Dive Brief:
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JBS SA’s momentum to list its shares on the New York Stock Exchange has slowed over the summer, CFO Guilherme Cavalcanti said in an earnings call, raising questions as to whether the world's largest meat processor will complete an initial public offering before its end-of-year goal.
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Cavalcanti said Wednesday that the company has been answering questions from regulators and submitting new filings as part of the listing process. "At some point, the questions will be decreasing," he said, noting the process is "out of our control."
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The update comes months after JBS delayed its “dual-listing” plans again to give American depository receipt holders enough time to vote on the transaction. JBS set a deadline for the back half of 2024.
Dive Insight:
JBS has sought to list its shares in the U.S. over the past decade or so, but has run into challenges along the way. A history of bribery that led to a huge scandal and jail-time for the executives, not to mention a global pandemic, slowed efforts.
As it looks to access cheaper capital and more investors, JBS could be forced to delay its plan to list its shares both in the U.S. and Brazil yet again. Cavalcanti updated investors that more steps are necessary before a proposal is ready for a general assembly.
“It’s a regular process,” he said in the call, but noted that “everything gets to a lower pace” during the summer months. Cavalcanti gave no updated timeline for the listing in the call.
JBS' listing plans have faced considerable backlash from environmental and consumer groups, who say an IPO would reward the company with cheap capital despite its climate and corporate governance record.
“Today’s earnings call exposed the truth: JBS’s IPO is floundering, and the Batistas have no one to blame but themselves,” Jason Elan, executive vice president of Ban the Batistas, said in a statement. “Their history of corruption, environmental destruction, and predatory price-gouging practices are catching up with them.”
JBS earnings soared in the second quarter as the chicken and pork businesses benefited from lower grain and feed costs. JBS reported a net profit of $329 million for the period, with sales up 7% over last year.
Pilgrim’s Pride had one of its best earnings quarters ever, CEO Gilberto Tomazoni said, with strong results in the U.S., Mexico and Europe. JBS reported improved earnings across all of its businesses except for its North American beef division, which is still being challenged by a difficult cattle market in the U.S.
“The strength of our diversification puts JBS in a unique position in the industry,” Tomazoni said in a letter to investors.
