JBS

This article first appeared on GuruFocus. Adjusted Net Income: USD218 million, with adjusted EPS of USD0.20. Adjusted EBITDA (IFRS): USD1.43 billion, with a margin of 6%. Adjusted EBITDA (US GAAP): USD1.3 billion, with a margin of 5.3%. Net Sales: Record USD24 billion for the second quarter. Net Loss: USD102 million, with a negative EPS of USD0.10, impacted by nonrecurring items. Adjusted Operating Income: USD790 million (IFRS) with a 3.3% margin; USD866 million (US GAAP) with a 3.6% margin. Free Cash Flow: Positive USD130 million, an improvement of USD185 million year-over-year. JBS Brazil Beef Adjusted EBITDA: USD269 million, with a margin of 5.9%, marking the highest EBITDA for a second quarter. US Beef EBITDA Margin: Improved from negative 3.9% in Q2 2025 to negative 1.3% in Q2 2026. US Pork EBITDA Margin: Reached 8.9%, compared to 6.5% a year ago. Net Leverage: Ended the quarter at 3.1 times, slightly above the long-term target of 2 to 3 times. Capital Expenditures: Expected USD2 billion in 2026, a USD400 million reduction versus the initial estimate. Warning! GuruFocus has detected 8 Warning Signs with JBS. Is JBS fairly valued? Test your thesis with our free DCF calculator. Release Date: August 11, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Adjusted EBITDA improved sequentially across most business units, with JBS Brazil posting its highest-ever second-quarter EBITDA of $269 million. US beef EBITDA margin improved from -3.9% to -1.3% year-over-year, driven by operational restructuring and productivity gains. The strategic partnership with Danantara provides up to $5 billion for growth in Southeast Asia without stressing the balance sheet. Pork business delivered a solid EBITDA margin of 8.9%, up from 6.5% a year ago, despite challenging market conditions. Liquidity strengthened with a $4.2 billion revolving credit facility and total liquidity of approximately $7.7 billion, with no significant debt maturities until 2031. Net loss of $102 million in Q2 2026, impacted by nonrecurring items including $133 million in antitrust settlements and $81 million in bargain purchase gain adjustments. Net leverage rose to 3.1 times, above the long-term target of 2-3 times, due to dividend payments and first-half cash consumption. US beef remains under pressure with negative EBITDA margin of -1.3%, reflecting tight cattle supplies and historically high costs. Pork demand is weaker than beef and chicken, with lower cutout prices and pressure from prepared foods segment. Chicken supply in the US grew 4.5% in Q2, exceeding expectations and pressuring commodity big bird prices, though industry adjustments are expected. Q: What is the outlook for US beef margins and cattle supply, particularly regarding the reopening of the Mexican border and herd rebuilding? A: Wesley Batista, CEO of JBS USA, stated that the gradual reopening of the Mexican border is a critical positive development. The first port (Douglas, Arizona) is expected to open on the 24th, with two more in New Mexico to follow, potentially restoring most of the historical flow of cattle from Mexico, which represents about 5% of US slaughter. He noted that cattle crossing may be heavier than usual, allowing them to reach slaughter weight sooner. Assuming ports reopen as expected, slaughter volumes should return to more normal levels by the second quarter of 2027. He also mentioned that while heifer retention and herd rebuilding in the US are more timid than hoped, the influx of Mexican cattle provides a more balanced supply situation, potentially bringing margins back to an equilibrium similar to 2023-2024 levels. Q: Can you provide more details on the strategic partnership with Danantara and its impact on JBS's growth strategy and balance sheet? A: Gilberto Tomazoni, Global CEO, explained that the partnership involves a USD2.5 billion equity investment by Danantara for a 25% stake in JBS's Australia and New Zealand operations. Combined with additional funding capacity, this provides access to up to USD5 billion for acquisitions and greenfield projects in Indonesia and Southeast Asia. The priority for the first two years is investing in Indonesia, a market with a population of 640 million. Importantly, JBS retains full operational control and the operations remain fully consolidated, with no change in management. This structure allows JBS to accelerate growth in a high-demand protein region without stressing its balance sheet. Q: What is the current state of US protein demand, and how are consumers responding to high prices? A: Wesley Batista noted that protein demand remains very strong, with a surprising inelasticity across beef, pork, and chicken. While pork demand is slightly weaker, beef demand is particularly robust, with cutout values reaching near $400, far exceeding prior expectations. However, there is a notable shift in where consumption is happening, with more eating at home (retail) versus away from home (foodservice). This trend is supporting demand for value-added and case-ready products. Q: What specific operational initiatives are driving the improvement in US beef margins, and how much more upside is expected? A: Wesley Batista detailed that JBS has integrated its two previously separate US beef business units (Swift and Packerland) into one, unlocking synergies in sales and procurement. Key initiatives include improving yields, selling more value-added ground beef, and converting plants like Souderton into value-added facilities due to strong demand. He emphasized that the current results do not yet reflect the full benefit of these initiatives, stating, "We are just getting started on that 3% improvement plan that we think we have." Q: How is the US pork market performing, and what are the key demand dynamics? A: Wesley Batista acknowledged that pork demand is weaker than chicken and beef, with stable industry volumes but lower cutout prices indicating softer demand. He attributed this to some weakness in the prepared foods market, where consumers are cutting back on those options. However, he cautioned against viewing this as a long-term trend, suggesting it may be a temporary quarterly phenomenon. Q: What is the outlook for the US chicken industry, and when will supply and demand rebalance? A: Gilberto Tomazoni explained that US chicken supply grew 4.5% in Q2, driven by higher egg sets and, notably, better bird survival rates compared to last year when respiratory disease and avian influenza increased mortality. This unexpected supply increase has pressured commodity big bird prices. However, he expects the industry to adjust in the coming months, citing its historical discipline in managing supply-demand dynamics. Pilgrim's is mitigating this by converting big bird capacity to case-ready products, which have stronger demand. Q: How do you view the performance and outlook for Seara, and what is driving the sequential margin decline? A: Gilberto Tomazoni stated that Seara's margins, while slightly down quarter-over-quarter, remain healthy at 14-15%. The decline was primarily driven by weaker pork prices in the domestic market. He remains confident in Seara's ability to deliver good margins through efficiency gains, innovation, and a strong mix, despite a challenging comparison and changing export market dynamics. Q: What is the outlook for JBS Brazil's beef business, particularly regarding China demand and export volumes? A: Gilberto Tomazoni provided a detailed outlook, noting that Brazil is expected to resume beef production for China in October, with shipments restarting in November, and commercial impacts reflected primarily in 2027. In the interim, without the China quota, he expects cattle prices to fall and harvest volumes to be reduced. He highlighted Friboi's competitive advantages, including its brand and category management with retailers, which position it well to navigate this period. He expects the market to return to a healthy situation in the coming months. Q: What are the expectations for free cash flow and net leverage for the remainder of 2026? A: Guilherme Cavalcanti, Global CFO, stated that while the statistical effect of replacing last year's strong US chicken EBITDA with more normalized margins pressures leverage, the second half of the year typically generates the bulk of free cash flow. He expects net leverage to finish the year at levels similar to Q2, slightly above 3 times. The company has no significant debt maturities until 2031, and any debt repayment would likely target the more expensive bonds, such as the 6.75% coupon notes due 2034. Q: What is the strategic vision for JBS under new leadership, and will there be a change in strategy? A: Wesley Batista, incoming Global CEO, emphasized continuity, stating that he and Tomazoni have worked together for a decade, ensuring alignment in strategy and priorities. He highlighted new avenues of growth, including the Danantara partnership in Southeast Asia, the project in Oman for the Middle East, and continued evolution of brands in the US and growth in Brazil. He stressed that JBS has a strong leadership team and will continue to focus on operational excellence, disciplined capital allocation, and creating long-term value across its diversified global platform. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Jbs N.V.? Here are five stocks we like better. JBS reported record second-quarter sales of $24 billion, with adjusted EBITDA of $1.43 billion under IFRS and adjusted net income of $218 million. The company nevertheless posted a $102 million net loss due to higher financial expenses and non-recurring items. U.S. beef performance improved, with its EBITDA margin narrowing to negative 1.3% from negative 3.9%, though tight cattle supplies and high costs remain significant challenges. Pork, Brazil operations and value-added chicken products provided support across the portfolio. JBS is preparing for a CEO transition in January 2027 and announced a $2.5 billion Danantara investment for a 25% stake in its Australia and New Zealand operations, potentially unlocking up to $5 billion for Southeast Asian expansion. Free cash flow turned positive at $130 million, while net leverage remained slightly above target at 3.1 times EBITDA. 3 Overlooked Stocks Analysts Still Like as AI Trades Get Crowded JBS (NYSE:JBS) reported record second-quarter sales of $24 billion as its diversified protein operations helped offset continued pressure in U.S. beef markets, while management outlined a leadership transition and a new Southeast Asia growth platform. Adjusted EBITDA totaled $1.43 billion under IFRS, representing a 6% margin, and $1.3 billion under U.S. GAAP, or a 5.3% margin. Adjusted net income was $218 million, or $0.20 per share. The company reported a net loss of $102 million, or negative $0.10 per share, which CFO Guilherme Cavalcanti said reflected higher financial expenses and several non-recurring items. → SoundHound AI Sends a Loud Signal After Its Q2 Earnings Beat 5 High-Yield Stocks With Analyst Support and Room to Run Global CEO Gilberto Tomazoni said the quarter demonstrated the resilience of JBS’ global operating model despite differing supply-and-demand conditions across proteins and regions, currency movements, trade disruptions and geopolitical uncertainty. “Our priorities are clear: improving efficiency, protecting margin and strengthening commercial performance, allocation production to the markets where we create the most value,” Tomazoni said. → 3 Dividend Champion Utilities for a Market That Can't Sit Still Tomazoni said he will continue leading JBS through the transition period before Wesley Batista Filho assumes the role of global CEO in January 2027. Batista Filho, currently CEO of JBS USA, said the company’s strategic direction will remain consistent. “You should not at all see JBS have a big change in the strategy, in the way we do things,” Batista Filho said, citing his more than 10 years of work alongside Tomazoni. → Is Wingstop's Growth Story Losing Steam? JBS also recently announced a strategic partnership with Danantara Investment Management. Danantara will make an initial $2.5 billion investment for a 25% stake in JBS’ Australia and New Zealand operations. Tomazoni said the joint venture is expected to provide access to as much as $5 billion for acquisitions, greenfield projects and other growth opportunities in Indonesia and Southeast Asia. The Australia and New Zealand operations will remain fully consolidated by JBS and continue under the existing leadership and operating model, management said. Cavalcanti said the structure is intended to support expansion in the region without adding pressure to JBS’ consolidated balance sheet. JBS USA’s beef business remained under pressure from tight cattle supplies and historically high cattle costs, but Batista Filho said performance improved meaningfully. The unit’s EBITDA margin improved to negative 1.3% from negative 3.9% in the prior-year quarter. Management attributed the improvement to better plant performance, operating-footprint optimization, commercial initiatives and productivity gains. JBS combined two previously separate U.S. beef business units, which Batista Filho said should create commercial and operating synergies. The company is emphasizing sales of ground beef, value-added ground beef and other value-added items. JBS had previously announced the closure of its Souderton facility, but Batista Filho said the company reversed that decision and will operate the site as a value-added facility due to demand for those products. Batista Filho said much of JBS’ targeted 3% improvement plan for U.S. beef has yet to be realized. He also pointed to the expected reopening of Mexican cattle import channels as an important potential support for U.S. industry supply. The Port of Douglas in Arizona is expected to open first and could handle an estimated 300,000 to 400,000 head annually, according to Batista Filho. If two additional ports in New Mexico open, the three locations could handle more than 1 million head of cattle flow, he said. JBS expects cattle availability for slaughter to begin increasing during the first quarter of 2027, with volumes returning closer to normal levels by the second quarter if the reopening proceeds as expected. Batista Filho also said U.S. herd rebuilding has been more subdued than expected, though he believes the herd’s decline has stopped for now. He noted that cow slaughter has declined sharply from 2022 levels and said JBS has seen encouraging anecdotal signs of heifer retention and herd rebuilding in Canada. In U.S. pork, JBS reported an EBITDA margin of 8.9%, up from 6.5% a year earlier, despite softer market conditions. Batista Filho said demand for pork was weaker than for chicken and beef, with some pressure in prepared foods and from processors. He said it was too early to characterize the quarter as a longer-term trend. U.S. chicken supply increased 4.5% in the second quarter, exceeding industry expectations, Tomazoni said. He attributed the increase partly to better bird survival rates compared with the prior year, when respiratory disease and low-pathogenic avian influenza increased mortality. Management expects the industry to adjust supply in coming months. Tomazoni said Pilgrim’s Pride faced particular pressure in big-bird commodity chicken, which represents about 25% of its business. However, he said demand for retail-oriented case-ready chicken remained strong as consumers shifted more consumption toward eating at home. In Brazil, JBS Brazil generated adjusted EBITDA of $269 million under IFRS and a 5.9% margin. Tomazoni said the unit posted its highest second-quarter EBITDA despite elevated cattle prices, supported by export demand and commercial execution. China remains an important destination for Brazilian beef, but Tomazoni said Brazil is expected to resume production for China in October, with shipments restarting in November. The commercial impact of those shipments is expected primarily in 2027 because of transit times. He said there is no alternative market capable of fully absorbing the roughly 150,000 tons previously exported to China during the affected period. Seara’s margins declined sequentially but remained at what Tomazoni characterized as healthy levels of roughly 14% to 15%. He attributed the weaker comparison mainly to lower pork prices and softer domestic-market conditions. Still, management said demand for chicken and value-added products in Brazil remained strong. Free cash flow improved $185 million year over year to positive $130 million, compared with a cash outflow of $55 million in the second quarter of 2025. Cavalcanti said the improvement was driven largely by working-capital movements, including higher receivables discounts and larger advance payments from Chinese customers related to Brazilian exports. The company expects approximately $2 billion in capital expenditures during 2026, $400 million below its initial estimate. Cavalcanti said JBS expects 2026 cash-flow breakeven EBITDA of $5.1 billion. Net leverage ended the quarter at 3.1 times EBITDA, slightly above JBS’ long-term target range of two to three times, following a $1 billion dividend payment in June and typical first-half cash consumption. Cavalcanti said the company expects leverage to finish the year at roughly the same level, slightly above 3 times. JBS increased its revolving credit line to $4.2 billion from $3.5 billion in August, while reducing the facility’s cost. Total cash liquidity, including the revolving facility, was approximately $7.7 billion. The company said its average debt maturity was 15.3 years, with an average cost of 5.7%, and it has no significant debt maturities before 2031. JBS SA is a global leader in the production and processing of meat products, with a focus on beef, pork and poultry. Headquartered in São Paulo, Brazil, the company operates through an extensive network of owned facilities and partnerships that span the Americas, Europe and the Asia-Pacific region. JBS supplies fresh, frozen and value-added protein solutions for retail, foodservice and industrial customers, and is active across the entire supply chain—from livestock procurement and feed production to slaughtering, processing, packaging and distribution. Founded in 1953 by José Batista Sobrinho in Anápolis, Goiás, JBS began as a small slaughterhouse and expanded rapidly through strategic acquisitions and organic growth. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "JBS Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

AMSTELVEEN, Netherlands, Aug. 10, 2026 (GLOBE NEWSWIRE) -- JBS N.V. (NYSE: JBS; B3: JBSS32), announces today its 2Q26 results. The numbers reported herein are in US dollars, in accordance with International Financial Reporting Standards (IFRS), unless otherwise specified. (in millions, except per share data) (1) Reconciliations for non-GAAP measures are provided in subsequent sections within this release.(2) IFRS(3) USGAAP (non-audited) Second Quarter Highlights Net Sales of $23.9 billion, up 14% from prior year IFRS Adjusted EBITDA of $1,429 million, down 18% from prior year USGAAP¹ Adjusted EBITDA of $1,257 million, down 8% from prior year IFRS Adjusted operating income of $790 million, down 34% from prior year USGAAP¹ Adjusted operating income of $866 million, down 16% from prior year EPS of -$0.10, vs. $0.48 from prior year Adjusted EPS of $0.20, vs. $0.52 from prior year “In 2Q26, JBS once again reported a record revenue, reflecting the strength of the Company's multi-geography and multi-protein platform. Compared to last year, profitability was pressured by a tough comparison base, as the poultry operations had posted record results in 2Q25. Compared to the first quarter, profitability already showed an improvement in the majority of our business units. The quarter recorded a net loss of $102 million, while adjusted net income totaled $218 million, translating into adjusted EPS of $0.20. The main non-recurring items adjusted in net income were: (i) $172 million in premiums, interest, and costs associated with the tender offers for the bond and the CRA (Brazilian local debenture); (ii) antitrust settlements of $133 million; and (iii) the final calculation of the bargain purchase price gain on the acquisition of Mantiqueira Alimentos, totaling $81 million; among others. Leverage ended 2Q26 at 3.1x, slightly above the Company's long-term target. We also joined the Russell 1000 and Russell 3000 indices, an important milestone that contributes to stock liquidity, expands our shareholder base, and enhances our global visibility. During the quarter, we returned value to our shareholders through a $1 billion dividend payment." said Gilberto Tomazoni — Global CEO. JBS Beef North America reported record sales in the second quarter while cutout values remained at historically high levels, supported by resilient U.S. consumer demand. The increase in live cattle prices outpaced the change in cutout values, reflecting the low cattle availability. As a result, industry spreads remained pressured. Live cattle imports from Mexico remained restricted during the quarter, further constraining supply in the U.S. market, but are expected to resume gradually beginning on August 24th. In this scenario, the Company announced the closure of two plants, one located in Souderton, Pennsylvania (processing), and the another in Memphis, Tennessee (case ready). Production will be absorbed by other US plants, therefore with minimal impact on sales. JBS also merged the Fed Beef, Regional Beef, and Case Ready business units into a single structure, Beef USA. These measures simplify operations, aiming at greater operational efficiency. Pilgrim’s Pride saw firm chicken demand across all regions. In the U.S., Fresh volumes rose on stronger retail and foodservice demand. Profitability declined year-over-year due to lower commodity pricing, though margins improved sequentially on productivity gains, plant upgrades, and better live operations. Case Ready and Small Bird volumes grew via distribution with key customers. Prepared Foods delivered profitable growth, with both sales and margins rising. In Europe, retail volumes to key customers grew faster than the overall grocery channel, helping offset pressured pork margins from higher UK imports, added costs from the Middle East conflict, and softer foodservice traffic. In Mexico, volumes rose across fresh and prepared products. Chicken demand stayed robust despite a significant rise in overall protein supply. Across key markets, growth in branded and prepared offerings, along with ongoing investments, will further mitigate commodity market challenges and strengthen margins while reducing risk. JBS USA Pork reported flat revenue compared to the prior year. Domestic demand for pork softened as inflation pressured the American consumer. According to the USDA, pork exports continued to stay above last year’s level and were up 4.7% Y/Y during January through May. The Company continues to invest in expanding its value-added and branded product portfolio. JBS USA Pork, the Company's most resilient business unit, maintained its profitability within its historical range. JBS Australia net sales growth in 2Q26 was driven by higher prices and volumes. The beef segment delivered strong revenue growth, supported by higher prices in both domestic and export markets. Strong commercial dynamics, combined with continued operational efficiency gains, more than offset the 24% year-over-year increase in cattle costs in 2Q26. Pork profitability was also a highlight, driven by operational execution and higher productivity. The weaker U.S. dollar relative to the Australian dollar continued to weigh on the translation of results into U.S. dollars versus the prior-year period. JBS Brazil also reported record sales for a second quarter. The revenue growth reflects higher prices and volumes in both the export and domestic markets. In the export market, strong revenue growth was driven by higher prices and volumes, mainly to fill the Chinese quota. Robust global demand and the Company's geographic diversification strategy also boosted exports. In the domestic market, higher prices and volumes for beef were driven by World Cup-related marketing initiatives and stronger commercial execution, particularly through partnerships with key customers. In relation to costs, the average live cattle price during the quarter was approximately R$353/@, an increase of 12% compared to 2Q25. Even with elevated cattle prices, JBS reported its highest EBITDA for a second quarter. Seara reported an 18% sales growth compared to the same period of last year, with a strong adjusted EBITDA margin of 14.9% in 2Q26. In the export market, the Company maintained its sales growth driven by higher volumes of fresh poultry. Another highlight was the sales to the Middle East, despite a more challenging operating environment resulting from the conflict. Investments Seara has been making in the region supported volume growth, especially for value-added and branded products. In the Brazilian market, Seara continued to invest in its fundamentals, expanding its value-added portfolio, increasing processing capacity for fresh and prepared products, strengthening its brand, and maintaining solid commercial and operational execution. As a result, the Company delivered a strong performance, reinforcing the consistency of its strategy and operational discipline. Free Cash Flow & LeverageFree cash flow in 2Q26 improved by US$185 million year-over-year, reaching a positive US$130 million, compared to a cash consumption of US$55 million in 2Q25. The improvement was mainly driven by working capital, particularly (i) a US$600 million improvement in receivables, reflecting higher receivables discounting and larger advance payments from Chinese customers related to JBS Brazil's exports, and (ii) a US$390 million increase in payables, driven mainly by higher cattle prices and increased slaughter volumes, particularly in Brazil. These effects were partially offset by (i) a US$324 million decline in Adjusted EBITDA, (ii) a US$129 million increase in net cash interest expenses and (iii) a US$163 million increase in capex. The average debt term reached 15.3 years, with an average cost of 5.7%. Net leverage ended the quarter at 3.1x, slightly above the company's long-term financial target. In August, JBS increased its revolving credit facility from US$3.5 billion to US$4.2 billion, while reducing the all-in cost. Considering this increase, JBS grew its total liquidity to US$7.7 billion. SEGMENT RESULTS USGAAP (non-audited) (1) USGAAP (non-audited) (1) USGAAP (non-audited) (1) USGAAP (non-audited) Net Debt Bridge and Proforma Debt Amortization Schedule (In millions)(Unaudited) Conference Call Information and Other Selected Data JBS will host a conference call to discuss its financial results on Tuesday, August 11, 2026, at 9:00 a.m. Eastern Time. The live webcast will be available on the JBS Investor Relations website at https://ir.jbsglobal.com/, where a replay of the webcast, the accompanying presentation, the earnings release, financial statements, and other supplemental information will also be available following the event. The webcast can also be accessed directly by clicking here. To add the event to your calendar, click here. This press release is being made in respect of JBS N.V. and its subsidiaries (collectively, the “JBS Group”). Forward-Looking Statements We make statements about future events that are subject to risks and uncertainties. Such statements are based on the beliefs and assumptions of our Management and information to which the Company currently has access. Statements about future events include information about our current intentions, beliefs or expectations, as well as those of the members of the Company's Board of Directors and Officers. Forward-looking statements may include information on possible or presumed operating results, as well as statements that are preceded, followed or that include the words "believe,“ "may," "will," "continue," “expects,“ "predicts," "intends," "plans," "estimates," or similar expressions. Forward-looking statements and information are not guarantees of performance. They involve risks, uncertainties and assumptions because they refer to future events, depending, therefore, on circumstances that may or may not occur. Future results and shareholder value creation may differ materially from those expressed or implied by the forward-looking statements. Many of the factors that will determine these results and values are beyond our ability to control or predict. IFRS and Non-GAAP Financial MeasuresThis release is prepared under IFRS and also includes certain non-GAAP financial measures. These measures are not calculated in accordance with any generally accepted accounting principles (GAAP) or International Financial Reporting Standards (IFRS) and should not be viewed as substitutes for IFRS metrics such as net income, operating cash flow, or other measures of operating performance or liquidity. We present non-GAAP financial measures to provide additional information that we believe is useful and meaningful to investors. However, such measures do not have standardized definitions and may therefore not be comparable to similarly titled measures presented by other companies. Non-GAAP financial measures should always be considered together with, and not as alternatives to, the financial results reported in accordance with IFRS as issued by the International Accounting Standards Board. Additionally, all the numbers are unaudited in the condensed consolidated interim financial information, the consolidated US GAAP figure includes non-audited accounting GAAP adjustments in Seara and JBS Brazil, in addition to the Business Units that already report under US GAAP. Investor Contact: [email protected] Cavalcanti (Global CFO)Christiane Assis (IRO)Pedro BuenoFelipe BrindoVítor FigueiraAmanda Harumi Photos accompanying this announcement are available at: https://www.globenewswire.com/NewsRoom/AttachmentNg/5d7a7830-cc4c-4e73-9a61-e6296777ef75 https://www.globenewswire.com/NewsRoom/AttachmentNg/40a189ff-1017-4107-a2f9-0d4f0e7c3f00

JBS N.V. (NYSE:JBS) shares edged lower in pre-market trading on Tuesday after the meat producer reported second-quarter adjusted earnings below analyst expectations, even as revenue surpassed forecasts and reached a record level. Adjusted earnings per share came in at $0.20, below the $0.34 analyst consensus. Revenue reached $23.9 billion, ahead of expectations of $22.77 billion and up 14% from $21.0 billion in the same period last year. JBS shares were down 1.27% in pre-market trading following the results. While revenue continued to expand, JBS reported weaker profitability compared with the second quarter of 2025. Adjusted EBITDA under IFRS declined 18% year on year to $1.43 billion, while adjusted operating income fell 34% to $790 million. JBS recorded a net loss of $102 million, reversing net income of $528 million a year earlier. “In 2Q26, JBS once again reported a record revenue, reflecting the strength of the Company’s multi-geography and multi-protein platform,” said Gilberto Tomazoni, Global CEO. “Compared to last year, profitability was pressured by a tough comparison base, as the poultry operations had posted record results in 2Q25.” The figures indicate that strong top-line growth did not translate into comparable earnings growth during the quarter, helping explain the muted market reaction. JBS Beef North America generated record sales but operated at a loss, reporting adjusted EBITDA of negative $78 million under IFRS. Higher live cattle prices outpaced movements in cutout values as limited cattle availability squeezed industry spreads. JBS also announced plans to close two plants in Pennsylvania and Tennessee as part of efforts to improve operational efficiency. Pilgrim’s Pride experienced a significant year-on-year decline in profitability, with adjusted EBITDA falling 39% to $503 million under IFRS as lower commodity pricing weighed on results. However, margins improved compared with the previous quarter. Performance elsewhere in the JBS portfolio was more supportive. JBS Brazil achieved record second-quarter sales, while adjusted EBITDA increased 18% to $269 million. The improvement was supported by higher prices and volumes across both domestic and export markets. Seara delivered an 18% increase in sales and generated adjusted EBITDA of $380 million, representing a margin of 14.9%. JBS USA Pork, meanwhile, maintained profitability within its historical range despite broadly flat revenue growth. Net leverage finished the quarter at 3.1 times, slightly above the company’s long-term target. For investors, the second-quarter results present a mixed picture. Record revenue and strong performances from JBS Brazil and Seara demonstrate the benefits of the company’s diversified geographic and protein portfolio. However, the adjusted earnings miss, weaker group profitability and losses within JBS Beef North America remain important considerations. The plant closures also put additional focus on management’s efforts to improve efficiency as it navigates challenging cattle economics and less favourable comparisons with last year’s unusually strong poultry performance. JBS stock price

Kraft Heinz (KHC) came out with quarterly earnings of $0.56 per share, beating the Zacks Consensus Estimate of $0.53 per share. This compares to earnings of $0.69 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +5.66%. A quarter ago, it was expected that this processed food company with dual headquarters in Pittsburgh and Chicago would post earnings of $0.5 per share when it actually produced earnings of $0.58, delivering a surprise of +16%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Kraft Heinz, which belongs to the Zacks Food - Miscellaneous industry, posted revenues of $6.26 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 1.62%. This compares to year-ago revenues of $6.35 billion. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Kraft Heinz shares have added about 9.9% since the beginning of the year versus the S&P 500's gain of 13%. While Kraft Heinz has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Kraft Heinz was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.47 on $6.06 billion in revenues for the coming quarter and $2.07 on $24.45 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Food - Miscellaneous is currently in the bottom 16% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, JBS N.V. (JBS), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 10. This company is expected to post quarterly earnings of $0.32 per share in its upcoming report, which represents a year-over-year change of -39.6%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. JBS N.V.'s revenues are expected to be $22.96 billion, up 9.3% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Kraft Heinz Company (KHC) : Free Stock Analysis Report JBS N.V. (JBS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Sysco (SYY) came out with quarterly earnings of $1.53 per share, beating the Zacks Consensus Estimate of $1.51 per share. This compares to earnings of $1.48 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +1.33%. A quarter ago, it was expected that this food distributor would post earnings of $0.95 per share when it actually produced earnings of $0.94, delivering a surprise of -1.05%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Sysco, which belongs to the Zacks Food - Miscellaneous industry, posted revenues of $22.12 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.92%. This compares to year-ago revenues of $21.14 billion. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Sysco shares have added about 15.3% since the beginning of the year versus the S&P 500's gain of 11%. While Sysco has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Sysco was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.16 on $22.07 billion in revenues for the coming quarter and $4.95 on $89.07 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Food - Miscellaneous is currently in the bottom 15% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. JBS N.V. (JBS), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 10. This company is expected to post quarterly earnings of $0.32 per share in its upcoming report, which represents a year-over-year change of -39.6%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. JBS N.V.'s revenues are expected to be $22.96 billion, up 9.3% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Sysco Corporation (SYY) : Free Stock Analysis Report JBS N.V. (JBS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

JBS N.V. (JBS) is expected to deliver a year-over-year decline in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price. The earnings report, which is expected to be released on August 10, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise. This company is expected to post quarterly earnings of $0.32 per share in its upcoming report, which represents a year-over-year change of -39.6%. Revenues are expected to be $22.96 billion, up 9.3% from the year-ago quarter. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For JBS N.V., the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -9.38%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination makes it difficult to conclusively predict that JBS N.V. will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that JBS N.V. would post earnings of $0.28 per share when it actually produced earnings of $0.20, delivering a surprise of -28.57%. Over the last four quarters, the company has beaten consensus EPS estimates just once. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. JBS N.V. doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Among the stocks in the Zacks Food - Miscellaneous industry, Celsius Holdings Inc. (CELH), is soon expected to post earnings of $0.42 per share for the quarter ended June 2026. This estimate indicates a year-over-year change of -10.6%. This quarter's revenue is expected to be $887.71 million, up 20.1% from the year-ago quarter. Over the last 30 days, the consensus EPS estimate for Celsius has been revised 0.5% down to the current level. Nevertheless, the company now has an Earnings ESP of -4.59%, reflecting a lower Most Accurate Estimate. This Earnings ESP, combined with its Zacks Rank #4 (Sell), makes it difficult to conclusively predict that Celsius will beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report JBS N.V. (JBS) : Free Stock Analysis Report Celsius Holdings Inc. (CELH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. May 13, 2026 9:00 a.m. ET Chief Executive Officer — Gilberto Tomazoni Chief Financial Officer — Guilherme Cavalcanti [Role Not Specified] — Unknown Executive Gilberto Tomazoni: Good morning, everyone. Thank you for joining us today. The first quarter of 2026 was a challenging period for JBS, shaped by market volatility seasonality, operational disruption and change in a global trade flows. This is consistent with what we have been signing. We understand the nature of our business and the cycles we operate in, and we manage the company with that in mind. In the environment, we remain focused on what we can control. Operational excellence, cost discipline, agility and long-term value creation delivered net sales growth of 11%, reaching $21 billion and record first is a record for our first quarter. Net income was USD 221 million and EBITDA total approximately USD 1.1 billion, with a margin of 5.2%. Leverage increased to 2.7x reflecting pressure on earnings and cash generation, while we continue to strengthen our liability profile, extending average debt maturity to approximately 15.6 million years. From an operation perspective, the quarter reflected both the challenge of the cycle and the resilience of our platform. In Beef North America, the environment remained very difficult. EBITDA was negative USD 230 million, with margin at 2.3% negative impacted by [indiscernible] cattle supply and higher costs. During the quarter, we advanced organizational and operational adjustments across our U.S. beef platform. focused on the rationale, and researching and simplifying our restructure in more challenging phase of the cattle cycle. As the business has evolved, several areas we are already operating and increase their integrated way, building on that we brought together fed beef that is the 3 business units have fed beef, regional beef and case-ready into a more unified structure. This is a natural step it reduce duplication, improve coordination and allow us to leverage our skills and talent more efficiently while strengthen decision-making and position the business to improve performance over time. These actions are part of a broader effort driving efficiency across the company. Our focus is to extract more value from the existing access improve productivity and enhance execution through technology, automation and data. At Friboi and [indiscernible] , we have been developing piloting artificial intelligence initiatives for over a year to support better decision-making, commercial execution and operational efficacy. And we are now is scaling this capability globally. At Seara, we continue to advance automation and process improvement to increase productivity, improve product quality and support the expansion of higher value-added categories. This reflects our approach to the cycle. We are -- we act early focus on what we control and position the business for a stronger performance ahead. This quarter once again highlighted the importance of our diversified platform. Despite the headwinds, our business helped balance consolidation performance. Seara delivered an EBITDA margin of 15.5%, supported by strong export demand, innovation and growth in value-added products despite currency pressure and cost inflation. The outlook for poultry in Brazil remained positive, supported by balancing supply-demand, including adjustment in breed replacement and continuous demand growth. JBS Brazil reported EBITDA margin of 4.5%, a second to higher first quarter margin in history, supported by a disciplined commercial execution and favorable demand. Friboi also delivered a strong top line performance with a solid demand, both domestic and in exports. The China safeguard created an adjustment in the global trade flow during the quarter, but our team responded quickly, managing volume within the quota structure and develop alternative markets such as United States, Mexico, Indonesia, preserving value and expanding our commercial footprint. In Australia, margin reached 7.1%, and operational [indiscernible] remained positive in Queensland cattle conditions are the best we have seen in the last 3 years, reinforcing our positive outlook for the business. In the United States, figures softer quarter, impacted by seasonality and [indiscernible] plant adjustment. These were necessary to improve efficiency, and hence, productivity mix and better align our footprint with demand. The adjustment have been completed, and we have already seen improvement trends. U.S. park remained stable with a sign of gradual improvement supported by more balanced supply and demand dynamics. Cash flow in the quarter was also impacted to grow with investment focused on efficiency, especially in value-added products and strengthening our global footprint, truly aligning with our long-term value creation. Looking ahead, the fundamental of our global protein remains strong. Beef supply continues to be constrained in key markets. Poultry demand remains solid, and our brands continue to gain relevance with the consumers. Seasonality, we are being an important low, the start of barbeque season in the United States typically support stronger consumption across protein and improving industrial conditions to coming quarters. At the same time, we will remain disciplined. Our priorities are clear. Operational excellence, exceed control on cash generation. We also remain focused on threatening the company's long-term position in our global capital market. including creating the conditions for further expand our participation in relevant equity indices over time. We continue to review costs, optimize resources and improve productivity across the business. We understand the cycle. We operate with discipline, and we are taking the right action to navigate the current environment while strengthening the company for the future. Thank you. I will now turn the call over to Guilherme, who will be through the financial results in more details. Guilherme, please? Guilherme Cavalcanti: Thank you, Tomazoni. Well, let's now move on to the operational and financial highlights of the first quarter 2026. Net sales reached a record of $22 billion for our first quarter. Adjusted EBITDA in the IFRS totaled $1.1 billion, which represents a margin of 5.2% in the quarter. Adjusted EBITDA in U.S. GAAP totaled $960 million, which represents a margin of 4.2% in the quarter. Adjusted operating income was [indiscernible] million with a margin of 2.4% in IFRS and $444 million in U.S. GAAP with a margin of 2.5%. Net income was $222 million in the quarter and an earnings per share of $0.21. Excluding the nonrecurring items, adjusted net income would be $241 million and earnings per share $0.23 per share in the quarter. Finally, the return on equity was 22% and return on invested capital was 15%. Free cash flow in the first quarter 2026 was negative at $1.5 billion compared to a cash consumption of $970 million in the first quarter of 2025. In addition to the seasonal cash consumption, that typically occurs in the first quarter, the main drivers of a higher cash burn compared to the same period last year were a decline in adjusted EBITDA of approximately $400 million reflecting the weaker operating results. An increase in capital expenditures, which more than doubled compared to the first quarter 2025, totaling $566 million driven primarily by expansion CapEx of $390 million compared to $79 million in the first quarter of 2025. An additional of $252 million working capital impact resulting from the higher livestock suppliers payment deferral as previously flagged in our last earnings call. It is worth noting that if we execute the same level of livestock deferral in the fourth quarter 2026, this impact will be offset on the free cash flow for the full year. Notably, working capital consumption was already below the same period last year because excluding the additional $252 million in deferred livestock payments, working capital would have been approximately 23% better compared to the first quarter of 2025. In the first quarter, we also strengthened our balance sheet with the issuance of $2.5 billion in bonds in the market and the tender offer of $1.45 billion. This allowed us to extend our debt maturity profile, reaching an average debt term of 15.6 years and an average cost of 5.7%. We have no significant debt maturities until 2031. Our leverage ended the year at 2.77x in line with our long-term target of keeping net debt to EBITDA between 2x and 3x. Our $3.4 billion in revolving credit lines and $3.5 billion in available cash, provide us with the flexibility to continue executing our expansion CapEx value creation projects and shareholder returns, while maintaining a health and robust balance sheet. Last night we also announced it that beginning next quarter, we will voluntarily file forms 10-K, 10-Q and 8-K with the SEC prepared under IFRS and supplemented on the earnings release by certain indicators reported under U.S. GAAP. This initiative is expected to broaden our eligibility for key benchmark indexes, such as S&P composed 1,500 family. With that in mind, I would like to open up for the question-and-answer session. Operator: [Operator Instructions] Ladies and gentlemen, the first question comes from Isabella Simonato from Bank of America. Isabella Simonato: I have a couple of questions. First, Guilherme,if I may ask you for that breakeven EBITDA exercise you do every quarter, that's really helpful. If you could just walk through that, we really appreciate. And also to the point of cash, right, and your leverage is pretty close to 3x, right? I know that's not how rating agencies look at that. But if you look to the EBITDA, U.S. GAAP, right, is even higher than that. So I was wondering, you mentioned before, right, a CapEx of $2.4 billion for this year and $1.3 million of expansion. If that continues to be the goal right or if you are reviewing that not only for this year but going forward, what type of levers you have, right, to bring leverage down, assuming you don't have a big jump, right, in your EBITDA for the next 18 to 24 months. So that would be my first point. And also about the U.S. beef business, right? I think we have been discussing that for a while now, about how the cycle apparently is being -- has changed right or is being different than the previous down cycles and there is a matter of really how the cattle herd can be rebuilt at this point as the sector goes through generational transitions and issues? I mean, do you see the business model changing going forward? I mean, any type of vertical integration that would make sense on the cattle part for you to be supportive of the cattle herd growth over time, that would be my second point. Guilherme Cavalcanti: Isabella. So on the first question, I think it's early. We're still reviewing our estimates. And again, there's a lot of variable that's not in our control. But I would say that for this year, the breakeven EBITDA, the cash flow breakeven EBITDA will be anything between $5.7 billion and $6 billion. That's our better estimation moment. In terms of cash usage. You're right, the leverage reached 2.77. So we bear in mind that our long-term target is to be between 2x and 3x. We -- being in this range, we think we keep investment grades above 3x we enter on the attention zone, we were when we start reviewing things like you mentioned, capital expenditures, dividends and so on. Our dividend limit is at 3.75%. And I think it's worth mentioning that in 2023, our leverage reached 4.84% in the third quarter, and we kept the investment grade because of the cyclicality nature of our business. In 2024, the leverage came down without any effort to 1.89%. In fact, in 2024, I even unwind the discount receivables. So 2024, we use -- we would be printing a $2.8 billion free cash flow, but I used $500 million to unwind discount receivables. So I printed $2.3 billion free cash flow. So that's the kind of leverage that the levers that we have to use because we are not -- we don't use these levers recurrently, exactly to be able to use whenever we need. So for example, I could increase my discount receivables again for anything from $500 million to $1 billion in discount receivables that I unwinded in 2024 when the cash flow was robust. I can also increase my supplier vendor finance because we have space for that. But these all have costs. So we use only if needed. So that's how we will be managing leverage. So second quarter, we may be closer to our range limit on the long-term target. But bear in mind that the second semester, there's always a strong free cash flow generation. So we expect to end up the year in our target zone of between 2x and 3x net debt to EBITDA. And as long as we keep inside this range, we've been managing to keep the $1 billion dividend that we already announced and around on more than $1 billion in growth CapEx. If you look at since 2019, we did an average of expansion CapEx of almost $1 billion with an almost $1 billion average dividend as well. So I think being in this range, I think we can keep this pace of growth CapEx and dividends, but we will always be monitoring according to our leverage, which is our main variable for capital allocation decisions. Gilberto Tomazoni: So obviously, this herd reviewed in the cycle. The U.S. business is taking longer than we all wish for. But for the industry to have any integration on the -- especially on the [indiscernible] side of the business is just not realistic for a few reasons. It's very specialized in the people that do it have very special knowledge that's very different than what we do. And other than that, especially on the Cauca side of this supply chain, it's very expensive, right? -- expensive, not is in price. I mean it's expensive. It has a lot of -- you need a lot of land and you need to manage a lot of land to be able to have a significant amount of livestock, and that's not our business. So we're not looking into that. Operator: The next question comes from Erik Bresolin with Bradesco. Unknown Analyst: I have 2 also on U.S. beef. The first is to understand a little bit more the profitability we delivered in the quarter. We know it's a seasonally weak quarter evolving into the barbecue season, right? We continue to see spreads that seem to be pressured as we [Technical Difficulty] Guilherme Cavalcanti: Maybe can you repeat the question? You -- we lost half of the question. Can you repeat please? Unknown Analyst: Sorry, sure. The first one is if there was anything extraordinary in Q1 U.S. beef margins such as hedges or even the impact from the Greeley strike? And the second is how you see margins evolving into the barbecue season, spreads appear to be pressured back to the levels they were in the beginning of the year. So how do you see this favorable playing out under the current environment? Guilherme Cavalcanti: So no, there wasn't anything extraordinary from a hedge perspective or even the whole strike situation, didn't have a meaningful impact on our quarterly results. So nothing to do that. It was simply margins, especially in January and February -- we're, for sure, very, very challenging and probably one of the most challenging periods we've ever seen in history. So talking about the next quarters, we expect obviously to be better than what we had in Q1. But for sure, 2026 will be a more challenging year than 2025. Operator: Our next question comes from Benjamin Theurer with Barclays. Benjamin Theurer: Just 2 very quick ones. So first, can we talk a little bit about Australia and some of the cost headwinds what you're seeing on the Australian cattle cycle maybe and if there was something in particular in the first quarter, that drove a little over 300 basis points of margin contraction. And then second, if you could share a few thoughts as it relates to the cattle price in Brazil. It's been very erratic and volatile. Any background, any interpretation as what we should think about going forward for the Brazilian capital price? That would be helpful. Gilberto Tomazoni: Hi Ben, thank you for your question. related to Australia, only the operation was very strong. We had a good quarter in terms of volume and sales and the impact when you compare to the last quarter -- last year, the first quarter last year was FX was around 15% devaluation -- the valuation of the Aussie. And this is the only impact of the business. EBITDA remains strong in Queensland that where we have 40% of the cattle herd the conditions, the environment conditions for pesos the best we have seen in the last 3 years. And then we remain very positive with the Australia business. About the volatility in Brazil, it's normal because, as you know, Brazil is focusing to accomplish the quota China quota and all of the players in the market try to produce as much as they can in order to able to reach a part -- share of the quota. It is normal. The price of the car increase. But you saw in the last 2 weeks, the price start to go down. And we see that if the quota will be achieved, we believe at the end of June, the volume should be -- go down and the price of the cow should be down as well. in way to accommodate that to where Brazil will be put in an additional 100,000 tonnes per month. This is normally that what we see in the situation that to be less cattle harvest and the price of the cow will be done. I think it's a part of the -- we are seeing it as a normal. Operator: And now Muzilla from BTG would like to ask a question. Guilherme Guttilla: Good morning. So we have 2 questions here also. The first one is regarding Seara. So I just want to discuss a little bit more about the margin of the company. So margins stayed at quite strong levels, but they declined sequentially. So if you could provide us a bit more information on what drove the sequential decline if it was more related to the pork business, to the chicken or maybe something else like any color you can provide us would be very helpful. And if I may just do a quick follow-up also in the U.S. beef. There was some new reports like pointing to the postponing of the measure, but there was also the possibility of lower U.S. beef import tariffs. So how are you guys seeing this for the U.S. Beef segment and also for JBS Brazil and Australia, that should also benefit kind of from this. Gilberto Tomazoni: Guilherme, related to Seara, [indiscernible] increasing its sales volume, both domestic and export demand for all of the products remain very strong. The only explanation is the FX. If you take the FX that compared to the last -- the quarters, you see the FX, the impact will be around 10%. And this is more than justify all of these the business is very strong. We are very confident with the results of Seara [indiscernible] quarters. Guilherme Cavalcanti: And on the U.S. beef, Guilherme so -- if tariffs are lower, I actually see this as -- and there is a more -- a bigger income of Australian and Brazilian beef and from other geographies as well. I see this as mostly in a lot of -- in a big sense, very complementary. The U.S. has really gone a production system that prioritizes prime and choice and have your cattle. And today, just the percentage of select, [indiscernible] that we see a lot smaller than what we used to have is basically a very, very small minority of cattle nowadays is ungraded or low-grade cattle. So I think that increase in imports, potential increase in imports could complement that production that we're doing a lot less of. And I actually think that the byproduct of having this priority of higher marble, more premium beef that we're a production system that we have in the U.S. is that we have a lot of fat trim as part of our production. Actually, you could almost argue it's one of the main primes, one of the main products that comes out of cattle is Fed trim. And the only reason why our [indiscernible] is valued so high and it has such a good value is because we have available lean. And if we don't have available that available in, we actually could see our Fed cut out actually reduce. And the price of that well marvel beef actually have to be higher because we don't have the credit for that trim. So my point is, in some cuts, yes, you would probably be in a way, competitive with domestic production. But I would say that the majority of what potentially would come in would actually be pretty complementary and not what we're targeting to produce in the U.S. right now. Operator: And our next question comes from John Bob Gardner from Mizuho. Unknown Analyst: This is Isabella on for John. So could you please discuss the next step that JBS plans to take in terms of increasing its presence in value-added need? Is there still more to do on the M&A front secure assets? And does JBS have the necessary brands and assets right now for the next steps in its growth. And in terms of going to market, should we expect a strategy similar with the partnership between Seara and Netflix in Brazil? Or is there a different approach that you plan to take? Gilberto Tomazoni: Isabella, in terms of M&A, it's -- we are -- as part of our routine to look all the time the opportunities for M&A for growth. But this moment, we are focused on the cash generation and to personal excellence. And this is the focus of the company now. Operator: And our next question comes from Laura Harada from Santander. Unknown Analyst: Actually, I have 2 from my end. First on Seara, the export narrow have become somewhat more challenging in key markets as a result of [indiscernible] as a result of disruptions in the Middle East, while we also saw the European Union considering noting sports from Brazil. So it would be very helpful to understand how Seara adjusted its commercial strategy in response to that environment, both in terms of logistics and also in terms of pricing. And if I may add, you announced you're going to start publishing 10-Q and 10-K filings, which we see as positive in terms of eligibility for U.S. indexes. In this sense, what are our expectations for JBS' next steps towards being included in those indexes. And I was wondering if you could share with us some thoughts on the accounting standards that this broader discussion could potentially bring? That's all from my end. Gilberto Tomazoni: Laura, I will start to answer the question about Seara that you have made. And Guilherme will answer you about the 10-Q, 10-K published. First, you asked about the Middle East or and how this impact the business. I will tell you this is the neutral impact because we have an input of cost additional because you need to skip some part and you need to use trucks for internal transportation to reach the customers. But demand in terms of volume has remained the same, remains strong, as it was before. And the extra cost is being by the market means that we say this is neutral this are in the business so far. Related to the European that you mentioned, it's very new. I know that Brazil will provide the necessary clarification to the European Union regarded to the technical guidance related to the subject. And for our side, we see Brazil is fully compliant with European unit requirements. And the other thing is important to clarify, import point that is part have not been suspended. I think we have a period of clarifications, and this has not impacted the business so far. And we are we are very confident Brazil will be fine -- will be reached an agreement with a European unit. And for our side, we continue to monitor the matter. Guilherme Cavalcanti: Regarding indices, it's worth mentioning that today, only around 40% of our free float is for it comes from passive funds with -- in this sector, generally, this number is 60%. And the reason is that is because we are not on the main indices yet, However, we already have -- we think we already have the necessary criteria for the Russell. We ended last year, last September in the Foods U.S. as a U.S. company. So now May, June, we have rebalancing of Russell. It's not in our control, but there's chances that we enter into rest, creating demand for the shares and now having more than 50% of our sales in U.S. And if we do 10-Ks and 10-Qs, and in June, we will complete 1 year of list of having our primary leasing in U.S. This makes us eligible to the S&P family. So that's the perspective in terms of the index. In terms of accounting standards, we are Netherlands incorporated. So the IFRS is the accounting standard for that. But in our press release, we put all the relevant information in U.S. GAAP. So you can compare and also the bridge from IFRS to U.S. GAAP. So with that, we think we can reach U.S. investors that are used to U.S. GAAP and we have the comparability and reach also European investors and Latin American investors that are used to IFRS. Operator: And our next question comes from Leonardo Alencar with XP Investments. Leonardo Alencar: I would like to discuss a little bit more about US beef. You mentioned that the strike in the first quarter wasn't really impactful for the results. I would just say that without the strike situation would be a little worse for the first quarter or not or even if there's lingering effects for the Q2 from this strike? Another thing that I would like to understand from your side that we've been discussing this for the last few quarters, but just to get an update regarding the Mexican border, if you're expecting that to open in time if you think that we've changed the supply side in the short term could be the wind for this second quarter, maybe for the second semester. So 2 questions for you speak. And just a small thing about Seara. You mentioned, Tomazino, regarding the exports, Middle East, I believe that, then -- looking on the domestic side. We've been seeing some [indiscernible] performance prices between Natura or fresh and processed goods. It looks like in the beginning of the year, we saw some strength from the processing side, and now we are seeing some transitioning to the [indiscernible] So just to get an understanding here what you're seeing if the demand is softening or if it's just a short-term pick up, let's say, so just to get a better view from Seara on the domestic market as well. Guilherme Cavalcanti: Leonard, just on the -- just on this strike situation, we were able to redirect volumes in other plants. So we didn't lose volume because of this strike or maybe costs here and there that were extraordinary, but nothing significant enough to justify doing any adjustment or anything like that, that's relevant to the market. So we decided to just leave it as is with the result because it was a significant. Mexico border opening for Friboi cattle, absolutely no question. It's the most important thing that could ever happen in the short term to get this -- to get some sort of relief on the supply side on beef in the U.S. Obviously, the USDA has been super as always, very responsible in making sure that, that's done whenever they feel the situation or they have assurance that the situation from the Mexico side is where exactly how they want so that they keep screams outside of the U.S. But having said that, whenever that the U.S. whenever, and if that ever happens with the U.S. government feeling that, that is the right time, absolutely will be the most significant thing that could happen to normalized supply in this industry in the short term. Gilberto Tomazoni: And Leonardo related to your question about chicken in Brazil. Chicken in Brazil, we start the year -- beginning of the year, I think in general was a little bit softening. And in this quarter, but then February and March that recovery, I think, is the market demand in Brazil very strong. and the demand in the export is strong. With that time, in the last quarter, we discussed that the statistics show that Brazil will be grow high volume because of the genetic will be higher. And at that moment, I saw that -- I said that we're not seeing the market, but I don't know it's statistical, but the reality statistical was some mistake that the association that republish the numbers and correct the information that the market will be grow around 10%, you're talking more about -- but 4% is very -- it is -- I think it's balanced with the demand we have a standard demand in the normal growing domestic market. Leonardo Alencar: Okay and Tomazino, just to be clear, you said there's improvement, but that is mostly in Natura or processed or both Gilberto Tomazoni: No. processed, we are -- the market is, we can say, stable. The market is not grow but we are -- you say you are flat, but we sell more value-added, more premium products and the loan -- the more commodity product -- but the demand, if you saw the demand in January was weak, but they recover in March, we are -- we made very good sales that we are confident that this is a combination of our strategy to distributing domestic market, differently than different category of product, we are able to manage this situation. But for chicken, it's very strong the demand for processed products is strong in the premium and soft in the more commodity. Operator: And our question comes from Heather Jones from Heather Jones. Unknown Analyst: Are you able to hear me now? Operator: Yes. Unknown Analyst: My question is on North American beef. And just due to a variety of factors, including drought, it just seems like the herd we built rebuild is getting pushed out and it's likely to be much more slow and meager than expected. And then like you mentioned, the border reopening, so it just seems like even if everything goes right from here, we're looking at like late '28 before any significant increase in cattle availability. So it would seem additional industry rationalizations required. And so I was just wondering when do you see that happening and wondering if JBS has considered rationalizing some capacity, maybe one of your smaller facilities to Hoping you could help me how to think through that. Guilherme Cavalcanti: So yes, you're right. It's especially this drought, it's going to delay the herd rebuild, it's -- I don't think it we further liquidate, but it's probably going to delay the herd rebuild here. Look, we're not really focused on that right now with this -- talking about rationalization and all of that. So we're focused just on making our business better with the things that we can control given the footprint we have. So that's not something that we're looking at the moment. And it's very difficult for me to speculate on anything else, right, because anyway, it wouldn't be -- it wouldn't be appropriate for me to speculate on other players in the market. But we're not looking at that right now. Operator: Our next question comes from Ricardo Alves from Morgan Stanley. Ricardo Alves: One question for Wesley, one for Guilherme. First, on U.S. beef, Wesley, please. As we think about the greening season, protein inventories are down big time in the U.S. red meat is down, chicken is down. And when you look at beef purchases to be delivered in June, July also down big time, 15% or so. How do you feel about channel inventory today when you're thinking about retailers and foodservice as we head into the grilling season. These data points, I think that my point is that -- these data points would indicate to us that there's a lot of upside to cut our prices in the very near term. I wanted to see if you have that view, or on the flip side, maybe it could also indicate that demand is expected to be softer, I guess, I don't know. I don't think that's the case, but it is a possibility. So I just wanted to hear from you what you get from retailers and food service in your conversations on ground. I think that, that would be helpful for the very short term on the cutouts? That's my first question. The second question, really a quick one to Guilherme. The pretty significant CapEx expansion that we've been discussing for the past couple of months, and we saw that taking place in the first quarter. Could you detail a little bit more -- I know that maybe you cannot quantify by division, but at least the main projects that you're working on for the rest of this year, just so that we have a better idea of what's going on in your U.S. pork division, even projects that you're doing on US beef, PPC and so forth, I think that, that would be helpful as well. Just a reminder of the CapEx expansion. Guilherme Cavalcanti: Ricardo, on beef, cattle has already started the year already compared to the same time last year, much higher than 15% higher than on the whole quarter than compared to the same period of time. And the reason is lower volume and demand continues to be strong. So you have a constant demand and a shorter supply price tends to go up when that happens. So looking forward, I would expect -- it's difficult to -- we have to wait and see and see how that's going to impact demand, this potentially higher prices, but supply is tighter. So we'll see what happens there. But we'll probably see demand continue to stay strong, and we know that supply is kind of short. So there is a potential for -- but we have to wait and see. Unknown Executive: So the main projects continue to be on [indiscernible] So the Pures prepared foods facility in Walker County, the key Iowa fully cooked Becle and sausage facility, the Perry Iowa fresh sausage plant Cactus Texas in Greene Colorado modernization of the beef processing plants. Then we have investments in Brazil and [indiscernible] the Paraguay chicken plant and also the Oman acquisition. Bear in mind that the Oman acquisition will not be a cash effort, given that it will all be financed with the local banks there. Operator: And our next question comes from Lucas Ferreira with JPMorgan. Lucas Ferreira: Two follow-ups. One is on Australia. It seems like you guys have a sort of constructive view there on the quality of pastures in the business. I just wanted to understand potentially the trend for margins there once at least if you look at the Australian dollar remains even a bit stronger than the levels we've been seeing in the first quarter? And cattle prices seems to be sort of stable, but with the M&A outlook of some reduction in slaughtering this year, right, with the changing cycle. So I don't know in the regions you guys operate and all the other businesses in Australia, how to think about margin is going from here. If it's also some seasonal effects that should help lifting the margins going forward? And #2 is on -- still on the U.S. beef. Just so I understand your comment, you mentioned that you expect a 2026 to be more challenged than '25. Last year, you had a 1.5% negative margin. Should we expect a weaker margin this year given your comments. And then 2Q was particularly weak last year, right, minus 3.9% margin. Again, remember the issues with the hedging, et cetera. So should this sort of weakness more skewed towards the second half or how to think about also the evolution of the business from here? Gilberto Tomazoni: Lucas, thank you for your question. Related to Australia, I think where we operate, we are very positive in terms of the volume that will be harvested this year. I think will be not different than the last year. Some period of the year, I think, will be higher. I mentioned at the beginning in one of the answers that we have Queensland that where we are main operation that the climate condition is very positive. I think it's the best in the last 3 years that -- and this is -- this shows us that will be -- the coming months will be a good supplier and talk about supplier. Then you talk about demand. Demand is very, very strong from -- and I think it's not just in U.S., but all of the premium markets that Australia sell that Japan, Korea and other ones. Japan is very -- Australia is very well positioned for catch this benefit from this demand, grow demand, global [indiscernible] grow demand. So look, we are positive where we operate. That will be a great year for the JBS Australia. Guilherme Cavalcanti: As we -- so I'm going to say this without giving any guidance, but you could expect this year versus last year, I'm talking marketing in general to be 1, 1.5 percentage points worse than last year, about 1%, I think, is fair. Obviously, then we have our internal dynamics, right, how our operations are. And like you said, last year, we had some hedging impact in a specific quarter. But overall, you could expect the market to be 1 to 1.5 percentage points worse than the last year. Operator: Jack Harden from Stephens. Unknown Analyst: This is Jack Carden on for ParonSharma. Thanks for the question. For U.S. chicken, consumer demand remained strong, partly supported by Time supplies. -- but broader processing margins remain below mid-cycle levels, how do you assess the current supply-demand balance in chicken? And do today's margin levels suggest the industry needs to moderate production growth Gilberto Tomazoni: Steve, we see very balanced in the chicken demand in U.S. We had in the beginning of the year that the big bird was a little bit very challenged. But this -- that the price of breast recovered during the quarter, we see that demand is strong in value-added and prepared. We are very strong demand. And all of the business, all of the other category that purges sell in domestic market in the U.S. all of them are positive. And when you look for the site in the supply, we see better balanced supply/demand. We are positive with our business in [indiscernible] business. Operator: And our next question comes from Thiago Bortoluci from Goldman Sachs. Thiago Bortoluci: I think the question goes to Tomazoni. And this is just to try to gain perspective beyond the quarter on the benefits from diversification and portfolio Tomazoni. This was a very rare quarter where we saw very strong demand. Actually, you mentioned in 3 business units, record high sales for our first quarter. But at the same time, virtually all the business units delivered lower margins versus last year. I think the exception was Brazil beef, which One could argue that this quarter, particularly diversification didn't quite help you. I think my question for you is, once you think about the year and the buildup, you mentioned the grilling season in the U.S. Obviously, the year-end brings seasonality also to Brazil. Where are the opportunities where you think margins could show some clearer sequential improvements? Where are the main risks and how would you expect diversification to help you going forward? Gilberto Tomazoni: Good question, Thiago. I'm very positive on the verification because when you look for our results this quarter, if you compare it to the last quarter, the difference is around $400 million or -- if -- and we can explain this difference with 2 business units. First, in U.S. beef U.S. I think the results of beef U.S. was impact around 50% of the difference of EBITDA. And Wesley explained about that. And I think we reached the bottom of the results. I think is we made some -- we are -- we see that the common quarter, we cannot say that it will be improved a lot, but I think it will be better than it was this quarter. The market conditions didn't change. But I think is we are more balanced, and we made some adjustments in our structure that I think will help us to navigate even inside of the company with a low cost of operation, more synergy and outside synergy in terms of commercial. I think this is -- this is one of the things that give us more confident about that the results will be better than it was this quarter. if you can add in Wesley? Unknown Executive: I was just going to add, Thiago, that I think a good way to think about diversification is always more so than comparing every time to the -- always on the comp versus last year. If you look just at the absolute number, right? You have pork U.S.A. and sat with double-digit margins you have Australia, even though this quarter was a lower quarter than when it has been. It's still in a very positive high single-digit right when you have the U.S. beef U.S. at the low cycle. If you went back 5 years ago, you'd probably see all of the other businesses at a lower margin and beef higher. And I think the other way to look at the diversification is as working even in this quarter is when you compare our portfolio of businesses with any one of our peers, right? And each one of them could be that they are in a singularly in a market, and that market is really good or really bad. But our businesses are always going to have -- our portfolio of business is always going to give a more stable kind of result versus our peers just based on the uniqueness of our diversification. So I think I would say that even in this quarter, that was a weaker quarter, the diversification thesis that we have is actually pretty evident in my opinion. Gilberto Tomazoni: And just to end finish my point of view that will start that 50% was beef in U.S. The other 50% was pure [indiscernible] need to adapt its portfolio to the market demand. Before U.S. was just focused to export they use the breast, the white meat and exported dark meat that is part leg quarters. But the market changes. There is a demand in domestic market now in U.S. for dark meat and previous need to adapt its layout of the 2 factories in order to be able to supply the demand of the market. Then we stop for 2 weeks, 3 plants, then this was affected the results and the climate conditions affected as well. Then these 2 things explain the difference in terms of the results compared to the last year, $400 million, that $200 million and [indiscernible] around $200 million in -- that is one thing about that. The other thing is, you mentioned that the other business not delivered results. But that was the effect was affect and FX was affect Australia. This is -- if you want to explain the business, it's that effects in Australia and the [indiscernible] that I explained in beef in U.S. But this is one thing about the results. The other thing, if you talk about diversification, of course, if you have just the beef in U.S., we have a really tough situation. But as we have managed different business, in different geography, we are able to compensate. If you compare just a single company with one business, that will be a huge difference. Of course, the [indiscernible] is working. And I believe that this difference in terms of cycle is normal in our business. We need to be able and to focus and manage the business -- when they have the low level they need to be better than the other competition, the high level will be better [indiscernible] This is the part this is the game. Operator: And our next question comes from Renata Cabral at Citi. Renata Fonseca Cabral Sturani: All right. Thank you so much for this space for questions. My first one is a follow-up related to the last one, diversification, but in the angle of GLP-1 adoption, it was already mentioned by company's management that the adoption of GLP-1, it's a structural shift towards [indiscernible] of course, particularly in the U.S. as the adoption is higher right now due to costs. So could you please calibrate us how tangible this trend is already in your day-to-day business? Are you measurable change in the consumer behavior already in, it was set different perceptions of the consumers for PPC. So in terms of innovation, GLP-1 is something that you think about when you are elaborating new products and mix in terms of smaller portion or anything different? And this focus in the U.S., but even for Brazil, are you seeing already this trend? Or you think the contribution can come in the future? And since you are investing expansion for Seara, so do you have this in mind in terms of the future products that you are going to release on those investments. So this is my first question. The second one is related to grain prices that has been positive for the company for a while. Right now, there's the discussions on the potential risks on the [indiscernible] and fertilizers costs. So if you can share your outlook for 2026, '27, it would be great as well. Gilberto Tomazoni: When you talk about GLP-1, I think it's GLP-1 is one of the factors that is affecting the global consumption of protein. When you look -- when you say -- when we are saying here that is strong demand for protein is globally in all of the market. And this is affected by, of course, as you mentioned, GLP-1. But GLP-1, I think, is now the most important issue. I think this is the perception and the and not just perception, but the knowledge that protein is very important for to have -- even in the even in the new generation or the older generations. Because if you want to have longer life, you need to eat more protein. If you want to have muscle in the beginning, you need to add, to eat protein. That protein become very important for all of the generations. The second, the regulatory that you saw that the U.S. FDA changed the pyramid, the inverted pyramid because that's the put that you need to have more protein in order to have more health. Then to eat more protein is healthier and this is globally. And then there is about this new technology about medicine that is because we want to lose weight. And if you lose weight, you need to get more protein order not to lose muscle but lose more fat. And this is -- it's not in one country. I think this is globally, we see the continuous high protein, the consumption. And we are -- it's not new. Northern -- now what we see in new now all the companies try to adapt the portfolio to have more protein even that the company that work in high carbonate product, now they want to adopt for more protein. But this -- but if you look at our core, our core is focused on protein that we don't need to adopt our core. We is to accelerate what we have done so far. We are -- for example, we have launched high-protein line of products in Seara and other parts of the world. And we are working innovation in order to facilitate how the people eat protein, for example, use RF for simplified simplify the lives if you want to cook at home. And you see that the people cook more at home. And if the -- if I say you, we have the right portfolio for the right trend. And we not see is attendance. We see this is structural. They eat more protein. And we are investing in all of the innovation in order to facilitate that. too. And the second question, I understood that you asked about grain, about the cost of the -- of course, of the nutrition of the animal. Look, if you look for -- despite a global inventories being at a comfortable level, there is a significant volatility in the market and I think it's a lot of uncertainty regarding to the weather conditions and the fertilizer cost. If you look for corn, globally, demand remained very strong. [indiscernible] support the market even with the recent pressure on the grain price. I think is -- the tender is to increase the price because of the weather, because of the fertilizers. But in terms of what is the impact of our company, I can tell you that we believe that we are well positioned from a risk management perspective. while the crop conditions have improved, we remain prepared for the potential volatility including the possible reduction in the Brazilian safrina crops. Operator: And our next question comes from Ricardo Boiati with Safra. Ricardo Boiati: Wesley, a couple of follow-ups here regarding North America. The first one, besides the tariffs discussions this week, right, there were some reports about the potential deregulation in the cattle industry. So in your view, what can be really done to incentivize rangers to raise more cattle sustainably, I mean, in the longer term? And what is the likelihood of any potential policy change happening this year in that regard. The second point here on the overall protein demand in North America. This summer, we have the FIFA World Cup happening in North America, right? So can we expect here any meaningful impact coming from that event specifically in North America, maybe a stronger than usual barbecue season or something like that? And lastly, on Prepared Foods, this is a more broad question for the company. We see many CapEx initiatives to build or expand capacity in prepared foods. So my question is, if you can quantify a little more how fast prepared foods are growing within JBS portfolio and do you have any particular long-term target for this category to represent in your overall portfolio in the long term? Unknown Executive: So on the deregulation for sure, I mean, as we see top end producers and renters in general, trying rebuild herd and deciding to rebuild their regulation and overregulation can be an obstacle anything the government does to help the renter is very helpful. And for sure, it's important. On the protein side, demand is pretty strong overall, how impactful the FIFA World Cup, I don't know. I think it's helpful. It's not negative. But there is I think it might be relevant in a few days of the next few months. And -- but I don't think it moves the needle enough to say that this substantially structurally changes that -- how we're going to see the overall summer and spring year for this demand. Gilberto Tomazoni: About our strategy for value added. We don't have a specific target for value. We want to increase the share of prepared food and our portfolio. and why we want to do that? Because when we talk now a lot about cycle, where is the low part of the cycle, a high part of the side, prepared there is particularly no cycle that the demand normally is very stable and with higher margin. And because of that, we are prioritize our investment in the prepared, and prepare food and brands, we are investing in brands and we are investing in the line of prepared foods. And if you saw that investment we have, Guilherme just mentioned before, the investment in U.S. about sources. It's breakfast sources. It's value-added Berens value-added from branded plant. And you saw in Brazil some investment in CR was a focus on that. We are predated investments in value-added. This is the fact we are not having a specific target on that. Operator: And our next question comes from Priya Ohri with Barclays. Priya Ohri-Gupta: Guilherme, can we talk a little bit about how we should think about net leverage trending through the end of the year? I think earlier, a couple of months ago at CAGNY, in particular, we had talked about scope for net leverage below 2.5x this year. And it sounds like it could be ending the year sort of in the upper range of that 2.5 to 3x area. I just want to make sure that we're thinking about that correctly. And as part of that, highlighted or the new issuance and tender that you did recently. However, it does look like you tendered less than you issued. Should we expect some of that incremental amount to get deployed to debt reduction later this year or just kept on the balance sheet. And then the second question I had was just on the free cash flow breakeven. You talked about it being $5.7 billion to $6 billion now. Last quarter, you had said it would be 5.7%. So if you could just walk us through what's driving the higher end of that range now, that would be helpful. Guilherme Cavalcanti: So from a leverage perspective, you're right. I think the perspective to end this year more likely to be between 2.5 and 3x given again the weaker results we had in the first quarter. In terms of the tender, we did -- bear in mind, we have billion dollars in dividends to be paid in June. But our cash position is still at $3.5 billion, which is around at least around $500 million to $600 million above our minimum cash, given our cash conversion cycle and the different geographies that we are around the world. So we have space to buy bonds with this excess cash. But this decision will probably be done in the second semester when is the period where our cash generation is stronger. In terms of the free cash flow breakeven, it's just an estimate. I think the account that we have continues to be on $5.7 billion. Working capital in the first quarter was better than the first quarter last year. But going forward, I just gave this range because there's a lot of moving things like energy prices that could impact grains. We know how much will be this impact basically on fertilizers and energy in the grain prices that could move working capital if prices go up. So that's why I gave the range from $5.7 million to $6 million because of the uncertainties that we have given all the volatility in the markets. Priya Ohri-Gupta: Great. And just a quick follow-up. If you do think about looking at further debt paydown, should we expect you to use a similar approach to what you did in the beginning of the year? Or could you take other considerations into account sort of thinking through interest expense reduction versus maturity management and absolute debt reduction. Guilherme Cavalcanti: Yes. The approach will be absolutely the same given that all my debt, including the $2.9 billion maturing in 2032. All the coupons are below treasury. So it's not worth it to pay any of those debt. So any repurchase would be on 34, 33, 35 spots. The 34, for example, is the highest coupon, which we still have $300 million outstanding debt that could be a possible target. Operator: And our next question comes from Mattheus Enfeldt with UBS. Matheus Enfeldt: My first question on the beef demand in Brazil. We're still seeing it quite resilient despite of prices. So I'm just trying to get a sense if you're getting pushback from retailers or push back on the margin on demand growth or demand reduction? And what's the size or scale that we could expect for demand down in but also in U.S. beef as a result of higher prices? And then my second question is on sort of a longer-term view around production. We're seeing quite a lot of restrictions to trade flows, be it quotas or sanitary barriers for exports. I know the company is planning diversified, but whether there are some additional regions that could become focus for investments in the midterm, such as rest of LatAm or more investments in Europe that could help circumvent those sanitary and trade flow restrictions in general and how you're incorporating that into the longer-term decisions that the company has taken. Those are the 2 questions. Gilberto Tomazoni: I understood well, you asked about the demand for beef in Brazil and beef in U.S? Matheus Enfeldt: Yes, both that. Gilberto Tomazoni: Well, look, we -- in Brazil, even that we had the higher price of cow and the higher price of meat, the demand in Brazil remains strong. For beef and for all of the proteins. And we talk about -- we -- and now with I think is with the end of the quarters of China may the price of cattle will be decreased and I think it will be more fable to sell in domestic market. It is important that we have developed a category management 2.0 say that call Aogi reserve. It's -- in Brazil that we manage inside of the store of our customers, the budget area. And this shows that the stores they have, our model, they sell not just more meat, but they sell more for all of the stores. And this project is get a strong reception from our customers. And because of that, I see that even now with this situation that after the quarter of China and we are -- I think we are very well structured, even in Brazil, even in the U.S. to manage the volume for our business, [indiscernible] I think it's in U.S. we have to comment a little bit about the demand, but... Unknown Executive: We continue strong material is, we think all the things I already mentioned before or just the overall protein trend and people just saying more about nutrition and prioritizing protein. We've seen that -- and just the overall preference also for protein and especially beef has been pretty strong. So that's obviously the demand in the U.S. Gilberto Tomazoni: I think it is related to the first -- the question. First, we answered about the demand of protein GLP-1 and the other factor that is boosted all of the consumption -- protein consumption globally. I think if Mattheus, if I'm right, your question about the investment, the finite station of our investment. Is it correct? Matheus Enfeldt: Yes, how you're considering restriction ship trade flows with quotas and stay barriers into your investment process and investment decision for the mid, long term. Gilberto Tomazoni: I think we are very well positioned and where we produce and where we sell our product. I think as we build this global platform and you look -- we are produced where is the most competitive way to produce. And we are present to sell where the market demand is. Then I think it's -- in terms of balance, we are very balanced. Of course, now our focus now for this year is to cash generation. We are not looking for a new project in our portfolio. We just and start with the project in Paraguay, we started the project in Oman. I think now we need to develop this project in the greenfield that we are working on. Now any new project in our pipeline now. Operator: And our next question comes from Igor Guedes with Genial. Igor Guedes: Can you hear me? Operator: Yes. Igor Guedes: Okay. Thank you very much for the opportunity. The first question is about CapEx. We observed CapEx essentially doubling year-over-year. And it came slightly higher than expected, reflecting an acceleration across the platform, but mainly related to renovation project stemming from the downtime at PPC with capacity expansion initiatives. It would be interesting to understand if you can share with us how the capacity expansion is progressing from an American standpoint. How much of increase you expect to achieve based on what production levels and whether we can expect CapEx to normalize as early as second quarter? And my second question, I would like to get your perspective on what might happen in the second half of the year regarding the filling of China quotas. As you have already mentioned, it's possible that cattle prices will fall in Brazil, given the quota is being front loaded faster than initially expected which could reduce the number of slaughters in the second half of the year, leaving more cattle on hand and lowering price per [indiscernible] . But my question is more focused on the cattle side of the domestic market. Do you think it's possible that with the reduction in exports, part of the volume will be directed to the domestic market. And with more meat supply here, the cutout price might face downward pressure. I would like to take your view on this variable going forward. Thank you very much. Gilberto Tomazoni: Look, we have -- when you talk about the CapEx, we have put $1 billion -- $1 billion in CapEx for expansions. The growth CapEx as we call, growth CapEx. And this is -- we are not disclosure 1 by one, but because many business units in different types of different types of the CapEx, it will be different. It is difficult to explain the volume because, one is number of chicken. The other one is a volume of, well, prepared food and put together will be difficult to explain that we are not disclosed them. But the CapEx is, as you mentioned, is a new compare for the last years is higher because we are seeing this strong demand. But we are not seeing now any moment that we need to review the CapEx because we are seeing the cash generation for the second semester of the year will be strong, but this is something we can see in the future. If you -- because it's capital expansion, we can postpone, we can give more time to do. But we are not looking now because we are not -- that is necessary for now but could be in the future is something that we can take a look. The other thing about the Brazilian situation about the market situation about beef. We said that the end of quota of China, we made the number of care will be harvest for the industry will be done should be down because we need to accommodate this, I mentioned, 120,000 tons per month per beef. We need to find a market for that, then the industrial be reduced the number of cattle by harvest. And if you do the number of [indiscernible] be harvest, combined with more availability of current for feedlot. And we believe that the price of car will be down as well means that route could be down because more volume domestic, but the price of beef will be down as well. Then I see that the spread between the both the cutout and the life care will remain or depends in our case, could be, hence, that we have value-added product. When you talk value-added products, not with processed product. It's value-added products that I mentioned you better presentation, a better way to serve the customer in different cuts of beef. That if you look to our side, I think we are very well structured in Brazil and outside of Brazil to take the advantage the impact of this end of the quarters of China. Operator: Ladies and gentlemen, there being no further questions. I would like to pass the floor to Mr. Gilberto Tomazoni. Gilberto Tomazoni: I would like to thank you, everyone, for joining us today and all JBS team members for their dedication and you look ahead, we have not changed our focus, execution, efficiency and disciplined capital allocation and cash generation. That is what allows us to deliver consistent results and build a long-term value creation. Thank you. Operator: This is the end of the conference call held by JBS. Thank you very much for your participation, and have a nice day. 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Interested in Jbs N.V.? Here are five stocks we like better. JBS posted record Q1 sales of $22 billion, but profitability weakened as adjusted EBITDA fell to $1.1 billion under IFRS and net income came in at $222 million. Management said the quarter was pressured by volatile markets, seasonality, operational disruption and trade shifts. U.S. beef was the biggest drag on results, with the segment generating negative EBITDA of $230 million amid tight cattle supply and higher costs. Executives said 2026 is likely to be tougher than 2025 for U.S. beef, though they expect supply relief if the Mexico feeder cattle border reopens. Diversified operations and investment plans helped offset some weakness, with strong margins in Seara, Brazil and Australia, while Pilgrim’s and U.S. beef faced challenges. JBS also boosted capex on prepared foods and other projects, and said it will voluntarily begin SEC 10-K, 10-Q and 8-K filings next quarter. JBS (NYSE:JBS) reported record first-quarter sales but lower profitability as executives said the global protein company faced difficult market conditions in U.S. beef, seasonal pressures, operational adjustments and shifting trade flows. Global CEO Gilberto Tomazoni said the first quarter of 2026 was “a challenging period” shaped by market volatility, seasonality, operational disruption and changes in global trade. He said JBS remained focused on “operational excellence, cost discipline, agility, and long-term value creation.” → Rocket Lab Just Hit a New All-Time High—Time to Buy or Let It Breathe? Global CFO Guilherme Cavalcanti said net sales reached a first-quarter record of $22 billion. Adjusted EBITDA under IFRS totaled $1.1 billion, representing a 5.2% margin, while adjusted EBITDA under U.S. GAAP was $960 million, with a 4.2% margin. Net income was $222 million, or $0.21 per share. Excluding non-recurring items, adjusted net income was $241 million, or $0.23 per share. Tomazoni said the North American beef business remained under significant pressure due to constrained cattle supply and higher costs. The segment posted EBITDA of negative $230 million, with a margin of negative 2.3%. → MP Materials Is Quietly Building a Rare Earth Powerhouse The company is making organizational changes across its U.S. beef platform, combining fed beef, regional beef and case-ready operations into a more unified structure. Tomazoni said the move is intended to reduce duplication, improve coordination and strengthen decision-making during a difficult phase of the cattle cycle. Wesley Batista Filho, CEO of JBS USA, said there were no meaningful extraordinary impacts from hedging or the Greeley strike in the first quarter. He described January and February margins as “probably one of the most challenging periods we’ve ever seen in history.” → Micron Investors Face a High-Stakes Moment After the Latest Rally Batista said 2026 is expected to be more challenging than 2025 for U.S. beef. In response to analyst questions, he said the industry is unlikely to vertically integrate meaningfully into cow-calf operations because that business requires specialized knowledge and substantial land resources. He also said reopening the Mexican border to feeder cattle would be “the most important thing” that could provide short-term supply relief for U.S. beef, while noting the timing depends on U.S. government assurances related to keeping screwworm out of the country. Executives repeatedly emphasized JBS’s diversified platform across proteins and geographies. Seara delivered a 15.5% EBITDA margin, supported by export demand, innovation and growth in value-added products, though Tomazoni said currency movements pressured comparisons with the prior quarter. JBS Brazil reported a 4.5% EBITDA margin, which Tomazoni described as the second-highest first-quarter margin in its history. He said Friboi saw solid demand in both domestic and export markets. He also said the China trade environment required adjustments in global flows, but JBS responded by managing volumes and developing alternative markets such as the United States, Mexico and Indonesia. In Australia, JBS posted a 7.1% margin. Tomazoni said operating fundamentals remained positive, particularly in Queensland, where cattle conditions were the best the company has seen in three years. He attributed the year-over-year margin contraction primarily to foreign exchange movements rather than weaker operations. Pilgrim’s had a softer quarter in the United States, affected by seasonality and planned plant adjustments. Tomazoni said the company had to adapt some plants to changing U.S. demand, including stronger domestic demand for dark meat. He said those adjustments have been completed and improvement trends are already visible. Free cash flow was negative $1.5 billion in the first quarter, compared with cash consumption of $970 million a year earlier. Cavalcanti said the decline reflected weaker EBITDA, higher capital expenditures and a working capital impact from livestock supplier payment deferrals. Capital expenditures totaled $566 million, more than double the prior-year period, driven mainly by $390 million in expansion CapEx. Cavalcanti highlighted projects including Pilgrim’s Prepared Foods in Marshall County, a fully cooked bacon and sausage facility in Ankeny, Iowa, a fresh sausage plant in Perry, Iowa, modernization of beef processing plants in Cactus, Texas, and Greeley, Colorado, biodiesel investments in Brazil, a chicken plant in Paraguay and the Oman acquisition. Executives said JBS is prioritizing value-added and prepared foods investments because those categories generally have more stable demand and higher margins than cyclical commodity protein businesses. Tomazoni said the company does not have a specific target for prepared foods as a share of the portfolio but wants to increase its weight over time. JBS ended the quarter with leverage of 2.77 times net debt to EBITDA, within its long-term target range of 2 times to 3 times. Cavalcanti said the company could move closer to the upper end of that range in the second quarter, but expects stronger free cash flow generation in the second half of the year. The company issued $2.5 billion of bonds and completed a $1.45 billion tender offer during the quarter. Cavalcanti said the actions extended average debt maturity to 15.6 years and brought the average cost of debt to 5.7%. He said JBS has no significant debt maturities until 2031 and has $3.4 billion in revolving credit lines plus $3.5 billion in available cash. Cavalcanti estimated the company’s free cash flow breakeven EBITDA for the year at $5.7 billion to $6 billion, citing uncertainty around working capital, grains, energy and fertilizer costs. He said JBS could use tools such as receivables discounting or supplier finance if needed, but those are not used recurrently because they carry costs. JBS also announced that beginning next quarter it will voluntarily file Forms 10-K, 10-Q and 8-K with the SEC, prepared under IFRS and supplemented in earnings releases with certain U.S. GAAP indicators. Cavalcanti said the move is intended to broaden eligibility for key benchmark indexes, including the S&P Composite 1500 family. He said JBS already meets criteria for potential Russell index inclusion and noted that passive funds account for about 40% of the company’s free float, compared with roughly 60% for the sector. Looking ahead, Tomazoni said global protein fundamentals remain strong, with constrained beef supply in key markets, solid poultry demand and continued relevance for JBS brands. He said the start of the U.S. barbecue season typically supports stronger protein consumption, but emphasized that the company’s priorities remain execution, efficiency, cash generation and disciplined capital allocation. JBS SA is a global leader in the production and processing of meat products, with a focus on beef, pork and poultry. Headquartered in São Paulo, Brazil, the company operates through an extensive network of owned facilities and partnerships that span the Americas, Europe and the Asia-Pacific region. JBS supplies fresh, frozen and value-added protein solutions for retail, foodservice and industrial customers, and is active across the entire supply chain—from livestock procurement and feed production to slaughtering, processing, packaging and distribution. Founded in 1953 by José Batista Sobrinho in Anápolis, Goiás, JBS began as a small slaughterhouse and expanded rapidly through strategic acquisitions and organic growth. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "JBS Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.