JBS — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net Sales for the third quarter of 2026 were $22.7 billion, a 1% increase from $22.6 billion in the prior year period.
• IFRS Adjusted EBITDA was $1.181 billion, down 36% year-over-year from $1.835 billion; US GAAP Adjusted EBITDA was $1.001 billion, down 38% from $1.624 billion.
• IFRS Adjusted Operating Income was $521 million, a 58% decrease from $1.251 billion in the prior year; US GAAP Adjusted Operating Income was $597 million, down 53% from $1.276 billion.
• Net Income attributable to JBS was $164 million ($0.15 per share) compared to $581 million ($0.52 per share) in the prior year.
• Adjusted Earnings Per Share (EPS) was $0.16, down from $0.54 in the prior year.
• For the nine months ended September 30, 2026, Net Sales were $68.2 billion (up 8% from $63.1 billion).
• IFRS Adjusted EBITDA for the nine months was $3.744 billion (down 27% from $5.116 billion); US GAAP Adjusted EBITDA was $3.174 billion (down 26% from $4.305 billion).
• Free cash flow for the third quarter was negative $167 million, a $551 million decrease year-over-year, driven by a $653 million decline in Adjusted EBITDA and higher working capital consumption.
• Net leverage (Net Debt / Adjusted EBITDA LTM) increased to 3.54x from 2.39x in the prior year period.
• Interest Coverage (Adjusted EBITDA LTM / Net Interest Expenses LTM) was 4.34x, down from 6.84x.
• Return on Equity (ROE) for the trailing twelve months was 8.2%, down from 23.7%.
• Return on Invested Capital (ROIC) for the trailing twelve months was 11.1%, down from 16.7%.
• Total assets were $47.08 billion as of September 30, 2026, compared to $45.16 billion as of December 31, 2025.
• Total equity was $9.18 billion as of September 30, 2026, compared to $9.52 billion as of December 31, 2025.

Guidance and Future Outlook:

• Management noted that JBS Beef North America and JBS Brazil are showing more constructive market dynamics at the beginning of the fourth quarter.
• Chinese demand strengthened in the fourth quarter as customers began securing volumes for the 2027 quota, supporting a recovery in export volumes.
• The Brazilian domestic market is entering a seasonally stronger consumption period driven by year-end demand.
• Improved pasture conditions in Australia are supportive of livestock availability over the longer term.

Business Segments and Product Lines:

• JBS Beef North America: Returned to positive Adjusted EBITDA under US GAAP ($21 million) supported by better market conditions, operational integration, and the reopening of U.S.-Mexico cattle crossings. Margins improved sequentially from negative 2.9% in July to breakeven in August and positive 3.9% in September.
• Pilgrim's Pride (PPC): U.S. chicken demand continued to grow across retail and foodservice channels. Prepared Foods drove profitable growth with increased sales and margins. The Just Bare® brand saw market share volume rise over 300 basis points year-over-year. In Europe, profitability was pressured by challenging pork market conditions and higher input costs. In Mexico, profitability improved sequentially.
• JBS USA Pork: Reported lower net sales ($1.881 billion, down 15.3%) due to softened domestic demand and increased global pork supply. Adjusted EBITDA was $37 million (IFRS) and $97 million (US GAAP), down significantly from the prior year.
• JBS Brazil: Net sales were $4.093 billion (down 1.6%) primarily due to lower export volumes to China following the completion of the 2026 quota. Domestic sales were supported by the expansion of the Friboi+ retailer program. Seara delivered strong profitability with record fresh poultry export volumes in September, though pork exports remained pressured.
• JBS Australia: Profitability was pressured by completed quotas in China and South Korea, lower shipments to the U.S., and higher cattle and lamb costs due to rainfall. Huon delivered a strong performance supported by increased harvest and higher fish weights.
• Seara: Expanded its value-added product portfolio and achieved highest-ever levels of brand consideration and preference in Brazil.

Market and Competitive Landscape:

• The operating environment was challenging across several business units, with weaker performance impacting overall profitability.
• JBS USA Pork faced an unusually challenging market environment with inflation pressuring the American consumer and global supply weighing on export demand.
• JBS Australia faced higher input costs due to continued rainfall in key livestock-producing regions, with lamb prices reaching record levels.
• JBS Beef North America benefited from industry processing capacity adjustments and robust beef demand.

Risks and Challenges:

• Higher working capital consumption in Brazil, particularly inventories of grain at Seara, chicken at Seara Europe, and beef products in Brazil for the 2027 China quota.
• Completion of export quotas in key markets (China, South Korea) impacted export performance.
• Higher cattle prices in Brazil and higher input costs in Europe pressured profitability.
• Inflation continued to pressure consumer demand for pork in the U.S.
• Ample global pork supply affected market dynamics in Brazil and export markets.

Management Commentary and Tone:

• Gilberto Tomazoni, Global CEO, stated that the company faced a more challenging operating environment in Q3 2026, resulting in increased leverage.
• Management highlighted the recovery in JBS Beef North America and the constructive market dynamics emerging in Q4 for JBS Beef North America and JBS Brazil.
• The tone acknowledged the pressure on margins and profitability in specific segments while emphasizing strategic improvements in operational efficiency and product portfolios.

Other Key Points:

• The Company increased its revolving credit facility from $3.5 billion to $4.2 billion in the third quarter while reducing the all-in cost.
• Total liquidity grew to $8.2 billion following the credit facility increase.
• The average debt term is 14.4 years with an average cost of 5.7%, with more than 95% of debt at fixed rates.
• The Company has no material debt maturities over the next five years.
• JBS acquired non-controlling interests in Andrew Meats for $50.1 million in the nine-month period.
• Share buybacks totaled $1.2 million in the nine-month period, compared to $362.5 million in the prior year period.
• Dividends paid to JBS shareholders were $1.07 billion in the nine-month period.
• Payments related to DOJ and antitrust agreements were $101.0 million in the nine-month period.
• The Company reported a $24.1 million expense for the closure of plants in the nine-month period.
• A $80.5 million gain from the final calculation of the bargain purchase price was recorded in the nine-month period.
• Costs related to the war were $39.8 million in the nine-month period.