BRF results: Volume progression contributes towards steady sales growth

By Ashley Williams

- Last updated on GMT

BRF's plant in Abu Dhabi, United Arab Emirates
BRF's plant in Abu Dhabi, United Arab Emirates
Growing volume sales across its Brazilian, Turkish and Chinese units has helped BRF increase its net revenue by 5.7% to R$8.2 billion in its first quarter results.

The volume growth in Brazil, which rose by 9.6%, was driven by the strategy of offering a product portfolio more suited to the country and greater availability of products. Volume growth was also prompted by a larger number of customers, reaching 191,000 points of sale, a 13.5% growth compared to last year.

Net revenue across other South American countries, including Argentina, Bolivia, Chile, Paraguay and Uruguay, increased by 12.4% compared to the previous quarter, which was impacted by sales of in natura turkey in Chile.

New categories such as filled fresh sausages, frozen burgers and ready-to-eat pies and meatballs were introduced during the quarter across wholesale channels, which significantly contributed towards its 1.1% rise in market share to 45.7%, according to the Brazilian firm. The wholesale channel represents approximately 20% of the total market.

China and Hong Kong’s volume development came after action was taken to improve the spending structure in the region. Net revenue grew by 12.9% from R$943 million to R$1.08 billion in comparison to the previous year.

Other markets including BRF’s Dubai-based subsidiary OneFoods recorded a total net revenue of R$1.8 billion in Q1 2018, an increase of 39.6% over the same quarter of the previous year. This was helped by local efforts to recover margins.

Total gross profit in the period increased by 11.7% and adjusted EBITDA totalled R$802 million, up 40.7% compared to last year, but net losses declined 60.2% to R$114 million.

Challenges in the domestic market have affected previous quarter net revenue results for BRF following its alleged involvement in the Brazilian meat scandal, which authorities accused the firm​ of covering up salmonella in its chicken.

BRF has more than 30 brands across its portfolio and sells its products in more than 140 countries on five continents. 

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