BRF S.A. (BRFS): history, ownership, mission, how it works & makes money

A Brief History of BRF S.A. (BRFS)

Founding and Early Years

BRF S.A., originally known as Brasil Foods S.A., was established in 2009 through the merger of two major Brazilian companies: Perdigão and Sadia. It quickly became one of the largest food companies in Brazil and around the globe.

Key Mergers and Acquisitions

In July 2012, BRF acquired 100% of the shares of the Brazilian special products company, Avipal. This acquisition expanded its portfolio significantly.

In 2013, BRF expanded internationally by acquiring a 51% stake in the Argentine company, El Osito, further solidifying its footprint in South America.

Business Growth and Expansion

BRF's revenue reached R$ 36.6 billion in 2018, indicating a strong market presence in both domestic and international sectors. The company's financial growth was partly due to its strategic focus on exports, which accounted for approximately 28% of its total revenue in 2019.

Financial Performance

In the third quarter of 2021, BRF posted net revenues of R$ 11.7 billion, representing a 13.4% increase compared to the same period in the previous year. The net income for the same period was R$ 725 million.

Global Presence

BRF operates in over 140 countries worldwide. The company's brands include well-known names such as Sadia, Perdigão, and Qualy, catering to a wide array of consumer preferences.

Recent Developments

In 2023, BRF announced plans to invest R$ 1.5 billion in expanding its production capacity in Brazil and enhancing its supply chain initiatives. This investment aims at increasing operational efficiency by 25%.

Sustainability Initiatives

BRF has committed to sustainable practices, targeting 100% of its production facilities to be certified by industry sustainability standards by 2025. The reduction of greenhouse gas emissions is also a priority, with plans to cut emissions by 15% by 2030.

Market Position

As of 2023, BRF is recognized as the second-largest poultry exporter in the world and the largest in Brazil, contributing to approximately 17% of the country's poultry production.

Challenges and Controversies

BRF has faced various challenges, including allegations of corruption and price-fixing in the past. In 2017, the company was involved in a major investigation which led to restructuring and changes in management.

Future Outlook

Analysts predict steady growth for BRF, with expectations of a 5% annual growth rate over the next five years, driven by increasing demand for meat and processed food products, both domestically and internationally.

A Who Owns BRF S.A. (BRFS)

Ownership Structure

As of October 2023, BRF S.A. (B3: BRFS3) has a diverse ownership structure, with significant shares held by both institutional and individual investors.

Key Institutional Shareholders

Several key institutional shareholders significantly influence BRF S.A.'s strategic direction. Below are the major institutional holders.

Shareholder Voting Rights

BRF S.A. operates under a common share structure, with voting rights distributed as follows:

• Common Shares: 1 vote per share
• Preferred Shares: No voting rights

As of the latest shareholder meeting, over 80% of the common shares were present, allowing significant decisions to be passed with overwhelming support.

Recent Stock Performance

BRF S.A. has shown robust stock performance in recent months, reflecting its strong market position.

Strategic Alliances and Partnerships

BRF S.A. has formed strategic alliances that enhance its market competitiveness:

• Partnership with Tyson Foods: Joint ventures in poultry processing.
• Collaboration with Olam International: Focus on supply chain efficiencies in the agribusiness sector.
• Innovative Product Development with Nestlé: Co-creation in ready-to-eat meals.

Future Outlook

Market analysts predict a steady growth trajectory for BRF S.A. over the next five years, driven by increasing demand for protein-based products globally. Projections indicate a potential revenue growth of 10% annually.

BRF S.A. (BRFS) Mission Statement

Overview

BRF S.A. (BRFS) operates in the food production sector, with a mission focused on providing high-quality food products while ensuring sustainability and innovation in its processes. The company's mission statement emphasizes its commitment to feeding the world responsibly.

Core Elements of the Mission Statement

• Quality: Commitment to high standards in food safety and quality.
• Sustainability: Focus on sustainable practices throughout the supply chain.
• Innovation: Continuous improvement in products and processes.
• Responsibility: Commitment to social responsibility and community engagement.

Recent Financial Performance

As of the second quarter of 2023, BRF S.A. reported significant financial figures that align with its mission goals:

Global Reach and Sustainability Initiatives

BRF operates across several continents, supplying products in over 130 countries. Its sustainability initiatives underscore its mission statement as follows:

• Carbon Footprint Reduction: Aiming for a 25% reduction in greenhouse gas emissions by 2025.
• Water Usage Efficiency: Targeting a 20% reduction in water usage in operations by 2025.
• Animal Welfare Standards: Adhering to international standards in animal welfare across all operations.

Market Position and Competitiveness

As one of the largest food companies in Brazil, BRF maintains a strong market presence:

Market Segment	Market Share (%)	Key Competitors
Poultry	35%	JBS, Seara
Pork	20%	JBS, Minerva Foods
Processed Foods	15%	Unilever, Nestlé

Strategic Goals for the Future

To bolster its mission, BRF has set strategic goals which include:

• Increasing production capacity by 10% by 2025.
• Enhancing product innovation with a focus on health and wellness.
• Expanding into emerging markets to diversify its customer base.

Commitment to Corporate Social Responsibility

BRF emphasizes its dedication to making a positive impact on society, which is a key element of its mission statement:

• Community Support: Investing over BRL 50 million annually in community initiatives.
• Employee Training: Providing training to approximately 25,000 workers to enhance skills and safety.
• Food Donation Programs: Committing to donate 5,000 tons of food annually to food banks and NGOs.




How BRF S.A. (BRFS) Works

Company Overview

BRF S.A. is a Brazilian multinational company specializing in food production, specifically in the meat and processed food sector. The company was formed in 2013 from the merger of Perdigão and Sadia. It operates in more than 150 countries and has a diverse portfolio of well-known brands.

Business Segments

BRF's operations can be categorized into several key business segments:

• Chicken
• Beef
• Pork
• Processed Foods
• Poultry

Production Capacity

As of 2022, BRF runs 37 production facilities worldwide. The company has a daily production capacity of:

Product Type	Daily Production Capacity (Tons)
Chicken	1,600
Beef	1,200
Pork	600
Processed Foods	1,000

Financial Performance

According to the Q2 2023 financial report, BRF posted the following key figures:

• Total Revenue: R$ 12.3 billion
• Net Income: R$ 780 million
• EBITDA: R$ 1.5 billion
• Operating Margin: 6.3%

Market Presence

BRF is one of the largest food companies in Brazil, holding a significant share in the poultry market with:

Market Segment	Market Share (%)
Chicken	20%
Pork	15%
Processed Foods	18%

Global Reach

BRF exports its products to over 150 countries, with key markets including:

• United States
• Europe
• Asia
• Middle East

Research and Development

BRF invests significantly in R&D, allocating approximately 1.5% of its annual revenue to innovate and enhance product offerings. In 2022, this amounted to R$ 185 million.

Sustainability Initiatives

BRF has committed to achieving carbon neutrality by 2030, implementing various sustainability practices, such as:

• Reducing water consumption by 20%
• Increasing renewable energy usage to 70%
• Improving animal welfare standards

Recent Acquisitions

In recent years, BRF has made strategic acquisitions to enhance its market position:

• Acquisition of Ovos e Cia in 2022 for R$ 60 million
• Acquisition of a controlling stake in a European meat company in 2023 for R$ 400 million

Stock Performance

As of October 2023, BRF S.A.'s stock (BRFS) is trading at R$ 19.75 per share, with a market capitalization of approximately R$ 30 billion.

Employee Base

BRF employs around 100,000 people globally, contributing to its large-scale operational capabilities.





How BRF S.A. (BRFS) Makes Money

Revenue Streams

BRF S.A. generates revenue primarily through the sale of processed foods and animal protein. For the fiscal year 2022, the company reported total net revenue of approximately R$ 54.6 billion.

Segmentation of Revenue

• Domestic Market: 70% of total revenue
• International Market: 30% of total revenue

Product Categories

BRF's product offerings can be categorized as follows:

Product Category	Percentage of Revenue	FY 2022 Revenue (R$ billion)
Poultry	45%	24.57
Processed Foods	31%	16.96
Pork	12%	6.66
Beef	10%	5.97

Geographic Revenue Distribution

International operations have expanded significantly, contributing to revenue diversity:

Region	Percentage of Total Revenue	FY 2022 Revenue (R$ billion)
South America	20%	10.92
North America	5%	2.73
Europe	2%	1.10
Asia	3%	1.64

Cost Structure

The cost of goods sold (COGS) for BRF S.A. was approximately R$ 46.1 billion in FY 2022, accounting for about 84% of total revenues. Key components of COGS include:

• Raw materials
• Transportation
• Production costs

Profit Margins

BRF's EBITDA for FY 2022 was R$ 6.3 billion, yielding an EBITDA margin of approximately 11.5%.

Investment in Innovation

BRF S.A. invests in new product development and technology, with R&D spending representing about 1.2% of net revenue, translating to R$ 655 million in FY 2022.

Recent Acquisitions

Acquisitions play a significant role in BRF's growth strategy. Notable acquisitions include:

• In 2021, the acquisition of the brands “Adujo” and “Sadia” expanded market presence.
• The 2022 acquisition of company assets from “Doria” to enhance product variety.

Market Trends and Outlook

According to industry reports, the global meat market is expected to reach a valuation of R$ 1.8 trillion by 2027, which presents growth opportunities for BRF S.A. The CAGR (Compound Annual Growth Rate) is projected at 5% from 2022 to 2027.

Current Financial Performance

As of Q3 2023, BRF S.A. reported a net income of R$ 1.5 billion, with earnings per share (EPS) standing at R$ 1.02.

Shareholder Information

BRF S.A.’s market capitalization is approximately R$ 33 billion as of October 2023.



BRF S.A. (BRFS) DCF Excel Template

5-Year Financial Model

40+ Charts & Metrics

DCF & Multiple Valuation

Free Email Support

DOWNLOAD