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Agenda
Página
Conference Call
1Q07 Results
April 26, 2007
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Presenters
André Gustavo Menezes
Investor Relations Manager
1
Sérgio Longo
Director of Finance and Investor Relations
Wesley Mendonça Batista
Executive Director of Operations
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We are:
The world's third largest beef producer in terms of slaughtering
capacity;
The largest beef producer and exporter in Latin America;
The second largest exporter of fresh beef in the world in terms of
revenues;
The largest exporter of processed beef in the world;
The leading beef seller in the domestic Brazilian market;
Our products include fresh and chilled beef, processed beef and
other beef by-products;
We posted net revenues of R$4.0 billion in 2006, of which 61%
from exports
An overview of JBS
An overview of JBS
2
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Our modern facilities are strategically
located...
Asset Locations
Asset Locations
Overview
Overview
Slaughterhouse
Slaughterhouse/Processing plant
Distribution center
Canned vegetables plant
Canned beef plant
Container field
SP
MG
MS
MT
GO
RO
RJ
Argentina
Brazil
Head of cattle (in thousands)
2.500 ­ 7.500
7.500 ­ 12.500
12.500 ­ 17.500
17.500 ­ 22.500
Over 22.500
JBS' operational
footprint
AC
JBS owns 31 units:
24 slaughterhouses, including
9 processing plants
1 vegetables canning plant
1 beef canning plant
4 distribution centers
1 container area
Geographic diversification
provides:
Operational flexibility to
source from, and produce in,
different locations
Lower transportation costs
Natural hedge to disease risk
3
... to provide flexibility, geographic diversification and access to cattle supplies
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For the 1Q07, JBS posted net revenues of
R$1.1 billion, while our EBITDA grew by
28.4%, with a margin of 14.4%...
4
(*) Net income decreased by 67.0% to R$10.6 million in the 1Q07, mainly due to non-
recurrent expenses related to the Company's initial public offering in the total amount
of R$50.6 million
R$ million
1Q07
1Q06
Var.%
Net Sales Revenue
1.086,10
886,1
22,6%
Domestic Market
460,2
384,6
19,6%
Exports
626,0
501,5
24,8%
Gross Profit
257,6
204,4
26,0%
Gross Margin 23,7%
23,1%
Net Income*
10,6
32,3
-67,0%
Net Margin 1,0%
3,6%
EBITDA
156,2
121,7
28,4%
EBITDA Margin
14,4%
13,7%
Sales Volumes (thousands of tons)
Beef ­ Exports
103,6
76,2
35,9%
Beef ­ Domestic Market
189,2
167,9
12,7%
Total
292,7
244,1
19,9%
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In the domesctic market, net revenues grew
by 19.6%...
...primarily due to a volume growth of 12.7%
and an average sales price increase of 6.2%
5
Beef ­ Domestic Market
1Q07
1Q06
Var. %
Net Sales Revenue (R$ million)
Fresh and Chilled Beef
312,4
267,4
16,8%
Processed Beef
67,3
53,8
25,2%
Others
80,5
63,4
26,9%
TOTAL
460,2
384,6
19,6%
Volume (thousands of tons)
Fresh and Chilled Beef
138,5
122,6
12,9%
Processed Beef
12,6
9,8
28,3%
Others
38,1
35,5
7,4%
TOTAL
189,2
167,9
12,7%
Average Sales Price (R$/kg)
Fresh and Chilled Beef
2,26
2,18
3,4%
Processed Beef
5,34
5,47
-2,4%
Others
2,11
1,79
18,2%
TOTAL
2,43
2,29
6,2%
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Our export revenues grew by 24.8%...
...while our volume to international markets
increased by 35.9%
6
Beef Exports
1Q07
1Q06
Var. %
Net Sales (R$ million)
Fresh and Chilled Beef
436,3
322,7
35,2%
Processed Beef
189,7
178,9
6,1%
TOTAL
626,0
501,5
24,8%
Volume (thousands of tons)
Fresh and Chilled Beef
73,0
48,8
49,6%
Processed Beef
30,5
27,4
11,6%
TOTAL
103,6
76,2
35,9%
Average Sales Prices (R$/kg)
Fresh and Chilled Beef
5,97
6,61
-9,6%
Processed Beef
6,21
6,54
-5,0%
TOTAL
6,04
6,58
-8,2%
Average Sales Prices (US$/kg)
Fresh and Chilled Beef
2,83
3,01
-5,8%
Processed Beef
2,95
2,97
-1,0%
TOTAL
2,87
3,00
-4,3%
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Our operational results...
7
R$ million
1Q07
V%
1Q06
V%
Net Sales Revenue
1086,1
100,0%
886,1
100,0%
Cost of Goods Sold
(828,5)
-76,3%
(681,7)
-76,9%
Gross Margin
257,6
23,7%
204,4
23,1%
Selling Expenses
(99,9)
-9,2%
(77,6)
-8,8%
General and Administrative Expenses
(20,6)
-1,9%
(23,2)
-2,6%
Net Financial Income (Expenses)
(57,0)
-5,2%
(42,2)
-4,8%
Initial Public Offering Expenses
(50,6)
-4,7%
0,0
0,0%
Operating Income
29,6
2,7%
61,5
6,9%
Non Operating Income (Exepnses)
0,1
0,0%
0,1
0,0%
Income Tax and Social Contribution
(19,6)
-1,8%
(29,4)
-3,3%
Minority Interest
0,5
0,0%
0,0
0,0%
Net Income
10,6
1,0%
32,3
3,6%
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During the quarter, JBS invested a total of
R$213.3 million in the following projects...
CAPEX
CAPEX
Increase of the production capacity of its processed beef plant located in
Andradina, São Paulo from 30 tons to 100 tons per day;
Increase of the production capacity of its plant located in Barra do Garça, Mato
Grosso from 1,300 to 2,500 head of cattle slaughtered and deboned per day;
Increase of the production capacity of its plant located in Campo Grande, Mato
Grosso do Sul from 1,300 to 3,000 head of cattle slaughtered and deboned per
day;
Increase of the production capacity of its plant located in Vilhena, Rondônia,
from 900 to 2,200 head of cattle slaughtered and deboned per day;
Construction of a beef jerky production plant in Santo Antônio da Posse, São
Paulo, which is currently in its final phase;
Increase of the production capacity of its plant located in Barretos, São Paulo
from 1,600 to 2,500 head of cattle slaughtered and deboned per day;
Acquisition of new trucks to be used for product transportation; and
Other investments such as acquisition of new equipment and maintenance of
the Company's facilities;
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...including acquisitions in Argentina and the
United States
RECENT EVENTS
RECENT EVENTS
Acquisition of a slaughtering plant in Berazategui, Buenos Aires, Argentina, still
in the process of approval by the Argentine autorithies;
Acquisition of 100% of the North American SB Holdings and its subsidiaries:
-
One of the largest processed beef distributors in the US market;
-
Investment: US$11.9 million;
-
Consolidated net revenues in 2006: US$55.7 million;
The Company entrered into a joint venture to produce, market and distribute
beef jerky and, through this joint venture, a total of US$30 million has been
invested towards:
-
Acquisition of a company in the US (Pioneer) to produce, market and
distribute beef jerky with sales in 2006 of approximately US$22 million;
-
Acquisiton of another US company (Double B) to produce, market and
distribute beef-based products with sales of US$18 million;
-
The company is in the final phase of construction of a beef jerky production
plant in Santo Antônio da Posse, São Paulo, whose operations are expected
to begin in the first half of may
9
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Suggested
Pricing Range
Offering Size
Offering
Structure
Green Shoe
Use of Proceeds
Total Proceeds
R$8.00 per Common Share
200,000,000 Common Shares, representing 23.5% of JBS' capital post-
offering (excluding Over-allotment Option)
Local offering with international sales effort under Rule 144A/Reg-S
Up to 15% of the base offering (100% secondary)
70% capacity expansion investments and acquisition / 30% working capital
R$1.6 billion
Selling
Shareholder
Issuer
JBS S.A. ("JBS")
Listing
Novo Mercado of Bovespa (ticker: JBSS3)
Joint
Bookrunners
1
65% / 35% primary and secondary, respectively, if Over-allotment Option is fully exercised
2
Lock-up Period
180 days for the Selling Shareholders, the Company and Management
ZMF Fundo de Investimento em Participações (Batista family)
Share
Composition
75% primary / 25% secondary
1
Initial Public Offering
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Safe Harbor
We make forward-looking statements that 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 include
statements regarding our intent, belief or current expectations or that of our
directors or executive officers.
Forward-looking statements also include information concerning our possible or
assumed future results of operations, as well as statements preceded by, followed
by, or that include the words ''believes,'' ''may,'' ''will,'' ''continues,'' ''expects,'`
''anticipates,'' ''intends,'' ''plans,'' ''estimates'' or similar expressions. 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 results and
shareholder 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.
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Thank You