JBS to resume U.S. share listing plan after COVID-19 fallout

Management looking also for US$100 million in cost cuts

Sao Paulo | Reuters — Brazil’s JBS SA is reviving plans to list shares on Wall Street after dealing with the COVID-19 pandemic’s fallout, CEO Gilberto Tomazoni said on Friday, as the world’s largest meatpacker reported strong quarterly results.

Speaking on a conference call with analysts following the company’s second-quarter results, Tomazoni said the focus is turning toward the Wall Street listing now that the worst of the COVID-19 outbreak appears to have passed.

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“In the last quarter we said we would prioritize the protection of our people and tackle the operating challenges imposed by the pandemic,” he said.

“Now things are more under control. We have learned to deal with the challenges. We are again discussing the listing.”

Despite the volatility caused by the pandemic, JBS late Thursday posted quarterly net profits that were nearly twice as high as the average of analysts’ estimates, buoyed by a strong performance in its beef and pork divisions at home and in the United States.

Regarding the timing for the U.S. listing, Tomazoni said “it cannot happen this year” given the steps needed to complete such an undertaking.

JBS managers also said the company will cut financial expenses by an estimated US$100 million this year.

Chief financial officer Guilherme Cavalcanti noted, hypothetically, that if JBS exchanged all of its debt for a 10-year bond, it could reduce financial expenses by a further US$100 million given its good credit rating.

In the second quarter, JBS’ leverage ratio fell to 1.75x in U.S. dollars, its lowest in history.

“In terms of financial performance, this was a quarter to remember,” Banco BTG Pactual analysts said in a note to clients on Friday.

— Reporting for Reuters by Ana Mano and Paula Arend Laier.

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