Message from Management
GRI 102-14

2018 proved to be yet another challenging year in the history of the Company bringing about significant achievements. We completed the integration of all facilities acquired in South America during the 2017 year, implemented an accelerated program for financial deleveraging, and created a new avenue for generating growth and value: Athena Foods, out of the region’s most diverse operating platform, South America’s leading beef export is born.

Our commodity and our operation strategy is based on large-scale production with efficient channels of distribution and risk management. Therefore, over the last year, we have worked to standardize the management procedures of our operations within the various countries, as well as the expansion of our marketing intelligence tool: Beef Desk which allows to strategically address the aspects of industry-specific prices and margins of foreign operations.

Achieving these results required planning, agility and discipline, on three closely interlinked work fronts: geographical diversification, growth and strengthening of distribution channels, and an operational strategy lead by efficient actions. A strategic diversification in South America, with a focus on new markets, permitted for business to be conducted at a global scale minimizing the dependency on domestic markets during periods of volatility and economic downturn.

Understanding how to take advantage of market conditions, our business growth has been driven by an increase in demand, all the while we continuously pursue ways to boost operational efficiency. The incorporation of technology and employee engagement in actions such as health and safety and efficiency are strategic for improving our productivity, the safety of our products and the quality of the work environment.

Fernando Galletti de Queiroz
Chief Executive Officer

Gathered in 2018, the capacity utilization rate demonstrated a three percentage point increase when compared to 2017 and ended up at approximately 78%. By having a net revenue of R$ 16.2 billion over the last year, equivalent to a 16% increase when compared to 2017, we exceeded the expectations for the period with a 22% return on invested capital.

We continue to focus our efforts on carrying out our business model with greater excellence and efficiency, searching for greater commercial expansion into domestic and export markets, greater geographical diversification in the sale of our own and third party products, and the integration of our continuous improvement programs, ever confident in the direction in which we are heading.

For 2019, our focus will continue to be to seek out the best results, confident that it is obtainable by means of operational efficiency and quality excellence.