Business

Minerva Foods Reports Robust Financial Growth in Q1 of 2024

In a comprehensive financial disclosure, Minerva Foods (Minerva S.A. – B3: BEEF3 | OTC – Nasdaq International: MRVSY), the premier exporter of fresh beef and its by-products in South America, revealed its exceptional performance for the first quarter of 2024 (1Q24). The company, which is also advancing in the processed meat market, shared that an impressive EBITDA of BRL 628.9 million and a free cash flow of BRL 367 million were achieved within this period.

Strong Free Cash Flow

The reported free cash flow for the first quarter clocked in at BRL 367 million. The figures are even more impressive when examined over a longer timeframe; the recurring free cash flow accumulated over the previous 12 months, ending on March 31, reached BRL 1.3 billion. This represents a remarkable annualized free cash flow yield of 35%. Excluding expenses attributed to the recent acquisitions of ALC (Australia Lamb Company) and BPU Meat (Uruguay), and after accounting for Financial Expenses, Capital Expenditures (Capex), and Working Capital adjustments, the yield stands at a substantial BRL 1.5 billion. Since 2018, the company has demonstrated strong financial management by amassing BRL 6.9 billion in free cash generation.

Substantial Revenue Growth

Minerva Foods reported a consolidated Gross Revenue of BRL 7.7 billion in the first quarter of the year, with exports contributing substantially to this figure, representing 58% of the total. Looking at the performance over the past year leading up to March 31, the company's gross revenue totaled BRL 29.5 billion, with a significant 64% derived from exports. The figures underscore Minerva's dominant position in the South American beef export market, boasting an approximate market share of 20%.

Operational Profitability

The company's EBITDA for 1Q24 reached an impressive BRL 628.9 million, corresponding to an EBITDA margin of 8.8%. The EBITDA performance over the preceding 12 months recorded a robust BRL 2,659.6 million with a slightly higher EBITDA margin of 9.6%. When considering the pro forma performance following the acquisition of BPU Meat, the adjusted EBITDA over the same 12-month period totaled BRL 2,688.6 million. This represents the operational profitability and efficiency of Minerva Foods amid market challenges.

Leverage and Strategic Acquisitions

The net leverage, when evaluated at the end of March and measured by the Net Debt/Adjusted EBITDA ratio over the last 12 months, stood at 2.8x. These figures have been adjusted to account for the pro forma EBITDA of BPU Meat as well as the BRL 1.5 billion laid out as initial payment for the acquisition of assets from Marfrig South America. These strategic acquisitions demonstrate Minerva Foods' commitment to enhancing its market presence and scaling its operations internationally.

Leadership in Sustainability

Adhering to a Sustainability Commitment adopted back in 2021, Minerva Foods has accomplished a noteworthy milestone by achieving 100% monitoring of its direct supplier farms in Argentina, a goal that was accomplished six years before the set deadline for the country. Additionally, in Uruguay, Minerva has achieved oversight of over 90% of its direct supplier farms.

During this period, Minerva Foods received outstanding recognition in the Forest 500 Ranking, where it stood among the top ten best-rated companies in Brazil. The ranking is a critical evaluation that highlights how companies and financial institutions approach deforestation, natural ecosystem conversions, and related human rights issues.

Furthermore, the company secured for the fourth consecutive year the reputable Renewable Energy Gold Seal. This honor is in recognition of Minerva Foods' dedication to sustainability, confirming that all energy consumed by the company's operational units in Brazil is sourced from power plants aligned with high sustainability standards and complying with the 17 Sustainable Development Goals (SDGs) of the United Nations (UN).

Expansive Global Operations

Minerva Foods is an epitome of success in the beef export sector within South America and continues to excel in the processed meat segment. With a presence in multiple countries such as Brazil, Paraguay, Argentina, Uruguay, Colombia, and specialized lamb facilities in Australia, the company has established a global footprint. Its product distribution has reached over 100 countries across five continents, featuring beef, lamb, and derived products. Operating with more than 23,000 dedicated employees, Minerva Foods currently boasts an impressive count of 33 industrial plants, 17 international offices, and 14 distribution centers.

To put the company's financial achievements into perspective, Minerva Foods’ performance is calculated based on the closing price of BEEF3 as of April 30, 2024.

Bridging the Global Demand

Minerva Foods has made substantial headway in establishing itself as the go-to source for high-quality fresh beef and its derivatives, catering to diverse markets and culinary preferences. With their extensive logistic network and international offices, they expertly bridge the gap between South American beef producers and a global marketplace hungry for premium meat products. The global strategic framework of the company has allowed for cost-efficiencies and enhanced market responsiveness, contributing to their exceptional financial standings.

Innovation and Market Adaptation

As demand patterns evolve and consumer preferences shift, Minerva Foods has shown a remarkable ability to adapt and innovate. Their operations in the processed meat segment are reflective of the company’s agility and forward-thinking approach. Minerva’s strategic investments have often been ahead of market trends, allowing them to capitalize on new opportunities and maintain a competitive edge in international markets.

The continued focus on sustainability, evident from their compliance with United Nations' SDGs and various recognitions for their environmental efforts, demonstrates a corporate philosophy that aligns profit with planetary health. Such credentials also improve the company's reputation among ecologically conscious consumers, which is a growing demographic in both domestic and international markets.

Conclusion: A Beacon of Growth and Responsibility

In conclusion, Minerva Foods' first-quarter results for 2024 are the culmination of strategic planning, stringent financial discipline, and a fervent commitment to sustainability. Their impressive financial figures and the obtained sustainability accolades underscore that sustainable practices not only enhance corporate image but also contribute positively to a company's bottom line.

While Minerva Foods’ immediate financial horizon shows clear skies, the company’s vision extends much farther. They are setting new benchmarks for sustainability and operational efficiency, while also expanding their global reach. Through their measured expansion and commitment to ethical sourcing and production, Minerva Foods is shaping the future of the meat industry, advocating for a balance between profitability and environmental stewardship. In an era demanding greater corporate responsibility, Minerva Foods stands out as a leader that translates promises into actions, delivering value to shareholders and society alike.

Embracing the Future with Sustainable Practices

Minerva Foods not only promises a more eco-friendly approach but has already made considerable strides in aligning its operations with sustainable practices. The company’s concerted efforts in monitoring supply chain sustainability demonstrate their commitment to the environment and provide a blueprint for others in the industry to follow. As the company continues to advance in both financial growth and sustainable practices, it strengthens its position as a trailblazer in the global market.

The synthesis of innovation, thoughtful expansion, and responsible governance has undoubtedly played a key role in the solid financial performance seen in the first quarter. As Minerva Foods charts its course for the rest of 2024 and beyond, industry observers anticipate the company will maintain its upward trajectory. With a clear strategy that aligns with the evolving landscapes of both commerce and conservation, Minerva Foods has laid the groundwork to become one of the most respected firms in the food industry.

Beyond its immediate accomplishments, Minerva Foods' initiatives signify a long-term strategy with an eye on the horizon. Their diligent pursuit of sustainability, from the farm level to the finished product, resonates with a broader objective: to drive change within the industry, encouraging a shift towards more sustainable and ethical practices worldwide.

This transformative approach not only helps safeguard the environment but also ensures the longevity of the business. As Minerva Foods continues to lead with robust results and high sustainability standards, it not only redefines success in the meat industry but also charts a path towards a more sustainable future for global meat production and consumption.

In summary, Minerva Foods’ Q1 2024 financial report is a testament to a company that’s effectively navigating the complex terrain of the modern food industry. Their strategic acquisitions and sustained emphasis on sustainability are key factors in their ongoing success. As Minerva Foods consolidates its presence in the market, it offers valuable insights into how companies can thrive economically while upholding a commitment to environmental and social responsibility.

The report not only reflects the strength and resilience of Minerva Foods but also illustrates a proactive approach to business growth that prioritizes both profit and planet. It sets a standard for corporates worldwide, proving that business goals can be aligned with global sustainability efforts. As the future unfolds, Minerva Foods is well-positioned to continue leading the charge in responsible business practices, and their journey thus far serves as an inspiring blueprint for others to emulate.

For more detailed information on Minerva Foods and its various initiatives, visit their official website at www.minervafoods.com, providing a comprehensive overview of the company's operations, sustainability commitments, and financial data to stakeholders and interested parties worldwide.