PerdigÃ£o reports lower profits from exports
One of the largest food companies in Latin America, PerdigÃ£o, had its 2006
financial statements hurt by a weaker export market. Domestic sales, however,
compensated in some way for the foreign losses.
The fall in exports was largely the result of a reduction in the demand for
chicken meats - due to the spread of avian influenza outbreaks - and the Russian
trade ban on imports of pork meat following cases of foot and mouth disease in
PerdigÃ£o's earnings were also impacted by a 10% appreciation in the
Brazilian currency, the real against the American dollar.
Focus on domestic market
In an attempt to compensate for
these unfavourable conditions on the international front, the company increased
its business in the domestic market through the continued diversification of the
product mix with the emphasis on high value-added products.
According to the
company, the greater focus on domestic business improved employment rates and
mass of real wages levels and PerdigÃ£o's start in the dairy-processed product
market were reflected in an increase of 20.1% in gross sales to the domestic
market, surpassing the US$ 1.7 billion revenues.
On the other hand,
exports dipped 13.3% in revenue terms, posting US$ 1.2 billion for the year.
With the good performance in domestic market sales, gross sales reached US$ 2.9
billion, a 4% improvement over fiscal year 2005.
The Company reported
gross profits of US$ 625 million, a year-on-year decline of 7.9%, the
consequence of the unfavourable business conditions for the industry,
particularly in the first six months of 2006.
During 2006, PerdigÃ£o invested
US$ 306 million (including the acquisitions of Batavia and
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