00
June 2010
Our MissionTo be the best at what we set out to do, totally focused on our business, ensuring the
best products and services for our customers, solidity for our suppliers, satisfactory
profitability for our shareholders and the certainty of a better future for all our
employees.
Our ValuesExcellence
Planning
Determination
Discipline
Availability
Openness
Simplicity
1
Agenda
Company Overview
Market Overview
1Q10 Highlights
Short Term Outlook
2
Company Overview
3
JBS S.A. at a Glance
• Founded in the 1950’s in Central West Brazil
• IPO in 2007
• Ibovespa ticker: JBSS3
• ADR ticker: JBSAY
• Leading protein producer in the World
• Production platform in South America, North America, Europe and
Oceania
• 125,000 employees worldwide
• Market cap of approximately R$19 billion
*Source: Bloomberg 13/05/2010
*
4
Shareholders
5
Controlling Holding 55.5%
BNDESPAR 17.3%
Market 19.1%
PROT - FIP 8%
6
EBITDA (R$mm)
.
Bertin Merger
Pilgrim’s Pride
JBS Hides
5 new units
Tasman
Smithfield Beef
Five RiversInalca
Swift Foods Co.
SB Holdings Venado Tuerto Pontevedra(CEPA)
CAGR (2001-2009): 62%
2001 2006 – pre IPO 2009
% of total revenues of R$1,212mm % of total revenues of R$4.3bn % of total revenues of R$55.2bn
Beef Beef
Industrialized/Further
Processed
Beef
Poultry
Industrialized/Further
Processed
Pork
100%
23%
77%
52%
13%6%
29%
JBS S.A. Growth Through Acquisitions
Global Low Cost Production Platform
7
World Beef Producers World Pork Producers World Chicken Producers
Total Number of Plants
65
33
3
6
3
10 544
OthersBrazil
EU
34%16%
14%
21%
10% China
5%
IndiaUS
OthersBrazil
EU
17%3%
10%48%
China
22%
US
Others
Brazil
EU
34%
15%
22%
17% China
12%
US
8 33 3 1
8
1st
Ranking
Well-Recognized
Brands
Production Units
Geographic Presence
and Installed Capacity
2nd 3rd 1st 3rd 1st
Global Global U.S.A. Global Brazil Global
Beef
41.2
1.1
6.7
28.6
8.7
3.0
1.0
‘000 heads/day:
6.9
0.7
mm heads/day:
48.5
‘000 heads/day: ‘000 hides/day:
1.4
‘000 tons/day:
4.5
23.0
‘000 heads/day:
Total: 90.3 Total: 7.6 Total: 48.5 Total: 91.4 Total: 1.4 Total: 27.5
Chicken PorkHides / Leather
Dairy Lamb
65 33 3 26 7 6
55.6
28.6
6.0
1.2
Leading, Sizeable and Diversified Business Platform
9
Our Strategy
Production platform
Sales and distribution platform
Value added products
Branding
JBS’ Value & Strategy
EBITDA Margin
Financial structure
Experienced management
Cost reduction,
process optimization
Risk management
• Developed an efficient and diversified global production platform
• Expanding a global distribution platform to reach end clients
• Customized and further processed products for the end users
• Associating quality and branding to increase client loyalty
Rationale
10
Protein Consumption in Key Markets (millions of Ton, 2009E)
53 Distribution Centers
Growth 1
2 %
5 %
8 %
Growth 1
7 %
16 %
25 %
Growth 1
9%
8%
13 %
Growth 1
4 %
3 %
-2 %
Total: 46 mm ton Total: 74 mm ton Total: 86 mm ton
Asia & Middle East
13
North America
15
Europe
8
Latin America
10
28%17%
22%
33%
Asia & Middle East
30
North America
21
Europe
12
Latin America
1141%
16%
15%
28%
Asia
51
North America
11
Europe
21
Latin America
359%
24%
3%
13%
1 Real growth of total consumption in tons – 2010E to 2015ESource – OECD-FAO
Distribution Platform with Access to Key Markets
Market Overview
11
Market Highlights
• Domestic growth in Brazil remains strong
• Grain prices are competitive
• Signs of growing importance of international trade with increased
demand in all major importing markets
• Increase in US Exports
• Declining production in Europe
12
Average Growth of Consumption of Animal Protein in the last 10
years
13
3
Source: FAPRI February 2010
7.5%
29%
32.2%
70.2%
41.4%
47.7%
23.7%
23.3%
48.7%
North America
Central
America
South
America
Sub Saharan
Africa
Middle EastSoutheast
Asia
East Asia
Former USSR
Oceania
EU - 27
Source: Secex
* Until March
Brazilian Beef exports
(Thousand Tons)
14
780
1,095
1,263
1,425 1,491
1,218
1,086
258 231
0
200
400
600
800
1,000
1,200
1,400
1,600
2003 2004 2005 2006 2007 2008 2009 2010
E.U. Russia Egypt Venezuela Algeria USA Hong Kong Others Until March
*
Source: USDA ERS
* Until March
US Beef and Veal Exports (Million Pounds)
15
*
2,412 2,467
2,269
2,449 2,520
461
697
1,146
1,433
1,888 1,867
478 384
0
500
1,000
1,500
2,000
2,500
3,000
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Mexico Canada South Korea Japan Vietnam China Hong Kong Netherlands Others Until March
Source: USDA ERS
* Until March
US Pork Exports (Million Pounds)
16
*
1,278 1,287
1,560 1,612 1,717
2,181
2,667
2,995 3,142
4,667
4,128
1,047
1,034
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Japan China Hong Kong Mexico Russia Canada South Korea Australia Others Until March
Source: USDA ERS
* Until March
US Poultry Exports (Million Pounds)
17
*
4,980 5,138
5,738
4,942 5,013 4,997
5,333 5,367
6,070
7,109 6,906
1,508
1,754
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Russia China (Mainland) Iraq Mexico Canada Cuba Other Chicken Others Until March
18
Beef & Veal – Supply and Demand in 2020
Source: Goldman Sachs
14.3
0.2
9.4
5.1
4.1
0.5
3.6 2.40.8
1.6
12.7
1.5 1.2
13.0 8.6
0.5
8.18.0
0.8 0.2
8.6
India
Europe
Australia
China
Brazil
Argentina & Uruguay
Global Surplus (Deficit) of Beef & Veal (Million metric tons)
USA
3.6
0.4
3.2
Production Imports Exports ConsumptionProduction Imports Exports ConsumptionProduction Imports Exports Consumption
Production Imports Exports Consumption
Production Imports Exports Consumption Production Imports Exports Consumption Production Imports Exports Consumption
Deficit
Surplus
19
Chicken – Supply and Demand in 2020
1.91.0
0.8
19.1 15.1
4.1
8.9
1.1 0.9
9.119.2
0.2
20.02.2
3.41.2
India
Russia
Thailand
China
Brazil
USA
Global Surplus (Deficit) of Chicken (Million metric tons)
Europe
Production Imports Exports Consumption
3.7 3.7
Deficit
Surplus
Production Imports Exports ConsumptionProduction Imports Exports Consumption
Production Imports Exports Consumption
Production Imports Exports Consumption Production Imports Exports Consumption Production Imports Exports Consumption
16.29.4
6.9
Source: Goldman Sachs
20
Pork – Supply and Demand in 2020
1.6 2.1
0.2
4.2 3.056.9 56.4
0.8
11.9 9.9
2.5
2.2
0.3
1.21.3 2.7
3.822.7 21.6
0.1
Brazil
Europe
China
Russia
Mexico
USA
Global Surplus (Deficit) of Pork Meat (Million metric tons)
Canada
1.11.1
0.5
0.7 1.2
0.3
Deficit
Surplus
Production Imports Exports ConsumptionProduction Imports Exports ConsumptionProduction Imports Exports Consumption
Production Imports Exports Consumption
Production Imports Exports Consumption Production Imports Exports Consumption Production Imports Exports Consumption
Source: Goldman Sachs
1Q10 Highlights
21
Highlights for the 1st Quarter 2010
• Net Revenue increased by 35.4%, from R$9,267.9 million in 1Q09 to R$12,550.3
million in 1Q10, mainly due to the incorporation of Bertin and acquisition of Pilgrim’s
Pride.
• The 1Q10 consolidated EBITDA increased 307.5% compared to the same period in
2009, from R$211.5 million to R$862.0 million. The EBITDA margin was 6.9% for the
period, compared with 2.3% for 1Q09.
• Net Profit of R$99.4 million in 1Q10, compared to a net loss of R$322.7 million in
1Q09.
• Beef US posted EBITDA of US$170.5 million, on margin of 6.0%, a record for 1Q.
• In Mercosul, JBS posted EBITDA of R$352.6 million, with 11.9% margin.
22
JBS Consolidated Results
Net Revenue (R$ million) EBITDA and EBITDA Margin (R$ million)
Source: JBS
EBITDA Margin (%)
-11.6%
36.3%
-0.1%
81.6%
-9.5%
-24.0%
23
69.4%95,2%
Performance by Business Units
Source JBS
EBITDA Margin (%)
Net Sales(R$ billion)
EBITDA (R$ mi) EBITDA margin
JBS MERCOSUL
24
Net Sales(€ million)
EBITDA (€ mi)
EBITDA margin
INALCA JBS
Performance by Business Units
Source JBS
EBITDA Margin (%)
Net Sales(US$ billion)
EBITDA (US$ mi) EBITDA margin
JBS USA (Beef)Including Australia
Net Sales(US$ million)
EBITDA (US$ mi) EBITDA margin
JBS USA (Pork)
25
Net Sales(US$ million)
EBITDA (US$ mi) EBITDA margin
Pilgrim’s Pride Corporation
Debt
• Net debt / EBITDA ratio remained at 3.1x q-o-q. Gross debt declined 5.7%, while Net Debt
increased 12.2%, reflecting working capital requirements to ramp up recent acquisitions, as well
as investments in fixed assets, further impacted by FX fluctuations.
• The vast majority of the company’s short term debt is composed of revolving trade finance credit
lines.
• As demonstrated below, the percentage of short term debt was 40% in 1Q10, compared with
37% in 4Q09 and 47% in 1Q09.
Net Debt / EBITDA Pro Forma per Quarter
Source: JBS
Net Debt/ EBITDA EBITDA pro-forma
* LTM including Bertin and Pilgrim’s Pride pro-forma.
Gross debt Profile (R$ million)
26
*
Revenue Distribution by Market
1Q10 1Q09
Source: JBS Source: JBS
27
Domestic
Market77%
Exports 23%
Domestic
Market78%
Exports 22%
JBS Consolidated Exports Distribution
JBS Exports 1Q10
Source: JBS
JBS Exports 1Q09
28
US$ 1,765.4 Million
Japan16%
E.U.16%
USA11%Mexico
9%
Russia8%
South Korea6%
China5%
Hong Kong5%
Canada4%
Middle East4%
Taiwan2%
Others14%
US$ 901.4 Million
Short Term Outlook
29
A Closer look at synergies – Pilgrim’s Pride
30
US$35mn
US$30mn
US$50mn
US$50mn
US$35mn
US$20mn
US$220mn
Description Size Timing
Transportation
Suppliers
G&A
Logistics optimization
Corporate
Exports
Total
Review of contract terms with carriers
Review of contract terms with packaging and other suppliers
Review of service contracts (e.g. Legal, insurance and IT)
Increase efficiency in average weight per truck
Streamlining of corporate structure and headquarters closure
Reach-out to end clients through JBS existing sales network 2010
1H10
Pilgrim’s Pride Acquisition: Synergies of over US$220mm/year
1H10
2 years
A Closer look at synergies – Bertin S.A.
31
R$45mn
R$20mn
R$40mn
R$35mn
R$245mn
R$100mn
Hides / Leather
Logistics
Corporate/G&A
Suppliers
Industrial Processes
Exports
Total R$485mn
Value enhancement through further processing
Review of transportation contracts
Offices, personnel, services contracts and third parties
Review contract terms of non core suppliers (e.g. packaging)
Optimization of fixed costs and rationalization of existing contracts
Maximization of the combined sales channels and review of freight contracts
Description Size Timing
1H10
1H10
2 years
2010
Association with Bertin: Synergies to Achieve at Least R$485mm/year
“In God We Trust, Nature We Respect”
IR Contacts:
+55 11 3144 4055
www.jbs.com.br/ir32