4. Global Market
Largest beef producers Largest beef consumers
Others Others
United States United States
31% 31%
21% 22%
Brazil EU-27
15% 15%
India
4% Mexico
4%
Argentina
Argentina
5% EU-27 Brazil
China 5% China
14% 13%
10% 10%
Largest beef exporters Largest beef importers
Others
25% Brazil United States
23% Others 19%
38%
Russia
16%
New Zealand
Australia
7%
19%
Canada
7% India South Korea
Japan
United States 4% EU-27
8% Mexico 10%
11% 8%
5%
Source: USDA 2009
3
5. World Population Growth and Beef Consumption
(1960 – 2050)
140
10000 Population growth, a beef
consumption driver.
120
8000
Consumption (million tons)
100
Population (million)
6000 80
60
4000
40
2000
20
0 0
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010* 2015* 2020* 2025* 2030* 2035* 2040* 2045* 2050*
Population - Developed countries Population - Developing countries Beef Consumption**
Source: UN (United Nations) and USDA
*UN Estimates
**Beef consumption trend considering CAGR of 2.0% (from 1960 to 2008) 4
6. Per capita food consumption (Kg / Year)
180
1969/ 71
160 1979/ 81
1989/ 91
140
1999/ 01
120 2030
2050
100
80
60
40
20
0
Cereals Roots and Beans, Peas Sugar Oils Crops Meat Milk and its
Tubers and Lentils and its products
products
Source: FAO
5
7. US Beef and Veal Exports (Million Pounds)
3,000
2,467 2,520
2,412 2,449
2,500
2,269
2,000 1,888
1,433
1,500 1,349
1,146 1442
1349
1,000
697
461
500
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Mexico Canada South Korea Japan Vietnam China Hong Kong N etherlands Others Until September
Source: USDA ERS
6
8. US Pork Exports (Million Pounds)
5,000
4,667
4,500
4,000
3,500 3,142 3,619
2,995 3,003
3,000 2,667
3,003
2,500
2,181
2,000 1,717
1,560 1,612
1,500 1,278 1,287
1,000
500
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Japan China Hong Kong Mexico Russia Canada South Korea Australia Others Until September
Source: USDA ERS
7
9. US Poultry Exports (Million Pounds)
8,000
7,109
7,000
6,070
6,000 5,738
5,333 5,367
5,138 5,208
4,980 4,942 5,013 4,997
5,000 5,324 5,208
4,000
3,000
2,000
1,000
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Russia China (Mainland) Iraq Mexico Canada Cuba Other Chicken Others Until September
Source: USDA ERS
8
12. Our Strategy
2005/2006 2009/2010 2011/2012
2007/2008
Adequate Global Sales & Value Added
Global Production
Financial Distribution Products &
Platform
Structure Platform Branding
South America Fresh Products
South
Debt for America North America
Cooked Products
Working Minced Products
North Australia Cured Products
Capital America European Union Ready to Eat
Products
Equity Australia
Asia Case Ready
Products
to Russia
Global Brands
Finance European Africa
Marketing
Union
Growth Middle East Investments
- Access to raw material - Integrate the sales and - High technology
- High liquidity level. distribution platform to investments to produce
supply globally.
- Debt equalized to cash serve efficiently, local and value added products.
- Leader in countries with
generation. external markets, small - Increase value added
surplus production.
- Strong cash position. retailers, food processors, products portfolio.
- Scale.
- Access to international restaurants, and other - Customized products to
- Leader in exports globally.
capital markets to finance customers globally. each market.
- Access to all meat
growth. - Sales force distributed over - Convenience to consumers
markets. the globe.
- Development of long term day to day.
- Exchange of best - Efficiency on selling the best
financing plan. - Brand and Quality
practices. product, to the best market,
- Use of export platform to recognition and leadership.
- Efficiency cost gains. with the best price. - Marketing investments to
grow.
- Cost reduction - Cost reduction on sales and be present in consumer
- Hands-on working capital
opportunities. transport. minds.
management.
- Margin improvements. - Margin improvements. - Margin improvements. 11
13. Our Strategy
50%
Branding
Value
Added
Products 12%
Sales &
Distribution 8%
Platform
Production Platform 4%
Consolidated
Cost Reduction, Average
Financial Experienced Productivity, Risk
EBITDA
Structure Management Process Management Margin
Optimization
Foundation 12
14. JBS’ History
Bertin Association*
Pilgrim’s Pride*
• JBS’ History has been built through
Inalca JBS Hides
more than 30 acquisitions in 15 years Swift Foods Co. 5 new units
with appropriated capital structure and Maringá (Amambay)
management Berazategui Tasman
(Rio Platense) Smithfield
Colonia Caroya Beef
Net Sales (in US$ billion)
SB Holdings Five Rivers
Companies and assets acquired
JV Beef Jerky
Rio Branco Venado
Barretos (Anglo) Cacoal 1 Tuerto 30.3
Pres. Epitácio (Bordon) Cacoal 2 Pontevedra
Campo Grande (Bordon) Porto Velho (CEPA)
Vilhena (Frigovira)
Barra do
Cáceres Pedra Preta
Garças Araputanga (Frigo Marca)
19.8
(Frigosol)
(Sadia) (Frigoara) Rosário
Iturama
(Swift ARG)
(Frigosol) San Jose
Andradina
(Swift ARG)
12.7
(Sadia)
1.2 1.5 1.9
0.3 0.4 0.4 0.5 0.5 0.4 0.7
(1) (2) (3)
1996 1997 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
R$/US$ end of the year quotation
Source: JBS
(1) Pro Forma JBS S.A. LTM Dec07
(2) Pro Forma JBS S.A. LTM Dec08
(3) Pro Forma JBS S.A. LTM Jun09 (including 5 new units and hides operation); Pilgrim’s Pride Sep09 (Estimated); Bertin LTM Jun09 13
* Transactions subject to customary conditions for this type of business
15. Global Production and Distribution Platform
JBS’ main units and markets
x =
Legend
Slaughterhouse (Beef)
Slaughterhouse and Industry
Distribution Center
Vegetable Canning Plant
Beef Canning Plant
Beef Jerky Plant (Beef Snack’s)
Slaughterhouse (Pork)
Slaughterhouse (Lamb)
x Beef and Pork Processing Plant
= Wet Blue Processing Plant
Headquarters Office
Feed Lot
Package Industry
Inland Container Terminal
Commercial Office
14
16. Brief Description
Global Production Platform
Production Units Employees Daily Slaugther Capacity
JBS Brasil 25 16,993 26,950 B
JBS Argentina 6 5,059 6,700 B
28,600 B
JBS USA 16 24,295 48,500 P
4,500 S
8,690 B
JBS Australia 10 6,995
15,000 S
Inalca JBS 8 2,019 3,000 B
7 3 ,9 4 0 B
Tota l JBS 65 5 5 ,3 6 1
4 8 ,5 0 0 P
1 9 ,5 0 0 S
Additional Distribution Platform
United Kingdom Russia Angola Congo Algeria Dem. Rep. of the Congo Poland
(B) Beef; (P) Pork; (S) Smalls;
15
17. JBS Consolidated Net Revenue Distribution
Revenue Distribution by Market 3Q09
Italy
Australia 5% Argentina
14% 2%
Brazil
Pork USA
17%
12%
Beef USA
50%
Source: JBS
16
18. Sustainability
Actions Sustainability Policies
Reduction of Greenhouse JBS is aware of its responsibilities as the largest beef Company in the world and all the impacts its operations
Emissions, Effluents
Gases emission (GHG) generates in every region. The Company has a appropriate sustainability program in each of its units including:
and W aste
Environmental Policy Natural Resources Usage
Procedures Adopted Social-environmental Actions
50% Effluent reutilization
50% Solid waste recycling Informative Policy Waste Treatment
Energetic Matrix development Community Relationship and Environmental Investments
Energy
Use of certified wood
25% Consume reduction
JBS is the first and only beef Company to register a CDM project at the
35% Consume reduction UNFCCC (United Nations Framework Convention on Climate Change).
W ater
(2m3 per head) The project is in validation phase at the designated national authority.
Flora conservation
Biodiversity
Animal origination control Sustainability Principles Priorities
• Ecological feasability • Sustainable use of materials
Focus on environmentally
Materials
friendly materials • Ecological correctness • Partnership with organizations equally
concerned
• Social concern
Laws Legislative compliance • Health and Quality of Life
• Cultural acceptance
Environmental awareness • Climate
Physical activities
• Waste
Society
Health Care
The environmental and social responsibility have always been part of JBS´s development and business growth.
Formal education The Company’s extensive experience proves the importance of the reduction of environmental impacts and the
improvement of its relations with the community, throughout constant investments that focus these issues.
17
19. Corporate Governance
JBS has embraced a Corporate Governance model with a view to implant the best practices in the Company. The view is that the model
demonstrates transparency and confidence to the public, guaranteeing the best products and services for customers, solidity for
suppliers, satisfactory return for shareholders and the certainty of a better future for all JBS collaborators.
Novo Mercado
JBS is part of the of BM&FBOVESPA´s Novo Mercado, is in accordance with all requirements of this market and with the obligations imposed by the
current Brazilian legislation.
Management and Board of Directors
Board of Directors - JBS’ Board of Directors is formed by 7 members – a president, a vice-president, 2 effective councils without specific
denomination and 3 independent effective councils.
Audit Board - The Audit Board shall consist of at least 3 and at most five 5 sitting members and alternates in the same number, shareholders or not,
liable to be elected or dismissed at any time of the General Meeting.
Board of Executive Officers - The members of the Company’s board of executive officers are elected by the board of directors, for three-year terms,
and are eligible for reelection.
Board of Directors’ Committees
The Board of Directors has approved the establishment of the following Committees: Audit, Financial, Personnel Management and Corporate
Strategy, that incorporates the Sustainability matters.
Publishing and Use of Information
JBS is completely in accordance with the CVM 358 instruction that revised and consolidated the requirements regarding the disclosure and use of
information related to material facts and acts of publicly held companies, including the disclosure of information in the trading and acquisition of
securities issued by publicly held companies.
Conduct and Ethic Manual
JBS Executive Officers have developed a Conduct and Ethic Manual according to the corporate governance best practices concept. The conduct
code embraces the relationship between the members of the board, shareholders, employees, suppliers and all the other stakeholders.
18
20. JBS American Depositary Receipt (JBSAY)
The Bank of New York Mellon, has been selected by JBS S.A. as the depositary bank for its
American depositary receipt (ADR) program. Each JBS ADR represents two common shares
and they are traded on the over-the-counter market under the symbol “JBSAY“.
On May 2009, JBS became the first Brazilian Company to have its ADRs traded under the
OTCQX, a kind of “Novo Mercado” of the North American over-the-counter market. Since then,
the JBS’ ADRs (JBSAY) appreciated in value by 172.1%.
ADRs’ traded volume (JBSAY)
140,000 11.51 $12.00
10.51
120,000
$10.00
99,075
100,000 7.95
7.92
$8.00
7.26
80,000
6.00 6.08
$6.00
60,827
60,000 4.60
4.23 4.13 3.96
41,970 $4.00
40,000
23,730
$2.00
20,000 14,600
11,000 10,000
4,500
1,300 500 1,500
0 $0.00
Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09
Volume Closing Price (U$) 19
24. Currency effects in the net revenue
Net Revenue (Million)
• Excluding the exchange rate effect in
R$ US$ the period, net revenue increased
Exchange rate
0.6% over 2Q09.
average of the period:
2Q09 – 2.0748
3Q09 – 1.8677
9,255.0
8,379.9 4.460.7 4.486.8
-9.5% 0.6%
2Q09 3Q09 2Q09 3Q09
Source: JBS
Source: Banco Central
23
26. Debt
• The net debt / EBITDA ratio increased from 2.6x in 2Q09 to 3.3x in 3Q09, reflecting
the EBITDA decline when compared with 3Q08.
• The company projects a reduction in leverage levels by the end of the year.
• The gross and net debt reduced 5.6% and 2.2%, respectively, over 2Q09.
Net Debt / EBITDA Pro Forma per Quarter Gross debt Profile (R$ million)
5,971.8 6,226.4
5,877.1
3.3 *
2.5 2.6
2.3
2.0
3Q08 4Q08 1Q09 2Q09 3Q09 1T09 2T09 3T09
Short term Long term
Source: JBS
Net Debt/ EBITDA EBITDA pro-forma
* LTM including Smithfield Beef pro-forma.
25
27. Working Capital
JBS continues to reduce its working capital needs, which decreased from 37 days in 2Q09 to 33
days in 3Q09.
2º Quarter 2009
Client’s order Product Client’s payment
to JBS Delivery to JBS
Production & Stock
CLIENT = 37 days
21 dias
SUPPLYER = 21 days 37 days
Supplyer
WORKING CAPITAL &
payment
INTERESTS
3º Quarter 2009
Client’s order Product Client’s payment
to JBS Delivery to JBS
Production & Stock
CLIENT = 33 days
21 dias
SUPPLYER = 21 days 33 days
Supplyer
WORKING CAPITAL &
payment
INTERESTS
26
28. JBS Consolidated Exports Distribution
Revenue Distribution by Market 3Q09 Revenue Distribution by Market 2Q09
Exports Exports
24% 26%
Domestic
Domestic Market Market
76%
74%
Exports Distribution 3Q09 Exports Distribution 2Q09
JBS Exports 3Q09
US$ 1,127.4 Million JBS Exports2Q 09
US$ 1,169.1 Million
Others Japan Taiwan O thers Japan
Indonesia 18% China
2% 14% 18%
19%
3% 4%
China E.U. Hong Kong E.U.
4% 12% 5% 15%
Russia South Korea
South Korea USA Canada 6% Russia
Africa and USA
Mexico 9% Mexico Middle East 9%
4% 8% 5% 7% 7% 8%
7%
Hong Kong
5%
Africa and
Middle East Canada
6% 6%
Source: JBS
27
30. Disclaimer
The forward-looking statements presented herein are subject to risks and uncertainties. These statements are
based on the beliefs and assumptions of our management, and on information currently available to us.
Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions
because they relate to future events and therefore depend on circumstances that may or may not occur. Our future
operating results, financial condition, strategies, market share and values may differ materially from those expressed
in or suggested by these forward-looking statements. Many of the factors that will determine these results and
values are beyond our ability to control or predict.
Forward-looking statements also include information concerning our possible or assumed future operating results,
as well as statements preceded by, followed by, or including the words ''believes,'' ''may,'' ''will,'' ''continues,''
''expects,'„ ''anticipates,'' ''intends,'' ''plans,'' ''estimates'' or similar expressions.
29
