EARNINGS RELEASE 1Q24
Earnings
Release
2Q24 | 1H24
August 9th, 2024
l
EARNINGS RELEASE 2Q24 | 1H24
In the first six months, volumes increased by 5.5%, Net Income grew by 19.8%, and EBITDA grew by 11.6%.
In 2Q24, volumes increased by 11.6% over 2Q23.
NET
REVENUE
SALES
VOLUME
MARKET
SHARE
CAPACITY
UTILIZATION
%
GROSS MG.
EBITDA
R$2.6 billion, 7.7% lower than in 2Q23. Volumes grew and average prices fell, following the decline in commodity prices.
507 thousand tons sold, +11.6% over 2Q23 and +27.7% over 1Q24.
Gain in market share volume in the Pasta and Wheat Flour categories. Cookies & Crackers stable at a 32% level.
Increase in the production capacity utilization rate, reaching 71.9% in 2Q24, +7.4 p.p. over 2Q23 and +11.4 p.p. over 1Q24.
Gross Margin of 34.9% in 2Q24, +1.9 p.p. over 2Q23.
EBITDA of R$336.8 million in 2Q24, with an EBITDA Margin of 12.8%.
CASH
GENERATION
Operating cash generation of R$211.5 million in 2Q24, with net cash position of 0.1x (LTM EBITDA).
2Q24 WEBINAR RESULTS | IR CONTACT |
Gustavo Lopes Theodozio | |
August 12th, 2024 | Vice-President of Investments and Controllership |
11h (Brasília time) | 10h (New York time) | Fabio Cefaly |
New Business and Investor Relations Officer | |
Zoom Meetings: Click Here | Rodrigo Ishiwa |
Youtube:Click Here | |
Investor Relations Manager | |
Everlene Pessoa | |
MDIA3 | Investor Relations Analyst |
Closing on 08/07/2024 | Lucas Laport |
Share Price: R$ 28.56 per share | Investors Relations Intern |
Market Cap: R$ 9.7 billion | Contact: ri@mdiasbranco.com.br |
youtube.com/rimdias | ri.mdiasbranco.com.br | ri@mdiasbranco.com.br |
M. Dias Branco ranks as one of the 50 Most Honored Companies in the Institutional Investor
2024 survey, voted among analysts and investment managers from around the world.
We would like to thank all the market analyst and investor who challenges us to increasingly
improve our corporate governance, transparency and communication with the market.
Food and beverage segment in the Latin America
ranking - MIDCAP
1st | 1st | 1st | 1st |
Best CEO | Best CFO | Best IR Professional | Best IR Team |
Ivens Dias Branco Jr. | Gustavo Theodozio | Fabio Cefaly | |
1st | 1st | 1st | 1st |
Best Company | Best IR Program | Best Analyst Days | Best ESG Program |
Board |
Food and beverage segment in the Latin America
ranking - OVERALL
2nd | 2nd | 1st | 2nd |
Best CEO | Best CFO | Best IR Professional | Best IR Team |
Ivens Dias Branco Jr. | Gustavo Theodozio | Fabio Cefaly | |
2nd | 2nd | 2nd | 2nd |
Best Company | Best IR Program | Best Analyst Days | Best ESG Program |
Board | 3 | ||
EARNINGS RELEASE 2Q24 | 1H24
ECONOMIC AND FINANCIAL PERFORMANCE
MDIA3, the leader in the Brazilian cookies and crackers, pasta, granolas and healthy cookies markets releases the result for the second quarter of 2024 (2Q24) and first half of 2024 (1H24).
Financial and Operating Results
2Q24 | 2Q23 | Var. % | 1Q24 | Var. % | 1H24 | 1H23 | Var. % |
Net Revenue (R$ million) | 2,630.0 | 2,849.4 | -7.7% | 2,140.4 | 22.9% | 4,770.4 | 5,334.9 | -10.6% |
Total Sales Volume (thousand tonnes) | 507.0 | 454.1 | 11.6% | 397.1 | 27.7% | 904.1 | 856.9 | 5.5% |
Cookies and Crackers Sales Volume (thousand tonnes) | 134.4 | 133.1 | 1.0% | 105.8 | 27.0% | 240.2 | 249.9 | -3.9% |
Pasta Sales Volume (thousand tonnes) | 98.1 | 90.1 | 8.9% | 81.2 | 20.8% | 179.3 | 169.4 | 5.8% |
Market Share of Cookies and Crackers (volume)* | 31.8% | 32.0% | -0.2 p.p | 32.6% | -0.8 p.p | 32.5% | 32.4% | 0.1 p.p |
Market Share of Pasta (volume)* | 29.2% | 28.1% | 1.1 p.p | 28.6% | 0.6 p.p | 28.8% | 29.9% | -1.1 p.p |
Net Income (R$ million) | 189.9 | 217.9 | -12.8% | 154.9 | 22.6% | 344.8 | 287.8 | 19.8% |
EBITDA (R$ million) | 336.8 | 376.8 | -10.6% | 277.3 | 21.5% | 614.1 | 550.5 | 11.6% |
EBITDA Margin | 12.8% | 13.2% | -0.4 p.p | 13.0% | -0.2 p.p | 12.9% | 10.3% | 2.6 p.p |
Net Cash (Debt) (R$ million) | 80.7 | -1,253.1 | n/a | 149.0 | -45.8% | 80.7 | -1,253.1 | n/a |
Net Cash (Debt) / EBITDA (last 12 months) | 0.1 | -1.2 | n/a | 0.1 | 0.0% | 0.1 | -1.2 | n/a |
Capex (R$ million) | 60.9 | 71.9 | -15.3% | 52.1 | 16.9% | 113.0 | 117.1 | -3.5% |
Net Cash generated from operating activities** | 211.5 | 511.8 | -58.7% | 138.0 | 53.3% | 349.5 | 568.6 | -38.5% |
Values for 2Q24 and 2Q23 are from the period of May-Jun 2024 and 2023; 1Q24 refers to Jan-Feb 2024. | ||||||||
**Net Cash generated from operating activities. |
EARNINGS RELEASE 2Q24 | 1H24
Context
After a prolonged period of falling wheat prices, which led to a reduction in the prices of our items, especially those with lower added value, we observed a reversal in the trend of wheat prices (in USD) starting in March 2024, simultaneously with the devaluation of the Real. Given this scenario, our price adjustments began to be reflected in the result as of June 2024.
WHEAT | 325 | 324 | 343 | 342 | 316 | ||||||||||
288 | |||||||||||||||
(US$/TON.) | 269 | 267 | 279 | ||||||||||||
249 | |||||||||||||||
235 | |||||||||||||||
WHEAT | 234 | 227 | 229 | ||||||||||||
1,631 | 1,614 1,664 | 1,640 | 213 | ||||||||||||
1,550 | |||||||||||||||
(R$/TON.) | 1,504 | ||||||||||||||
1,423 | 1,372 | ||||||||||||||
1,360 | |||||||||||||||
1,220 | |||||||||||||||
1,148 | 1,156 1,129 | 1,061 | 1,174 | 5.4 | |||||||||||
DOLLAR | |||||||||||||||
5.0 | 5.0 | 4.9 | 5.1 | 5.0 | 5.0 | 5.1 | 5.1 | ||||||||
(Month | 4.9 | 4.9 | 4.9 | 4.9 | 4.9 | ||||||||||
4.8 | |||||||||||||||
Average) | |||||||||||||||
Apr-23May-23Jun-23 | Jul-23Aug-23Sep-23Oct-23Nov-23Dec-23Jan-24Feb-24Mar-24Apr-24May-24Jun-24 | ||||||||||||||
6.3 | 6.1 | 5.8 | 5.4 | 5.2 | Jun | ||||||||||
AVERAGE | |||||||||||||||
5.55 | |||||||||||||||
PRICE | |||||||||||||||
(R$/Kg) | |||||||||||||||
2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 |
Source: Wheat - SAFRAS & Mercado; Dollar - Banco Central do Brasil.
Net Revenue
Regarding the Cookies & Crackers and Pasta markets, in 2Q24, as shown on the side, we recorded an increase in units sold compared to the previous year. In terms of volumes, they remained flat for Cookies & Crackers and a strong increase in Pasta. The drop in average price reflects the reduction in commodity prices (ex: wheat) until the first half of 2Q24.
COOKIES & | PASTA | ||||||
CRACKERS | 2Q24 vs. | 2Q24 vs. | 2Q24 vs. | 2Q24 vs. | |||
2Q23 | 1Q24 | 2Q23 | 1Q24 | ||||
Value | -1% | +7% | Value | +3% | +6% | ||
Sold | Sold | ||||||
Volume | 0% | +7% | Volume | +8% | +9% | ||
Sold | Sold | ||||||
Units | +3% | +9% | Units | +11% | +10% | ||
Sold | Sold | ||||||
Average Price | -1% | -1% | Average Price | -4% | -3% | ||
(R$/Kg) | (R$/Kg) | ||||||
Source: Nielsen - Retail Index. Total Brazil. INA+C&C. |
M. Dias Branco's sales volumes increased by 11.6% in 2Q24, with highlight to the Pasta and Wheat Flour and Bran categories, which recorded a strong growth and gain in market share, as shown below.
In relation to the average price, the reduction from 2Q23 and 1Q24 was mainly due to the drop in commodity prices. In the second half
of 2Q24, following the depreciation of the Real against the Dollar | 6.27 | |||
and the subsequent impact on costs, we adjusted our prices and | 5.55 | |||
observed an increase in the average price starting in the last | 5.39 | 5.46 | ||
5.19 | ||||
month of the quarter (June 2024), as shown on the side. | ||||
Additionally, compared to 2Q23, the faster growth in flour and bran | ||||
sales led to an unfavorable mix effect on the consolidated average | ||||
2Q23 | 1Q24 | Mar/24 2Q24 Jun/24 | ||
price (about ¼ of reduction), as this category is priced lower than | ||||
other items. The strong performance in this category was primarily
driven by the addition of new institutional clients, particularly in the South and Southeast regions.
5
EARNINGS RELEASE 2Q24 | 1H24
2Q24 | 2Q23 | Var. % | |||||||
Categories | Net | Volume | Price | Net | Volume | Price | Net | Volume | Price |
Revenue | Revenue | Revenue | |||||||
Cookies and Crackers | 1,342.8 | 134.4 | 9.99 | 1,466.4 | 133.1 | 11.02 | -8.4% | 1.0% | -9.3% |
Pasta | 577.8 | 98.1 | 5.89 | 589.8 | 90.1 | 6.55 | -2.0% | 8.9% | -10.1% |
Wheat Flour and Bran | 440.6 | 246.1 | 1.79 | 494.6 | 202.3 | 2.44 | -10.9% | 21.7% | -26.6% |
Margarine and Vegetable Shortening | 141.4 | 20.6 | 6.86 | 178.6 | 21.5 | 8.31 | -20.8% | -4.2% | -17.4% |
Other products** | 127.4 | 7.8 | 16.33 | 120.0 | 7.1 | 16.90 | 6.2% | 9.9% | -3.4% |
TOTAL | 2,630.0 | 507.0 | 5.19 | 2,849.4 | 454.1 | 6.27 | -7.7% | 11.6% | -17.2% |
*Net revenue in R$ million, weight excluding sales returns in thousand tonnes and net average price in R$/Kg. | |||||||||
**Cakes, snacks, cake mix, packaged toast, healthy products, sauces and seasonings. | |||||||||
2Q24 | 1Q24 | Var. % | |||||||
Categories | Net | Volume | Price | Net | Volume | Price | Net | Volume | Price |
Revenue | Revenue | Revenue | |||||||
Cookies and Crackers | 1,342.8 | 134.4 | 9.99 | 1,089.3 | 105.8 | 10.30 | 23.3% | 27.0% | -3.0% |
Pasta | 577.8 | 98.1 | 5.89 | 481.2 | 81.2 | 5.93 | 20.1% | 20.8% | -0.7% |
Wheat Flour and Bran | 440.6 | 246.1 | 1.79 | 352.5 | 187.7 | 1.88 | 25.0% | 31.1% | -4.8% |
Margarine and Vegetable Shortening | 141.4 | 20.6 | 6.86 | 118.2 | 16.6 | 7.12 | 19.6% | 24.1% | -3.7% |
Other products** | 127.4 | 7.8 | 16.33 | 99.2 | 5.8 | 17.10 | 28.4% | 34.5% | -4.5% |
TOTAL | 2,630.0 | 507.0 | 5.19 | 2,140.4 | 397.1 | 5.39 | 22.9% | 27.7% | -3.7% |
*Net revenue in R$ million, weight excluding sales returns in thousand tonnes and net average price in R$/Kg. | |||||||||
**Cakes, snacks, cake mix, packaged toast, healthy products, sauces and seasonings. | |||||||||
1H24 | 1H23 | Var. % | |||||||
Categories | Net | Volume | Price | Net | Volume | Price | Net | Volume | Price |
Revenue | Revenue | Revenue | |||||||
Cookies and Crackers | 2,432.1 | 240.2 | 10.13 | 2,720.5 | 249.9 | 10.89 | -10.6% | -3.9% | -7.0% |
Pasta | 1,059.0 | 179.3 | 5.91 | 1,093.5 | 169.4 | 6.46 | -3.2% | 5.8% | -8.5% |
Wheat Flour and Bran | 7,793.1 | 433.8 | 1.83 | 9,970.7 | 385.5 | 2.52 | -18.3% | 12.5% | -27.4% |
Margarine and Vegetable Shortening | 259.6 | 37.2 | 6.98 | 324.5 | 38.8 | 8.36 | -20.0% | -4.1% | -16.5% |
Other products** | 226.6 | 13.6 | 16.66 | 225.7 | 13.3 | 16.97 | 0.4% | 2.3% | -1.8% |
TOTAL | 4,770.4 | 904.1 | 5.28 | 5,334.9 | 856.9 | 6.23 | -10.6% | 5.5% | -15.2% |
*Net revenue in R$ million, weight excluding sales returns in thousand tonnes and net average price in R$/Kg. | |||||||||
**Cakes, snacks, cake mix, packaged toast, healthy products, sauces and seasonings. |
Market share
Cookies & Crackers | Pasta | Wheat Flour | |||||||||||||
Share | 28.8 | 28.3 | 28.5 | 29.2 | 27.8 | 27.3 | 27.8 | 28.2 | 28.0 | 28.0 | 11.6 | 12.1 | 11.6 | 12.4 | 12.9 |
Value* | |||||||||||||||
Share | 32.0 | 31.3 | 31.6 | 32.6 | 31.8 | 28.1 | 27.9 | 28.2 | 28.6 | 29.2 | 10.1 | 11.0 | 10.3 | 11.2 | 12.1 |
Volume* | |||||||||||||||
2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | |
* Source: Nielsen - Retail Index. Total Brazil. INA+C&C. |
In 2Q24, we increased our market share of volume and value in the Pasta and Wheat Flour categories over 1Q24 and 2Q23. In the Pasta category, the growth in share volume was mainly related to common pasta in the Defense region (North and Northeast). In the Wheat Flour category, we highlight the growth in both domestic and industrial flour.
In the Cookies & Cracker category, we maintained our market share in the quarter, at a level close to 32%, which allows us to readjust prices to improve our competitiveness.
6
EARNINGS RELEASE 2Q24 | 1H24
Cookies & Crackers | Pasta
The drop in revenue versus 2Q23 was due to the lower average price, mainly in the subcategories that follow commodity prices, such as cream cracker cookies, maria maizena and common pasta.
Cookies & crackers launches contributed R$74.1 million in gross revenue in 2Q24, stable versus 2Q23 and up by 18% versus 1Q24.
Cookies and Crackers | ||||
1,466.4 | 1,432.4 | 1,413.0 | 1,342.8 | |
1,089.3 | ||||
133.1 | 129.7 | 134.8 | 105.8 | 134.4 |
2T23 | 3T23 | 4T23 | 1T24 | 2T24 |
Pasta | ||||
589.8 | 564.6 | 606.2 | 577.8 | |
481.2 | ||||
90.1 | 87.6 | 97.6 | 81.2 | 98.1 |
Wheat Flour and Bran | Margarine and
Vegetable Shortening
In the Wheat Flour and Bran category, we highlight the volume growth in both the Attack and Defense regions. The reduction in net revenue, in comparison to 2Q23, was due to the drop in average price, which followed the trend for wheat prices.
In margarine and shortening, the decrease in net revenue over 2Q23 was mainly due to lower average prices, which follow the palm oil price trend.
Sales by Region and Channel
2T23 | 3T23 | 4T23 | 1T24 | 2T24 |
Wheat Flour and Bran | ||||
494.6 | 477.8 | 481.1 | 440.6 | |
202.3 | 207.7 | 219.3 | 352.5 | 246.1 |
187.7 | ||||
2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 |
Margarine and Vegetable Shortening | ||||
178.6 | 158.5 | 154.8 | 141.4 | |
118.2 | ||||
21.5 | 19.9 | 20.7 | 20.6 | |
16.6 | ||||
2T23 | 3T23 | 4T23 | 1T24 | 2T24 |
Net Revenue (R$ million) | Volume (thousand tonnes) |
Region | 2Q24 | 2Q23 | Var. | 1Q24 | Var. | 1H24 | 1S23 | Var. | ||||||||||||||||||||
Attack | 902.1 | 965.9 | -6.6% | 712.8 | 26.6% | 1,612.4 | 1,813.9 | -11.1% | ||||||||||||||||||||
Defense | 1,667.4 | 1,837.9 | -9.3% | 1,382.7 | 20.6% | 3,053.1 | 3,425.0 | -10.9% | ||||||||||||||||||||
Foreign | 60.5 | 45.6 | 32.7% | 44.9 | 34.7% | 104.9 | 96.0 | 9.3% | ||||||||||||||||||||
TOTAL | 2,630.0 | 2,849.4 | -7.7% | 2,140.4 | 22.9% | 4,770.4 | 5,334.9 | -10.6% | ||||||||||||||||||||
Attack Region: South, Southest and Midwest; and Defense Region: North and Northeast . | ||||||||||||||||||||||||||||
Client Mix* | 2Q24 | 2Q23 | Var. p.p. | 1Q24 | Var. p.p. | 1H24 | 1H23 | Var. p.p. | ||||||||||||||||||||
Key Accounts / Regional Chains | 20.8% | 22.2% | -1.4 p.p | 19.5% | 1.3 p.p | 20.2% | 22.3% | -2.1 p.p | ||||||||||||||||||||
Cash and Carry | 27.1% | 24.5% | 2.6 p.p | 30.4% | -3.3 p.p | 28.6% | 23.1% | 5.5 p.p | ||||||||||||||||||||
Wholesale | 15.4% | 16.6% | -1.2 p.p | 15.1% | 0.3 p.p | 15.2% | 17.5% | -2.3 p.p | ||||||||||||||||||||
Small Retail | 17.4% | 17.4% | 0 p.p | 17.5% | -0.1 p.p | 17.4% | 18.1% | -0.7 p.p | ||||||||||||||||||||
Distributors | 13.0% | 13.3% | -0.3 p.p | 11.8% | 1.2 p.p | 12.5% | 12.6% | -0.1 p.p | ||||||||||||||||||||
Industry | 2.6% | 2.8% | -0.2 p.p | 2.3% | 0.3 p.p | 2.5% | 3.0% | -0.5 p.p | ||||||||||||||||||||
Other | 3.7% | 3.2% | 0.5 p.p | 3.4% | 0.3 p.p | 3.6% | 3.4% | 0.2 p.p | ||||||||||||||||||||
TOTAL | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | |||||||||||||||||||||||
Major Clients | Sales 2Q24 | Gross revenue* (%) | Sales 1H24 | Gross revenue* (%) | ||||||||||||||||||||||||
Sequence | Accumulated | (R$ million) | Individual Accumulated | (R$ million) | Individual Accumulated | |||||||||||||||||||||||
Major Client | 1 | 253.6 | 8.2% | 8.2% | 514.7 | 9.1% | 9.1% | |||||||||||||||||||||
49 Subsequent | 50 | 1,056.8 | 34.0% | 42.2% | 1,942.9 | 34.5% | 43.6% | |||||||||||||||||||||
50 Subsequent | 100 | 280.4 | 9.0% | 51.2% | 498.3 | 8.9% | 52.5% | |||||||||||||||||||||
900 Subsequent | 1,000 | 960.8 | 30.9% | 82.1% | 1,685.6 | 29.9% | 82.4% | |||||||||||||||||||||
Other Clients | All clients | 557.6 | 17.9% | 100.0% | 988.5 | 17.6% | 100.0% | |||||||||||||||||||||
TOTAL | 3,109.2 | 5,630.0 |
*Gross revenue excluding discounts and returns.
7
EARNINGS RELEASE 2Q24 | 1H24
Costs
COGS | 2Q24 | % Net | 2Q23 | % Net | Var. % | 1Q24 | % Net | Var. % | 1H24 | % Net | 1H23 | % Net | Var. % |
(R$ million) | Rev. | Rev. | Rev. | Rev. | Rev. | ||||||||
Raw material | 1,171.4 | 44.5% | 1,448.8 | 50.8% | -19.1% | 909.9 | 42.5% | 28.7% | 2,081.3 | 43.6% | 2,803.3 | 52.5% | -25.8% |
Wheat | 719.8 | 27.4% | 890.0 | 31.2% | -19.1% | 575.3 | 26.9% | 25.1% | 1,295.1 | 27.1% | 1,756.0 | 32.9% | -26.2% |
Vegetable Oil | 210.3 | 8.0% | 304.1 | 10.7% | -30.8% | 148.4 | 6.9% | 41.7% | 3,358.7 | 7.5% | 5,579.8 | 10.9% | -38.1% |
Sugar | 90.7 | 3.4% | 76.2 | 2.7% | 19.0% | 70.2 | 3.3% | 29.2% | 160.9 | 3.4% | 142.2 | 2.7% | 13.2% |
Third Party Flour | 3.2 | 0.1% | 2.3 | 0.1% | 39.1% | 2.2 | 0.1% | 45.5% | 5.4 | 0.1% | 4.6 | 0.1% | 17.4% |
Third Party Vegetable Shortening | 0.1 | 0.0% | 0.1 | 0.0% | 0.0% | 0.0 | 0.0% | n/a | 0.1 | 0.0% | 0.1 | 0.0% | 0.0% |
Other | 147.3 | 5.6% | 176.1 | 6.2% | -16.4% | 113.8 | 5.3% | 29.4% | 261.1 | 5.5% | 320.6 | 6.0% | -18.6% |
Packages | 175.1 | 6.7% | 173.2 | 6.1% | 1.1% | 132.2 | 6.2% | 32.5% | 307.3 | 6.4% | 321.4 | 6.0% | -4.4% |
Labor | 238.7 | 9.1% | 210.4 | 7.4% | 13.5% | 203.5 | 9.5% | 17.3% | 442.2 | 9.3% | 417.2 | 7.8% | 6.0% |
Indirect costs | 188.1 | 7.2% | 167.4 | 5.9% | 12.4% | 161.1 | 7.5% | 16.8% | 349.2 | 7.3% | 331.1 | 6.2% | 5.5% |
Depreciation and amortization | 52.0 | 2.0% | 52.6 | 1.8% | -1.1% | 47.8 | 2.2% | 8.8% | 99.8 | 2.1% | 103.4 | 1.9% | -3.5% |
Other | 1.8 | 0.1% | 3.9 | 0.1% | -53.8% | -0.4 | 0.0% | n/a | 1.4 | 0.0% | 22.4 | 0.4% | -93.8% |
Total | 1,827.1 | 69.5% | 2,056.3 | 72.2% | -11.1% | 1,454.1 | 67.9% | 25.7% | 3,281.2 | 68.8% | 3,998.8 | 75.0% | -17.9% |
In the comparison between 2Q24 and 2Q23, the drop in commodity prices had a favorable impact on results.
Compared to 1Q24, costs were negatively impacted by the devaluation of the Brazilian Real against the U.S. dollar. In nominal terms, costs increased due to the growth in volumes sold and produced.
Average Purchase Price M. Dias Branco x Market Price | |||||||||||||||||||||||
WHEAT | |||||||||||||||||||||||
(US$/TON.) | |||||||||||||||||||||||
349 | 350 | 342 | 337 | 331 | 343 | 342 | |||||||||||||||||
316 | |||||||||||||||||||||||
349 | 339 | 288 | |||||||||||||||||||||
331 | 325 | 324 | 314 | 269 | 267 | 279 | |||||||||||||||||
255 | 256 | 250 | 251 | ||||||||||||||||||||
290 | 284 | 274 | 249 | 243 | |||||||||||||||||||
266 | |||||||||||||||||||||||
249 | 234 | ||||||||||||||||||||||
235 | 227 | 213 | 229 | 235 | 228 | ||||||||||||||||||
Jan-23Feb-23Mar-23Apr-23May-23Jun-23 | Jul-23Aug-23Sep-23Oct-23Nov-23Dec-23Jan-24Feb-24Mar-24Apr-24May-24Jun-24 | ||||||||||||||||||||||
PALM | |||||||||||||||||||||||
OIL | |||||||||||||||||||||||
(US$/TON.) | |||||||||||||||||||||||
1,635 | 1,594 | 1,486 | |||||||||||||||||||||
1,392 | 1,412 | 1,367 | 1,378 | ||||||||||||||||||||
1,298 | |||||||||||||||||||||||
1,224 | 1,204 | 1,204 | 1,147 | ||||||||||||||||||||
1,103 | 1,090 1,119 | 1,129 | 1,084 | 1,097 | 1,116 | 1,146 | 1,108 | 1,088 | |||||||||||||||
1,053 1,045 | |||||||||||||||||||||||
1,169 | |||||||||||||||||||||||
1,151 | 1,110 | 1,082 | 1,057 | 1,068 | 1,041 | 1,048 | 998 | 1,043 | 1,082 | 1,069 | |||||||||||||
Jan-23 | Feb-23Mar-23 | Apr-23May-23 | Jun-23 | Jul-23 | Aug-23Sep-23Oct-23Nov-23Dec-23 | Jan-24 | Feb-24Mar-24Apr-24May-24Jun-24 | ||||||||||||||||
Market* | M. Dias | ||||||||||||||||||||||
*Source: Wheat - SAFRAS & Mercado; Palm oil - Rotterdam.
Vertical Integration
We maintained a high level of verticalization. Flour verticalization was 99.7% while shortening verticalization came to 100.0% in 2Q24.
Wheat flour | Vegetable shortening | |||||||
2Q24 | 99.7% | 0.3% | 39.3% | 60.7% | 2T24 | 100.0% | 48.7% | 51.3% |
1Q24 | 99.6% | 0.4% | 38.2% | 61.8% | 1T24 | 100.0% | 49.6% | 50.4% |
2Q23 | 99.6% | 0.4% | 37.6% | 62.4% | 2T23 | 100.0% | 46.3% | 53.7% |
Own Production External Source | Sale Internal Consumption | Own Production External Source | Sale | Internal Consumption | ||||
8
EARNINGS RELEASE 2Q24 | 1H24
Production capacity utilization rate
In 2Q24, we reached a capacity utilization level of 71.9%, higher than in 2Q23 and 1Q24. This increase reflects the higher volumes sold and consequently produced. As a result, the dilution of our fixed costs increased in 2Q24, as shown on the side.
Fixed costs* (R$/Kg)
1.0 | 1.0 | 1.0 | 1.0 | |
0.9 | ||||
2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 |
*Labor, indirect costs, depreciation and amortization, and other. |
Cookies and | Wheat Flour and | Margarine and | Other | |||||||||
Effective Production / | Pasta | Vegetable | Total | |||||||||
Crackers | Bran | products** | ||||||||||
Shortening | ||||||||||||
Production Capacity* | ||||||||||||
2Q24 | 2Q23 | 2Q24 | 2Q23 | 2Q24 | 2Q23 | 2Q24 | 2Q23 | 2Q24 | 2Q23 | 2Q24 | 2Q23 | |
Total Production | 147.5 | 144.7 | 111.9 | 96.7 | 467.9 | 402.6 | 48.7 | 45.5 | 8.1 | 6.2 | 784.1 | 695.7 |
Total Production Capacity | 215.9 | 219.5 | 144.2 | 129.8 | 625.7 | 624.5 | 90.0 | 90.0 | 15.3 | 14.4 | 1,091.1 | 1,078.2 |
Capacity Utilization | 68.3% | 65.9% | 77.6% | 74.5% | 74.8% | 64.5% | 54.1% | 50.6% | 52.9% | 43.1% | 71.9% | 64.5% |
2Q24 | 1Q24 | 2Q24 | 1Q24 | 2Q24 | 1Q24 | 2Q24 | 1Q24 | 2Q24 | 1Q24 | 2Q24 | 1Q24 | |
Total Production | 147.5 | 121.5 | 111.9 | 95.3 | 467.9 | 383.3 | 48.7 | 40.6 | 8.1 | 6.0 | 784.1 | 646.7 |
Total Production Capacity | 215.9 | 215.1 | 144.2 | 131.4 | 625.7 | 618.9 | 90.0 | 90.0 | 15.3 | 14.2 | 1,091.1 | 1,069.6 |
Capacity Utilization | 68.3% | 56.5% | 77.6% | 72.5% | 74.8% | 61.9% | 54.1% | 45.1% | 52.9% | 42.3% | 71.9% | 60.5% |
1H24 | 1H23 | 1H24 | 1H23 | 1H24 | 1H23 | 1H24 | 1H23 | 1H24 | 1H23 | 1H24 | 1H23 | |
Total Production | 269.0 | 256.9 | 207.2 | 181.9 | 851.2 | 757.4 | 89.3 | 83.9 | 14.1 | 11.8 | 1,430.8 | 1,291.9 |
Total Production Capacity | 431.0 | 441.1 | 275.6 | 262.0 | 1,244.6 | 1,242.2 | 180.0 | 180.0 | 29.5 | 28.0 | 2,160.7 | 2,153.3 |
Capacity Utilization | 62.4% | 58.2% | 75.2% | 69.4% | 68.4% | 61.0% | 49.6% | 46.6% | 47.8% | 42.1% | 66.2% | 60.0% |
*Thousand tonnes. | ||||||||||||
**Cakes, snacks, cake mix, packaged toast, healthy products, sauces and seasonings. |
Note: Total production capacity refers to the maximum yield that can be extracted from the equipment considering the losses caused by maintenance stoppages, setup time, line clean-up, restrictions on the maximum number of shifts in the plants, etc.
Gross Profit and Gross Margin
Gross Profit (R$ million) and Gross Margin (%)
In 2Q24, gross profit had a nominal drop of 2.5% against 2Q23. Gross margin increased, ending the quarter at 34.9%, up by 1.9 p.p. over 2Q23. This growth was due to the reduction in commodity costs, in particular wheat and palm oil, which positively impacted variable costs (R$/Kg), falling 25.7%, while the total average price fell 17.2%.
Variable costs* | 3.6 | 3.2 | 3.0 | 2.6 | 2.7 |
(R$/kg) | |||||
Fixed costs* | 1.0 | 1.0 | 1.0 | 1.0 | 0.9 |
(R$/kg) | |||||
(%) | 35.6% | 36.3% | 36.6% | 34.9% | |
Gross Mg. | |||||
33.0% | |||||
Average Price | 6.3 | 6.1 | 5.8 | 5.4 | 5.2 |
(R$/kg) | |||||
*Without incentives. | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 |
941.2 | 972.4 | 1,007.0 | 917.3 | |
784.1 | ||||
33.0% | 35.6% | 36.3% | 36.6% | 34.9% |
2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 |
Gross Profit | Gross Margin |
Compared to 1Q24, the Company recorded a 17% increase in gross profit, however, gross margin reduced by 1.8 p.p. This drop was due to the 4% reduction in average price and the increase in variable costs, particularly in the second half of the quarter, due to the depreciation of the Brazilian Real against the U.S. Dollar, which increased variable costs.
Gross profit includes subsidies for state investments, of R$ 114.4 million in 2Q24 (R$148.1 million in 2Q23), which are recorded in the income statement according to accounting pronouncement CPC 07 - Government Subsidies.
9
EARNINGS RELEASE 2Q24 | 1H24
Operating Expenses
We report sales and administrative expenses (SG&A) and, separately, the other operating expenses (donations, taxes, depreciation and amortization and others):
Operating Expenses (RS million)
Selling Administrative (SG&A) Donations Taxes Depreciation and amortization Other operating expenses/(revenue) TOTAL
2Q24 | % Net | 2Q23 | % Net | Var. % | 1Q24 | % Net | Var. % | 1H24 | % Net | 1H23 | % Net | Var. % |
Rev. | Rev. | Rev. | Rev. | Rev. | ||||||||
531.1 | 20.2% | 492.4 | 17.3% | 7.9% | 427.3 | 20.0% | 24.3% | 958.4 | 20.1% | 929.5 | 17.4% | 3.1% |
89.9 | 3.4% | 81.8 | 2.9% | 9.9% | 85.0 | 4.0% | 5.8% | 175.0 | 3.7% | 158.0 | 3.0% | 10.8% |
621.0 | 23.6% | 574.2 | 20.2% | 8.2% | 512.3 | 24.0% | 21.2% | 1,133.4 | 23.8% | 1,087.5 | 20.4% | 4.2% |
5.0 | 0.2% | 7.2 | 0.3% | -30.6% | 4.2 | 0.2% | 19.0% | 9.1 | 0.2% | 17.9 | 0.3% | -49.2% |
7.2 | 0.3% | 8.2 | 0.3% | -12.2% | 8.3 | 0.4% | -13.3% | 15.5 | 0.3% | 16.2 | 0.3% | -4.3% |
37.8 | 1.4% | 37.1 | 1.3% | 1.9% | 38.1 | 1.8% | -0.8% | 75.9 | 1.6% | 73.9 | 1.4% | 2.7% |
-1.7 | -0.1% | 26.5 | 0.9% | n/a | 28.3 | 1.3% | n/a | 26.6 | 0.6% | 45.6 | 0.9% | -41.7% |
669.3 | 25.4% | 653.2 | 22.9% | 2.5% | 591.2 | 27.7% | 13.2% | 1,260.5 | 26.5% | 1,241.1 | 23.3% | 1.6% |
In 2Q24, the increase in expenses as a percentage of net revenue, compared to 2Q23, was mainly due to the lower average price during the period.
In relation to 1Q24, nominal expenses grew by 13.2% due to the increase in volumes sold.
SG&A (% NR)
3.4 p.p. | |
-0.4 p.p. | |
24.0% | 23.6% |
20.2% | 20.5% | 20.8% |
2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 |
In light of the current pricing context, we have organized several initiatives to readjust our expense structure, which will be implemented and captured throughout 2H24. These include, for example:
Structure | Discretionary | Operational | |
Expenses | Efficiency | ||
• | Halting recruitment; | • Reduction of current services; | • High Performance Engines; |
• | Reduction of overtime. | • Project replanning. | • System license profile suitability; |
• Renegotiation and availability of data | |||
processing and storage services. |
Financial Result
Financial Result | 2Q24 | 2Q23 | Var. % | 1Q24 | Var. % | 1H24 | 1H23 | Var. % |
(R$ million) | ||||||||
Financial Revenue | 81.6 | 113.0 | -27.8% | 80.2 | 1.7% | 161.8 | 197.2 | -18.0% |
Financial Expenses | -98.4 | -168.0 | -41.4% | -80.9 | 21.6% | -179.3 | -310.3 | -42.2% |
TOTAL | -16.8 | -55.0 | -69.5% | -0.7 | n/a | -17.5 | -113.1 | -84.5% |
In 2Q24, our financial result was negative by R$16.8 million, compared to R$55.0 million in 2Q23. This reduction was mainly related to a lower cost of debt, due to the drop in the CDI rate, and the decrease in gross debt in domestic currency. Compared to 1Q24, the increase was due to negative exchange rate variations, caused by the devaluation of the Brazilian real against the U.S. dollar.
10