Brazilian multinational meatpacking business Marfrig has posted improved results at both the full year and final quarter stages of fiscal 2019. It is diversifying into plant-based food products to meet growth in consumer demand for meat alternatives.
The group reported an adjusted EBITA of Rs4.8bn on revenues of Rs49.9bn in the year ended December 31st 2019 – respective increases of 33.0% and 11.2% on the Rs3.6bn and 44.8bn from full year 2018.
Net income in the fourth quarter of the latest year was R$26.9m, up from the net loss of R$1.3bn from the same period of 2018, on net revenues of R$14.2bn - 23.5% higher year-on-year.
The latest year saw 3.33 million tonnes of product processed – a 1.9% fall on 2018 – of which 2.6m tonnes was for domestic consumption and 0.75m tonnes for export.
Marfrig said its North American operations benefited from a strong and growing domestic market in the year which also saw its South American division became the region’s largest beef exporter to China. It now has 13 plants authorised for export to China - seven in Brazil, four in Uruguay and two in Argentina.
Investment in plant-based “meat”
The group also completed its purchase of an additional 30.73% stake in Kansas City-based National Beef, the fourth largest beef processor in the US, in which it now holds an 81.73% controlling interest.
In August, Marfrig unveiled a partnership with Archers Daniel Midland to produce plant-based “meat” on a commercial scale, backed with a supply agreement with the Burger King fast food chain. The company has also launched Revolution, its own brand of plant-based product ranges, which will be exported and distributed to retail customers from this year.
A project to promote sustainable cattle farming will see the company investing in the purchase of cattle in the Amazon Biome region through the issue of sustainable transition bonds.
“We enjoyed a quarter of extraordinary results that confirm the effectiveness of our strategy based on focus, operational excellence and investments in a portfolio of innovative and value-added products,” said Eduardo Miron, global chief executive of Marfrig Global Foods. “The records set in the fourth quarter made a decisive contribution to meeting our guidance given for the whole of the year.”