SDA » Topics » Export Market

This excerpt taken from the SDA 20-F filed Jul 30, 2009.

Export Market

        Sales in the export market increased from 2006 to 2007 in terms of volumes and revenues. Gross export revenues of R$4.6 billion in 2007 represented an increase of 35.9% compared to 2006. Volumes totaled 1,148.3 thousand tons, representing an increase of 19.1%.

        In the Middle East, we maintained our traditional presence in the main areas of the region, with a strong market position and brand recognition. Middle Eastern consumers primarily consume whole birds of low weight (from 0.8 to 1.3 kilograms) and processed products. Exports to Middle Eastern countries accounted for 21.3% of revenues in the export market. Europe, which was responsible for 27.1% of exports revenues, is a large purchaser of poultry cuts and processed products. The main exports to Asia, which accounted for 14.9% of all revenues from exports, are special poultry cuts, pork carcasses and cuts. In the Americas, sales are concentrated mainly on processed products, poultry parts

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and whole birds. The Americas accounted for 13.9% of export revenues. With respect to Eurasia, which comprises the Caucasus region and Russia and represented 20.4% of all exports, Sadia exports were mainly pork and poultry cuts and processed products.

This excerpt taken from the SDA 20-F filed Jun 30, 2009.

Export Market

        Sales in the export market increased from 2006 to 2007 in terms of volumes and revenues. Gross export revenues of R$4.6 billion in 2007 represented an increase of 35.9% compared to 2006. Volumes totaled 1,148.3 thousand tons, representing an increase of 19.1%.

        In the Middle East, we maintained our traditional presence in the main areas of the region, with a strong market position and brand recognition. Middle Eastern consumers primarily consume whole birds of low weight (from 0.8 to 1.3 kilograms) and processed products. Exports to Middle Eastern countries accounted for 21.3% of revenues in the export market. Europe, which was responsible for 27.1% of exports revenues, is a large purchaser of poultry cuts and processed products. The main exports to Asia, which accounted for 14.9% of all revenues from exports, are special poultry cuts, pork carcasses and cuts. In the Americas, sales are concentrated mainly on processed products, poultry parts

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and whole birds. The Americas accounted for 13.9% of export revenues. With respect to Eurasia, which comprises the Caucasus region and Russia and represented 20.4% of all exports, Sadia exports were mainly pork and poultry cuts and processed products.

This excerpt taken from the SDA 6-K filed May 15, 2009.

Export Market

Sadia's performance in the external market followed the sector's trend and was not very favorable in 1Q09 in comparison with 1Q08. Physical sales dropped 10.5%, mostly due to the global economic-financial crisis and credit restriction in the markets of Asia and Eurasia. Gross revenue in this market totaled R$ 1.2 billion, a drop of 3.3% in relation to 1Q08. Average prices in reais increased 3.0% in relation to 1Q08. The regions that imported Sadia products the most were the Middle East and Europe with growths similar to the ones recorded in 1Q08.

Poultry sales volume fell 9.3% mainly due to the Company's distributor in Saudi Arabia having financial difficulties. Despite this, the poultry segment maintained its position of highest participation in revenue in the Company's external market, 69.1% in 1Q09 and 73.5% in 1Q08, reaching a sum of R$ 801.6 million. The products impacted the most were whole poultry. Another factor that contributed to the decrease in physical sales was stronger external competition in product sales due to high inventory levels in the sector. The average prices practiced in this segment showed to be stable in reais with a 0.2% variation in 1Q09, but a drop of 35.0% in dollar terms.




Despite the drop of 17.1% in the volume sold of processed products, the period ended with an increase of 2.3% in gross revenues for a total of R$ 138.8 million. The reason for this is that prices charged in reais increased 23.2%. There was a drop during the period of 9.8% for prices in dollars.

The volume sold in the pork segment remained stable in relation to 1Q08 due in part to the drop in demand from countries such as Ukraine and for the increase in sales to other countries such as Angola. Gross revenues from this protein increased 4.7%, totaling R$ 116.7 million. In relation to 1Q08, the average price increased 4.8% in reais while in dollars there was a decrease of 29.0%.

The beef segment was the one most affected by the decrease in the Company's export demand. The volume sold fell 43.0% and revenue generation, which totaled R$ 39.4 million, had a drop of 36.2%. The average prices charged in reais, however, increased 12.1%, while the prices in dollars fell 20.7%.


This excerpt taken from the SDA 6-K filed Mar 30, 2009.

Export Market

Sadia performance in the export market was also favorable in 2008. In relation to the prior year, physical sales were 5.0% higher and revenues, 21.7% higher. Gross revenues totaled R$ 5.6 billion, and average prices had an increase of 18.0% in reais and 23.9% in U.S. dollars. The main importing regions of Sadia products were the Middle East and Europe. The Middle East was the market that grew the most in relation to 2007.

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BREAKDOWN OF GROSS OPERATING INCOME – EXPORT MARKET

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The poultry segment recorded an increase of 8.2% in total volume sold and continued to be the most representative in terms of share in the total revenues of this market, from 70.8% in 2007 to 74.0% in 2008, totaling R$ 4.1 billion.

Average prices recorded an increase of 17.6% in reais and of 23.5% in U.S. dollars, mostly due to an improved mix, and the superior sales of poultry cuts.

The increase of sales in the segment of processed products continued to the Company’s focus, since this is the segment with the highest added value. In 2008, physical sales of this segment grew by 18.6%, and gross revenues increased by 41.2% in relation to 2007 totaling R$ 667.9 million, as a result of the higher average price charged, of 19.2% in reais and 25.2% in U.S. dollars. The products which contributed the most to the revenues of this segment were baked, grilled and breaded products. The main importing region of processed products continued to be Europe. The highlights were the sales to the Middle East, Russia and Venezuela.

The volume sold of the pork segment in 2008 recorded a drop of 21.3% due to the redirecting of this protein to the production of processed products, particularly to sales in the domestic market. Revenues totaled R$ 489.7 million in the year, 2.1% higher than that of 2007. Due to the reduction of the offer of this protein to the market, the average price in reais increased by 29.8% and in U.S. dollars, by 36.3%.

The restrictions imposed by the EU to the beef and the reduction in demand in the main importing markets encouraged the redirecting of beef products to the domestic market, causing a decrease of 26.3% in volume and of 13.2% in export revenues, a year to date decrease of R$ 234.2 million. The mix adjustment, however, increased the average price in reais by 17.8% over that of 2007, and in U.S. dollars, 23.7% higher.

 

This excerpt taken from the SDA 6-K filed Oct 30, 2008.

Export Market

Income generated in the quarter increased by 27.3%, totaling R$ 1.5 billion, mostly due to an increase of 16.4% in average prices. The volume sold grew by 14.2% in the 3Q08, totaling 328.8 thousand tons. In the 9M08 the income generated rose 26.3% in relation to same period in 2007 and prices charged by the Company increased by 17.3%. The real appreciated 9.9% in relation to the U.S. dollar in the 3Q08/3Q07 and appreciated 14.8% in the 9-month comparison.

The poultry segment accounted for 73.8% of the total income generated by exports in the 3Q08. This income totaled R$ 1.1 billion in the 3Q08, a growth of 31.9%. The volume sold totaled 260.6 thousand tons representing a growth of 17.3% in relation to the same period in 2007. The average price charged in the period increased by 12.6% in reais and 23.8% in U.S. dollars. In the 9M08, revenue reached R$ 3.0 billion, a growth of 32.9%, and the volume sold totaled 723.4 thousand tons, an increase of 12.9%. The increased price average in reais in the 9M08 was 17.8%, representing an increase of 35.3% in U.S. dollars.

 

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The segment of processed products accounted for 13.6% of the export revenues in the quarter. Income totaled R$198.0 million in the 3Q08, a growth of 73.7% in relation to 3Q07, while physical sales of this segment totaled 39.4 thousand tons, a growth of 34.2%. The most representative products of this segment, as to income, were baked, grilled and breaded products. In the quarterly comparison, the average price increased by 29.6% in reais and 42.5% in U.S. dollars. Income from exports in this segment had a growth of 42.8% in the 9M08 when compared to the same period in 2007, a year-to-date figure of R$ 478,7 million, representing 11.7% of total sales. The volume sold totaled 98.5 thousand tons in the 9M08, an increase of 20.2%. The increase in average prices contributed to the evolution of income, since it was 18.8% higher in reais and 36.4% in U.S. dollars.


The pork segment had an income growth of 15.9% in relation to the 3Q07 totaling R$ 133.4 million, with a fall in volumes of 20.8% to 22.7 thousand tons and an evolution of 46.3% in the average in reais in the 3Q08, representing an increase in U.S. dollars of 60.8%. In the 9M08, income rose 13.5%, to R$ 389.8 million, and prices increased 27.2% in reais and 46.0% in U.S. dollars while the volume had a reduction of 10.8%, to 71.3 thousand tons. This fall in volumes, as much in the 3Q08 as in the 9M08, occurred due to the redirecting of this protein to the production of processed products in the domestic market, to take advantage of the heated demand for these products.

Beef exports generated an income of R$ 41.3 million in the quarter, a reduction of 10.3%; physical sales dropped 22.5%, to 6.2 thousand tons.  Beef export prices increased 16.0% in the 3Q08 in reais, representing an increase of 27.5% in U.S. dollars. In the 9M08, revenues totaled R$168.7 million, a drop of 19.1% and volumes 29.0% lower than those in 9M07. Beef export prices increased by 13.9% in reais, representing am increase of 30.8% in U.S. dollar. Beef sales to the international market continue to be affected by the European embargo on the Brazilian beef. In the 3Q08, those barriers started to be gradually removed.


BREAKDOWN OF GROSS OPERATING INCOME – EXPORT MARKET

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AVERAGE PRICES – R$/KG – EXPORT MARKET


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EXPORTS BY REGION

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This excerpt taken from the SDA 20-F filed Jun 27, 2008.

Export Market

 

Sales to the export market dropped from 2005 to 2006 in terms of volumes and revenues. Shipments totaled 964.0 thousand tons, representing a decrease of 4.2%. Gross export revenues of R$3.4 billion in 2006 represented a decrease of 16.2% from 2006 levels.

 

In the Middle East, we maintained our traditional presence in the main areas of the region, with market leadership and brand recognition. Middle Eastern countries primarily consume whole birds of low weight (up to 1.2 kg) and processed products. Exports to Middle Eastern countries accounted for 23.0% of revenues in the export market. Europe, which received 26.0% of exports, is a large purchaser of poultry cuts and processed products. With respect to Eurasia, which comprises the Caucasus region and Russia, Sadia exports were mainly pork and poultry cuts. This region represented 21.0% of all exports. The main exports to Asia, which accounted for 15.6% of all revenues from exports, are special poultry cuts, pork carcasses and cuts. In the Americas, sales are concentrated mainly on processed products, poultry parts and whole birds. The Americas accounted for 15.5% of export revenues.

 

This excerpt taken from the SDA 20-F filed Jun 29, 2007.

Export Market

Strong export demand for Sadia products in 2005 resulted in a 20.1% increase in revenues, to R$4.1 billion. Sales volumes reached record levels, surpassing the 1.0 million ton mark for the year, representing a 17.6% increase over 2004 shipments.

Sadia’s performance was due to its ability to increase international prices, optimize logistics and improve product mix. In dollar terms, these factors effectively offset the 11.8% devaluation of the

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average dollar for the twelve months ended December 31, 2005 against the twelve months ended December 31, 2004.

In the Middle East, Sadia maintains its traditional presence in the principal areas of the region, with market leadership and brand recognition. Middle Eastern countries primarily consume whole birds of low weight (up to 1.4 kg) and processed products. Exports to Middle Eastern countries accounted for 25.7% of revenues in the export market. Europe, which received 24.0% of exports, is a large purchaser of poultry cuts and processed products. With respect to Eurasia, which comprises the Caucasus region and Russia, Sadia exports were mainly pork and poultry cuts. This region represented 21.4% of all exports. The main exports to Asia, which accounted for 15.6% of all revenues from exports, are special poultry cuts, pork carcasses and cuts. In the Americas, sales are concentrated mainly on processed products, poultry parts and whole birds. The Americas accounted for 13.3% of export revenues.

This excerpt taken from the SDA 6-K filed Nov 9, 2006.

Export Market

With the reduction of inventories in the international markets and the gradual recovery of demand and prices, due to the lessening of the concern over the avian influenza in the world, the first signs of recovery started to appear in the 3Q06. Volumes shipped grew 9.8% in relation to the 2Q06, to 254.5 thousand tons and export revenues rose 26.9% in the same period, totaling R$ 953.2 million. In the 3Q06, Sadia´s exports expanded to a new destination, Egypt, with the announcement in July of its release of chicken imports.

 

Poultry, Sadia's main export product, is again recording an increase both in shipped volume and in revenues. Concerns in relation to the Avian Influenza are diminishing gradually with the worldwide efforts to slow down the spreading of this virus. The 200.0 thousand tons of poultry shipped in the 3Q06 represented a growth of 6.6% in relation to the prior quarter and generated revenues of R$ 676.6 million – up 29.2% from the 2Q06. The participation of poultry exports in the total revenues from this segment grew to 86.5% in the 3Q06, compared with 82.8% in the 2Q06. Out of the total revenues earned by Sadia in the external market, this segment accounted for 71.0% in the 3Q06, the same level of the 3Q05.

 

This quarter was also marked by a gradual pick-up in the exports of pork to Russia. Although Russia kept the restrictions on the imports of Brazilian pork from a number of states the Russian government reopened the market to exports from Rio Grande do Sul and Mato Grosso, states where Sadia has pork slaughter facilities.

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From the 2Q06 to the 3Q06, the shipments of these products advanced 46.9% and export revenues grew 56.2%. The exported volume of pork totaled 23.5 thousand tons, generating revenues of R$ 110.8 million. In relation to the same period of the last year, this segment still records a decline in physical sales and revenues.

 

The external sales of processed products totaled 18.8 thousand tons in volume, corresponding to R$ 90.7 million in revenues. This reflects a growth of 1.9% and 4.0% respectively in relation to the second quarter. In terms of revenues, the increase was higher than that of the shipped volumes due to the increasing average selling price both in reais and in strong currency in comparison to the 2Q06. In relation to the 3Q05 the volume was 18.7% lower while revenues were 15.1% lower. These results are explained primarily by the reduction of purchases done by the government of Venezuela.

 

The beef segment, following the Company's strategy of returning to this market as from the 4Q05, had a growth in shipments and in revenues both in the quarterly and in the annual comparisons. The sales volume in the external market totaled 12.2 thousand tons in the 3Q06, representing an increase of 84.8% above the 3Q05 and 24.1% above the 2Q06. The export revenues from this segment, of R$ 74.5 million, more than doubled in relation to 3Q05, being equivalent to a growth of 29.6% in relation to 2Q06. The participation of beef exports in total revenues generated by the external market rose from 2.9% in the 3Q05 to 7.8% in the 3Q06.

 

This excerpt taken from the SDA 20-F filed Jun 30, 2006.

Export Market

In terms of exports, even with the 8.1% appreciation of the Brazilian real compared to the U.S. dollar in 2004, export revenues increased 34.1% and accounted for a 49% share of total revenues. Export volumes were 28% higher than those in 2003.

With the AI epidemic in Asia, which reduced the world supply of poultry, international prices rose substantially in the first quarter of 2004. With the gradual reestablishment of supply, the entrance of new

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players in the market, and the trend in consumption to replace poultry with other kinds of meat, the high point of the cycle was interrupted in the region.

In Europe, competition conditions remained stable, since no restrictions were placed on processed products from countries affected by AI. Sadia took advantage of opportunities that opened up for Brazilian products, expanding its presence in the Asian region. During the year, gross revenues for the export market increased 34.1% over 2003. Regarding the processed products line, the 42.4% growth in revenues reflects the Company’s efforts to increase its share of higher value-added products in the export market, as well. The growth in revenues is also the result of the stepping up of business activities in new markets in South America, which made it possible to increase sales of products that were previously under represented in the export mix, such as bolognas, salamis and margarines. The pork segment, negatively affected by the Russian government’s establishment of quotas, represented a 3% decrease in revenues. The distribution of Sadia’s exports has remained well balanced among the principal regions of the world. The more than 1,000 items exported are developed according to the features of each market.

Europe, which received 23% of exports, is a large purchaser of poultry cuts and processed products. In the Middle East, the Company maintains its traditional presence in the principal areas of the region, with market leadership and brand recognition. Arabic countries primarily consume whole birds of low weight (up to 1.4 kg) and processed products. With respect to Eurasia, which comprises the Caucasus region and Russia, Sadia exports mainly pork and poultry cuts. The main exports to Asia are special poultry cuts, pork carcasses and cuts. In the Americas, sales are concentrated principally on processed products, poultry parts and whole birds. Secondary markets include regions with great potential for growth in the medium term.

This excerpt taken from the SDA 20-F filed Nov 14, 2005.

Export Market

 

Even with the appreciation of the real against the dollar in 2003 and the raising of protectionist barriers in some international market regions, revenues increased 31.2%, from R$ 1,928.0 million in 2002 to R$ 2,529.3 million in 2003. Export sales as a percentage of gross revenues increased from 44.7 % in 2002 to 49.6% in 2003 and volumes sold reached 668 thousand tons, 9.9% over the 608 thousand tons shipped in 2002. This performance resulted from diversifying destinations and increasing exports of processed products.

 

This excerpt taken from the SDA 20-F filed Jul 12, 2005.

Export Market

 

Even with the appreciation of the real against the dollar in 2003 and the raising of protectionist barriers in some international market regions, revenues increased 31.2%, from R$ 1,928.0 million in 2002 to R$ 2,529.3 million in 2003. Export sales as a percentage of gross revenues increased from 44.7 % in 2002 to 49.6% in 2003 and volumes sold reached 668 thousand tons, 9.9% over the 608 thousand tons shipped in 2002. This performance resulted from diversifying destinations and increasing exports of processed products.

 

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BRF-BRASIL FOODS S.A. (PDA)
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