 FY06 FY07 4Q07 1Q08
Margin (%)
Source: JBS
FY of Swift used to be from June to May and INALCA period is from January to December.
JBS USA (Beef)
(1) 14 weeks ended in 12/30/2007. (2) 13 weeks ended in 03/30/2008. (3) Values referring to 100% of INALCA JBS Pro Forma.
(4) EBITDA Normalization of JBS Argentina to 3% and maintenance of EBITDA in JBS Brazil.
9
2,175
2,070
2,243
598
536
FY05 FY06 FY07 4Q07 1Q08
Net Revenue
(US$ million)
EBITDA (US$ mi)
EBITDA Margin
15.7
40.5
122.1
73.3 70.3
2.9%
6.8%
3.2%
3.5%
5.4%
FY05 FY06 FY07 4Q07 1Q08
Margin (%)
JBS USA (Pork)
Net Revenue
(US$ million)
EBITDA (US$ mi)
EBITDA Margin
20.9
17.7
106.0
29.5
45.6
6.1%
3.5%
2.4%
1.7%
5.7%
FY05 FY06 FY07 4Q07 1Q08
Margin (%)
JBS Australia
1,041
1,045
1,006
275
264
FY05 FY06 FY07 4Q07 1Q08
Net Revenue
($ million)
EBITDA ( $ mi)
EBITDA Margin
14.7
16.5
44.0 45.0
51.0
5.6%
6.0%
4.9%
4.8%
4.3%
FY05 FY06 FY07 4Q07 1Q08
Margin (%)
INALCA JBS
(3)
4,892
3,968
3,577
1,319 1,271
FY05 FY06 FY07 4Q07 1Q08
Net Revenue
(R$ million)
EBITDA (R$ mi)
EBITDA Margin
Margin (%)
JBS MERCOSUL
1,914
1,745
1,871
503
342
FY05 FY06 FY07 4Q07 1Q08
(1) (2)
(1) (2)
(1) (2)
(1) (2)
(1) (2)
(1) (2)
(4)
565.0
132.7
199.1
692.5
345.0
143.7
11.3%
10.4%
15.1%
14.2%
14.2%
9.6%
FY05
FY06
FY07
4T07
1Q08
1Q08*
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Global Cattle Prices US$/@
10
Source: JBS
Converging Prices
Converging Margins
20.00
25.00
30.00
35.00
40.00
45.00
50.00
55.00
Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
Jul-07
Aug-07
Sep-07
Oct-07
Nov-07
Dec-07
Jan-08
Feb-08
Mar-08
Apr-08
BRA
AUS
ARG
USA
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-80
-70
-60
-50
-40
-30
-20
-10
0
10
20
30
40
50
60
70
132
137
142
147
152
157
Jul-07
Aug-07
Sep-07
Oct-07
Nov-07
Dec-07
Jan-08
Feb-08
Mar-08
Apr-08
May-08
Margin/Head
Cattle Price
Beef Price
Beef Price vs. Cattle Price in USA
Source: Bloomberg
11
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QUESTIONS & ANSWERS
12
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Disclaimer
13
The forward-looking statements presented herein are subject to risks and
uncertainties. These statements are based on the beliefs and assumptions of our
management, and on information currently available to us.
Forward-looking statements are not guarantees of performance. They involve
risks, uncertainties and assumptions because they relate to future events and
therefore depend on circumstances that may or may not occur. Our future
operating results, financial condition, strategies, market share and values may
differ materially from those expressed in or suggested by these forward-looking
statements. Many of the factors that will determine these results and values are
beyond our ability to control or predict.
Forward-looking statements also include information concerning our possible or
assumed future operating results, as well as statements preceded by, followed by,
or including the words ''believes,'' ''may,'' ''will,'' ''continues,'' ''expects,'`
''anticipates,'' ''intends,'' ''plans,'' ''estimates'' or similar expressions.