Marfrig & BRF 2025年第一季度财报/合并

Restricted - External Ansel Tessitore+1 212 412 5982ansel.tessitore@barclays.comBCI, US FIGURE 1. We See A Long Term Value Opportunity for MRFG and BRF as the Group Pursues Its StrategicAmbitions of Becoming a Globally Diversified Protein Producer That is Listed in The USSource: BloombergTransaction Summary:Marfrig will acquire BRF through an all-share merger, with BRF shareholders receiving 0.8521Marfrig shares for each BRF share. Upon completion, BRF will become a wholly ownedsubsidiary of Marfrig. The new entity will be renamed MBRF Global Foods CompanyS.A. Shareholder votes are scheduled for June 18, with the transaction expected to close by lateJuly.The post-merger ownership structure will change significantly. Marcos Molina and relatedparties will see their stake stake in Marfrig fall to 41% from their current 73% holding. BRF'spublic shareholders will emerge as key stakeholders with a 32% interest, while other remainingMarfrig shareholders will retain 26%. SALIC, the Saudi strategic investor, will keep a 11%position. We view Molina's willingness to dilute his control as a credit positive, reinforcing thecommitment to governance and balance sheet flexibility. Importantly, the transactioneliminates a structuralinefficiencyby granting Marfrig full access to BRF's earnings andresolving minority interest leakage.Extraordinary dividends of BRL3.5bn from BRF and BRL2.5bn from Marfrig are planned ahead ofclosing, through those amounts may be adjusted to reflect shareholder withdrawal rights.Dissenting BRF holders may opt to receive BRL19.9 per share in cash rather than Marfrig equity.However, with BRF stock currently trading near BRL20.8 and management signaling supportfrom major shareholders on the earnings call, we view large opt-outs as unlikely. Taking thesedistributions into account, we expect Marfrig’s net leverage to rise modestly, from 3.0x in 1Q25to 3.3x pro forma.According to the companies, the merger is expected to generate BRL805mn in annual EBITDAsynergies, including BRL485mn from logistics, procurement and commercial integration, andBRL320mn from streamlined systems and administrative functions. Additional tax benefits, withan estimated NPV of BRL3bn, are expected – primarily from asset step-up amortization andmonetization of existing credits.Strategically, the merger combines complementary operations – Marfrig's beef platform acrossNorth and South America, including US-based National Beef, with BRF's strengths in poultry,pork and value-added products. The resulting scale is expected to enhance global marketpresence and export capabilities, creating a stronger platform for long-termgrowth. Management also intends to pursue a US listing, which could help narrow the valuationgap with peers such as JBS and improve long-term market access.2 Source: Company ReportsFIGURE 4. Consolidated LTM Revenue is Geographically WellDiversified with Significant US exposureAsia + MiddleEast20%Other InternationalsSource: Company Reports19 May 2025 FIGURE 5. Consolidated LTM Volumes are well diversified betweenProtein Categories with Significant Processed Products Exposure.ProcessedProducts38%Poultry +Pork34%Beef28%Source: Company ReportsConsolidated 1Q25 revenue reached $6.6bn, (-7% q/q, +8% y/y), with EBITDA at $546mn (-15%q/q, +2% y/y), yielding an 8.3% margin (-78bp q/q, -42bp y/y). Free cash flow was negative$30mn, and shareholder returns amounted to $137mn. Net debt (including leases) rose to$7.7bn (+9% q/q, +8% y/y), and cash declined to $3.5bn (-4% q/q, -15% y/y). Consequently, netleverage increased to 3.0x from 2.8x in 4Q24 but improved from 3.6x in 1Q24.BRF continues to drive consolidated earnings, delivering $471mn in EBITDA (-2% q/q, +10% y/y),bolstered by robust poultry fundamentals and successful implementation ofefficiencymeasures under the BRF+ program. In contrast, Marfrig's beef operations struggled, withEBITDA declining sharply to $76mn (-53% q/q, -29% y/y).North American profitability remained under intense pressure in 1Q25. Despite a 15% y/yincrease in sales, adjusted EBITDA fell sharply to $6mn, with margins compressing to 0.2%.Higher cattle procurement costsoffsetgains in boxed beef pricing. Management cited earlysigns of stabilization in the US cattle cycle, including reduced cow liquidation and increasedheifer retention, but a meaningful recovery in industry margins is unlikely in the short term. The Earnings Highlights 3 weak contribution from North America underscores BRF's central role in supportingconsolidated results.At BRF, management maintains a constructive outlook. However, the confirmed case of avianinfluenza in Rio Grande do Sul introduces near-term uncertainty. Authorities implemented a 10-kilometer containment zone, and management expects the episode to be resolved similarly thethe Newcastle outbreak in 2024, which had minimal financial impact. Still, temporary exportbans from China and other countries elevate headline risk. Additionally, while currentbiosecurity measure