FORM 6-K
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-15148
BRF–BRASIL FOODS S.A.
(Exact Name as Specified in its Charter)
N/A
(Translation of Registrant’s Name)
760 Av. Escola Politecnica
Jaguare 05350-000 Sao Paulo, Brazil
(Address of principal executive offices) (Zip code)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ___X___ Form 40-F _______
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [ ]
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes _______ No ___X____
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): Not applicable.
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Index
|
|
Identification
|
|
Capital Stock Breakdown
|
1
|
Individual FS
|
|
Balance Sheet Assets
|
2
|
Balance Sheet Liabilities
|
3
|
Statement of Income
|
4
|
Statement of Comprehensive Income
|
5
|
Statement of Cash Flows
|
6
|
Statement of Changes in Shareholders' Equity
|
|
Statement of Changes in Shareholders' Equity - from 01/01/2012 to 03/31/2012
|
7
|
Statement of Changes in Shareholders' Equity - from 01/01/2011 to 03/31/2011
|
8
|
Statement of Added Value
|
9
|
Consolidated FS
|
|
Balance Sheet Assets
|
10
|
Balance Sheet Liabilities
|
11
|
Statement of Income
|
12
|
Statement of Comprehensive Income
|
13
|
Statement of Cash Flows
|
14
|
Statement of Changes in Shareholders' Equity
|
|
Statement of Changes in Shareholders' Equity - from 01/01/2012 to 03/31/2012
|
15
|
Statement of Changes in Shareholders' Equity - from 01/01/2011 to 03/31/2011
|
16
|
Statement of Added Value
|
17
|
Management Report / Comments on the Performance
|
18
|
Explanatory Notes
|
39
|
Breakdown of the Capital by Owner
|
127
|
Declarations and Opinion
|
|
Independent Auditors' Report on the Financial Statements
|
128
|
Opinion from Fiscal Council
|
131
|
Opinion from Executive Board on the Quarterly Information
|
132
|
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Identification / Capital Stock Breakdown
|
|
Number of shares
|
Current year
|
(Units)
|
03/31/2012
|
Paid-in Capital
|
|
Common
|
872,473,246
|
Preferred
|
0
|
Total
|
872,473,246
|
Treasury shares
|
|
Common
|
3,012,142
|
Preferred
|
0
|
Total
|
3,012,142
|
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS / Balance Sheet Assets
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Current Year
|
Previous Year
|
Account Code
|
Account Description
|
03/31/2012
|
12/31/2011
|
1
|
Total Assets
|
21,852,985
|
22,055,908
|
1.01
|
Current Assets
|
4,478,596
|
4,733,378
|
1.01.01
|
Cash and Cash Equivalents
|
82,003
|
68,755
|
1.01.02
|
Marketable Securities
|
308,325
|
763,535
|
1.01.02.01
|
Financial Investments Evaluated at Fair Value
|
308,325
|
763,535
|
1.01.02.01.01
|
Held for Trading
|
306,837
|
761,850
|
1.01.02.01.02
|
Available for Sale
|
1,488
|
1,685
|
1.01.03
|
Trade Accounts Receivable and Other Receivables
|
1,319,392
|
1,452,610
|
1.01.03.01
|
Trade Accounts Receivable
|
1,284,991
|
1,427,374
|
1.01.03.02
|
Notes Receivable
|
34,401
|
25,236
|
1.01.04
|
Inventories
|
1,278,168
|
1,166,150
|
1.01.05
|
Biological Assets
|
561,728
|
554,483
|
1.01.06
|
Recoverable Taxes
|
707,193
|
572,720
|
1.01.06.01
|
Current Tax Recoverable
|
707,193
|
572,720
|
1.01.08
|
Other Current Assets
|
221,787
|
155,125
|
1.01.08.01
|
Non-current Assets Held for Sale
|
6,764
|
5,980
|
1.01.08.03
|
Other
|
215,023
|
149,145
|
1.01.08.03.01
|
Equity Interest Receivable
|
5
|
5
|
1.01.08.03.02
|
Derivatives
|
57,040
|
22,944
|
1.01.08.03.03
|
Other
|
157,978
|
126,196
|
1.02
|
Non-current Assets
|
17,374,389
|
17,322,530
|
1.02.01
|
Non-current Assets
|
1,835,094
|
1,968,312
|
1.02.01.03
|
Trade Accounts Receivable and Other Receivables
|
77,120
|
77,966
|
1.02.01.03.01
|
Trade Accounts Receivable
|
10,385
|
2,419
|
1.02.01.03.02
|
Notes Receivable
|
66,735
|
75,547
|
1.02.01.05
|
Biological Assets
|
184,695
|
179,188
|
1.02.01.06
|
Deferred Taxes
|
908,682
|
935,607
|
1.02.01.06.01
|
Income Tax and Social Contribution
|
908,682
|
935,607
|
1.02.01.08
|
Receivables from Related Parties
|
11,084
|
5,138
|
1.02.01.08.04
|
Receivables from Related Parties
|
11,084
|
5,138
|
1.02.01.09
|
Other Non-current Assets
|
653,513
|
770,413
|
1.02.01.09.03
|
Judicial Deposits
|
118,304
|
110,582
|
1.02.01.09.04
|
Recoverable Taxes
|
320,929
|
449,376
|
1.02.01.09.05
|
Other
|
214,280
|
210,455
|
1.02.02
|
Investments
|
10,153,328
|
10,133,423
|
1.02.02.01
|
Investments
|
10,153,328
|
10,133,423
|
1.02.02.01.01
|
Equity in Affiliates
|
14,856
|
8,987
|
1.02.02.01.02
|
Interest on wholly-owned subsidiaries
|
9,802,326
|
9,793,790
|
1.02.02.01.04
|
Other
|
336,146
|
330,646
|
1.02.03
|
Property, Plant and Equipment, net
|
3,732,428
|
3,562,727
|
1.02.03.01
|
Property, Plant and Equipment in Operation
|
3,387,564
|
3,292,498
|
1.02.03.02
|
Property, Plant and Equipment Leased
|
46,786
|
39,007
|
1.02.03.03
|
Property, Plant and Equipment in Construction
|
298,078
|
231,222
|
1.02.04
|
Intangible
|
1,653,539
|
1,658,068
|
1.02.04.01
|
Intangible
|
1,653,539
|
1,658,068
|
1.02.04.01.02
|
Software
|
100,295
|
105,023
|
1.02.04.01.03
|
Goodwill
|
1,546,653
|
1,546,653
|
1.02.04.01.04
|
Other
|
6,591
|
6,392
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS / Balance Sheet Liabilities
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Current Year
|
Previous Year
|
Account Code
|
Account Description
|
03/31/2012
|
12/31/2011
|
2
|
Total Liabilities
|
21,852,985
|
22,055,908
|
2.01
|
Current Liabilities
|
4,695,740
|
5,064,892
|
2.01.01
|
Social and Labor Obligations
|
55,184
|
59,348
|
2.01.01.01
|
Social Obligations
|
6,695
|
8,583
|
2.01.01.02
|
Labor Obligations
|
48,489
|
50,765
|
2.01.02
|
Trade Accounts Payable
|
1,295,973
|
1,270,696
|
2.01.02.01
|
Domestic Suppliers
|
1,243,582
|
1,214,936
|
2.01.02.02
|
Foreign Suppliers
|
52,391
|
55,760
|
2.01.03
|
Tax Obligations
|
83,096
|
91,838
|
2.01.03.01
|
Federal Tax Obligations
|
33,210
|
47,055
|
2.01.03.01.02
|
Other Federal
|
33,210
|
47,055
|
2.01.03.02
|
State Tax Obligations
|
48,877
|
44,261
|
2.01.03.03
|
Municipal Tax Obligations
|
1,009
|
522
|
2.01.04
|
Short Term Debts
|
1,624,685
|
1,445,779
|
2.01.04.01
|
Short Term Debts
|
1,624,685
|
1,445,779
|
2.01.04.01.01
|
Local Currency
|
895,991
|
956,077
|
2.01.04.01.02
|
Foreign Currency
|
728,694
|
489,702
|
2.01.05
|
Other Obligations
|
1,426,075
|
1,979,796
|
2.01.05.01
|
Liabilities with Related Parties
|
1,210,380
|
1,200,679
|
2.01.05.01.04
|
Other Liabilities with Related Parties
|
1,210,380
|
1,200,679
|
2.01.05.02
|
Other
|
215,695
|
779,117
|
2.01.05.02.01
|
Dividends Payable and Interest on Shareholders' Equity
|
2,122
|
312,624
|
2.01.05.02.04
|
Derivatives
|
136,467
|
227,891
|
2.01.05.02.05
|
Management and Employees Profit Sharing
|
21,978
|
173,402
|
2.01.05.02.07
|
Other Obligations
|
55,128
|
65,200
|
2.01.06
|
Provisions
|
210,727
|
217,435
|
2.01.06.01
|
Provisions for Tax, Civil and Labor Risks
|
44,124
|
68,550
|
2.01.06.01.01
|
Tax Provisions
|
6,597
|
13,958
|
2.01.06.01.02
|
Labor and Social Security Provisions
|
32,661
|
46,757
|
2.01.06.01.04
|
Provision for Civil Risk
|
4,866
|
7,835
|
2.01.06.02
|
Other Provisons
|
166,603
|
148,885
|
2.01.06.02.04
|
Provisions for Vacations & Christmas bonuses
|
166,603
|
148,885
|
2.02
|
Non-current Liabilities
|
2,834,416
|
2,920,676
|
2.02.01
|
Long-term Debt
|
1,467,360
|
1,597,342
|
2.02.01.01
|
Long-term Debt
|
1,467,360
|
1,597,342
|
2.02.01.01.01
|
Local Currency
|
781,684
|
818,214
|
2.02.01.01.02
|
Foreign Currency
|
685,676
|
779,128
|
2.02.02
|
Other Obligations
|
765,809
|
730,122
|
2.02.02.01
|
Liabilities with Related Parties
|
553,005
|
562,740
|
2.02.02.01.04
|
Other Liabilities with Related Parties
|
553,005
|
562,740
|
2.02.02.02
|
Other
|
212,804
|
167,382
|
2.02.02.02.06
|
Other Obligations
|
212,804
|
167,382
|
2.02.03
|
Deferred Taxes
|
352,394
|
340,606
|
2.02.03.01
|
Income Tax and Social Contribution
|
352,394
|
340,606
|
2.02.04
|
Provisions
|
248,853
|
252,606
|
2.02.04.01
|
Provisions for Tax, Civil and Labor Risks
|
131,712
|
139,890
|
2.02.04.01.01
|
Tax Provisions
|
101,496
|
114,555
|
2.02.04.01.02
|
Labor and Social Security Provisions
|
7,955
|
6,798
|
2.02.04.01.04
|
Provision for Civil Risk
|
22,261
|
18,537
|
2.02.04.02
|
Other Provisons
|
117,141
|
112,716
|
2.02.04.02.04
|
Provisions for Employee Benefits
|
117,141
|
112,716
|
2.03
|
Shareholders' Equity
|
14,322,829
|
14,070,340
|
2.03.01
|
Paid-in Capital
|
12,460,471
|
12,460,471
|
2.03.02
|
Capital Reserves
|
14,726
|
10,939
|
2.03.02.01
|
Costs of Shares Issuance
|
62,767
|
62,767
|
2.03.02.04
|
Granted Options
|
26,027
|
22,430
|
2.03.02.05
|
Treasury Shares
|
(65,162)
|
(65,320)
|
2.03.02.07
|
Gain on Disposal of Shares
|
3,318
|
3,286
|
2.03.02.08
|
Goodwill on Acquisition of Non-controlling Entities
|
(12,224)
|
(12,224)
|
2.03.04
|
Profit Reserves
|
1,770,789
|
1,760,446
|
2.03.04.01
|
Legal
|
179,585
|
179,585
|
2.03.04.02
|
Statutory
|
1,524,319
|
1,524,319
|
2.03.04.07
|
Fiscal Incentive Reserve
|
66,885
|
56,542
|
2.03.05
|
Accumulated Earning
|
142,856
|
-
|
2.03.08
|
Other Comprehensive Income
|
(66,013)
|
(161,516)
|
2.03.08.01
|
Derivative Financial Intrument
|
(67,545)
|
(167,293)
|
2.03.08.02
|
Financial Instrument (Available for Sale)
|
9,064
|
5,051
|
2.03.08.03
|
Equity on Other Comprehensive Income from subsidiaries
|
12,551
|
12,584
|
2.03.08.04
|
Actuarial Losses
|
(20,083)
|
(11,858)
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS / Statement of Income
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 to
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
3.01
|
Net Sales
|
3,278,293
|
2,932,791
|
3.02
|
Cost of Sales
|
(2,732,226)
|
(2,371,481)
|
3.03
|
Gross Profit
|
546,067
|
561,310
|
3.04
|
Operating Income (Expenses)
|
(413,789)
|
(121,114)
|
3.04.01
|
Sales
|
(385,807)
|
(339,062)
|
3.04.02
|
General and Administrative
|
(45,868)
|
(50,192)
|
3.04.04
|
Other Operating Income
|
62,446
|
14,948
|
3.04.05
|
Other Operating Expenses
|
(59,339)
|
(66,897)
|
3.04.06
|
Equity Interest in Income of Affiliates
|
14,779
|
320,089
|
3.05
|
Profit before Financial and Tax Results
|
132,278
|
440,196
|
3.06
|
Financial Results
|
10,241
|
(22,886)
|
3.06.01
|
Financial Income
|
88,267
|
56,441
|
3.06.02
|
Financial Expenses
|
(78,026)
|
(79,327)
|
3.07
|
Income before Taxes
|
142,519
|
417,310
|
3.08
|
Income and Social Contribution
|
10,680
|
(33,842)
|
3.08.01
|
Current
|
-
|
-
|
3.08.02
|
Deferred
|
10,680
|
(33,842)
|
3.09
|
Net Income
|
153,199
|
383,468
|
3.11
|
Net Income
|
153,199
|
383,468
|
3.99
|
Profit per Share - (Brazilian Reais/Share)
|
-
|
-
|
3.99.01
|
Earnings per Share - basic
|
869,453,964
|
871,710,398
|
3.99.01.01
|
ON
|
0.18
|
0.44
|
3.99.02
|
Earning per Share - diluted
|
869,703,383
|
873,477,792
|
3.99.02.01
|
ON
|
0.18
|
0.44
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS / Statement of Comprehensive Income
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 to
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
4.01
|
Net Income
|
153,199
|
383,468
|
4.02
|
Other Comprehensive Income
|
95,503
|
(2,841)
|
4.02.01
|
Gain (Loss) in Foreign Currency Translation Adjustments
|
(33)
|
(161)
|
4.02.02
|
Unrealized Gain (Loss) on Marketable Securities Available for Sale, net of
Income Tax in the amount of (R$82) in 2012 and (R$94) in 2011
|
4,013
|
2,162
|
4.02.03
|
Unrealized Gain (Loss) in Cash Flow Hedge, net of Income Tax in the
amount of R$49,392 in 2012 and (R$3,420) in 2011
|
99,748
|
3,714
|
4.02.04
|
Actuarial Losses, net of Income Tax in the amount of R$4,238 in 2012 and
R$4,407 in 2011
|
(8,225)
|
(8,556)
|
4.03
|
Comprehensive Income
|
248,702
|
380,627
|
4.03.01
|
BRF Shareholders
|
248,702
|
380,627
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS / Statement of Cash Flows
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 a
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
6.01
|
Net Cash Provided by Operating Activities
|
550,740
|
187,383
|
6.01.01
|
Cash from Operations
|
215,068
|
206,654
|
6.01.01.01
|
Net Income for the Year
|
153,199
|
383,468
|
6.01.01.03
|
Depreciation and Amortization
|
116,677
|
90,744
|
6.01.01.04
|
Gain on PP&E Disposals
|
6,469
|
(54)
|
6.01.01.05
|
Deferred Income Tax
|
(10,680)
|
33,842
|
6.01.01.06
|
Provision (Reversal) for Tax, Civil and Labor Risks
|
(8,919)
|
14,573
|
6.01.01.07
|
Other Provisions
|
(21,869)
|
2,460
|
6.01.01.08
|
Exchange Rate Variations and Interest
|
(5,030)
|
1,710
|
6.01.01.09
|
Equity Interest in Income of Affiliates
|
(14,779)
|
(320,089)
|
6.01.02
|
Changes in Operating Assets and Liabilities
|
335,672
|
(19,271)
|
6.01.02.01
|
Trade Accounts Receivable
|
139,416
|
57,802
|
6.01.02.02
|
Inventories
|
(115,471)
|
(88,808)
|
6.01.02.03
|
Trade Accounts Payable
|
38,466
|
(50,294)
|
6.01.02.04
|
Payable of Provisions for Tax, Civil and Labor Risks
|
(29,131)
|
(12,013)
|
6.01.02.05
|
Payroll and Related Charges
|
(141,196)
|
145,946
|
6.01.02.06
|
Investment in Trading Securities
|
(653,770)
|
(679,406)
|
6.01.02.07
|
Redemptions of Trading Securities
|
1,121,900
|
637,876
|
6.01.02.10
|
Other Financial Assets and Liabilities
|
19,750
|
1,538
|
6.01.02.11
|
Interest Paid
|
(44,292)
|
(31,912)
|
6.02
|
Net Cash Provided by Investing Activities
|
(274,702)
|
(151,865)
|
6.02.03
|
Additions to Property, Plant and Equipment
|
(221,838)
|
(89,321)
|
6.02.04
|
Proceeds from disposals of property, plant and equipment
|
4,927
|
80
|
6.02.06
|
Additions to Intangible
|
(1,003)
|
(12,290)
|
6.02.07
|
Additions to Biological Assets
|
(56,788)
|
(50,334)
|
6.03
|
Net Cash Provided by Financing Activities
|
(262,093)
|
(113,554)
|
6.03.01
|
Proceeds from Debt Issuance
|
394,768
|
269,241
|
6.03.02
|
Repayment of Debt
|
(311,571)
|
(173,495)
|
6.03.03
|
Interest on Shareholders' Equity Paid
|
(339,790)
|
(209,300)
|
6.03.05
|
Advance for Future Capital Increase
|
(5,500)
|
-
|
6.04
|
Effect on Exchange Rate Variation on Cash and Cash Equivalents
|
(697)
|
(2,424)
|
6.05
|
Net (Decrease) Increase in Cash
|
13,248
|
(80,460)
|
6.05.01
|
At the Beginning of the Year
|
68,755
|
211,159
|
6.05.02
|
At the End of the Year
|
82,003
|
130,699
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS
/ Statement of Changes in Shareholders' Equity for the Period from
01/01/2012 to 03/31/2012
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
Account
Code
|
Account Description
|
Capital Stock
|
Capital Reserves,
Granted Options
and Treasury
Shares
|
Profit Reserves
|
Retained earning
(losses)
|
Other
Comprehensive
Income
|
Shareholders'
Equity
|
5.01
|
Balances at January, 2012
|
12,460,471
|
10,939
|
1,760,446
|
-
|
(161,516)
|
14,070,340
|
5.03
|
Opening Balance Adjustment
|
12,460,471
|
10,939
|
1,760,446
|
-
|
(161,516)
|
14,070,340
|
5.04
|
Share-based Payments
|
-
|
3,787
|
-
|
-
|
-
|
3,787
|
5.04.03
|
Options Granted
|
-
|
3,597
|
-
|
-
|
-
|
3,597
|
5.04.05
|
Treasury Shares Sold
|
-
|
158
|
-
|
-
|
-
|
158
|
5.04.08
|
Gain on Disposal of Shares
|
-
|
32
|
-
|
-
|
-
|
32
|
5.04.10
|
Participation of Non-controlling Shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
5.05
|
Total Comprehensive Income
|
-
|
-
|
-
|
153,199
|
95,503
|
248,702
|
5.05.01
|
Net Income for the Year
|
-
|
-
|
-
|
153,199
|
-
|
153,199
|
5.05.02
|
Other Comprehensive Income
|
-
|
-
|
-
|
-
|
95,503
|
95,503
|
5.05.02.01
|
Adjustments of Financial Instruments
|
-
|
-
|
-
|
-
|
149,140
|
149,140
|
5.05.02.02
|
Tax Adjustments on Financial Instruments
|
-
|
-
|
-
|
-
|
(49,392)
|
(49,392)
|
5.05.02.06
|
Unrealized Gain on Marketable Securities Available for Sale
|
-
|
-
|
-
|
-
|
4,013
|
4,013
|
5.05.02.07
|
Actuarial Loss
|
-
|
-
|
-
|
-
|
(8,225)
|
(8,225)
|
5.05.02.08
|
Cumulative Foreign Currency Translation Adjustments
|
-
|
-
|
-
|
-
|
(33)
|
(33)
|
5.06
|
Appropriation of Income (Loss):
|
-
|
-
|
10,343
|
(10,343)
|
-
|
-
|
5.06.08
|
Reserve of Tax Incentives
|
-
|
-
|
10,343
|
(10,343)
|
-
|
-
|
5.07
|
Balances at March, 2012
|
12,460,471
|
14,726
|
1,770,789
|
142,856
|
(66,013)
|
14,322,829
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS
/ Statement of Changes in Shareholders' Equity for the Period from
01/01/2011 to 03/31/2011
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
Account
Code
|
Account Description
|
Capital Stock
|
Capital Reserves,
Granted Options
and Treasury
Shares
|
Profit Reserves
|
Retained earning
(losses)
|
Other
Comprehensive
Income
|
Shareholders'
Equity
|
5.01
|
Balances at January, 2011
|
12,460,471
|
68,614
|
1,064,688
|
-
|
35,194
|
13,628,967
|
5.03
|
Opening Balance Adjustment
|
12,460,471
|
68,614
|
1,064,688
|
-
|
35,194
|
13,628,967
|
5.04
|
Share-based Payments
|
-
|
3,323
|
-
|
-
|
-
|
3,323
|
5.04.03
|
Options Granted
|
-
|
1,809
|
-
|
-
|
-
|
1,809
|
5.04.05
|
Treasury Shares Sold
|
-
|
51
|
-
|
-
|
-
|
51
|
5.04.08
|
Gain on Disposal of Shares
|
-
|
1,463
|
-
|
-
|
-
|
1,463
|
5.04.10
|
Participation of Non-controlling Shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
5.05
|
Total Comprehensive Income
|
-
|
-
|
-
|
383,468
|
(2,841)
|
380,627
|
5.05.01
|
Net Income for the Year
|
-
|
-
|
-
|
383,468
|
-
|
383,468
|
5.05.02
|
Other Comprehensive Income
|
-
|
-
|
-
|
-
|
(2,841)
|
(2,841)
|
5.05.02.01
|
Adjustments of Financial Instruments
|
-
|
-
|
-
|
-
|
7,133
|
7,133
|
5.05.02.02
|
Tax Adjustments on Financial Instruments
|
-
|
-
|
-
|
-
|
(3,419)
|
(3,419)
|
5.05.02.06
|
Unrealized Gain on Marketable Securities Available for Sale
|
-
|
-
|
-
|
-
|
2,162
|
2,162
|
5.05.02.07
|
Actuarial Loss
|
-
|
-
|
-
|
-
|
(8,556)
|
(8,556)
|
5.05.02.08
|
Cumulative Foreign Currency Translation Adjustments
|
-
|
-
|
-
|
-
|
(161)
|
(161)
|
5.07
|
Balances at March, 2011
|
12,460,471
|
71,937
|
1,064,688
|
383,468
|
32,353
|
14,012,917
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Individual FS / Statement of Value Added
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 to
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
7.01
|
Revenues
|
3,737,829
|
3,287,806
|
7.01.01
|
Sales of Goods, Products and Services
|
3,584,072
|
3,248,216
|
7.01.02
|
Other Income
|
(25,499)
|
(38,387)
|
7.01.03
|
Revenue Related to Construction of own Assets
|
178,330
|
79,472
|
7.01.04
|
Allowance for Doubtful Accounts Reversal (Provisions)
|
926
|
(1,495)
|
7.02
|
Raw material Acquired from Third Parties
|
(2,642,281)
|
(2,261,084)
|
7.02.01
|
Costs of products and Goods Sold
|
(2,217,865)
|
(1,935,187)
|
7.02.02
|
Materials, Energy, Services of Third Parties and Other
|
(421,852)
|
(324,157)
|
7.02.03
|
Losses of Assets Values
|
(2,564)
|
(1,740)
|
7.03
|
Gross Value Added
|
1,095,548
|
1,026,722
|
7.04
|
Retentions
|
(116,677)
|
(90,744)
|
7.04.01
|
Depreciation and Amortization
|
(116,677)
|
(90,744)
|
7.05
|
Net Value Added
|
978,871
|
935,978
|
7.06
|
Received from Third Parties
|
102,779
|
376,543
|
7.06.01
|
Equity Pickup
|
14,779
|
320,089
|
7.06.02
|
Financial Income
|
88,267
|
56,441
|
7.06.03
|
Other
|
(267)
|
13
|
7.07
|
Added Value to be Distributed
|
1,081,650
|
1,312,521
|
7.08
|
Distribution of Value Added
|
1,081,650
|
1,312,521
|
7.08.01
|
Payroll
|
437,817
|
396,632
|
7.08.01.01
|
Salaries
|
353,290
|
324,980
|
7.08.01.02
|
Benefits
|
59,789
|
51,345
|
|
Government Severance Indemnity Fund for Employees
|
|
|
7.08.01.03
|
Guarantee Fund for Length of Service - FGTS
|
24,738
|
20,307
|
7.08.02
|
Taxes and Contribution
|
389,781
|
428,133
|
7.08.02.01
|
Federal
|
192,803
|
254,741
|
7.08.02.02
|
State
|
190,728
|
169,212
|
7.08.02.03
|
Municipal
|
6,250
|
4,180
|
7.08.03
|
Capital Remuneration from Third Parties
|
100,853
|
104,288
|
7.08.03.01
|
Interests
|
81,645
|
80,287
|
7.08.03.02
|
Rents
|
19,208
|
24,001
|
7.08.04
|
Interest on Own Capital
|
153,199
|
383,468
|
7.08.04.03
|
Retained Earnings
|
153,199
|
383,468
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS
/ Balance Sheet Assets
(in thousands of Brazilian Reais)
|
|
|
|
Account
|
|
Current Year
|
Previous Year
|
Code
|
Account Description
|
03/31/2012
|
12/31/2011
|
1
|
Total Assets
|
29,618,011
|
29,983,456
|
1.01
|
Current Assets
|
10,437,777
|
11,123,751
|
1.01.01
|
Cash and Cash Equivalents
|
1,205,307
|
1,366,843
|
1.01.02
|
Marketable Securities
|
819,597
|
1,372,671
|
1.01.02.01
|
Financial Investments Evaluated at Fair Value
|
758,801
|
1,289,255
|
1.01.02.01.01
|
Held for Trading
|
528,353
|
1,054,105
|
1.01.02.01.02
|
Available for sale
|
230,448
|
235,150
|
1.01.02.02
|
Marketable Securities Evaluated at Amortized Cost
|
60,796
|
83,416
|
1.01.02.02.01
|
Held to maturity
|
60,796
|
83,416
|
1.01.03
|
Trade Accounts Receivable and Other Receivables
|
2,700,764
|
3,264,748
|
1.01.03.01
|
Trade Accounts Receivable
|
2,651,653
|
3,207,813
|
1.01.03.02
|
Notes Receivable
|
49,111
|
56,935
|
1.01.04
|
Inventories
|
3,057,498
|
2,679,211
|
1.01.05
|
Biological Assets
|
1,180,162
|
1,156,081
|
1.01.06
|
Recoverable Taxes
|
1,034,826
|
907,929
|
1.01.06.01
|
Current Tax Recoverable
|
1,034,826
|
907,929
|
1.01.08
|
Other Current Assets
|
439,623
|
376,268
|
1.01.08.01
|
Non-current Assets Held for Sale
|
19,792
|
19,007
|
1.01.08.03
|
Other
|
419,831
|
357,261
|
1.01.08.03.02
|
Derivatives
|
57,040
|
23,459
|
1.01.08.03.03
|
Other
|
362,791
|
333,802
|
1.02
|
Non-current Assets
|
19,180,234
|
18,859,705
|
1.02.01
|
Non-current Assets
|
4,635,739
|
4,654,837
|
1.02.01.02
|
Marketable Securities Evaluated at Amortized Cost
|
201,945
|
153,388
|
1.02.01.02.01
|
Held to maturity
|
201,945
|
153,388
|
1.02.01.03
|
Trade Accounts Receivable and Other Receivables
|
162,899
|
149,741
|
1.02.01.03.01
|
Trade Accounts Receivable
|
10,422
|
2,419
|
1.02.01.03.02
|
Notes Receivable
|
152,477
|
147,322
|
1.02.01.05
|
Biological Assets
|
399,852
|
387,383
|
1.02.01.06
|
Deferred Taxes
|
2,607,433
|
2,628,750
|
1.02.01.06.01
|
Income Tax and Social Contribution
|
2,607,433
|
2,628,750
|
1.02.01.09
|
Other Non-current Assets
|
1,263,610
|
1,335,575
|
1.02.01.09.03
|
Judicial Deposits
|
237,903
|
228,261
|
1.02.01.09.04
|
Recoverable Taxes
|
664,653
|
744,612
|
1.02.01.09.05
|
Other
|
361,054
|
362,702
|
1.02.02
|
Investments
|
26,069
|
20,399
|
1.02.02.01
|
Investments
|
26,069
|
20,399
|
1.02.02.01.01
|
Equity in Affiliates
|
25,175
|
19,505
|
1.02.02.01.04
|
Other
|
894
|
894
|
1.02.03
|
Property, Plant and Equipment, net
|
10,138,301
|
9,798,370
|
1.02.03.01
|
Property, Plant and Equipment in Operation
|
9,295,603
|
9,119,750
|
1.02.03.02
|
Property, Plant and Equipment Leased
|
85,997
|
58,411
|
1.02.03.03
|
Property, Plant and Equipment in Construction
|
756,701
|
620,209
|
1.02.04
|
Intangible
|
4,380,125
|
4,386,099
|
1.02.04.01
|
Intangible
|
4,380,125
|
4,386,099
|
1.02.04.01.02
|
Software
|
133,369
|
138,236
|
1.02.04.01.03
|
Brands
|
1,256,000
|
1,256,000
|
1.02.04.01.04
|
Other
|
15,432
|
18,048
|
1.02.04.01.05
|
Goodwill
|
2,975,324
|
2,973,815
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS
/ Balance Sheet Liabilities
(in thousands of Brazilian Reais)
|
|
|
|
Account
|
|
Current Year
|
Previous Year
|
Code
|
Account Description
|
03/31/2012
|
12/31/2011
|
2
|
Total Liabilities
|
29,618,011
|
29,983,456
|
2.01
|
Current Liabilities
|
7,418,427
|
7,987,829
|
2.01.01
|
Social and Labor Obligations
|
118,725
|
116,558
|
2.01.01.01
|
Social Obligations
|
17,212
|
14,923
|
2.01.01.02
|
Labor Obligations
|
101,513
|
101,635
|
2.01.02
|
Trade Accounts Payable
|
2,669,993
|
2,681,343
|
2.01.02.01
|
Domestic Suppliers
|
2,370,604
|
2,341,043
|
2.01.02.02
|
Foreign Suppliers
|
299,389
|
340,300
|
2.01.03
|
Tax Obligations
|
205,188
|
224,761
|
2.01.03.01
|
Federal Tax Obligations
|
100,076
|
137,779
|
2.01.03.01.01
|
Income Tax and Social Contribution Expense Payable
|
21,671
|
5,590
|
2.01.03.01.02
|
Other Federal
|
78,405
|
132,189
|
2.01.03.02
|
State Tax Obligations
|
102,559
|
86,460
|
2.01.03.03
|
Municipal Tax Obligations
|
2,553
|
522
|
2.01.04
|
Short Term Debts
|
3,590,413
|
3,452,477
|
2.01.04.01
|
Short Term Debts
|
3,590,413
|
3,452,477
|
2.01.04.01.01
|
Local Currency
|
1,747,822
|
1,814,220
|
2.01.04.01.02
|
Foreign Currency
|
1,842,591
|
1,638,257
|
2.01.05
|
Other Obligations
|
411,566
|
1,076,533
|
2.01.05.02
|
Other
|
411,566
|
1,076,533
|
2.01.05.02.01
|
Dividends Payable and Interest on Shareholders' Equity
|
2,727
|
312,624
|
2.01.05.02.04
|
Derivatives
|
172,854
|
270,693
|
2.01.05.02.05
|
Management and Employees Profit Sharing
|
27,272
|
224,480
|
2.01.05.02.07
|
Other Obligations
|
208,713
|
268,736
|
2.01.06
|
Provisions
|
422,542
|
436,157
|
2.01.06.01
|
Provisions for Tax, Civil and Labor Risks
|
79,732
|
118,466
|
2.01.06.01.01
|
Tax Provisions
|
9,763
|
17,446
|
2.01.06.01.02
|
Labor and Social Security Provisions
|
52,621
|
74,727
|
2.01.06.01.04
|
Provision for Civil Risk
|
17,348
|
26,293
|
2.01.06.02
|
Other Provisons
|
342,810
|
317,691
|
2.01.06.02.04
|
Provisions for Vacations & Christmas bonuses
|
342,810
|
317,691
|
2.02
|
Non-current Liabilities
|
7,833,699
|
7,885,710
|
2.02.01
|
Long-term Debt
|
4,494,557
|
4,601,053
|
2.02.01.01
|
Long-term Debt
|
4,494,557
|
4,601,053
|
2.02.01.01.01
|
Local Currency
|
1,444,365
|
1,515,486
|
2.02.01.01.02
|
Foreign Currency
|
3,050,192
|
3,085,567
|
2.02.02
|
Other Obligations
|
420,109
|
391,481
|
2.02.02.02
|
Other
|
420,109
|
391,481
|
2.02.02.02.06
|
Other Obligations
|
420,109
|
391,481
|
2.02.03
|
Deferred Taxes
|
1,816,670
|
1,791,897
|
2.02.03.01
|
Income Tax and Social Contribution
|
1,816,670
|
1,791,897
|
2.02.04
|
Provisions
|
1,102,363
|
1,101,279
|
2.02.04.01
|
Provisions for Tax, Civil and Labor Risks
|
826,281
|
835,234
|
2.02.04.01.01
|
Tax Provisions
|
199,163
|
214,177
|
2.02.04.01.02
|
Labor and Social Security Provisions
|
36,576
|
30,435
|
2.02.04.01.04
|
Provision for Civil Risk
|
28,055
|
18,881
|
2.02.04.01.05
|
Contingent liabilities
|
562,487
|
571,741
|
2.02.04.02
|
Other Provisons
|
276,082
|
266,045
|
2.02.04.02.04
|
Provisions for Employee Benefits
|
276,082
|
266,045
|
2.03
|
Shareholders' Equity
|
14,365,885
|
14,109,917
|
2.03.01
|
Paid-in Capital
|
12,460,471
|
12,460,471
|
2.03.02
|
Capital Reserves
|
14,726
|
10,939
|
2.03.02.01
|
Costs of Shares Issuance
|
62,767
|
62,767
|
2.03.02.04
|
Granted Options
|
26,027
|
22,430
|
2.03.02.05
|
Treasury Shares
|
(65,162)
|
(65,320)
|
2.03.02.07
|
Gain on Disposal of Shares
|
3,318
|
3,286
|
2.03.02.08
|
Goodwill on Acquisition of Non-controlling Entities
|
(12,224)
|
(12,224)
|
2.03.04
|
Profit Reserves
|
1,770,789
|
1,760,446
|
2.03.04.01
|
Legal
|
179,585
|
179,585
|
2.03.04.02
|
Statutory
|
1,524,319
|
1,524,319
|
2.03.04.07
|
Fiscal Incentive Reserve
|
66,885
|
56,542
|
2.03.05
|
Accumulated Earning
|
142,856
|
-
|
2.03.08
|
Other Comprehensive Income
|
(66,013)
|
(161,516)
|
2.03.08.01
|
Derivative Financial Instrument
|
(67,545)
|
(167,293)
|
2.03.08.02
|
Financial Instrument (Available for sale)
|
9,064
|
5,051
|
2.03.08.03
|
Equity on Other Comprehensive Income from Subsidiaries
|
12,551
|
12,584
|
2.03.08.04
|
Actuarial Losses
|
(20,083)
|
(11,858)
|
2.03.09
|
Non-controlling Interest
|
43,056
|
39,577
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS
/ Statement of Income
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 to
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
3.01
|
Net Sales
|
6,337,122
|
6,020,494
|
3.02
|
Cost of Sales
|
(4,993,642)
|
(4,474,918)
|
3.03
|
Gross Profit
|
1,343,480
|
1,545,576
|
3.04
|
Operating Income (expenses)
|
(1,075,450)
|
(1,020,582)
|
3.04.01
|
Sales
|
(953,434)
|
(854,954)
|
3.04.02
|
General and Administrative
|
(85,728)
|
(84,076)
|
3.04.04
|
Other Operating Income
|
110,541
|
57,349
|
3.04.05
|
Other Operating Expenses
|
(152,483)
|
(140,976)
|
3.04.06
|
Equity Interest in Income of Affiliates
|
5,654
|
2,075
|
3.05
|
Profit before Financial and Tax Results
|
268,030
|
524,994
|
3.06
|
Financial Results
|
(74,947)
|
(52,264)
|
3.06.01
|
Financial Income
|
284,038
|
157,728
|
3.06.02
|
Financial Expenses
|
(358,985)
|
(209,992)
|
3.07
|
Income before Taxes
|
193,083
|
472,730
|
3.08
|
Income and Social Contribution
|
(40,228)
|
(85,985)
|
3.08.01
|
Current
|
(38,205)
|
(4,775)
|
3.08.02
|
Deferred
|
(2,023)
|
(81,210)
|
3.09
|
Net Income
|
152,855
|
386,745
|
3.11
|
Net Income
|
152,855
|
386,745
|
3.11.01
|
BRF Shareholders
|
153,199
|
383,468
|
3.11.02
|
Non-controlling Shareholders
|
(344)
|
3,277
|
3.99.01
|
Earnings per Share - basic
|
869,453,964
|
871,710,398
|
3.99.01.01 ON
|
0.18
|
0.44
|
3.99.02
|
Earning per Share - diluted
|
869,703,383
|
873,477,792
|
3.99.02.01 ON
|
0.18
|
0.44
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS
/ Statement of Comprehensive Income
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 to
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
4.01
|
Net Income
|
152,855
|
386,745
|
4.02
|
Other Comprehensive Income
|
95,503
|
(2,841)
|
4.02.01
|
Loss (Gain) in Foreign Currency Translation Adjustments
|
(33)
|
(161)
|
4.02.02
|
Unrealized Gain (Loss) on Marketable Securities Available for Sale, net of
Income Tax in the amount of (R$82) in 2012 and (R$94) in 2011
|
4,013
|
2,162
|
4.02.03
|
Unrealized Gain (Loss) in Cash Flow Hedge, net of Income Tax in the
amount of R$49,392 in 2012 and (R$3,420) in 2011
|
99,748
|
3,714
|
4.02.04
|
Actuarial Losses, net of Income Tax in the amount of R$4,238 in 2012
and R$4,407 in 2011
|
(8,225)
|
(8,556)
|
4.03
|
Comprehensive Income
|
248,358
|
383,904
|
4.03.01
|
BRF Shareholders
|
248,702
|
380,627
|
4.03.02
|
Non-controlling Shareholders
|
(344)
|
3,277
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS
/ Statement of Cash Flows
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 a
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
6.01
|
Net Cash Provided by Operating Activities
|
616,536
|
62,237
|
6.01.01
|
Cash from Operations
|
382,463
|
735,395
|
6.01.01.01
|
Net Income for the Year
|
153,199
|
383,468
|
6.01.01.02
|
Non-controlling Shareholders
|
(344)
|
3,277
|
6.01.01.03
|
Depreciation and Amortization
|
237,580
|
220,249
|
6.01.01.04
|
Gain on PP&E Disposals
|
1,289
|
19,157
|
6.01.01.05
|
Deferred Income Tax
|
2,023
|
81,210
|
6.01.01.06
|
Provision (Reversal) for Tax, Civil and Labor Risks
|
(8,043)
|
12,969
|
6.01.01.07
|
Other Provisions
|
6,209
|
6,160
|
6.01.01.08
|
Exchange Rate Variations and Interest
|
(3,796)
|
10,980
|
6.01.01.09
|
Equity Interest in Income of Affiliates
|
(5,654)
|
(2,075)
|
6.01.02
|
Changes in Operating Assets and Liabilities
|
234,073
|
(673,158)
|
6.01.02.01
|
Trade Accounts Receivable
|
524,227
|
235,381
|
6.01.02.02
|
Inventories
|
(331,945)
|
(280,856)
|
6.01.02.03
|
Trade Accounts Payable
|
124
|
(27,797)
|
6.01.02.04
|
Payable of Provisions for Tax, Civil and Labor Risks
|
(50,927)
|
(96,488)
|
6.01.02.05
|
Payroll and Related Charges
|
(328,030)
|
(222,108)
|
6.01.02.06
|
Investment in Trading Securities
|
(1,358,705)
|
(684,634)
|
6.01.02.07
|
Redemptions of Trading Securities
|
1,906,722
|
638,419
|
6.01.02.08
|
Investment in Available for Sale
|
-
|
(716,583)
|
6.01.02.09
|
Redemptions of Available for Sale
|
5,063
|
612,714
|
6.01.02.10
|
Other Financial Assets and Liabilities
|
13,844
|
8,582
|
6.01.02.11
|
Interest Paid
|
(127,062)
|
(121,761)
|
6.01.02.12
|
Cash paid during the year for income tax
|
(19,238)
|
(18,027)
|
6.02
|
Net Cash Provided by Investing Activities
|
(589,706)
|
(275,871)
|
6.02.01
|
Cash investments
|
(48,619)
|
-
|
6.02.02
|
Redemptions of Marketable Securities
|
21,362
|
1,956
|
6.02.03
|
Additions to Property, Plant and Equipment
|
(448,031)
|
(152,178)
|
6.02.04
|
Proceeds from disposals of property, plant and equipment
|
3,322
|
278
|
6.02.06
|
Additions to Intangible
|
(1,037)
|
(16,632)
|
6.02.07
|
Additions to Biological Assets
|
(116,703)
|
(109,295)
|
6.03
|
Net Cash Provided by Financing Activities
|
(163,475)
|
28,024
|
6.03.01
|
Proceeds from Debt Issuance
|
801,392
|
610,034
|
6.03.02
|
Repayment of Debt
|
(625,077)
|
(372,710)
|
6.03.03
|
Interest on Shareholders' Equity Paid
|
(339,790)
|
(209,300)
|
6.04
|
Effect on Exchange Rate Variation on Cash and Cash Equivalents
|
(24,891)
|
(31,250)
|
6.05
|
Net (Decrease) Increase in Cash
|
(161,536)
|
(216,860)
|
6.05.01
|
At the Beginning of the Year
|
1,366,843
|
2,310,643
|
6.05.02
|
At the End of the Year
|
1,205,307
|
2,093,783
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS / Statement of Changes in Shareholders' Equity for the Period from
01/01/2012 to 03/31/2012
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
Account
Code
|
Account Description
|
Capital Stock
|
Capital Reserves,
Granted Options
and Treasury
Shares
|
Profit Reserves
|
Retained earning
(losses)
|
Other
Comprehensive
Income
|
Shareholders'
Equity
|
Participation of
Non-controlling
shareholders
|
Total
Shareholders'
Equity
|
5.01
|
Balances at January, 2012
|
12,460,471
|
10,939
|
1,760,446
|
-
|
(161,516)
|
14,070,340
|
39,577
|
14,109,917
|
5.03
|
Opening Balance Adjustment
|
12,460,471
|
10,939
|
1,760,446
|
-
|
(161,516)
|
14,070,340
|
39,577
|
14,109,917
|
5.04
|
Share-based Payments
|
-
|
3,787
|
-
|
-
|
-
|
3,787
|
3,823
|
7,610
|
5.04.03
|
Options Granted
|
-
|
3,597
|
-
|
-
|
-
|
3,597
|
-
|
3,597
|
5.04.05
|
Treasury Shares Sold
|
-
|
158
|
-
|
-
|
-
|
158
|
-
|
158
|
5.04.08
|
Gain on Disposal of Shares
|
-
|
32
|
-
|
-
|
-
|
32
|
-
|
32
|
5.04.10
|
Participation of Non-controlling Shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
3,823
|
3,823
|
5.05
|
Total Comprehensive Income
|
-
|
-
|
-
|
153,199
|
95,503
|
248,702
|
(344)
|
248,358
|
5.05.01
|
Net Income for the Year
|
-
|
-
|
-
|
153,199
|
-
|
153,199
|
(344)
|
152,855
|
5.05.02
|
Other Comprehensive Income
|
-
|
-
|
-
|
-
|
95,503
|
95,503
|
-
|
95,503
|
5.05.02.01
|
Adjustments of Financial Instruments
|
-
|
-
|
-
|
-
|
149,140
|
149,140
|
-
|
149,140
|
5.05.02.02
|
Tax Adjustments on Financial Instruments
|
-
|
-
|
-
|
-
|
(49,392)
|
(49,392)
|
-
|
(49,392)
|
5.05.02.06
|
Unrealized Gain on Marketable Securities Available for Sale
|
-
|
-
|
-
|
-
|
4,013
|
4,013
|
-
|
4,013
|
5.05.02.07
|
Actuarial Loss
|
-
|
-
|
-
|
-
|
(8,225)
|
(8,225)
|
-
|
(8,225)
|
5.05.02.08
|
Cumulative Foreign Currency Translation Adjustments
|
-
|
-
|
-
|
-
|
(33)
|
(33)
|
-
|
(33)
|
5.06
|
Appropriation of Income (Loss):
|
-
|
-
|
10,343
|
(10,343)
|
-
|
-
|
-
|
-
|
5.06.08
|
Reserve of Tax Incentives
|
-
|
-
|
10,343
|
(10,343)
|
-
|
-
|
-
|
-
|
5.07
|
Balances at March, 2012
|
12,460,471
|
14,726
|
1,770,789
|
142,856
|
(66,013)
|
14,322,829
|
43,056
|
14,365,885
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS / Statement of Changes in Shareholders' Equity for the Period from
01/01/2011 to 03/31/2011
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
Account
Code
|
Account Description
|
Capital Stock
|
Capital Reserves,
Granted Options
and Treasury
Shares
|
Profit Reserves
|
Retained earning
(losses)
|
Other
Comprehensive
Income
|
Shareholders'
Equity
|
Participation of
Non-controlling
shareholders
|
Total
Shareholders'
Equity
|
5.01
|
Balances at January, 2011
|
12,460,471
|
68,614
|
1,064,688
|
-
|
35,194
|
13,628,967
|
7,551
|
13,636,518
|
5.03
|
Opening Balance Adjustment
|
12,460,471
|
68,614
|
1,064,688
|
-
|
35,194
|
13,628,967
|
7,551
|
13,636,518
|
5.04
|
Share-based Payments
|
-
|
3,323
|
-
|
-
|
-
|
3,323
|
(178)
|
3,145
|
5.04.03
|
Options Granted
|
-
|
1,809
|
-
|
-
|
-
|
1,809
|
-
|
1,809
|
5.04.05
|
Treasury Shares Sold
|
-
|
51
|
-
|
-
|
-
|
51
|
-
|
51
|
5.04.08
|
Gain on Disposal of Shares
|
-
|
1,463
|
-
|
-
|
-
|
1,463
|
-
|
1,463
|
5.04.10
|
Participation of Non-controlling Shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
(178)
|
(178)
|
5.05
|
Total Comprehensive Income
|
-
|
-
|
-
|
383,468
|
(2,841)
|
380,627
|
3,277
|
383,904
|
5.05.01
|
Net Income for the Year
|
-
|
-
|
-
|
383,468
|
-
|
383,468
|
3,277
|
386,745
|
5.05.02
|
Other Comprehensive Income
|
-
|
-
|
-
|
-
|
(2,841)
|
(2,841)
|
-
|
(2,841)
|
5.05.02.01
|
Adjustments of Financial Instruments
|
-
|
-
|
-
|
-
|
7,133
|
7,133
|
-
|
7,133
|
5.05.02.02
|
Tax Adjustments on Financial Instruments
|
-
|
-
|
-
|
-
|
(3,419)
|
(3,419)
|
-
|
(3,419)
|
5.05.02.06
|
Unrealized Gain on Marketable Securities Available for Sale
|
-
|
-
|
-
|
-
|
2,162
|
2,162
|
-
|
2,162
|
5.05.02.07
|
Actuarial Loss
|
-
|
-
|
-
|
-
|
(8,556)
|
(8,556)
|
-
|
(8,556)
|
5.05.02.08
|
Cumulative Foreign Currency Translation Adjustments
|
-
|
-
|
-
|
-
|
(161)
|
(161)
|
-
|
(161)
|
5.07
|
Balances at March, 2011
|
12,460,471
|
71,937
|
1,064,688
|
383,468
|
32,353
|
14,012,917
|
10,650
|
14,023,567
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS / Statement of Value Added
(in thousands of Brazilian Reais)
|
|
|
|
|
|
Accumulated
|
Accumulated
|
|
|
Current Year
|
Previous Year
|
Account
|
|
01/01/2012 to
|
01/01/2011 to
|
Code
|
Account Description
|
03/31/2012
|
03/31/2011
|
7.01
|
Revenues
|
7,302,964
|
6,804,475
|
7.01.01
|
Sales of Goods, Products and Services
|
6,972,987
|
6,726,331
|
7.01.02
|
Other Income
|
(11,961)
|
(29,632)
|
7.01.03
|
Revenue Related to Construction of own Assets
|
350,726
|
115,278
|
7.01.04
|
Allowance for Doubtful Accounts Reversal (Provisions)
|
(8,788)
|
(7,502)
|
7.02
|
Raw material Acquired from Third Parties
|
(4,934,649)
|
(4,315,287)
|
7.02.01
|
Costs of products and Goods Sold
|
(3,959,241)
|
(3,478,396)
|
7.02.02
|
Materials, Energy, Services of Third Parties and Other
|
(981,875)
|
(836,415)
|
7.02.03
|
Losses of Assets Values
|
6,467
|
(476)
|
7.03
|
Gross Value Added
|
2,368,315
|
2,489,188
|
7.04
|
Retentions
|
(237,580)
|
(220,249)
|
7.04.01
|
Depreciation and Amortization
|
(237,580)
|
(220,249)
|
7.05
|
Net Value Added
|
2,130,735
|
2,268,939
|
7.06
|
Received from Third Parties
|
289,233
|
159,818
|
7.06.01
|
Equity on Pickup
|
5,654
|
2,075
|
7.06.02
|
Financial Income
|
284,038
|
157,728
|
7.06.03
|
Other
|
(459)
|
15
|
7.07
|
Added Value to be Distributed
|
2,419,968
|
2,428,757
|
7.08
|
Distribution of Value Added
|
2,419,968
|
2,428,757
|
7.08.01
|
Payroll
|
982,280
|
829,231
|
7.08.01.01
|
Salaries
|
808,487
|
698,776
|
7.08.01.02
|
Benefits
|
124,854
|
93,098
|
|
Government Severance Indemnity Fund for Employees,
|
|
|
7.08.01.03
|
Guarantee Fund for Length of Service - FGTS
|
48,939
|
37,357
|
7.08.02
|
Taxes and Contribution
|
864,081
|
935,854
|
7.08.02.01
|
Federal
|
511,168
|
604,928
|
7.08.02.02
|
State
|
341,948
|
326,748
|
7.08.02.03
|
Municipal
|
10,965
|
4,178
|
7.08.03
|
Capital Remuneration from Third Parties
|
420,752
|
276,927
|
7.08.03.01
|
Interests
|
369,707
|
210,952
|
7.08.03.02
|
Rents
|
51,045
|
65,975
|
7.08.04
|
Interest on Own Capital
|
152,855
|
386,745
|
7.08.04.03
|
Retained Earnings
|
153,199
|
383,468
|
7.08.04.04
|
Non-controlling interest
|
(344)
|
3,277
|
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
1Q2012 Results
Dear Shareholders
BRF - Brasil Foods S.A. (BM&FBOVESPA: BRFS3 and NYSE: BRFS)obtained one more important achievement: investment grade rating from all three major rating agencies. On April 4, 2012, Standard & Poor´s assigned the Company a BBB- rating. This was subsequent to the announcement of Moody’s rating on March 23, 2012 of a Baa3 rating and prior to Fitch’s reiteration of a BBB- rating on April 5, 2012. The rating agencies particularly pointed to the competitive advantages of the brand, distribution, financial strength, corporate governance, among others.
BRF’s first quarter 2012 results reflect a challenging scenario in the overseas market, a situation also observed in 4Q11. Certain key markets such as Japan and the Middle East continue to suffer a process of adjustment and normalization of inventory levels and merchandise flows. On the other hand, the performance of the domestic market and food service segments maintained a good performeance despite a weaker than expected first quarter in the Brazilian market.
Against this background, the Company recorded net sales for 1Q12 of R$ 6.3 billion, 5.3% up on 1Q11, with volumes of 1.4 million tons, 2.5% higher. Operating cash generation – EBITDA reached R$ 532 million, representing 8.4% of EBITDA margin. Net earnings amounted to R$ 153.2 million, corresponding to a net margin of 2.4%.
In accordance with the Performance Commitment Agreement – TCD signed with the Brazilian anti-trust authority - CADE, BRF and Marfrig announced in a Material Fact the signing of an Asset Exchange Contract in line with BRF’s commitment of July 13, 2011 to divest certain assets. Under the agreement, BRF will sell industrial units and distribution centers among other specified assets and will receive in exchange the processing operations of Quickfood S.A. of Argentina together with a cash payment of R$ 350 million. The Company adopts a strategy of recovering operational and financial performance as a whole with a view to executing the Performance Commitment Agreement -TCD which should have a temporary impact on the domestic market.
In order to improve the management of financial liquidity, BRF has signed a three year Revolving Committed credit facility for USD 500 million with a syndicate of banks. Together with a cash position of R$ 2.2 billion, the credit facility enables the Company to have immediate access to financial liquidity.
The Company continues fully committed to a process of integration across a broad front and involving innumerous structural projects such as integrated distribution and warehousing logistics and the corporate merger between BRF and Sadia. The international project proceeds apace with the incorporation of the acquisitions in Argentina (Dánica and Avex), the
construction of an industrial unit in the Middle East, a partnership in China and the expansion of Plusfood in Europe.
|
18
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
The
current scenario re-emphasizes correctness of the strategy in BRF15 of reducing volatility through a process of localization of international operations and capture of greater value along the value chain. At the same time, we are consolidating the domestic market base, leveraging opportunities in food service and improving the dairy segment.
|
São Paulo, April 2012
|
Nildemar Secches
Chairman of the Board
|
José Antonio do Prado Fay
Chief Executive Officer
|
19
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
1
st
QUARTER 2012 – 1Q12
Net sales totaled R$ 6.3 billion with a growth of 5.3%, driven by the good performance reported both in the domestic and food service.
The businesses involving meats, dairy products and other processed products reported sales volume of 1,4 million tons, an increase of 2.5%.
Gross profit amounted to R$ 1.3 billion, 13.1% lower, reflecting decrease of prices on exports and higher production costs.
EBITDA reached R$ 532.0 million, 34.8% less than the first quarter of the preceding year, bearing in mind the good performance for the businesses in 1Q11.
Net income was R$ 153.2 million against R$ 383.5 million reported in 1Q11.
Financial trading volume in BRF’s shares reached an average of US$ 86.4 million/day during the year, jumping 37.7% compared with 1Q11.
|
|
|
|
Highlights (R$ Million)
|
1Q12
|
1Q11
|
% Ch.
|
|
Net Sales
|
6,337
|
6,020
|
5
|
Domestic Market
|
3,919
|
3,592
|
9
|
Exports
|
2,418
|
2,428
|
(0)
|
Gross Profit
|
1,343
|
1,546
|
(13)
|
Gross Margin
|
21.2%
|
25.7%
|
-450 bps
|
EBIT
|
268
|
525
|
(49)
|
Net Income
|
153
|
383
|
(60)
|
Net Margin
|
2.4%
|
6.4%
|
-400 bps
|
EBITDA
|
532
|
816
|
(35)
|
EBITDA Margin
|
8.4%
|
13.6%
|
-520 bps
|
Earnings per share
(1)
|
0.18
|
0.44
|
(60)
|
1-Consolidated earnings per share (in R$), excluding treasury shares.
|
(The variations commented in this report are comparisons between the 1
st
quarter 2012 and 1
st
quarter 2011, except when another comparison is specified).
20
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Brazilian Exports
Brazilian exports of chicken meat, pork and beef recorded a weak performance in 1Q12 compared with 4Q11, although showed a recovery and higher volumes in relation to 1Q11, with the exception of beef.
Chicken meat exports amounted to 974 thousand tons in 1Q12, 6.8% lower than in 4Q11 but 4.4% up on 1Q11. In terms of export revenue, there was a decline of 14.9% against 4Q11 and an increase of 1.1% versus 1Q11. Shipments to Japan, Venezuela and Iraq registered the largest declines in the quarter. On the other hand, sales volume to Hong Kong, China and Egypt reported substantial increases in the same period. Among exported products, volumes of chicken cuts posted the best performance in 1Q12 (increase of 12.8% versus 1Q11 and of 0.7% versus 4Q11), with consistent growth in the markets of the Middle East and Africa.
Overseas sales of pork in 1Q12 were also positive versus 1Q11, albeit negative when compared with 4Q11. The volume of 122 thousand tons of exports in 1Q12 was 3.5% up on the volume for 1Q11 and 3.1% below 4Q11. In revenue terms, the quarter reported an increase of 0.7% over 1Q11 but 15.2% down on 4Q11. The Russian trade ban and recent restrictions on the part of Argentina have had a negative impact on Brazilian port exports, although efforts are being made to offset the shortfall to these countries with higher volumes to other importing markets such as Hong Kong and the Ukraine.
However, shipments of beef (in natura and industrialized) in terms of volume have not seen a recovery. In 1Q12, the 258 thousand tons of exports were 2,2% lower than 1Q11 and 7.8% lower than 4Q12. In export revenue, there was a decline of 0.5% versus 1Q11 and 12.7% versus 4Q12.
Raw Material
The average price per sack of corn on the domestic market increased by 2.0% in 1Q12 versus 4Q11 due to the severe drought conditions in the South of Brazil and consequently reducing the harvest for the 1
st
crop (summer) from 40 to 36 million tons. Comparing 1Q12 and 1Q11, domestic corn prices remained -1.6% lower due to domestic inventory which remained stable in relation to the preceding year and as a result of the decline on the international market (-4.3% down on 1Q11). Soybean prices on the Brazilian market saw an increase of 7.0% in 1Q12 versus 4Q11 due to a shortfall in the Brazilian crop (10 million tons down on forecast) and in Argentina (5 million tons less than forecast) and pricing tendencies continue to indicate an increase. Comparing 1Q12 and 1Q11, prices in the domestic market were off by -1.1% reflecting international quotations -8.4% lower and a 6% decline in the Real against the US Dollar (from R$1.67 in 1Q11 to R$ 1.77 in 1Q12).
21
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Investments
Investments for the quarter amounted to R$ 594.2 million, 127.6% more than the same quarter in 2011. Expenditures were directed to growth, efficiency and support projects, and biological assets (breeder stock), as well as investments for the capture of forecasted synergies and the replacement of production capacity in the light of asset sales under the Performance Commitment Agreement (TCD). Investments in breeder stock amounted to R$ 116.7 million. The significant year-on-year growth during the period was due both to a policy of containing investments last year pending the final decision on the merger from the anti-trust (CADE) authority and the increased expenditure in the quarter under review in line with our growth plan.
Production
A total of 1.4 million tons of foodstuffs was produced in 1Q12, in volume, 2.6% higher than reported in 1Q11, mainly due to higher output in the meats segment and for the food service business.
The production of the companies, Avex and Dánica in Argentina was also consolidated into the growth recorded for meats and other processed products.
From the innovation point of view, 61 new SKUs were launched: Food Service - 11; domestic market – 11; exports – 12 and 27 in the dairy products segment. Construction work on the new technological center in Jundiaí-SP to provide a support role for innovative processes is on schedule and operations are expected to begin before the end of 2012.
|
|
|
|
Production
|
1Q12
|
1Q11
|
% Ch.
|
|
Poultry Slaughter (million heads)
|
457
|
426
|
7
|
Hog/ Cattle Slaughter (thousand heads)
|
2,717
|
2,640
|
3
|
Production (thousand tons)
|
|
|
|
Meats
|
1,068
|
1,011
|
6
|
Dairy Products
|
257
|
283
|
(9)
|
Other Processed Products
|
117
|
111
|
5
|
Feed and Premix (thousand tons)
|
2,914
|
2,682
|
9
|
22
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Domestic Market
Sales to the domestic market reached R$ 3.0 billion, an 11.2% increase, in spite of a rise in volumes of only 2.5%, driven by average prices 8.4% higher. The latter gave support to the margin of 9.5% against 10.7% reported 2011, thus offsetting the increase in principal raw materials and other product costs in the period.
The product launches in the period incorporating the Sadia branded line of pizzas as well as Perdigão’s Meu Menu and Sanduba lines, gave an added boost to performance.
|
|
|
|
|
|
|
DOMESTIC MARKET
|
THOUSAND TONS
|
R$ MILLION
|
1Q12
|
1Q11
|
% Ch.
|
1Q12
|
1Q11
|
% Ch.
|
|
In Natura
|
99
|
93
|
7
|
481
|
479
|
0
|
Poultry
|
66
|
63
|
6
|
273
|
300
|
(9)
|
Pork/Beef
|
33
|
30
|
9
|
208
|
180
|
16
|
Elaborated/Processed
|
435
|
420
|
4
|
2,318
|
2,078
|
12
|
Others Sales
|
99
|
105
|
(6)
|
193
|
133
|
44
|
Total
|
633
|
617
|
3
|
2,992
|
2,690
|
11
|
Exports
The Company reported export revenue of R$ 2.4 billion, 1% down on 1Q11 due both to price and volume pressures in some key regions such as the Middle East (the Arab spring) and Japan (higher domestic inventory in that market), which resulted in a negative operating margin of 2.3% against a positive 8.1% in 1Q11, a quarter when we reported an important improvement in performance following a recovery in export markets.
While export volumes rose by 6.9% to 578 thousand tons, revenues fell due to a temporary trough in demand given high existing levels of local inventory in important markets such as the Far East and the Middle East. This inventory was built up in 2011 when there was strong demand from the importers in these areas due to production shortfalls in various producing countries, a fact which further accentuated demand for Brazilian meat.
23
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Export prices and volumes are expected to post a gradual recovery in 2Q12, with normalization as from 2H12, given greater equilibrium between supply and demand.
|
|
|
|
|
|
|
EXPORTS
|
THOUSAND TONS
|
R$ MILLION
|
1Q12
|
1Q11
|
% Ch.
|
1Q12
|
1Q11
|
% Ch.
|
|
In Natura
|
504
|
462
|
9
|
1,950
|
1,980
|
(1)
|
Poultry
|
437
|
400
|
9
|
1,538
|
1,621
|
(5)
|
Pork/Beef
|
68
|
62
|
9
|
412
|
359
|
15
|
Processed
|
74
|
79
|
(6)
|
409
|
403
|
1
|
Total
|
578
|
541
|
7
|
2,359
|
2,383
|
(1)
|
The Company reported the following scenario in its principal markets during the quarter:
Far East –
This market experienced narrower margins in the period and these are expected to persist until local inventory is fully aligned with supply and demand, more particularly the case of the Japanese market. Volumes rose 27.6% and revenues 9.9% in the year, with pricing pressure in the final quarter of 2011 in Japan - a market which had performed well up to the end of 1H11 - carrying over into the first quarter 2012.
Eurasia –
Revenues fell 29.9%, with volumes 26.7% less, due to the Russian trade ban on imports from a large part of Brazilian exporting units. However, the Ukraine is absorbing a substantial part of the volumes originally for export to the Russian market, offsetting the negative impact of the ban.
Europe –
Revenues in this market rose 3.1%, in spite of a 1.5% decline in volume, due to the continued strategic focus on greater added value, especially based on Plusfood’s products, which are expanding the portfolio based on an increase in local production capacity. The economic situation experienced by some regions in Europe has not so far impacted our businesses
.
Middle East –
While volumes were up 6.3%, this market posted revenues 9.9% lower. The fall-out from the Arab Spring drove down prices of in-natura products, especially griller chicken, squeezing margins in the Middle East market.
South America –
Revenues rose 36.6% and volumes 26% on the back of the newly acquired businesses of Avex and Dánica and growing demand in the South American markets as a whole. However, the Argentine government has adopted measures making exports via Brazil more difficult.
Africa and other countries –
Africa posted a good performance with an average growth of 14%, although imports by other countries fell, the overall result being a reduction of 0.9% in revenue and 1.4 in volume.
24
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Dairy products –
Dairy product revenues rose 0.9%, although volumes were off by 10.1%, notably in the fluid milk business, where the objective was to reduce the impact on margins due to higher production costs and the more commoditized nature of this product. Operating margin was a negative 0.3% against 0.1% in 1Q11.
The operating margin for this segment continues under some pressure. However product launches in the cheese line: Sadia’s danbo and mozzarella cheeses are beginning to show results and a good performance, reporting an increase of 127% in revenue and 86% in sales volume with products selling into the retail and food service segments.
In 1Q12, BRF launched 27 products aimed at improving margins and upgrading the portfolio. Launches included the yogurt line (tubs), the Kissy line of grape-flavored yogurts,
Pense Zero
, Batavo milks and trakinas shake and a line in cheeses, including the sliced product.
|
|
|
|
|
|
|
DAIRY
|
THOUSAND TONS
|
R$ MILLION
|
1Q12
|
1Q11
|
% Ch.
|
1Q12
|
1Q11
|
% Ch.
|
|
Dry Division
|
192
|
222
|
(13)
|
383
|
431
|
(11)
|
Fresh and Frozen Division
|
59
|
58
|
3
|
251
|
197
|
28
|
Total
|
252
|
280
|
(10)
|
634
|
628
|
1
|
Food service –
In 1Q12, revenue from food service rose 10.4%, with an operating margin of 11% against 13.9% in 1Q11, although volume grew 8%, principally for processed products, with average prices increase of 2.2%.
The Company launched a total of 11 products between in-natura and processed lines for the global networks, an appetizer/savory snacks platform, grill line and rotisserie products.
|
|
|
|
|
|
|
FOOD SERVICE
|
THOUSAND TONS
|
R$ MILLION
|
1Q12
|
1Q11
|
% Ch.
|
1Q12
|
1Q11
|
% Ch.
|
|
Total
|
57
|
53
|
8
|
353
|
320
|
10
|
25
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Net Sales
–
BRF registered net operating sales of R$ 6.3 billion in the year, 5.3% higher, largely driven by the favorable performance in the domestic market and in the food service segment.
Cost of Sales
– The cost of sales increased 11.6% to R$ 5 billion, a faster rate than for sales revenue, and trimming the Company’s gross margins. The principal impacts on costs reflected the cost of corn (12% higher), milk (a 7% increase) as well as other raw materials and direct inputs.
Gross Profit and Gross Margin
– Gross Profit totaled R$ 1.3 billion, a reduction of 13.1% with a gross margin declining from 25.7% to 21.2%, a significant fall in the quarter’s results.
Operating Expenses
– Operating expenses were 10.7% higher due to the lower level of revenue generation compared to structures with fixed selling expenses increasing 19.8% while variable and administrative expenses rose by only 2%.
Other Operating Expenses –
Other operating expenses decreased 49.8% to R$ 42 million due to income from reversal of provisions, recovery of expenses, and also pre-operational costs of the new industrial units, claims and provisions for tax and civil risks. Additionally, in accordance with the IFRS, profit sharing is also included under this item.
Operating
Profit and Margin –
The Company registered an operating margin of 4.2% in 1Q12 against 8.7% in 1Q11, equivalent to a decline in operating result of 48.9% for the quarter, reflecting a diminished performance in the overseas market and pressure on production costs. Operating profit before financial expenses (EBIT) reached R$ 268 million.
26
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Financial Result –
Net financial expenses amounted to R$ 74.9 million, 43.4% higher than for the same period in 2011 due to an increase in net debt and the foreign exchange translation effect. In addition to the currency effect, the allocation of cash in support of capital expenditure investments increased net debt to R$ 5.9 billion, resulting in a net debt to EBITDA (last twelve months) ratio of 2 times with book currency exposure of US$ 468 million.
In the light of the high level of exports, the Company conducts operations with the specific purpose of currency hedging. In accordance with hedge accounting standards (CPC 38 and IAS 39), it uses financial derivatives (for example: NDF) and non-derivative financial instruments (for example: foreign currency debt) for conducting hedging operations and concomitantly, to eliminate the respective unrealized foreign exchange rate variations from the income statement (under the Financial Expenses line).
The use of non-derivative financial instruments for foreign exchange cover, continues to permit a significant reduction in the net currency exposure in the balance sheet, resulting in substantial benefits through the matching of currency liability flows with export shipments and therefore contributing to a reduction in the volatility of the financial result.
On March 31, 2012, the non-financial derivative instruments designated as hedge accounting for foreign exchange cover amounted to USD 595 million, with a reduction in currency exposure in the balance sheet of the same value. In addition, the financial derivative instruments designated as hedge accounting according to the concept of a cash flow hedge for coverage of highly probable exports, totaled USD 1,385 million + EUR 216 million + GBP 77.1 million and also contributed directly to the reduction in currency exposure. In both cases, the unrealized result for foreign exchange rate variation was booked to shareholders’ equity, thus avoiding the impact on the Financial Expenses.
|
|
|
|
|
|
DEBT - R$ Million
|
03.31.12
|
12.31.11
|
Current
|
Non-Current
|
Total
|
Total
|
% Ch.
|
|
Local Currency
|
1,748
|
1,444
|
3,192
|
3,330
|
(4)
|
Foreing Currency
|
2,015
|
3,050
|
5,066
|
4,995
|
1
|
Gross Debt
|
3,763
|
4,495
|
8,258
|
8,324
|
(1)
|
Cash Investments
|
|
|
|
|
0
|
Local Currency
|
612
|
121
|
733
|
1,203
|
(39)
|
Foreing Currency
|
1,470
|
81
|
1,550
|
1,713
|
(9)
|
Total Cash Investments
|
2,082
|
202
|
2,284
|
2,916
|
(22)
|
Net Accounting Debt
|
1,681
|
4,293
|
5,974
|
5,408
|
10
|
Exchange Rate Exposure - US$ Million
|
|
|
468
|
471
|
-
|
Income Tax and Social Contribution
– Income tax and social contribution totaled R$ 40.2 million for the year, 53.2% less, due to differences in tax rates on the earnings of foreign subsidiaries and the foreign exchange translation effect on overseas investment.
27
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Net Income and Net Margin
– Net income was R$ 153.2 million in the year, corresponding to a net margin of 2.4%, a decline of 60% in relation to 2011, a reflection of one-off factors impacting export business and the increase in production costs.
EBITDA –
EBITDA (operating cash generation) reached R$ 532 million, a 34.8% decline, registering a net margin of 8.4% against 13.6% reported in 1Q11.
|
|
|
|
EBITDA - R$ Million
|
1Q12
|
1Q11
|
% Ch.
|
|
Net Income
|
153
|
383
|
(60)
|
Non Controlling Shareholders
|
(0)
|
3
|
-
|
Income Tax and Social Contribution
|
40
|
86
|
(53)
|
Net Financial
|
75
|
52
|
43
|
Equity Accounting and Other Operating Result
|
26
|
71
|
(63)
|
Depreciation and Amortization
|
238
|
220
|
8
|
= EBITDA
|
532
|
816
|
(35)
|
Shareholders’ Equity –
On March 31, 2012, shareholders’ equity was R$ 14.4 billion against R$ 14.1 billion on December 31, 2011, a 1.8% increase and reflecting an annualized 8% return on investment.
Performance
The average daily financial trading volume on the BM&FBovespa and NYSE was US$ 86.4 million, 37% more than reported for 1Q11, the shares depreciating 1.2% on the BM&FBovespa and appreciating 2.4% on the NYSE.
28
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
|
|
|
|
|
PERFORMANCE
|
1Q12
|
1Q11
|
|
|
|
Share price - R$*
|
36.00
|
30.83
|
Traded Shares (Volume) - Millions
|
152.7
|
132.9
|
Performance
|
(1.2%)
|
12.8%
|
Bovespa Index
|
13.7%
|
(1.0%)
|
IGC (Brazil Corp. Gov. Index)
|
14.0%
|
(1.1%)
|
ISE (Corp. Sustainability Index)
|
13.8%
|
4.7%
|
|
|
|
|
|
Share price - US$*
|
20.01
|
19.09
|
Traded Shares (Volume) - Millions
|
113.7
|
88.7
|
Performance
|
2.4%
|
13.1%
|
Dow Jones Index
|
8.1%
|
6.4%
|
|
|
|
* Closing Price
|
29
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
30
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Basis: 03/31/2012
Number of Common Shares: 872,473,246
Capital Stock: R$ 12.6 billion
Novo Mercado
- BRF signed up to the BM&FBovespa’s Novo Mercado Listing Regulations on April 12, 2006, requiring it to settle disputes through the Arbitration Panel under the arbitration commitment clause written into its bylaws and regulations.
Risk Management
- BRF and its subsidiaries adopt a series of previously structured measures for maintaining the risks inherent to its businesses under the most rigorous control, details of this management are shown in explanatory note 4 of the Financial Statements. Risks involving the markets in which the Company operates, sanitary controls, grains, nutritional safety and environmental protection as well as internal controls and financial risks are all monitored.
Independent Audit
–
In our relations with the Independent Auditor, we endeavor to assess conflicts of interest with non-audit work based on the principle that the auditor should not audit his own work, exercise managerial functions and promote our interests.
Pursuant to CVM Instruction 480/09, at a meeting held on April 27, 2012, management declares that it has discussed, reviewed and agreed the opinions expressed in the revision report of the independent auditors and with the quarterly information for the year ending March 31, 2012.
31
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
Value Added – R$ million
|
|
|
|
Added Value Distribution
|
1Q12
|
1Q11
|
% Ch.
|
|
Human Resources
|
982
|
829
|
18
|
Taxes
|
864
|
936
|
(8)
|
Interest
|
421
|
277
|
52
|
Retention
|
153
|
383
|
(60)
|
Non-controlling shareholders
|
0
|
3
|
(110)
|
Total
|
2420
|
2,429
|
(0)
|
Stock Option Plan
– The Company has currently granted
4,196,815
stock options to 55 executives with a maximum vesting period of five years according to the Compensation Plan Regulations based on shares approved in the E/AGM held on March 31, 2010.
32
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
BRF - Brasil Foods S.A.
PUBLIC COMPANY
CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS FOR THE PERIOD ENDED
|
|
|
|
|
|
|
BALANCE SHEET - R$ Million
|
03.31.2012
|
03.12.2011
|
% Ch.
|
|
|
Assets
|
29,618
|
29,983
|
(1)
|
Current Assets
|
10,438
|
11,124
|
(6)
|
Cash and Cash Equivalents
|
1,205
|
1,367
|
(12)
|
Marketable Securities
|
820
|
1,373
|
(40)
|
Trade Accounts Receivable and Other Receivables
|
2,652
|
3,208
|
(17)
|
Inventories
|
3,057
|
2,679
|
14
|
Biological Assets
|
1,180
|
1,156
|
2
|
Recoverable Taxes
|
1,035
|
908
|
14
|
Prepaid Expenses
|
98
|
100
|
(2)
|
Others Noncurrent Assets
|
391
|
334
|
17
|
|
|
|
|
Noncurrent Assets
|
19,180
|
18,860
|
2
|
Long Term Assets
|
4,636
|
4,655
|
(0)
|
Investments
|
26
|
20
|
28
|
Property, Plant and Equipment
|
10,138
|
9,798
|
3
|
Intangible
|
4,380
|
4,386
|
(0)
|
|
-
|
-
|
|
Liabilities
|
29,618
|
29,983
|
(1)
|
Current Liabilities
|
7,418
|
7,988
|
(7)
|
Payroll and related charges
|
462
|
434
|
6
|
Trade Accounts Payable
|
2,670
|
2,681
|
(0)
|
Tax Payable
|
205
|
225
|
(9)
|
Short- Term Debt
|
3,590
|
3,452
|
4
|
Other Current Liabilities
|
412
|
1,077
|
(62)
|
Provisions
|
80
|
118
|
(33)
|
|
|
|
|
Non-Current Liabilities
|
7,834
|
7,886
|
(1)
|
Short-Term Debt
|
4,495
|
4,601
|
(2)
|
Other Non-Current Liabilities
|
696
|
658
|
6
|
Deferred Income Tax
|
1,817
|
1,792
|
1
|
Provisions
|
826
|
835
|
(1)
|
|
|
|
|
Shareholders' Equity
|
14,366
|
14,110
|
2
|
Capital Stock Restated
|
12,460
|
12,460
|
-
|
Reserves/Accumulated earnings
|
1,994
|
1,837
|
9
|
Other Results
|
(66)
|
(162)
|
(59)
|
Treasury Shares
|
(65)
|
(65)
|
-
|
Non Controlling Shareholders
|
43
|
40
|
9
|
33
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
|
|
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
|
|
Management Report / Comments on the Performance
|
|
|
|
|
|
|
|
INCOME STATEMENT - R$ Million
|
1Q12
|
1Q11
|
% Ch.
|
|
|
|
|
|
Net Sales
|
6,337
|
6,020
|
5
|
|
Domestic Market
|
3,919
|
3,592
|
9
|
Exports
|
2,418
|
2,428
|
(0)
|
Cost of Sales
|
(4,994)
|
(4,475)
|
12
|
Gross Profit
|
1,343
|
1,546
|
(13)
|
Operating Expenses
|
(1,039)
|
(939)
|
11
|
Sales
|
(953)
|
(855)
|
12
|
General and Administrative
|
(86)
|
(84)
|
2
|
Other Operating Results
|
(42)
|
(84)
|
(50)
|
Equity Accounting
|
6
|
2
|
172
|
Financial Expenses, Net
|
(75)
|
(52)
|
43
|
Income Before Financial Exp. and Other Results
|
193
|
473
|
(59)
|
Income Tax and Social Contribution
|
(40)
|
(86)
|
(53)
|
Non-Controlling shareholders
|
0
|
(3)
|
-
|
Net Income
|
153
|
383
|
(90)
|
EBITDA
|
532
|
816
|
(35)
|
The results of the first quarter 2011 consolidate the Companies BRF - Brasil Foods S.A. and Sadia S.A. (whole-owned subsidiary). On July 2009, the results of Sadia started being fully consolidated, according to the Association Agreement and Shareholders Meeting that approved the merger of shares on July and August 2009.
All statements contained herein with regard to the Company’s business prospects, projected results and the potential growth of its business are mere forecasts, based on local management expectations in relation to the Company’s future performance. Dependent as they are on market shifts and on the overall performance of the Brazilian economy and the sector and international markets, such estimates are subject to changes.
On July 13 2011, the Administrative Council for Economic Defense – CADE approved the Association between BRF and Sadia S.A., conditional on compliance with the provisions contained in the Performance Agreement -TCD, which was also signed on the same date. The documents with respect to this agreement are available in the website: www.brasilfoods.com/ir.
|
34
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Consolidated FS / Statement of Value Added
(in thousands of Brazilian Reais)
1.
COMPANY’S OPERATIONS
The BRF – Brasil Foods S.A. (“BRF or parent company”) and its subsidiaries (collectively “Company”) is one of Brazil’s largest companies in the food industry.
The Company is a
public company
, listed on the Brazilian
Securities, Commodities & Futures Exchange (“BM&FBOVESPA”),
under the ticker BRFS3, and listed on the New York Stock Exchange (“NYSE”), under the ticker BRFS, which headquarters is located at 475, Jorge Tzachel Street in the City of Itajaí, State of Santa Catarina.
With a focus on raising, producing and slaughtering of poultry, pork and beef, processing and/or sale of fresh meat, processed products, milk and dairy products, pasta, frozen vegetables and soybean derivatives, among which the following are highlighted:
·
Whole chickens and cuts of chicken, turkey, pork and beef cuts;
·
Ham products, sausages, bologna, frankfurters and other smoked products;
·
Hamburgers, breaded meat products and meatballs;
·
Lasagnas, pizzas, vegetables, cheese breads, pies and frozen pastries;
·
Milk, dairy products and desserts;
·
Juices, soy milk and soy juices;
·
Margarine; and
·
Soy meal and refined soy flour, as well as animal feed.
During the last quarter of 2011, the Company's activities started to be segregated into 4 operating segments, being: domestic market, foreign market, food service and dairy products, as mentioned in note 5.
In the domestic market, the Company operates 45 meat processing plants, 16 milk and dairy products processing plants, 3 margarine processing plants, 4 pasta processing plants, 1 dessert processing plant and 1 soybean crushing plant, all of them located near the Company’s raw material suppliers or the main consumer centers.
In the foreign market, the Company operates 3 meat processing plants, 1 margarine and oil processing plant, 1 sauces and mayonnaise processing plant, 1 pasta and pastries processing plant and 1 cheese processing plant, and subsidiaries or sales offices in the United Kingdom, Italy, Austria, Hungary, Japan, The Netherlands, Russia, Singapore, United Arab Emirates, Portugal, France, Germany, Turkey, China, Cayman Islands, South Africa, Venezuela, Uruguay and Chile.
The Company has an advanced distribution system and uses 38 distribution centers, to deliver its products to supermarkets, retail stores, wholesalers, food service stores and other institutional customers in the domestic market and exports to more than 145 countries.
35
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The name BRF deploys and adds value and reliability to several trademarks among which the most important are:
Batavo, Claybon, Chester®, Confiança, Delicata, Doriana, Elegê, Fazenda, Nabrasa, Perdigão, Perdix, Fiesta, Hot Pocket, Miss Daisy, Nuggets, Qualy, Rezende, Sadia, Speciale Sadia, Texas
and
Wilson,
in addition to licensed brands such as
Turma da Mônica.
The table below summarizes the direct and indirect ownership interests of the Company, as well as the activities of each:
36
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
1.1.
Interest in subsidiaries
|
|
|
|
|
|
|
|
|
|
Subsidiary
|
|
|
Main activity
|
|
Country
|
|
03.31.12
|
|
12.31.11
|
PSA Laboratório Veterinário Ltda.
|
|
|
Veterinary activities
|
|
Brazil
|
|
88.00%
|
|
88.00%
|
Sino dos Alpes Alimentos Ltda.
|
|
|
Industrialization and commercializations of products
|
|
Brazil
|
|
99.99%
|
|
99.99%
|
PDF Participações Ltda.
|
|
|
Holding
|
|
Brazil
|
|
1.00%
|
|
1.00%
|
Sino dos Alpes Alimentos Ltda.
|
|
|
Industrialization and commercializations of products
|
|
Brazil
|
|
0.01%
|
|
0.01%
|
Vip S.A. Emp. Part. Imobiliárias
|
|
|
Commercialization of owned real state
|
|
Brazil
|
|
65.49%
|
|
65.49%
|
Establecimiento Levino Zaccardi y Cia. S.A.
|
|
|
Processing of dairy products
|
|
Argentina
|
|
10.00%
|
|
10.00%
|
Avipal S.A. Construtora e Incorporadora
|
(a)
|
|
Construction and real estate marketing
|
|
Brazil
|
|
100.00%
|
|
100.00%
|
Avipal Centro-oeste S.A.
|
(a)
|
|
Industrialization and commercializations of milk
|
|
Brazil
|
|
100.00%
|
|
100.00%
|
Establecimiento Levino Zaccardi y Cia. S.A.
|
|
|
Processing of dairy products
|
|
Argentina
|
|
90.00%
|
|
90.00%
|
UP! Alimentos Ltda.
|
|
|
Industrialization and commercializations of products
|
|
Brazil
|
|
50.00%
|
|
50.00%
|
Perdigão Trading S.A.
|
(a)
|
|
Holding
|
|
Brazil
|
|
100.00%
|
|
100.00%
|
PSA Laboratório Veterinário Ltda.
|
|
|
Veterinary activities
|
|
Brazil
|
|
12.00%
|
|
12.00%
|
PDF Participações Ltda.
|
|
|
Holding
|
|
Brazil
|
|
99.00%
|
|
99.00%
|
Heloísa Ind. e Com. de Produtos Lácteos Ltda.
|
|
|
Industrialization and commercializations of milk
|
|
Brazil
|
|
100.00%
|
|
100.00%
|
Crossban Holdings GmbH
|
|
|
Holding
|
|
Austria
|
|
100.00%
|
|
100.00%
|
Perdigão Europe Ltd.
|
|
|
Import and commercialization of products
|
|
Portugal
|
|
100.00%
|
|
100.00%
|
Perdigão International Ltd.
|
|
|
Import and commercialization of products
|
|
Cayman Island
|
|
100.00%
|
|
100.00%
|
BFF International Ltd.
|
|
|
Unrestricted activities
|
|
Cayman Island
|
|
100.00%
|
|
100.00%
|
Highline International
|
(a)
|
|
Unrestricted activities
|
|
Cayman Island
|
|
100.00%
|
|
100.00%
|
Plusfood Germany GmbH
|
|
|
Import and commercialization of products
|
|
Germany
|
|
100.00%
|
|
100.00%
|
Perdigão France SARL
|
|
|
Import and commercialization of products
|
|
France
|
|
100.00%
|
|
100.00%
|
Plusfood Holland B.V.
|
|
|
Administrative services
|
|
The Netherlands
|
|
100.00%
|
|
100.00%
|
Plusfood Groep B.V.
|
|
|
Holding
|
|
The Netherlands
|
|
100.00%
|
|
100.00%
|
Plusfood B.V.
|
|
|
Import and commercialization of products
|
|
The Netherlands
|
|
100.00%
|
|
100.00%
|
Plusfood Wrexham
|
|
|
Import and commercialization of products
|
|
United Kingdom
|
|
100.00%
|
|
100.00%
|
Plusfood Iberia SL
|
|
|
Marketing and logistics services
|
|
Spain
|
|
100.00%
|
|
100.00%
|
Plusfood Italy SRL
|
|
|
Import and commercialization of products
|
|
Italy
|
|
67.00%
|
|
67.00%
|
BRF Brasil Foods Japan KK
|
|
|
Import and commercialization of products
|
|
Japan
|
|
100.00%
|
|
100.00%
|
BRF Brasil Foods PTE Ltd.
|
|
|
Marketing and logistics services
|
|
Singapore
|
|
100.00%
|
|
100.00%
|
Plusfood Hungary Trade and Service LLC
|
|
|
Import and commercialization of products
|
|
Hungary
|
|
100.00%
|
|
100.00%
|
Plusfood UK Ltd.
|
|
|
Marketing and logistics services
|
|
United Kingdom
|
|
100.00%
|
|
100.00%
|
Acheron Beteiligung-sverwaltung GmbH
|
(b)
|
|
Holding
|
|
Austria
|
|
100.00%
|
|
100.00%
|
Xamol Consultores Serviços Ltda.
|
(a)
|
|
Import and commercialization of products
|
|
Portugal
|
|
100.00%
|
|
100.00%
|
BRF Brasil Foods África Ltd.
|
|
|
Import and commercialization of products
|
|
South Africa
|
|
100.00%
|
|
100.00%
|
Sadia Chile S.A.
|
|
|
Import and commercialization of products
|
|
Chile
|
|
40.00%
|
|
40.00%
|
Rising Star Food Company Ltd.
|
(d)
|
|
Industralization, import and commercialization of products
|
|
China
|
|
50.00%
|
|
-
|
Sadia S.A.
|
|
|
Industralization and commercialization of products
|
|
Brazil
|
|
100.00%
|
|
100.00%
|
Sadia International Ltd.
|
|
|
Import and commercialization of products
|
|
Cayman Island
|
|
100.00%
|
|
100.00%
|
Sadia Uruguay S.A.
|
|
|
Import and commercialization of products
|
|
Uruguay
|
|
100.00%
|
|
100.00%
|
Sadia Alimentos S.A.
|
(c)
|
|
Import and export of products
|
|
Argentina
|
|
0.02%
|
|
-
|
Sadia Chile S.A.
|
|
|
Import and commercialization of products
|
|
Chile
|
|
60.00%
|
|
60.00%
|
Sadia U.K. Ltd.
|
|
|
Import and commercialization of products
|
|
United Kingdom
|
|
100.00%
|
|
100.00%
|
Vip S.A. Emp. Part. Imobiliárias
|
|
|
Commercialization of owned real estate
|
|
Brazil
|
|
34.51%
|
|
34.51%
|
Athena Alimentos S.A.
|
|
|
Industrialization and commercialization of commodities
|
|
Brazil
|
|
99.99%
|
|
99.99%
|
Sadia Overseas Ltd.
|
|
|
Financial fund-raising
|
|
Cayman Island
|
|
100.00%
|
|
100.00%
|
Sadia GmbH
|
|
|
Holding
|
|
Austria
|
|
100.00%
|
|
100.00%
|
Wellax Food Logistics C.P.A.S.U. Lda.
|
|
|
Import and commercialization of products
|
|
Portugal
|
|
100.00%
|
|
100.00%
|
Sadia Foods GmbH
|
|
|
Import and commercialization of products
|
|
Germany
|
|
100.00%
|
|
100.00%
|
BRF Foods Limited Liability Company
|
|
|
Import and commercialization of products
|
|
Russia
|
|
10.00%
|
|
10.00%
|
Qualy B.V.
|
(b)
|
|
Import and commercialization of products
|
|
The Netherlands
|
|
100.00%
|
|
100.00%
|
Sadia Japan KK
|
|
|
Import and commercialization of products
|
|
Japan
|
|
100.00%
|
|
100.00%
|
Badi Ltd.
|
|
|
Import and commercialization of products
|
|
Arab Emirates
|
|
100.00%
|
|
100.00%
|
Al-Wafi
|
|
|
Import and commercialization of products
|
|
Saudi Arabia
|
|
75.00%
|
|
75.00%
|
BRF Foods Limited Liability Company
|
|
|
Import and commercialization of products
|
|
Russia
|
|
90.00%
|
|
90.00%
|
Baumhardt Comércio e Participações Ltda.
|
|
|
Holding
|
|
Brazil
|
|
73.94%
|
|
73.94%
|
Excelsior Alimentos S.A.
|
|
|
Industralization and commercialization of products
|
|
Brazil
|
|
25.10%
|
|
25.10%
|
Excelsior Alimentos S.A.
|
|
|
Industralization and commercialization of products
|
|
Brazil
|
|
46.01%
|
|
46.01%
|
K&S Alimentos S.A.
|
|
|
Industrialization and commercialization of products
|
|
Brazil
|
|
49.00%
|
|
49.00%
|
Sadia Alimentos S.A.
|
|
|
Import and export of products
|
|
Argentina
|
|
99.98%
|
|
100.00%
|
Avex S.A.
|
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
65.58%
|
|
65.58%
|
Flora Dánica S.A.
|
(c)
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
95.00%
|
|
100.00%
|
GB Dan S.A.
|
(c)
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
5.00%
|
|
-
|
Flora San Luis S.A.
|
(c)
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
95.00%
|
|
100.00%
|
Flora Dánica S.A.
|
(c)
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
5.00%
|
|
-
|
GB Dan S.A.
|
(c)
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
95.00%
|
|
100.00%
|
Flora San Luis S.A.
|
(c)
|
|
Industrialization and commercialization of products
|
|
Argentina
|
|
5.00%
|
|
-
|
37
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(a) Dormant subsidiaries.
(b) The wholly-owned subsidiary Acheron Beteiligung-sverwaltung GmbH owns 100 direct subsidiaries in Madeira Island, Portugal, with an investment of R$1,635 (R$1,588 as of December 31, 2011), and the wholly-owned subsidiary Qualy B.V. owns 48 subsidiaries in The Netherlands, and the amount of this investment, as of March 31, 2012 , is represented by a net capital deficiency of R$9,718 (R$9,363 as of December 31, 2011), the purpose of these two subsidiaries is to operate in the European market to increase the Company’s market share, which is regulated by a system of poultry and turkey import quotas.
(c) Change in the equity interest.
(d) Establishment of joint venture in China.
1.2.
Performance Commitment Agreement
As disclosed to the market on July 13, 2011, the Company, its wholly-owned subsidiary Sadia and the Administrative Council for Economic Defense (“CADE”) signed the Performance Commitment Agreement (“TCD”) which the main purpose is to establish measures to accomplish the following:
(i)
prevent the merger between the Company and its subsidiary from substantially eliminating the competition;
(ii)
establish conditions to the existence of a strong competitor in the markets affected by the merger;
(iii)
propitiate condition to the fast and efficient entrance of competitors in the affected markets; and
(iv)
ensure that the benefits originated from the merger be equally distributed among participants and consumers.
The measures established in the TCD are limited to the national territory, in certain markets and/or products category. The Company and its subsidiary are free to act in the whole foreign market, in the dairy products market and in the food service local market, as long as they do not interfere in the assumptions and effectiveness of TCD.
In order to attend the TCD’s purposes, the Company and its subsidiary committed to take the following measures:
(i)
disposal of the brands:
Rezende
,
Wilson
,
Texas
,
Tekitos
,
Patitas
,
Escolha Saudável
,
Light & Elegant
,
Fiesta
,
Freski
,
Confiança
,
Doriana
and
Delicata
, as well as all, the intellectual properties rights related to these brands;
(ii)
jointly dispose all the assets and rights related to the production plants:
38
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
Plant
|
|
State
|
|
Activity
|
|
|
|
|
|
Carambeí
|
|
PR
|
|
Pork slaughtering, finished goods processing, animal feed production, hatcheries and pork farms.
|
Três Passos
|
|
RS
|
|
Pork slaughtering, finished goods processing, hatcheries and pork farms.
|
Brasília
|
|
DF
|
|
Poultry slaughtering, finished goods processing, animal feed production, hatcheries and farms.
|
São Gonçalo
|
|
BA
|
|
Poultry slaughtering, finished goods processing, animal feed production, hatcheries and farms.
|
Salto Veloso
|
|
SC
|
|
Finished goods processing.
|
Bom Retiro do Sul
|
|
RS
|
|
Finished goods processing.
|
Lages
|
|
SC
|
|
Finished goods processing.
|
Duque de Caxias
|
|
RJ
|
|
Finished goods processing.
|
Várzea Grande
|
|
MS
|
|
Finished goods processing.
|
Valinhos
|
|
SP
|
|
Finished goods processing.
|
Excelsior
|
|
RS
|
|
Finished goods processing.
|
The total production capacity of the units to be disposed of must correspond to 730,000 tons per annum (“p.a.”).
(iii)
disposal of all the assets and rights related to the following distribution centers:
City
|
|
State
|
|
Salvador
|
|
BA
|
|
Duque de Caxias
|
|
RJ
|
|
Campinas
|
|
SP
|
|
Bauru
|
|
SP
|
|
Brasília
|
|
DF
|
|
São José dos Pinhais
|
|
PR
|
|
Ribeirão Preto
|
|
SP
|
|
Cubatão
|
|
SP
|
|
(iv)
assignment of the entire portfolio of contracts with poultry and pork outgrowers, currently utilized in order to guarantee the supply to the specific processing plants listed in the item (ii) above;
39
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(v)
suspension of the use of the
Perdigão
brand, from the signing date of the disposal agreement, in the Brazilian territory, for the following products and periods:
Product
|
|
Term
|
Ham products
|
|
3 years
|
Pork festive kits
|
|
3 years
|
Smoked sausage and pork sausage
|
|
3 years
|
Salamis
|
|
4 years
|
Lasagna
|
|
5 years
|
Frozen pizzas
|
|
5 years
|
Kibes and meat balls
|
|
5 years
|
Turkey cold cuts light line
|
|
5 years
|
(vi)
suspension of the use of the
Batavo
brand, from the signing date of the disposal agreement, for the period of 4 years, related to the products listed above in item (v).
The CADE has been assessing the Company’s compliance with the commitments disclosed herein, as the Company is subject to penalties in case of noncompliance with CADE’s provisions, which ultimately, includes the review of the operation.
In order to attend the obligations derived from the TCD, the Company’s management set up a plan to sell the above mentioned facilities including the related assets, rights and obligations. Additionally, the plan comprises the necessary actions to transfer the productive capacity of 730,000 tons to the future acquirer as established by the TCD, which includes: assets transfers, purchase and installation of new product lines and the shutdown of existing productions line with the correspondent transfer to other production plants.
On December 8, 2011, the Company and Marfrig Alimentos S.A. (“Marfrig”) disclosed to the market that they signed a binding document, Memorandum of Understanding (“MOU”), which was confirmed with some amendment by the Asset Exchange and Other Agreements signed on March 20, 2012, establishing the main terms and conditions aiming to accomplish an exchange of the Company’s assets and rights related to the TCD with Marfrig or its subsidiary Quickfood S.A. (“Quickfood”) as follows:
(i)
the entire equity interest held either directly or indirectly by Marfrig, equivalent to 90,05% of the capital of Quickfood, a company based in Argentina, which owns the rights of
Paty
brand. Additionally, Marfrig is compelled to adopt all necessary actions to segregate and remove from Quickfood, all assets and liabilities related to beef activity that will remain
under control of Marfrig, except the San Jorge cold storage, that property will be transferred to the Company;
40
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(ii)
additional payment of an amount of R$350,000, of which R$100,000 will be paid between June and October 2012 and the remaining amount of R$250,000 will be paid in 72 monthly installments bears market interest rates; and
(iii)
commercial operations related to the
Paty
brand in Uruguay and Chile.
Additionally, it was agreed that risks and benefits regarding to the Company's pork manufacturing facility , located in the City of Carambeí, State of Paraná, will be transferred to Marfrig through a lease contract for a period of 3 years, renewable for more 1 year, with a call option for the amount of R$188,000.
Management's understanding of both companies is that the assets to be exchanged have equivalent values. Such understanding is subject to corroboration through an appraisal report at fair market value of the businesses which is currently being prepared. The transaction is subject to adjustments resulting from the legal, accounting, financial and operational due diligences, which are in progress and until the date of the issuance of these financial statements have not been finalized.
The signing of the definitive agreements and the actual implementation of the transaction are subject to precedent conditions, including the assessment of CADE, in the terms and limits placed on the TCD signed on July 13, 2011.
The Company did not reclassify the set of assets and liabilities to be disposed of as held for sale, because it concluded that on March 31, 2012, the current condition of these assets did not met the requirements of CPC 31, paragraph 7 “ the assets or group of assets held for sale must be immediately available in its current conditions…”. The Company’s conclusion is supported by the following factors:
(i)
in order to attend the requirements related to the disposal of productive capacity, which correspond to 730,000 tons, the Company prepared a plan comprising of refurbishments and adaptations necessary in these plants which demand an investment in the amount of R$78,528. Until March 31, 2012, only R$22,265 was effectively invested, hence showing that the plants were not immediately available for sale in the conditions determined by CADE;
(ii)
in the MOU signed on December 8, 2011, and in the Asset Exchange and Other Agreements, Marfrig imposed other conditions that also require additional changes in the plants besides those mentioned in the item (1)
above, denominated “precedent conditions”;
41
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(iii)
the buildings and lands related to the plants to be disposed of are pledged as guarantees; and
(iv)
as required by CADE, the plants in the scope of TCD must operate until the moment of ownership transfer; therefore, such plants will attend the sales orders of the products currently being manufactured, which are not part of the products portfolio to be sold to Marfrig according to TCD. Thus, the sales orders backlog will not be transferred to the Marfrig.
Due to the fact that the Company and the Marfrig have not concluded all appraisal reports of fair value assets until the date of the issuance of these financial statements and also because it has not identified other
impairment
factors, no adjustments have been recorded in these quarterly financial information for the three month period ended March 31, 2012.
Based on a preliminary appraisal report, on March 31, 2012 the book value of Company’s assets to be exchanged do not exceed their fair value.
The estimated accounting balances of the assets and liabilities to be exchanged with Marfrig according to the MOU and confirmed by the Asset Exchange and Other Agreements as of March 31, 2012 are set forth below:
42
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
ASSETS
|
|
CURRENT ASSETS
|
|
Cash and cash equivalents
|
4,606
|
Trade accounts receivable
|
11,994
|
Inventories
|
125,689
|
Others
|
1,630
|
|
143,919
|
NON-CURRENT ASSETS
|
|
Deferred taxes
|
6,607
|
Judicial deposits
|
1,168
|
Others assets
|
1,232
|
Investments
|
13
|
Property, plant and equipment
|
470,000
|
|
479,020
|
|
|
TOTAL ASSETS
|
622,939
|
|
|
Consolidated current assets
|
10,437,777
|
Consolidated non-current assets
|
19,180,234
|
Consolidated total assets
|
29,618,011
|
|
|
% that represents in consolidated current assets
|
1.4%
|
% that represents in consolidated non-current assets
|
2.5%
|
% that represents in consolidated total assets
|
2.1%
|
43
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
LIABILITIES
|
|
CURRENT LIABILITIES
|
|
Short term debts
|
12,107
|
Trade accounts payable
|
7,190
|
Social and labor obligations
|
16,085
|
Tax obligations
|
3,152
|
Other obligations
|
1,409
|
|
39,943
|
NON-CURRENT LIABILITIES
|
|
Long term debts
|
61
|
Tax obligations
|
5,952
|
Other obligations
|
1,641
|
|
7,654
|
|
NET ASSETS
|
573,874
|
|
TOTAL LIABILITIES
|
622,939
|
|
Consolidated current liabilities
|
7,418,427
|
Consolidated non-current liabilities
|
7,833,699
|
Consolidated shareholders'equity
|
14,365,885
|
Consolidated total liabilities
|
29,618,011
|
|
% that represents in consolidated current liabilities
|
0.5%
|
% that represents in consolidated non-current liabilities
|
0.1%
|
% that represents in consolidated shareholders'equity
|
4.0%
|
% that represents in consolidated total liabilities
|
2.1%
|
The labor obligations related to the retirement supplementary plan and other benefits presented in the note 24 are still being estimated and for this reason were not included in the position above.
The Company does not expect the disposal of these assets to cause significant impacts on the Company’s future cash flows.
The Management´s Company and Marfrig expected to conclude the precedent conditions established by the Asset Exchange and Other Agreements until May 31, 2012, to allow the conclusion of the definitive asset exchange agreement on June 01, 2012.
1.3.
Establishment of joint venture in China
On February 14, 2012, the Company disclosed to the market the establishment of
Rising Star Food Company Limited
, a joint venture (“JV”) with the participation of
Dah Chong Hong Limited
(“DCH”), which purpose will be:
44
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(i)
access to the market distribution in Continental China, Hong Kong and Macau reaching retail and food service channels;
(ii)
local processing of products; and
(iii)
developing the Sadia brand in these countries.
The Company owns 50% participation in the JV and is committed to make a capital increase amounting to approximately R$2,450, which is proportional to its participation in the JV.
Management estimates that during the first year of operation, the JV will have sales volumes of more than 140,000 tons and have net revenues of approximately R$844,100.
1.4.
Seasonality
The Company does not operate with any significant seasonality impact through the fiscal year. In general, during the fourth quarter the demand in the domestic market is slightly stronger than in the other quarters, mainly due to the year-end celebration such as Christmas and New Years Eve. The most sold products are: turkey,
Chester
® and ham.
2.
MANAGEMENT’S STATEMENT AND BASIS OF PREPARATION AND PRESENTATION OF QUARTERLY FINANCIAL INFORMATION
The Company’s consolidated quarterly financial information are in accordance with the accounting practices adopted in Brazil which comprise the rules issued by the Brazilian Securities Commission (“CVM”) and the pronouncements and interpretations of the Brazilian Accounting Pronouncements Committee (“CPC”), which are in conformity with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”).
The Company’s individual quarterly financial information have been prepared in accordance with the accounting practices adopted in Brazil and for presentation purposes, are identified as (“BR GAAP”). Such financial statement differs from IFRS in relation to the evaluation of investments in associates and joint ventures, which were measured and recorded based on the equity accounting method rather than at cost or fair value, as is required by IFRS.
The Company’s individual and consolidated quarterly financial information are expressed in thousands of Brazilian Reais (“R$”), as well as, the amount of other
currencies disclosed in the financial statement, when applicable, were also expressed in thousands.
45
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The preparation of the Company’s quarterly financial information requires Management to make judgments, use estimates and adopt assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, as well as the disclosures of contingent liabilities, as of the reporting date of the quarterly financial information. However, the uncertainty inherent to these judgments, assumptions and estimates could lead to results requiring a material adjustment to carrying amount of the affected asset or liability in future periods.
The settlement of the transactions involving these estimates can result in amounts that significantly different from those recorded in the financial statement due to the lack of precision inherent to the estimation process. The Company reviews its judgments, estimates and assumptions on a quarterly basis.
The individual and consolidated quarterly financial information were prepared based on the historical cost except for the following material items recognized in the balance sheet:
(i)
derivative financial instruments measured at fair value;
(ii)
derivative financial instruments measured at fair value through the statement of income;
(iii)
financial assets available for sale measured at fair value;
(iv)
assets and liabilities of acquired companies from January 1, 2009 recorded initially at fair value; and
(v)
share-based payments measured at fair value.
3.
SUMMARY OF ACCOUNTING PRACTICES
The quarterly financial information were prepared according to CVM Deliberation No. 673/11, which establishes the minimum content of interim financial statements and the principles for measurement and recognition of full set or condensed financial statements for an interim period.
The interim financial statements, in this case denominated as quarterly financial information, are aiming to provide updated information based on the last annual financial statements disclosed. Therefore, the quarterly financial information is
focused on new activities, events and circumstances and do not duplicate the information previously disclosed, except in the case where Management judged that the maintenance of the information was relevant.
46
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The current quarterly financial information were consistently prepared based on the accounting policies and estimates calculation methodology adopted in the preparation of the annual financial statements for the year ended December 31, 2011 (note 3), except regarding to the adoption of the requirements stated in the paragraph 28 of CVM Deliberation No. 673/11. Thus, during this quarter the Company started to disclose the income tax expense based on the best estimate of the annual weighted effective tax rate for the fiscal period ended December 31, 2012, as disclosed in note 14.
There were no changes of any nature related to such policies and estimates calculation methodology. As allowed by CVM Deliberation No. 673/11, Management decided not to disclose again the details of the accounting policies adopted by the Company, hence, it is necessary the reading of the quarterly financial information together with the annual financial statements for the year ended December 31, 2011, in order to allow the quarterly financial information users to enlarge their understanding regarding the Company’s capacity of profit and future cash flows generation as well as its financial conditions and liquidity.
The exchange rates in Brazilian Reais effective at the date of the balance sheets translated were as follows:
|
|
|
|
Final rate
|
03.31.12
|
|
12.31.11
|
U.S. dollar (USD)
|
1.8221
|
|
1.8758
|
Euro (EUR)
|
2.4300
|
|
2.4342
|
British Pound (GBP)
|
2.9132
|
|
2.9148
|
Argentine Peso (ARS)
|
0.4164
|
|
0.4360
|
|
Average rates
|
|
|
|
U.S. dollar (USD)
|
1.7701
|
|
1.6746
|
Euro (EUR)
|
2.3194
|
|
2.3278
|
British Pound (GBP)
|
2.7798
|
|
2.6835
|
Argentine Peso (ARS)
|
0.4080
|
|
0.4056
|
47
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
4.
FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
4.1.
Overview
In the regular course of its business, the Company is exposed to market risks related mainly to the fluctuation of interest rates, variation of foreign exchange rates and changes in the commodities prices.
The Company utilizes hedging instruments to mitigate its exposure to these risks, based on a Risk Policy under the management of the Financial Risk Management Committee, Board of Executive Officers and Board of Directors. Such policy includes the monitoring of the levels of exposure to each market risk and its measurement is performed based on the accounting exposure and forecast of future cash flows. The policy establishes limits for the decision making and adoption of hedging instruments with the purposes of:
(i)
protecting from the exposure to fluctuation of interest rates;
(ii)
protecting from the exposure to variation of foreign exchange rates on debt and cash flow; and
(iii)
protecting from the exposure to changes in the commodities prices.
The Board of Directors plays a crucial role in the financial risk management structure as responsible for approving the Risk Policy. Moreover, the Board of Directors defines the limits of tolerance of the different risks identified as acceptable for the Company on behalf of its shareholders.
The Board of Directors is in charge of the evaluation of the Company’s positioning for each identified risk, according to the guidelines enacted by the Board of Directors as well as for approving:
(i)
the action plans defined for aligning the risks within the defined limits of tolerance;
(ii)
the performance indicators to be used in risk management;
(iii)
the overall limits; and
(iv)
the evaluation of improvements to the Risk Policy.
The Financial Risk Management Committee is in charge of the execution of the Risk Policy, which comprises the supervision of the risk management process, planning
and verification of the impacts of the decisions implemented, as well as the evaluation and approval of hedging alternatives and monitoring the exposure levels to risks in order to ensure the compliance of the Policy.
48
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The Risk Management area has as primary task the monitoring, evaluation and reporting of financial risk taken by the Company, and among these are:
(i)
an ongoing review of the scope of Risk Policy, ensuring that hedging instruments utilized are within the limits of tolerance established by the Policy;
(ii)
the preparation of reports;
(iii)
the evaluation and presentation of alternatives to mitigate risks; and
(iv)
the modeling and assessment of exposure to risks.
The tasks mentioned above are performed in order to highlight and give acknowledgement to Management on the magnitude of the risks and the related hedging instruments utilized presenting the potential impacts.
The Risk Policy defines the strategies to be adopted, and Management contracts hedging instruments that are approved within the delegation of authority levels. The Board of Directors, Board of Executive Officers and Financial Risk Committee have different levels of authority where each one acts within the limits pre-established in this Policy.
The Policy does not authorize the Company to contract leveraged transactions in derivative markets, as well as determines that individual hedge operations (notional) must be limited to 2.5% of the Company’s shareholders’ equity.
The inclusion and updating of transactions are recorded in the Company’s operating systems, with proper segregation of duties, being validated by the back-office and daily monitored by the Risk Management area.
Considering the objective of hedging transactions is to mitigate the risks and the uncertainties to which the Company is exposed, the results obtained for the period met the established objectives.
As permitted by CVM Deliberation No. 604/09, the Company applies hedge accounting rules to its derivative instruments classified as cash flow hedge, in accordance with its Risk Policy. The cash flow hedge consists of hedging the exposure to variations of the cash flow that:
49
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(i)
is attributable to a particular risk associated with a recognized asset or liability;
(ii)
is a highly probable transaction; and
(iii)
could affect profit and loss.
The Policy has also the purpose of determining parameters of use of financial instruments, including derivatives, which are designed to protect the operating and financial assets and liabilities, which are exposed to the variations of foreign exchange rates, the fluctuation of the interest rates and changes to the commodities prices. The Risk Management area is responsible for ensuring compliance to the requirements established by the Company’s Risk Policy.
4.2.
Interest rate risk management
The risk of interest rates is that one which the Company may suffer economic losses, arising from changes in these rates, which can be caused by factors related to economic crises or changes in monetary policy on domestic and foreign markets. This exhibition refers primarily to changes in market interest rates, that affect assets and liabilities of the companies, indexed to the London Interbank Offered rate ("LIBOR"), Term Interest Rate ("TJLP"). Currency of the Bank National Economic and Social Development ("UMBNDES") or Interbank Deposit ("CDI") Certificate, and any transactions with pre-established positions in some of the indices mentioned above, which can lead to losses unrealized or realized through the calculation of fair market value (mark to market).
The Company’s Risk Policy does not restrict exposure to different interest rates, neither establishes limits for fixed or floating rates.
The Company continually monitors the market interest rates, in order to evaluate any potential need to enter in hedging contracts to protect from the exposure to fluctuation of such rates. These transactions are basically characterized by contracts that exchange floating rate for fixed rate. Such transactions were designated by the Company as cash flow hedge.
The Company seeks a stable correlation between its current and non-current term indebtedness, maintaining a higher portion in the non-current term.
The Company’s indebtedness is essentially tied to the LIBOR, fixed coupon (“R$ and USD”), TJLP and UMBNDES rates. In case of adverse changes in the market that result in LIBOR hikes, the cost of the floating indebtedness rises and on the other
hand, the cost of the fixed indebtedness decreases in relative terms. The same consideration is also applicable to the TJLP and UMBNDES.
50
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
With regards to the Company's marketable securities, the main index is the CDI for investments in the domestic market and fixed coupon (“USD”) for investments in the foreign market. If CDI increases, impacts become favorable, while if CDI decreases, results become unfavorable.
4.3.
Foreign exchange risk management
Foreign exchange risk is the one related to variations of foreign exchange rates that may cause the Company to incur unexpected losses, leading to a reduction of the assets or an increase of the amounts of liabilities.
The main exposures to which the Company is subject, as regards foreign exchange rates variations, refer to the fluctuation of the U.S. Dollar (“US$” or “USD”) and also of the Euro (“EUR”) and the British Pound (“GBP”) in relation to the Brazilian Real.
The objective of the Company’s Risk Policy is the protection from excessive exposure to the risks of foreign exchange variations by balancing its assets not denominated in Brazilian Reais against its obligations not denominated in Brazilian Reais, thus protecting the Company’s balance sheet, through the use of over-the-counter transactions (“swap”) and transactions on the futures exchange.
4.3.1.
Breakdown of the balances of exposure in foreign currency
Foreign currency denominated assets and liabilities are as follows:
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
Parent company
|
|
Consolidated
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Cash and cash equivalents and marketable securities
|
38,038
|
|
40,469
|
|
1,493,456
|
|
1,689,551
|
Trade accounts receivable - third parties
|
51,904
|
|
37,921
|
|
1,279,803
|
|
1,379,420
|
Accounts receivable from subsidiaries
|
438,571
|
|
409,061
|
|
-
|
|
-
|
Dollar futures agreements
|
192,866
|
|
65,801
|
|
192,866
|
|
65,801
|
Inventory
|
1,904
|
|
-
|
|
354,549
|
|
112,267
|
Forward contracts (NDF)
(a)
|
5,466
|
|
-
|
|
5,466
|
|
11,255
|
Exchange rate contracts (SWAP)
|
(356,571)
|
|
(359,369)
|
|
(356,571)
|
|
(359,369)
|
Loans and financing
|
(1,414,370)
|
|
(1,268,830)
|
|
(4,892,783)
|
|
(4,723,824)
|
Pre-payment exports designated as hedge accounting
|
1,084,309
|
|
1,210,248
|
|
1,084,309
|
|
1,210,248
|
Trade accounts payable
|
(52,391)
|
|
(55,760)
|
|
(299,389)
|
|
(340,300)
|
Advance pre-payment from subsidiaries
|
(1,757,008)
|
|
-
|
|
-
|
|
-
|
Other operating assets and liabilities, net
|
5,484
|
|
-
|
|
285,294
|
|
71,948
|
|
(1,761,798)
|
|
79,541
|
|
(853,000)
|
|
(883,003)
|
|
Foreign exchange exposure in US$
|
(966,905)
|
|
42,404
|
|
(468,141)
|
|
(470,734)
|
(a)
Offshore non-deliverable forwards (“NDFs”) not designated as hedge accounting, impacting financial result and not shareholders' equity.
51
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The Company's total net foreign exchange exposure as of March 31, 2012, is a liability of US$468,141 and is within the limit established by the Risk Policy.
The Risk Policy aims to protect the operating revenues and costs that are related to the operations resulting from the commercial activity, such as estimates of exports and purchases of raw materials. For the purpose, the Company utilizes hedge instruments focusing mainly on the protection of its foreign currency denominated projected cash flow.
In order to conduct an active management and as required by the Risk Policy, the Company performs daily monitoring, through reports issued by the Risk Management area, on cash flow needs and foreign exchange exposure.
4.3.2.
Breakdown of the balances of derivative financial instruments
The positions of outstanding derivatives are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
Consolidated
|
03.31.12
|
|
|
Subject to
|
|
|
|
|
|
|
|
Reference value
|
|
Market value
|
Instrument
|
|
hedge
|
|
Maturity
|
|
Receivable
|
|
Payable
|
|
(notional)
|
|
(1)
|
Financial instruments designated as hedge accounting
|
|
|
|
|
|
|
|
|
NDF
|
|
Exchange rate
|
|
04/2012 to 02/2013
|
|
R$ (Pre- of 9.25%)
|
|
US$
|
|
2,523,609
|
|
7,134
|
NDF
|
|
Exchange rate
|
|
04/2012 to 02/2013
|
|
R$ (Pre- of 7.79%)
|
|
EUR
|
|
524,880
|
|
9,262
|
NDF
|
|
Exchange rate
|
|
04/2012 to 02/2013
|
|
R$ (Pre- of 7.76%)
|
|
GBP
|
|
224,608
|
|
(4,552)
|
Swap
|
|
Exchange rate
|
|
Up to 07/2013
|
|
US$ + 7%
|
|
R$ (76% from CDI)
|
|
56,112
|
|
1,351
|
Swap
|
|
Exchange rate
|
|
04/2012 to 12/2013
|
|
US$ + LIBOR 3M + 3.83%
|
|
R$ (97.50% from CDI)
|
|
330,750
|
|
(11,167)
|
Swap
|
|
Interest rate
|
|
08/2012 to 06/2018
|
|
US$ + LIBOR 3M + 1.43%
|
|
US$ + 3.92%
|
|
364,420
|
|
(16,092)
|
Swap
|
|
Interest rate
|
|
07/2012 to 02/2019
|
|
US$ + LIBOR 6M + 1.77%
|
|
US$ + 4.86%
|
|
984,194
|
|
(60,141)
|
Swap
|
|
Interest rate
|
|
Up to 11/2012
|
|
US$ + LIBOR 12M + 0.71%
|
|
US$ + 3.70%
|
|
182,210
|
|
(3,505)
|
|
|
|
|
|
|
|
|
|
|
5,190,783
|
|
(77,710)
|
Financial instruments not designated as hedge accounting
|
|
|
|
|
|
|
|
|
NDF
|
|
Exchange rate
|
|
04/2012 to 06/2012
|
|
US$
|
|
ARS (Pre- of 14.46%)
|
|
5,466
|
|
(43)
|
NDF
|
|
Exchange rate
|
|
03/2012
|
|
US$ (Pre- of 0.15%)
|
|
EUR
|
|
121,500
|
|
(69)
|
NDF
|
|
Exchange rate
|
|
04/2012 to 06/2012
|
|
R$ (Pre- of 11.14%)
|
|
EUR
|
|
9,720
|
|
392
|
NDF
|
|
Exchange rate
|
|
04/2012 to 06/2012
|
|
EUR
|
|
R$ (Pre- of 8.13%)
|
|
9,720
|
|
(1)
|
Swap
|
|
Interest rate
|
|
05/2012
|
|
US$ + LIBOR 3M + 3.85%
|
|
US$ + 5.78%
|
|
54,663
|
|
(192)
|
Swap
|
|
Exchange rate
|
|
03/2015
|
|
R$ (Pre- of 9.62%)
|
|
US$ + 1.40%
|
|
356,571
|
|
(37,165)
|
Options
|
|
Live cattle
|
|
07/2012 to 11/2012
|
|
R$
|
|
R$
|
|
100,122
|
|
(399)
|
NDF
|
|
Live cattle
|
|
09/2012
|
|
R$
|
|
R$
|
|
1,679
|
|
9
|
Future contract
|
|
Exchange rate
|
|
04/2012
|
|
US$
|
|
R$
|
|
192,866
|
|
(513)
|
Future contract
|
|
Live cattle
|
|
12/2012
|
|
R$
|
|
R$
|
|
44,476
|
|
(123)
|
|
|
|
|
|
|
|
|
|
|
896,783
|
|
(38,104)
|
|
|
|
|
|
|
|
|
|
|
6,087,566
|
|
(115,814)
|
52
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
Consolidated
|
12.31.11
|
|
|
Subject to
|
|
|
|
|
|
|
|
Reference value
|
|
Market value
|
Instrument
|
|
hedge
|
|
Maturity
|
|
Receivable
|
|
Payable
|
|
(notional)
|
|
(1)
|
Financial instruments designated as hedge accounting
|
|
|
|
|
|
|
|
|
NDF
|
|
Exchange rate
|
|
01/2012 to 11/2012
|
|
R$ (Pre- of 9.25%)
|
|
US$
|
|
2,551,088
|
|
(88,150)
|
NDF
|
|
Exchange rate
|
|
01/2012 to 11/2012
|
|
R$ (Pre- of 7.72%)
|
|
EUR
|
|
769,207
|
|
6,637
|
NDF
|
|
Exchange rate
|
|
01/2012 to 11/2012
|
|
R$ (Pre- of 7.59%)
|
|
GBP
|
|
201,996
|
|
(5,270)
|
Options
|
|
Exchange rate
|
|
Up to 01/2012
|
|
R$
|
|
US$
|
|
150,064
|
|
(1,308)
|
Swap
|
|
Exchange rate
|
|
Up to 07/2013
|
|
US$ + 7%
|
|
R$ (76% from CDI)
|
|
56,112
|
|
1,031
|
Swap
|
|
Exchange rate
|
|
10/2011 to 12/2013
|
|
US$ + LIBOR 3M + 3.83%
|
|
R$ (97.50% from CDI)
|
|
330,750
|
|
(16,702)
|
Swap
|
|
Interest rate
|
|
08/2012 to 06/2018
|
|
US$ + LIBOR 3M + 1.43%
|
|
US$ + 3.92%
|
|
375,160
|
|
(18,102)
|
Swap
|
|
Interest rate
|
|
07/2012 to 02/2019
|
|
US$ + LIBOR 6M + 1.77%
|
|
US$ + 4.80%
|
|
1,095,199
|
|
(74,176)
|
Swap
|
|
Interest rate
|
|
Up to 11/2012
|
|
US$ + LIBOR 12M + 0.71%
|
|
US$ + 3.70%
|
|
187,580
|
|
(3,593)
|
|
|
|
|
|
|
|
|
|
|
5,717,156
|
|
(199,633)
|
Financial instruments not designated as hedge accounting
|
|
|
|
|
|
|
|
|
NDF
|
|
Exchange rate
|
|
01/2012 to 11/2012
|
|
US$
|
|
ARS (Pre- of 13.45%)
|
|
11,255
|
|
(47)
|
NDF
|
|
Exchange rate
|
|
Up to 03/2012
|
|
US$ (Pre- of 0.54%)
|
|
EUR
|
|
60,855
|
|
515
|
Swap
|
|
Interest rate
|
|
Up to 05/2012
|
|
US$ + LIBOR 3M + 3.85%
|
|
US$ + 5.78%
|
|
56,274
|
|
(356)
|
Swap
|
|
Exchange rate
|
|
Up to 03/2015
|
|
R$ (Pre- of 9.62%)
|
|
US$ + 1.40%
|
|
359,369
|
|
(47,802)
|
Options
|
|
Live cattle
|
|
01/2012 to 10/2012
|
|
R$
|
|
R$
|
|
33,635
|
|
348
|
NDF
|
|
Live cattle
|
|
Up to 09/2012
|
|
R$
|
|
R$
|
|
1,679
|
|
29
|
Future contract
|
|
Exchange rate
|
|
Up to 01/2012
|
|
US$
|
|
R$
|
|
65,801
|
|
(292)
|
Future contract
|
|
Live cattle
|
|
Up to 10/2012
|
|
R$
|
|
R$
|
|
10,967
|
|
4
|
|
|
|
|
|
|
|
|
|
|
599,835
|
|
(47,601)
|
|
|
|
|
|
|
|
|
|
|
6,316,991
|
|
(247,234)
|
(1)
The market value determination method used by the Company consists of calculating the future value based on the contracted conditions and determining the present value based on market curves, extracted from the database of Bloomberg and BM&F.
The Company contracted swap operations, NDF and future contracts with the objective of minimize the effects of the variations in the foreign exchange rates and for protection from the fluctuations of interest rates.
Management understands that the results obtained with these derivative operations are in compliance with the Risk Policy adopted by the Company and were satisfactory.
4.3.3.
Options
As of March 31, 2012, the Company did not have any currency options designated or not as cash flow hedge accounting.
4.4.
Breakdown of the balances of financial instruments designated for cash flow hedge accounting and export revenues
The Company formally designated its operations for hedge accounting treatment for the derivative financial instruments to protect cash flows and export revenues, documenting:
(i)
the relationship of the hedge;
53
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(ii)
the objective and risk management strategy of the Company to hire a hedge transaction;
(iii)
the identification of the financial instrument;
(iv)
the hedge object or transaction;
(v)
the nature of the risk to be hedged;
(vi)
the description of the hedge relationship;
(vii)
the demonstration of the correlation between the hedge transaction and the hedge object, when applicable; and
(viii)
the prospective demonstration of the effectiveness of the hedge.
The transactions for which the Company has designated hedge accounting, are highly probable to present a variation in cash flow that could affect profit and loss are highly effective in achieving changes in fair value or cash flows attributable to hedged risk, consistent with the risk originally documented in the Risk Policy.
The Company recorded the unrealized results of the designated derivatives for interest rates and exchange rates risks in shareholders’ equity, net of taxes.
54
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
4.4.1.
Non-deliverable forwards - NDF
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
Consolidated
|
03.31.12
|
NDF
|
|
R$ x USD
|
|
R$ x EUR
|
|
R$ x GBP
|
Maturities
|
|
Curve
|
|
MTM
|
|
Notional
|
|
Average USD
|
|
Curve
|
|
MTM
|
|
Notional
|
|
Average EUR
|
|
Curve
|
|
MTM
|
|
Notional
|
|
Average GBP
|
April 2012
|
|
(3,930)
|
|
(3,454)
|
|
206,000
|
|
1.8105
|
|
3,094
|
|
3,043
|
|
22,000
|
|
2.5758
|
|
(369)
|
|
(397)
|
|
7,500
|
|
2.8702
|
May 2012
|
|
(1,212)
|
|
(976)
|
|
158,000
|
|
1.8342
|
|
1,119
|
|
989
|
|
22,000
|
|
2.5015
|
|
(608)
|
|
(679)
|
|
8,500
|
|
2.8654
|
June 2012
|
|
2,343
|
|
2,360
|
|
130,000
|
|
1.8707
|
|
874
|
|
789
|
|
18,000
|
|
2.5165
|
|
(531)
|
|
(566)
|
|
8,100
|
|
2.8924
|
July 2012
|
|
(1,952)
|
|
(1,124)
|
|
153,000
|
|
1.8544
|
|
630
|
|
604
|
|
30,000
|
|
2.5072
|
|
(329)
|
|
(370)
|
|
8,500
|
|
2.9344
|
August 2012
|
|
406
|
|
611
|
|
26,000
|
|
1.8984
|
|
437
|
|
284
|
|
23,000
|
|
2.5143
|
|
(312)
|
|
(378)
|
|
7,500
|
|
2.9449
|
September 2012
|
|
7,106
|
|
7,323
|
|
121,000
|
|
1.9486
|
|
1,709
|
|
1,351
|
|
19,000
|
|
2.5919
|
|
(25)
|
|
(90)
|
|
7,000
|
|
3.0017
|
October 2012
|
|
3,208
|
|
4,638
|
|
179,000
|
|
1.9225
|
|
1,161
|
|
1,107
|
|
28,000
|
|
2.5705
|
|
(384)
|
|
(336)
|
|
9,000
|
|
2.9922
|
November 2012
|
|
4,671
|
|
4,894
|
|
115,000
|
|
1.9510
|
|
707
|
|
810
|
|
20,000
|
|
2.5735
|
|
(67)
|
|
(117)
|
|
5,500
|
|
3.0241
|
December 2012
|
|
1,121
|
|
1,200
|
|
133,000
|
|
1.9260
|
|
(246)
|
|
150
|
|
14,000
|
|
2.5436
|
|
(433)
|
|
(446)
|
|
5,500
|
|
2.9750
|
January 2013
|
|
(4,631)
|
|
(4,456)
|
|
95,000
|
|
1.8760
|
|
(370)
|
|
120
|
|
13,000
|
|
2.5438
|
|
(649)
|
|
(625)
|
|
6,000
|
|
2.9654
|
February 2013
|
|
(4,699)
|
|
(3,882)
|
|
69,000
|
|
1.8758
|
|
(445)
|
|
15
|
|
7,000
|
|
2.5381
|
|
(552)
|
|
(548)
|
|
4,000
|
|
2.9465
|
|
|
2,431
|
|
7,134
|
|
1,385,000
|
|
1.8880
|
|
8,670
|
|
9,262
|
|
216,000
|
|
2.5433
|
|
(4,259)
|
|
(4,552)
|
|
77,100
|
|
2.9466
|
55
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
4.4.2.
Interest rate swap
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
Parent company and Consolidated
|
03.31.12
|
Assets
|
|
Liabilities
|
|
|
|
Maturity
|
|
Balance
|
|
Balance
|
(Hedged object)
|
|
(Protected risk)
|
|
Notional
|
|
date
|
|
(contract curve)
|
|
(MTM)
|
Libor 6M + 1.75% p.a.
|
|
4.22% p.a.
|
|
US$13,000
|
|
07.25.12
|
|
(71)
|
|
(198)
|
Libor 6M
|
|
4.06% p.a.
|
|
US$32,143
|
|
07.22.13
|
|
(330)
|
|
(1,821)
|
Libor 6M + 0.80% p.a.
|
|
4.31% p.a.
|
|
US$18,000
|
|
08.23.13
|
|
(78)
|
|
(851)
|
Libor 6M + 0.80% p.a.
|
|
4.36% p.a.
|
|
US$12,000
|
|
07.19.13
|
|
(111)
|
|
(573)
|
Libor 3M + 0.5% p.a.
|
|
3.96% p.a.
|
|
US$10,000
|
|
08.20.12
|
|
(60)
|
|
(257)
|
Libor 3M + 0.5% p.a.
|
|
3.96% p.a.
|
|
US$20,000
|
|
08.15.12
|
|
(138)
|
|
(520)
|
Libor 3M + 0.5% p.a.
|
|
3.96% p.a.
|
|
US$20,000
|
|
08.10.12
|
|
(152)
|
|
(521)
|
Libor 6M
|
|
3.82% p.a.
|
|
US$8,000
|
|
03.20.13
|
|
(15)
|
|
(319)
|
Libor 6M
|
|
3.79% p.a.
|
|
US$12,000
|
|
02.13.13
|
|
(72)
|
|
(465)
|
Libor 6M + 1.65% p.a.
|
|
4.15% p.a.
|
|
US$15,000
|
|
05.10.13
|
|
(192)
|
|
(451)
|
Libor 6M + 0.60% p.a.
|
|
2.98% p.a.
|
|
US$50,000
|
|
12.19.12
|
|
(301)
|
|
(1,225)
|
Libor 6M + 0.60% p.a.
|
|
2.99% p.a.
|
|
US$50,000
|
|
11.26.12
|
|
(423)
|
|
(1,289)
|
Libor 6M + 1.55% p.a.
|
|
3.55% p.a.
|
|
US$30,000
|
|
07.02.12
|
|
(54)
|
|
(110)
|
Libor 12M + 0.71% p.a.
|
|
3.57% p.a.
|
|
US$50,000
|
|
11.19.12
|
|
(583)
|
|
(1,648)
|
Libor 12M + 0.71% p.a.
|
|
3.82% p.a.
|
|
US$50,000
|
|
11.26.12
|
|
(631)
|
|
(1,857)
|
Libor 3M
|
|
0.78% p.a.
|
|
US$50,000
|
|
08.03.12
|
|
(34)
|
|
(72)
|
Libor 6M + 2.82% p.a.
|
|
5.86% p.a.
|
|
US$100,000
|
|
01.22.18
|
|
(394)
|
|
(16,565)
|
Libor 3M + 2.60% p.a.
|
|
5.47% p.a.
|
|
US$100,000
|
|
06.18.18
|
|
(243)
|
|
(14,721)
|
Libor 6M + 2.70% p.a.
|
|
5.90% p.a.
|
|
US$100,000
|
|
02.01.19
|
|
(248)
|
|
(18,252)
|
Libor 6M + 2.70% p.a.
|
|
5.88% p.a.
|
|
US$100,000
|
|
02.01.19
|
|
(246)
|
|
(18,023)
|
7% p.a.
|
|
76% CDI
|
|
US$35,000
|
|
07.15.13
|
|
97
|
|
1,351
|
Libor 3M + 2,50% p.a.
|
|
92,5% CDI
|
|
US$38,889
|
|
10.01.13
|
|
(1,095)
|
|
(3,560)
|
Libor 3M + 4,50% p.a.
|
|
100% CDI
|
|
US$77,778
|
|
12.23.13
|
|
(173)
|
|
(7,607)
|
|
|
|
|
|
|
|
|
(5,547)
|
|
(89,554)
|
4.4.3.
Exports pre-payments – PPEs
As authorized by CVM Deliberation No. 604/09, the Company utilizes the exchange rates variation of export pre-payments contracts (“PPEs”) as a hedge instrument in order to mitigate the risk of the variation of exchange rate resulting from the highly probable future sales designated in foreign currency.
In order to test the effectiveness of this hedge category, the Company established a comparison between the exchange rate variation arising from the PPE agreement (variation of the fair value of the hedging instrument) and the variation of the fair value of highly probable future export revenues (Spot-to-Spot rate method).
56
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The position of the PPEs designated as hedge accounting is set forth below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
Consolidated
|
03.31.12
|
|
|
|
|
Type of risk
|
|
|
|
Notional
|
|
|
Hedge Instrument
|
|
Subject to hedge
|
|
hedged
|
|
Maturity
|
|
(US$)
|
|
MTM
|
|
PPE
|
|
Foreign Market Sales
|
|
US$ (E.R.)
|
|
From 04.2012
to 02.2019
|
|
595,087
|
|
1,084,309
|
The unrealized gains and losses from PPEs designated as hedge accounting, recorded in the shareholders’ equity is represented by a loss of R$7,753, net of income tax of R$3,994.
4.5.
Gains and losses of derivative financial instruments
The amounts of gains and losses resulting from derivative financial instruments for the three month period ended March 31, 2012 were recorded in the statements of income as financial income or expenses, while the unrealized gains and losses were recognized in the shareholders’ equity, are shown below:
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
Parent company
|
|
Shareholders' equity
|
|
Statement of income
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
03.31.11
|
Derivatives intended for protection
|
|
|
|
|
|
|
|
Exchange risks
|
3,199
|
|
(101,129)
|
|
(1,171)
|
|
(2,290)
|
Interest rate risk
|
(39,584)
|
|
(46,050)
|
|
(3,880)
|
|
(3,944)
|
|
(36,385)
|
|
(147,179)
|
|
(5,051)
|
|
(6,234)
|
Derivatives intended for financial results
|
|
|
|
|
|
|
|
Interest rate risk
|
-
|
|
-
|
|
(192)
|
|
(705)
|
Exchange risks
|
-
|
|
-
|
|
(37,286)
|
|
(145)
|
Market risk of live cattle
|
-
|
|
-
|
|
(513)
|
|
(1,813)
|
|
-
|
|
-
|
|
(37,991)
|
|
(2,663)
|
|
(36,385)
|
|
(147,179)
|
|
(43,042)
|
|
(8,897)
|
|
|
BR GAAP and IFRS
|
|
Consolidated
|
|
Shareholders' equity
|
|
Statement of income
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
03.31.11
|
Derivatives intended for protection
|
|
|
|
|
|
|
|
Exchange risks
|
3,199
|
|
(101,129)
|
|
(1,171)
|
|
(2,290)
|
Interest rate risk
|
(75,362)
|
|
(85,698)
|
|
(4,376)
|
|
(4,339)
|
|
(72,163)
|
|
(186,827)
|
|
(5,547)
|
|
(6,629)
|
|
Derivatives intended for financial results
|
|
|
|
|
|
|
|
Interest rate risk
|
-
|
|
-
|
|
(192)
|
|
(705)
|
Exchange risks
|
-
|
|
-
|
|
(37,399)
|
|
5,601
|
Market risk of live cattle
|
-
|
|
-
|
|
(513)
|
|
(1,813)
|
|
-
|
|
-
|
|
(38,104)
|
|
3,083
|
|
(72,163)
|
|
(186,827)
|
|
(43,651)
|
|
(3,546)
|
The gains and losses from derivative financial instruments designated as hedge
accounting, recorded in the shareholders’ equity, are represented by a loss of R$59,792, net of income tax of R$12,371.
57
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
4.5.1.
Breakdown by category of the balances of financial instruments – except derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
Parent company
|
|
03.31.12
|
|
Loans and
|
|
Available for
|
|
Trading
|
|
Held to
|
|
Financial
|
|
|
|
receivables
|
|
sale
|
|
securities
|
|
maturity
|
|
liabilities
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts receivable
|
1,295,376
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,295,376
|
Credit notes
|
101,136
|
|
-
|
|
-
|
|
-
|
|
-
|
|
101,136
|
Fair value
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
1,488
|
|
306,837
|
|
-
|
|
-
|
|
308,325
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts payable
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,295,973)
|
|
(1,295,973)
|
Loans and financing
|
|
|
|
|
|
|
|
|
|
|
|
Local currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,677,675)
|
|
(1,677,675)
|
Foreign currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,414,370)
|
|
(1,414,370)
|
|
1,396,512
|
|
1,488
|
|
306,837
|
|
-
|
|
(4,388,018)
|
|
(2,683,181)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
Parent company
|
|
12.31.11
|
|
Loans and
|
|
Available for
|
|
Trading
|
|
|
|
Financial
|
|
|
|
receivables
|
|
sale
|
|
securities
|
|
Held to maturity
|
|
liabilities
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Trade accounts receivable
|
1,429,793
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,429,793
|
Credit notes
|
100,783
|
|
-
|
|
-
|
|
-
|
|
-
|
|
100,783
|
Fair value
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
1,685
|
|
761,850
|
|
-
|
|
-
|
|
763,535
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts payable
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,270,696)
|
|
(1,270,696)
|
Loans and financing
|
|
|
|
|
|
|
|
|
|
|
|
Local currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,774,291)
|
|
(1,774,291)
|
Foreign currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,268,830)
|
|
(1,268,830)
|
|
1,530,576
|
|
1,685
|
|
761,850
|
|
-
|
|
(4,313,817)
|
|
(2,019,706)
|
58
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
Consolidated
|
|
03.31.12
|
|
Loans and
|
|
Available for
|
|
Trading
|
|
Held to
|
|
Financial
|
|
|
|
receivables
|
|
sale
|
|
securities
|
|
maturity
|
|
liabilities
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
-
|
|
-
|
|
262,741
|
|
-
|
|
262,741
|
Trade accounts receivable
|
2,662,075
|
|
-
|
|
-
|
|
-
|
|
-
|
|
2,662,075
|
Credit notes
|
201,588
|
|
-
|
|
-
|
|
-
|
|
-
|
|
201,588
|
Fair value
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
230,448
|
|
528,353
|
|
-
|
|
-
|
|
758,801
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts payable
|
-
|
|
-
|
|
-
|
|
-
|
|
(2,669,993)
|
|
(2,669,993)
|
Loans and financing
|
|
|
|
|
|
|
|
|
|
|
|
Local currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(3,192,187)
|
|
(3,192,187)
|
Foreign currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(4,892,783)
|
|
(4,892,783)
|
|
2,863,663
|
|
230,448
|
|
528,353
|
|
262,741
|
|
(10,754,963)
|
|
(6,869,758)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
Consolidated
|
|
12.31.11
|
|
Loans and
|
|
Available for
|
|
Trading
|
|
|
|
Financial
|
|
|
|
receivables
|
|
sale
|
|
securities
|
|
Held to maturity
|
|
liabilities
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
-
|
|
-
|
|
236,804
|
|
-
|
|
236,804
|
Trade accounts receivable
|
3,210,232
|
|
-
|
|
-
|
|
-
|
|
-
|
|
3,210,232
|
Credit notes
|
204,257
|
|
-
|
|
-
|
|
-
|
|
-
|
|
204,257
|
Fair value
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
-
|
|
235,150
|
|
1,054,105
|
|
-
|
|
-
|
|
1,289,255
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts payable
|
-
|
|
-
|
|
-
|
|
-
|
|
(2,681,343)
|
|
(2,681,343)
|
Loans and financing
|
|
|
|
|
|
|
|
|
|
|
|
Local currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(3,329,706)
|
|
(3,329,706)
|
Foreign currency
|
-
|
|
-
|
|
-
|
|
-
|
|
(4,723,824)
|
|
(4,723,824)
|
|
3,414,489
|
|
235,150
|
|
1,054,105
|
|
236,804
|
|
(10,734,873)
|
|
(5,794,325)
|
4.6.
Determination of the fair value of financial instruments
The Company discloses its financial assets and liabilities at fair value, based on the pertinent accounting pronouncements, which refers to concepts of valuation and practices, and requires certain disclosures on the fair value.
Specifically related to the disclosure, the Company applies the hierarchy requirements set out in CVM Deliberation No. 604/09, which involves the following aspects:
(i)
The fair value is the price that an asset could be exchanged, a liability settled, between knowledgeable willing parties in a transaction without favoritism; and
59
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(ii)
Hierarchy on 3 levels for measurement of the fair value, according to observable inputs for the valuation of an asset or liability on the date of its measurement.
The valuation established on 3 levels of hierarchy for measurement of the fair value is based on observable and non-observable inputs. Observable inputs reflect market data obtained from independent sources, while non-observable inputs reflect the Company’s market assumptions. These two types of input create the hierarchy of fair value presented below:
(i)
Level 1 - Prices quoted for identical instruments in active markets;
(ii)
Level 2 - Prices quoted in active markets for similar instruments, prices quoted for identical or similar instruments in non-active markets and evaluation models for which inputs are observable; and
(iii)
Level 3 - Instruments whose significant inputs are non-observable.
Management concluded that balances of cash and cash equivalents, accounts receivable and accounts payable are close to their fair value recognition due to the short-term cycle of these operations.
The book value of financing and loans in the financial statements is close to the fair value due to the major portion of the total gross debt bears interest based on the variation of TJLP, LIBOR and CDI, except the capital markets transactions (Bond). On March 31, 2012, the fair value adjustment for Bond (“BRFSBZ”) is represented by a negative impact of R$198,154.
4.6.1.
Comparison between book value and fair value of financial instruments
The comparison between book value and fair value of financial instruments is set forth below:
60
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
03.31.12
|
|
12.31.11
|
|
|
Book
value
|
|
Fair
value
|
|
Book
value
|
|
Fair
value
|
|
|
Cash and cash equivalents
|
|
82,003
|
|
82,003
|
|
68,755
|
|
68,755
|
Marketable securities:
|
|
|
|
|
|
|
|
|
Available for sale
|
|
1,488
|
|
1,488
|
|
1,685
|
|
1,685
|
Trading securities
|
|
306,837
|
|
306,837
|
|
761,850
|
|
761,850
|
Trade accounts receivable, net
|
|
1,295,376
|
|
1,295,376
|
|
1,429,793
|
|
1,429,793
|
Notes receivable
|
|
101,136
|
|
101,136
|
|
100,783
|
|
100,783
|
Short and long term debt
|
|
(3,092,045)
|
|
(3,092,045)
|
|
(3,043,121)
|
|
(3,043,121)
|
Trade accounts payable
|
|
(1,295,973)
|
|
(1,295,973)
|
|
(1,270,696)
|
|
(1,270,696)
|
Other financial assets
|
|
57,040
|
|
57,040
|
|
22,944
|
|
22,944
|
Other financial liabilities
|
|
(136,467)
|
|
(136,467)
|
|
(227,891)
|
|
(227,891)
|
|
|
(2,680,605)
|
|
(2,680,605)
|
|
(2,155,898)
|
|
(2,155,898)
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
|
Book
value
|
|
Fair
value
|
|
Book
value
|
|
Fair
value
|
|
|
Cash and cash equivalents
|
|
1,205,307
|
|
1,205,307
|
|
1,366,843
|
|
1,366,843
|
Marketable securities:
|
|
|
|
|
|
|
|
|
Available for sale
|
|
230,448
|
|
230,448
|
|
235,150
|
|
235,150
|
Trading securities
|
|
528,353
|
|
528,353
|
|
1,054,105
|
|
1,054,105
|
Held to maturity
|
|
262,741
|
|
266,295
|
|
236,804
|
|
241,503
|
Trade accounts receivable, net
|
|
2,662,075
|
|
2,662,075
|
|
3,210,232
|
|
3,210,232
|
Notes receivable
|
|
201,588
|
|
201,588
|
|
204,257
|
|
204,257
|
Short and long term debt
|
|
(8,084,970)
|
|
(8,283,123)
|
|
(8,053,530)
|
|
(8,240,233)
|
Trade accounts payable
|
|
(2,669,993)
|
|
(2,669,993)
|
|
(2,681,343)
|
|
(2,681,343)
|
Other financial assets
|
|
57,040
|
|
57,040
|
|
23,459
|
|
23,459
|
Other financial liabilities
|
|
(172,854)
|
|
(172,854)
|
|
(270,693)
|
|
(270,693)
|
|
|
(5,780,265)
|
|
(5,974,864)
|
|
(4,674,716)
|
|
(4,856,720)
|
4.6.2.
Fair value valuation hierarchy
The table below depicts the overall classification of financial assets and liabilities according to the valuation hierarchy.
61
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
03.31.12
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
Financial assets
|
|
|
|
|
|
|
|
|
Available for sale
|
|
|
|
|
|
|
|
|
Shares
|
|
1,488
|
|
-
|
|
-
|
|
1,488
|
Held for trading
|
|
|
|
|
|
|
|
|
Bank deposit certificates
|
|
-
|
|
211,907
|
|
-
|
|
211,907
|
Financial treasury bills
|
|
94,930
|
|
-
|
|
-
|
|
94,930
|
Other financial assets
|
|
|
|
|
|
|
|
|
Derivatives designed as hedge
|
|
-
|
|
56,210
|
|
-
|
|
56,210
|
Derivatives not designated as hedge
|
|
-
|
|
830
|
|
-
|
|
830
|
|
|
96,418
|
|
268,947
|
|
-
|
|
365,365
|
Liabilities
|
|
|
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
Other financial liabilities
|
|
|
|
|
|
|
|
|
Derivatives designed as hedge
|
|
-
|
|
(97,646)
|
|
-
|
|
(97,646)
|
Derivatives not designated as hedge
|
|
-
|
|
(38,821)
|
|
-
|
|
(38,821)
|
|
|
-
|
|
(136,467)
|
|
-
|
|
(136,467)
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
12.31.11
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
Financial assets
|
|
|
|
|
|
|
|
|
Available for sale
|
|
|
|
|
|
|
|
|
Shares
|
|
1,685
|
|
-
|
|
-
|
|
1,685
|
Held for trading
|
|
|
|
|
|
|
|
|
Bank deposit certificates
|
|
-
|
|
465,804
|
|
-
|
|
465,804
|
Financial treasury bills
|
|
296,046
|
|
-
|
|
-
|
|
296,046
|
Other financial assets
|
|
|
|
|
|
|
|
|
Derivatives designed as hedge
|
|
-
|
|
22,360
|
|
-
|
|
22,360
|
Derivatives not designated as hedge
|
|
-
|
|
584
|
|
-
|
|
584
|
|
|
297,731
|
|
488,748
|
|
-
|
|
786,479
|
Liabilities
|
|
|
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
Other financial liabilities
|
|
|
|
|
|
|
|
|
Derivatives designed as hedge
|
|
-
|
|
(179,238)
|
|
-
|
|
(179,238)
|
Derivatives not designated as hedge
|
|
-
|
|
(48,653)
|
|
-
|
|
(48,653)
|
|
|
-
|
|
(227,891)
|
|
-
|
|
(227,891)
|
62
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
Available for sale
|
|
|
|
|
|
|
|
|
Credit linked notes
|
|
145,528
|
|
-
|
|
-
|
|
145,528
|
Brazilian foreign debt securities
|
|
83,432
|
|
-
|
|
-
|
|
83,432
|
Shares
|
|
1,488
|
|
-
|
|
-
|
|
1,488
|
Held for trading
|
|
|
|
|
|
|
|
|
Bank deposit dertificates
|
|
-
|
|
433,423
|
|
-
|
|
433,423
|
Financial treasury bills
|
|
94,930
|
|
-
|
|
-
|
|
94,930
|
Other financial assets
|
|
|
|
|
|
|
|
|
Derivatives designated as hedge
|
|
-
|
|
56,210
|
|
-
|
|
56,210
|
Derivatives not designated as hedge
|
|
-
|
|
830
|
|
-
|
|
830
|
|
|
325,378
|
|
490,463
|
|
-
|
|
815,841
|
Liabilities
|
|
|
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
Other financial liabilities
|
|
|
|
|
|
|
|
|
Derivatives designated as hedge
|
|
-
|
|
(133,920)
|
|
-
|
|
(133,920)
|
Derivatives not designated as hedge
|
|
-
|
|
(38,934)
|
|
-
|
|
(38,934)
|
|
|
-
|
|
(172,854)
|
|
-
|
|
(172,854)
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
12.31.11
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
Assets
|
|
|
|
|
|
|
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
Available for sale
|
|
|
|
|
|
|
|
|
Credit linked notes
|
|
146,954
|
|
-
|
|
-
|
|
146,954
|
Brazilian foreign debt securities
|
|
86,511
|
|
-
|
|
-
|
|
86,511
|
Shares
|
|
1,685
|
|
-
|
|
-
|
|
1,685
|
Held for trading
|
|
|
|
|
|
|
|
|
Bank deposit certificates
|
|
-
|
|
698,968
|
|
-
|
|
698,968
|
Financial treasury bills
|
|
355,137
|
|
-
|
|
-
|
|
355,137
|
Other financial assets
|
|
|
|
|
|
|
|
|
Derivatives designated as hedge
|
|
-
|
|
22,360
|
|
-
|
|
22,360
|
Derivatives not designated as hedge
|
|
-
|
|
1,099
|
|
-
|
|
1,099
|
|
|
590,287
|
|
722,427
|
|
-
|
|
1,312,714
|
Liabilities
|
|
|
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
Other financial liabilities
|
|
|
|
|
|
|
|
|
Derivatives designated as hedge
|
|
-
|
|
(221,993)
|
|
-
|
|
(221,993)
|
Derivatives not designated as hedge
|
|
-
|
|
(48,700)
|
|
-
|
|
(48,700)
|
|
|
-
|
|
(270,693)
|
|
-
|
|
(270,693)
|
Presented below is the description of the valuation methodologies used by the Company for financial instruments measured at fair value:
(i)
The investments in financial assets in the categories of Brazilian foreign debt securities, National Treasury Certificates (“CTN”), Financial Treasury Notes (“LFT”) and shares are classified at Level 1 of the fair value hierarchy, as the market prices are available in an active market;
63
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN
PORTUGUESE)
ITR –
Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS
S.A.
Explanatory
Notes
(in thousands of Brazilian
Reais)
(ii)
The
investments in financial assets in the categories of Bank Deposit Certificates
(“CDB”) and the repurchase agreements backed by debentures are classified at
Level 2, since the determination of fair value is based on the price quotation
of similar financial instruments in non-active markets; and
(iii)
The derivatives are valued
through existing pricing models widely accepted by financial market and
described in appendix 3 of the Risk Policy. Readily observable market inputs are
used, such as interest rate forecasts, volatility factors and foreign currency
rates. These instruments are classified at Level 2 of the valuation hierarchy,
including swaps, NDFs and options.
4.7.
Credit management
The Company is potentially
subject to the credit risk related to trade accounts receivable, financial
investments and derivative contracts. The Company limits its risk associated
with these financial instruments, allocating them to financial institutions
selected by the criteria of rating and percentage of maximum concentration by
counterparties.
The credit risk concentration
of accounts receivable is minimized due to the diversification of the customer
portfolio and concession of credit to customers with good financial and
operational conditions. The Company does not normally require collateral for
credit sales, yet it has a contracted credit insurance policy for specific
markets.
On March 31, 2012, the Company
had financial investments over R$10,000 at the following financial institutions:
Banco do Brasil, Banco Santander, Banco Itaú Unibanco, Deutsche Bank, Credit
Suisse, Banco Bradesco, BTG Pactual, Citigroup, Erste Bank, Banco do Nordeste,
Caixa Econômica Federal and JP Morgan.
The Company also held
derivative contracts with the following financial institutions: Banco Santander,
Citibank, HSBC, Credit Suisse, Banco do Brasil, Banco Itaú Unibanco, Rabobank,
Merrill Lynch, Deutsche Bank, Banco Votorantim, Banco Bradesco, JP Morgan,
Morgan Stanley, Standard Bank, Goldman Sachs, Barclays Bank, ING Bank and Banco
Safra.
4.8.
Liquidity risk management
Liquidity risk management aims
to reduce the impacts caused by events which may affect the Company’s cash flow
performance.
64
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The Company has identified market risk factors which are associated to future cash flow that may jeopardize its liquidity and calculates the Cash Flow at Risk (“CFAR”) on a twelve-month basis aiming to verify potential cash flow forecast deviations. The Company determined that the minimum value of its cash availability should consider mainly the average monthly revenue and EBITDA for the last twelve-month period.
Derivatives transactions may demand payments of periodic adjustments. Currently, the Company holds only BM&F operations with daily adjustments. In order to control the adjustments, the Company utilizes Value at Risk methodology (“VaR”), which statistically measures potential maximum adjustments to be paid in a 1 to 21-day interval.
The allocation of financial investments among counterparts is conservative and seek the liquidity and profitability of these assets avoiding concentration.
The Company maintains its leverage levels in a manner to not jeopardize the ability to honor commitments and obligations. On March 31, 2012, the long term debt portion accounted for 56% of the total outstanding debt with an average term greater than 3.3 years.
The table below summarizes the commitments and contractual obligations that may impact the Company’s liquidity as of March 31, 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
03.31.12
|
|
|
Book
value
|
|
Cash flow
contracted
|
|
Up to 9
months
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
After
5 years
|
Non derivatives financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and financing
|
|
3,092,045
|
|
3,306,902
|
|
1,480,958
|
|
527,228
|
|
452,923
|
|
78,752
|
|
64,980
|
|
702,061
|
Trade accounts payable
|
|
1,295,973
|
|
1,295,973
|
|
1,295,973
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Capital lease
|
|
62,226
|
|
70,558
|
|
25,076
|
|
26,327
|
|
8,628
|
|
6,260
|
|
4,267
|
|
-
|
Operational lease
|
|
213,535
|
|
213,535
|
|
50,756
|
|
52,097
|
|
38,667
|
|
24,190
|
|
13,418
|
|
34,407
|
|
Derivatives financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Designated as hedge accounting
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
|
54,631
|
|
77,566
|
|
24,467
|
|
18,367
|
|
8,077
|
|
8,067
|
|
8,111
|
|
10,477
|
Currency derivatives (NDF)
|
|
43,015
|
|
94,177
|
|
67,554
|
|
26,623
|
|
-
|
|
-
|
|
-
|
|
-
|
Not designated as hedge accounting
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency derivatives (NDF)
|
|
34
|
|
228
|
|
228
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Currency derivatives (Future)
|
|
513
|
|
513
|
|
513
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Interest rate derivatives
|
|
37,357
|
|
8,897
|
|
(20,867)
|
|
29,039
|
|
723
|
|
2
|
|
-
|
|
-
|
Commodities derivatives
|
|
917
|
|
917
|
|
917
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
65
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
|
Book
value
|
|
Cash flow
contracted
|
|
Up to 9
months
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
After 5
years
|
Non derivatives financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and financing
|
|
6,252,629
|
|
6,800,946
|
|
3,295,963
|
|
987,835
|
|
715,402
|
|
315,321
|
|
118,852
|
|
1,367,573
|
Bonds BRF
|
|
1,365,855
|
|
2,159,189
|
|
49,538
|
|
99,077
|
|
99,077
|
|
99,077
|
|
99,077
|
|
1,713,343
|
Bonds Sadia
|
|
466,486
|
|
627,769
|
|
31,317
|
|
31,317
|
|
31,317
|
|
31,317
|
|
31,317
|
|
471,184
|
Trade accounts payable
|
|
2,669,993
|
|
2,669,993
|
|
2,669,993
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Capital lease
|
|
98,547
|
|
110,803
|
|
43,583
|
|
46,831
|
|
9,862
|
|
6,260
|
|
4,267
|
|
-
|
Operational lease
|
|
240,456
|
|
240,456
|
|
57,883
|
|
54,653
|
|
40,819
|
|
26,320
|
|
15,548
|
|
45,233
|
|
Derivatives financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Designated as hedge accounting
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
|
90,905
|
|
133,452
|
|
28,579
|
|
26,758
|
|
16,375
|
|
16,458
|
|
16,409
|
|
28,873
|
Currency derivatives (NDF)
|
|
43,015
|
|
94,177
|
|
67,554
|
|
26,623
|
|
-
|
|
-
|
|
-
|
|
-
|
Not designated as hedge accounting
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency derivatives (NDF)
|
|
147
|
|
3,022
|
|
3,022
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Currency derivatives (future)
|
|
513
|
|
513
|
|
513
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Interest rate derivatives
|
|
37,357
|
|
8,897
|
|
(20,867)
|
|
29,039
|
|
723
|
|
2
|
|
-
|
|
-
|
Commodities derivatives
|
|
917
|
|
917
|
|
917
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
4.9.
Commodity price risk management
In the regular course of its operations, the Company purchases commodities, mainly corn, soymeal and live hog, which are some of the individual components of production cost.
Corn and soymeal prices are subject to volatility resulting from weather conditions, crop yield, transportation and storage costs,
government’s agricultural policy, foreign exchange rates and the prices of these commodities on the international market, among others factors. The prices of hog acquired from third parties are subject to market conditions and are influenced by internal availability and levels of demand in the international market, and other aspects.
The Risk Policy establishes limits for hedging the corn and soymeal purchase flow, aiming to reduce the impact resulting from a price increase of these raw materials, and may utilize derivative instruments or inventory management for this purpose. Currently, the Management of inventory levels is used as a hedging instrument.
During the first quarter of 2012, the Company utilized derivative instruments to mitigate the exposure to live cattle prices variation.
On March 31, 2012, the Company held a short position in the BM&F of 1,305
future contracts (150 contracts as of December 31, 2011) with maturity dates between April and October 2012.
In the counter market, the Company held a short position of 50 contracts with maturity dates in 2012. Additionally, through the utilization of options, the Company also held a short position of 1,600 allotments (600 allotments as of December 31, 2011), note 4.3.2.
66
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
4.10.
Table of sensitivity analysis
The Company has financing and loans and receivables denominated in foreign currency and in order to mitigate the risks resulting from exchange rate exposure it contracts and derivative financial instruments.
The Company understands that the current interest rate fluctuations do not significantly affect its financial results since it opted to change to fixed rate a considerable part of its floating interest rates debts by using derivative transactions (interest rates swaps). The Company designates such derivatives as hedge accounting and, therefore, the effectiveness is monitored through prospective and retrospective tests.
In the table depicted below, five scenarios are considered for the next twelve-month period, considering the variations of the quotations of the parity between the Brazilian Reais and U.S. Dollar, Brazilian Reais and Euro and Brazilian Reais and Pounds, whereas the most likely scenario is that one adopted by the Company. The total of export sales analyzed corresponds to the total of derivative financial instruments increased by the amortization flow of PPEs designated as hedge accounting.
67
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
Parity - Brazilian Reais x U.S. Dollar
|
|
|
|
1.8221
|
|
1.6399
|
|
1.3666
|
|
2.2776
|
|
2.7332
|
Transaction/Instrument
|
|
Risk
|
|
Scenario I
|
|
Scenario II
|
|
Scenario III
|
|
Scenario IV
|
|
Scenario V
|
|
|
|
|
(probable)
|
|
(10% appreciation)
|
|
(25% apreciation)
|
|
(25% devaluation)
|
|
(50% devaluation)
|
NDF (hedge accounting)
|
|
Devaluation of R$
|
|
83,483
|
|
335,844
|
|
714,385
|
|
(547,420)
|
|
(1,178,321)
|
Pre payment export
|
|
Devaluation of R$
|
|
(11,747)
|
|
96,684
|
|
259,330
|
|
(282,824)
|
|
(553,901)
|
Exports
|
|
Appreciation of R$
|
|
(84,272)
|
|
(378,933)
|
|
(820,924)
|
|
652,381
|
|
1,389,033
|
Net effect
|
|
|
|
(12,536)
|
|
53,595
|
|
152,791
|
|
(177,863)
|
|
(343,189)
|
Statement of income
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Shareholders' equity
|
|
|
|
(12,536)
|
|
53,595
|
|
152,791
|
|
(177,863)
|
|
(343,189)
|
|
Parity - Brazilian Reais x Euro
|
|
|
|
2.4300
|
|
2.1870
|
|
1.8225
|
|
3.0375
|
|
3.6450
|
Transaction/Instrument
|
|
Risk
|
|
Scenario I
|
|
Scenario II
|
|
Scenario III
|
|
Scenario IV
|
|
Scenario V
|
|
|
|
|
(probable)
|
|
(10% appreciation)
|
|
(25% apreciation)
|
|
(25% devaluation)
|
|
(50% devaluation)
|
NDF (hedge accounting)
|
|
Devaluation of R$
|
|
24,299
|
|
76,787
|
|
155,519
|
|
(106,921)
|
|
(238,141)
|
Exports
|
|
Appreciation of R$
|
|
(24,299)
|
|
(76,787)
|
|
(155,519)
|
|
106,921
|
|
238,141
|
Net effect
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Statement of income
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Shareholders' equity
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Parity - Brazilian Reais x Pound
|
|
|
|
2.9132
|
|
2.6219
|
|
2.1849
|
|
3.6415
|
|
4.3698
|
Transaction/Instrument
|
|
Risk
|
|
Scenario I
|
|
Scenario II
|
|
Scenario III
|
|
Scenario IV
|
|
Scenario V
|
|
|
|
|
(probable)
|
|
(10% appreciation)
|
|
(25% apreciation)
|
|
(25% devaluation)
|
|
(50% devaluation)
|
NDF (hedge accounting)
|
|
Devaluation of R$
|
|
2,247
|
|
24,708
|
|
58,399
|
|
(53,905)
|
|
(110,057)
|
Exports
|
|
Appreciation of R$
|
|
(2,247)
|
|
(24,708)
|
|
(58,399)
|
|
53,905
|
|
110,057
|
Net effect
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Statement of income
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Shareholders' equity
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
68
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
5.
SEGMENT INFORMATION
The operating segments are reported consistently with the management reports provided to Board and Directors for assessment the performance of each segment and allocating resources.
In order to reflect the organizational changes in the Company, during the last quarter of 2011, the segment information began to be prepared considering 4 reportable segments, as follows: domestic market, foreign markets, dairy products and food service, therefore the information as of March 31, 2011 is being restated. The reportable segments identified primarily observe division by sales channel.
(i)
Domestic market:
includes the Company´s sales for inside the Brazilian territory, except those relating to products in the dairy and the food service channel.
(ii)
Foreign market:
includes the Company´s sales for exports and those generated outside the national territory, except those relating to products in the dairy and the food service channel.
(iii)
Dairy products:
includes the Company´s sales of milk and dairy products produced domestically and abroad.
(iv)
Food service:
includes the Company's sales of all products in its portfolio, except in the category of dairy products, generated in the domestic and foreign customers for food service category that includes bars, restaurants, kitchens, etc.
Hence, these segments are subdivided according to the nature of the products and characteristics described below:
(i)
Poultry:
involves the production and trade of whole birds and poultry cuts in natura.
(ii)
Pork and beef cuts:
involves the production and trade of cuts in natura.
(iii)
Processed:
involves the production and trade of processed foods, frozen and processed derivatives of poultry, pigs and cattle.
(iv)
Others processed:
involves the production and trade of processed foods like margarine and vegetable products and soy.
(v)
Milk:
involves the production and trade of pasteurized and UHT milk.
69
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
(vi)
Dairy products and other drinks
: involves the production and trade of foods milk derivatives, including flavored milk, yogurts, fruit juices, soy-based beverages, cheeses and desserts.
(vii)
Others:
involves the production and trade of animal feed, soy meal and refined soy flour.
The net sales for each one of the reportable operating segments are presented below:
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
Net sales
|
|
03.31.12
|
|
03.31.11
|
Domestic market
|
|
|
|
|
Poultry
|
|
315,726
|
|
299,668
|
Porks/beef and fish
|
|
165,114
|
|
179,812
|
Processed products
|
|
1,640,132
|
|
1,617,497
|
Other processed
|
|
677,914
|
|
460,021
|
Other
|
|
192,587
|
|
133,460
|
|
|
2,991,473
|
|
2,690,458
|
Foreign market
|
|
|
|
|
Poultry
|
|
1,538,211
|
|
1,620,944
|
Porks/beef
|
|
412,175
|
|
358,946
|
Processed products
|
|
363,260
|
|
390,452
|
Other processed
|
|
45,438
|
|
12,229
|
|
|
2,359,084
|
|
2,382,571
|
Dairy products
|
|
|
|
|
Milk
|
|
337,945
|
|
431,558
|
Dairy products
|
|
295,819
|
|
196,257
|
|
|
633,764
|
|
627,815
|
Food service
|
|
|
|
|
Poultry
|
|
84,775
|
|
73,726
|
Porks/beef and fish
|
|
53,350
|
|
35,227
|
Processed products
|
|
176,622
|
|
199,524
|
Other processed
|
|
38,054
|
|
11,173
|
|
|
352,801
|
|
319,650
|
|
|
6,337,122
|
|
6,020,494
|
70
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The operating results before financial income (expenses) and others for each one of the reportable operating segments are presented below:
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
Operating income
|
|
|
|
|
Domestic market
|
|
285,006
|
|
287,246
|
Foreign market
|
|
(54,117)
|
|
194,047
|
Dairy products
|
|
(1,638)
|
|
(844)
|
Food service
|
|
38,779
|
|
44,545
|
|
|
268,030
|
|
524,994
|
No customer was individually responsible for more than 5% of the total revenue earned in the three month period ended March 31, 2012.
Net revenues from exports originate in the segments of the foreign market, dairy products and food service, as shown below:
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
Export net income per market
|
|
|
|
|
Foreign market
|
|
2,359,084
|
|
2,382,571
|
Dairy products
|
|
117
|
|
5
|
Food service
|
|
58,855
|
|
45,896
|
|
|
2,418,056
|
|
2,428,472
|
Export net income by region is presented below:
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
Export net income per region
|
|
|
|
|
Europe
|
|
432,421
|
|
419,005
|
Far East
|
|
565,656
|
|
514,534
|
Middle East
|
|
735,130
|
|
816,011
|
Eurasia (including Russia)
|
|
164,613
|
|
234,970
|
America / Africa / Other
|
|
520,236
|
|
443,952
|
|
|
2,418,056
|
|
2,428,472
|
The goodwill originated from the expectation of future profitability, as well as the intangible assets with indefinite useful life (trademarks and patents), were allocated to the reportable operating segments, taking into account the nature of the products manufactured in each segment (cash-generating unit). The allocation of intangible assets is presented below:
71
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Goodwill
|
|
Trademarks
|
|
|
|
Total
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Domestic market
|
|
1,153,790
|
|
1,153,790
|
|
1,065,478
|
|
1,065,478
|
|
2,219,268
|
|
2,219,268
|
Foreign market
|
|
1,075,893
|
|
1,074,384
|
|
190,522
|
|
190,522
|
|
1,266,415
|
|
1,264,906
|
Dairy products
|
|
664,102
|
|
664,102
|
|
-
|
|
-
|
|
664,102
|
|
664,102
|
Food service
|
|
81,539
|
|
81,539
|
|
-
|
|
-
|
|
81,539
|
|
81,539
|
|
|
2,975,324
|
|
2,973,815
|
|
1,256,000
|
|
1,256,000
|
|
4,231,324
|
|
4,229,815
|
Information referring to the total assets by reportable segments is not being presented, as it is not comprised in the set of information made available to the Company’s Management, which make investment decisions on a consolidated basis.
6.
BUSINESS COMBINATION AND OTHER ACQUISITIONS
During the first quarter of 2012, there were no changes deriving from the goodwill allocation of the acquisition of the subsidiaries Avex, Dánica group and Heloísa.
6.1
Acquisition of assets related to integration, production and slaughter of porks
With the purpose of acquiring assets related to integration, production and slaughter of porks, the Company made advanced payments in the amount of R$180,000.
CADE decided that this transaction could cause an adverse impact to the competitive market and rejected the acquisition. Thus, the Company and the seller dedicated their best efforts in order to identify another buyer for these assets and such negotiations are in an advanced stage. Management expects that the transaction will be concluded by the first semester of 2012.
The advanced payments are secured by statutory liens that corresponds to R$205,000.
Management does not expect any loss resulting from this operation.
72
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
7.
CASH AND CASH EQUIVALENTS
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Average
rate p.a.
|
|
Parent company
|
|
|
|
Consolidated
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Cash and bank accounts
|
|
|
|
|
|
|
|
|
|
|
U.S. Dollar
|
|
-
|
|
182
|
|
187
|
|
2,868
|
|
17,221
|
Brazilian Reais
|
|
-
|
|
32,523
|
|
16,973
|
|
69,852
|
|
65,174
|
Euro
|
|
-
|
|
159
|
|
240
|
|
238
|
|
43,746
|
Others
|
|
-
|
|
-
|
|
-
|
|
18,558
|
|
3,928
|
|
|
|
|
32,864
|
|
17,400
|
|
91,516
|
|
130,069
|
Highly liquid investments
|
|
|
|
|
|
|
|
|
|
|
In Brazilian Reais
|
|
|
|
|
|
|
|
|
|
|
Investment funds
|
|
10.27%
|
|
11,442
|
|
11,313
|
|
12,737
|
|
12,367
|
|
|
|
|
11,442
|
|
11,313
|
|
12,737
|
|
12,367
|
In U.S. Dollar
|
|
|
|
|
|
|
|
|
|
|
Interest bearing account
|
|
0.04%
|
|
-
|
|
-
|
|
55,341
|
|
42,065
|
Fixed term deposit
|
|
1.13%
|
|
18,221
|
|
-
|
|
296,440
|
|
371,344
|
Overnight
|
|
0.10%
|
|
10,223
|
|
28,001
|
|
485,317
|
|
458,236
|
In Euro
|
|
|
|
|
|
|
|
|
|
|
Interest bearing account
|
|
0.10%
|
|
9,253
|
|
12,041
|
|
82,889
|
|
235,237
|
Fixed term deposit
|
|
0.53%
|
|
-
|
|
-
|
|
128,360
|
|
82,372
|
Overnight
|
|
0.13%
|
|
-
|
|
-
|
|
7,291
|
|
17,815
|
Other Currencies
|
|
|
|
|
|
|
|
|
|
|
Interest bearing account
|
|
0.01%
|
|
-
|
|
-
|
|
45,416
|
|
17,338
|
|
|
|
|
37,697
|
|
40,042
|
|
1,101,054
|
|
1,224,407
|
|
|
|
|
82,003
|
|
68,755
|
|
1,205,307
|
|
1,366,843
|
73
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
8.
MARKETABLE SECURITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WATM
(*)
|
|
Currency
|
|
Average
interest rate
p.a.
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
Parent company
|
|
Consolidated
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit linked notes
|
|
4.60
|
|
US$
|
|
3.98%
|
|
-
|
|
-
|
|
145,528
|
|
146,954
|
Brazilian foreign debt securities
|
|
2.21
|
|
US$
|
|
9.28%
|
|
-
|
|
-
|
|
83,432
|
|
86,511
|
Shares
|
|
-
|
|
R$
|
|
-
|
|
1,488
|
|
1,685
|
|
1,488
|
|
1,685
|
|
|
|
|
|
|
|
|
1,488
|
|
1,685
|
|
230,448
|
|
235,150
|
Held for trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank deposit certificates
|
|
1.91
|
|
R$
|
|
9.96%
|
|
211,907
|
|
465,804
|
|
433,423
|
|
698,968
|
Financial treasury bills
|
|
1.83
|
|
R$
|
|
9.65%
|
|
94,930
|
|
296,046
|
|
94,930
|
|
355,137
|
|
|
|
|
|
|
|
|
306,837
|
|
761,850
|
|
528,353
|
|
1,054,105
|
Held to maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit linked notes
|
|
1.01
|
|
US$
|
|
4.97%
|
|
-
|
|
-
|
|
141,778
|
|
166,784
|
National treasury certificates
|
|
8.03
|
|
R$
|
|
15.20%
|
|
-
|
|
-
|
|
72,083
|
|
70,020
|
Financial treasury bills
|
|
5.52
|
|
R$
|
|
9.65%
|
|
-
|
|
-
|
|
48,880
|
|
-
|
|
|
|
|
|
|
|
|
-
|
|
-
|
|
262,741
|
|
236,804
|
|
|
|
|
|
|
|
|
308,325
|
|
763,535
|
|
1,021,542
|
|
1,526,059
|
Current
|
|
|
|
|
|
|
|
308,325
|
|
763,535
|
|
819,597
|
|
1,372,671
|
Non-current
|
|
|
|
|
|
|
|
-
|
|
-
|
|
201,945
|
|
153,388
|
(*)
Weighted average maturity in years.
There were no changes in the characteristics of the modalities of marketable securities presented above, when compared to the information disclosed in the annual financial statements as of December 31, 2011 (note 8).
The national treasury certificates classified in subgroup held to maturity are pledged as collateral for the loan obtained through the Special Program Asset Restructuring ("PESA"), see note 19 of these quarterly financial information.
The unrealized gain by the change in fair value of the marketable securities available for sale, recorded in equity as of March 31, 2012 is R$9,064, net of income tax of R$636.
Additionally, on March 31, 2012, of the total of marketable securities, R$41,755 (R$88,177 as of December 31, 2011) were pledged as collateral for futures contract operations in U.S. Dollars and live cattle, traded on the Futures and Commodities Exchange (“BM&F”).
On March 31, 2012, the maturities of the non-current marketable securities the consolidated balance sheet is as follows:
|
|
|
BR GAAP and IFRS
|
Maturities
|
Consolidated
|
2013
|
80,983
|
2015 onwards
|
120,962
|
|
201,945
|
74
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The Company conducted an analysis of sensitivity to foreign exchange rate as presented in note 4.10.
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent Company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Current
|
|
|
|
|
|
|
|
|
Domestic third parties
|
|
722,535
|
|
949,489
|
|
1,414,546
|
|
1,863,996
|
Domestic related parties
|
|
87,562
|
|
44,959
|
|
-
|
|
-
|
Foreign third parties
|
|
51,420
|
|
37,422
|
|
1,279,186
|
|
1,375,472
|
Foreign related parties
|
|
438,571
|
|
409,061
|
|
-
|
|
-
|
( - ) Estimated losses from doubtful accounts
|
|
(15,097)
|
|
(13,557)
|
|
(42,079)
|
|
(31,655)
|
|
|
1,284,991
|
|
1,427,374
|
|
2,651,653
|
|
3,207,813
|
Credit notes
|
|
34,401
|
|
25,236
|
|
49,111
|
|
56,935
|
|
|
1,319,392
|
|
1,452,610
|
|
2,700,764
|
|
3,264,748
|
Non-current
|
|
|
|
|
|
|
|
|
Domestic third parties
|
|
53,939
|
|
51,802
|
|
85,727
|
|
53,060
|
Foreign third parties
|
|
484
|
|
499
|
|
617
|
|
3,948
|
( - ) Adjustment to present value
|
|
(661)
|
|
(670)
|
|
(661)
|
|
(670)
|
( - ) Estimated losses from doubtful accounts
|
|
(43,377)
|
|
(49,212)
|
|
(75,261)
|
|
(53,919)
|
|
|
10,385
|
|
2,419
|
|
10,422
|
|
2,419
|
Credit notes
|
|
66,735
|
|
75,547
|
|
152,477
|
|
147,322
|
|
|
77,120
|
|
77,966
|
|
162,899
|
|
149,741
|
9.
TRADE ACCOUNTS RECEIVABLE AND OTHER
The rollforward of estimated losses from doubtful accounts is presented below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Beginning balance
|
|
62,769
|
|
38,613
|
|
85,574
|
|
62,839
|
Additions
|
|
11,680
|
|
73,712
|
|
57,883
|
|
112,406
|
Reversals
|
|
(12,608)
|
|
(34,935)
|
|
(19,562)
|
|
(65,279)
|
Write-offs
|
|
(3,353)
|
|
(14,677)
|
|
(6,428)
|
|
(24,596)
|
Exchange rate variation
|
|
(14)
|
|
56
|
|
(127)
|
|
204
|
Ending balance
|
|
58,474
|
|
62,769
|
|
117,340
|
|
85,574
|
The expense of the estimated losses on doubtful accounts was recorded as selling expenses in the statement of income. When efforts to recover accounts receivable prove unsuccessful, the amounts credited to estimated losses on doubtful accounts are generally reversed against the permanent write-off of the invoice.
75
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
Breakdown by maturity of overdue amounts and not included in estimated losses on doubtful accounts:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
60 to 90 days
|
|
-
|
|
-
|
|
-
|
|
14,855
|
91 to 120 days
|
|
687
|
|
2,233
|
|
4,121
|
|
3,468
|
121 to 180 days
|
|
18
|
|
1,250
|
|
5,431
|
|
1,317
|
181 to 360 days
|
|
926
|
|
602
|
|
900
|
|
1,469
|
More than 360 days
|
|
1,417
|
|
1,397
|
|
642
|
|
15,466
|
|
|
3,048
|
|
5,482
|
|
11,094
|
|
36,575
|
The receivables excluded from allowance for estimated losses on doubtful accounts are secured by letters of credit issued by financial institutions and by credit insurance contracted with insurance companies.
The breakdown of accounts receivable by maturity is as follows:
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Current
|
|
1,269,517
|
|
1,404,775
|
|
2,477,570
|
|
2,924,510
|
Overdue:
|
|
|
|
|
|
|
|
|
From 01 to 60 days
|
|
24,373
|
|
22,169
|
|
152,502
|
|
251,163
|
From 61 to 120 days
|
|
7,958
|
|
7,488
|
|
37,184
|
|
30,298
|
From 121 to 180 days
|
|
3,047
|
|
4,388
|
|
13,737
|
|
13,064
|
From 181 to 360 days
|
|
5,437
|
|
4,366
|
|
9,039
|
|
8,517
|
More than 360 days
|
|
44,179
|
|
50,046
|
|
90,044
|
|
68,924
|
( - ) Adjustment to present value
|
|
(661)
|
|
(670)
|
|
(661)
|
|
(670)
|
( - ) Estimated losses with doubtful accounts
|
|
(58,474)
|
|
(62,769)
|
|
(117,340)
|
|
(85,574)
|
|
|
1,295,376
|
|
1,429,793
|
|
2,662,075
|
|
3,210,232
|
10.
INVENTORIES
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Finished goods
|
|
749,162
|
|
708,162
|
|
1,863,977
|
|
1,633,492
|
Goods for resale
|
|
6,776
|
|
7,270
|
|
14,476
|
|
8,575
|
Work in process
|
|
87,137
|
|
85,700
|
|
150,691
|
|
316,875
|
Raw materials
|
|
180,121
|
|
112,490
|
|
502,902
|
|
214,630
|
Packaging materials
|
|
41,375
|
|
61,539
|
|
72,290
|
|
99,925
|
Secondary materials
|
|
74,556
|
|
71,341
|
|
191,093
|
|
153,898
|
Warehouse
|
|
73,676
|
|
71,972
|
|
115,133
|
|
112,001
|
Goods in transit
|
|
9,254
|
|
4,291
|
|
38,415
|
|
26,147
|
Imports in transit
|
|
32,298
|
|
13,357
|
|
81,405
|
|
83,640
|
Advances to suppliers
|
|
23,813
|
|
30,028
|
|
27,116
|
|
30,028
|
|
|
1,278,168
|
|
1,166,150
|
|
3,057,498
|
|
2,679,211
|
76
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The amount of the write-offs of inventories recognized in cost of sales during the three month period ended on March 31, 2012, totaled R$2,732,226 at the parent company and R$4,993,642 in the consolidated (on March 31, 2011, R$2,371,481 at the parent company and R$4,474,918 in the consolidated), such amounts include the additions and reversals of inventory provisions presented in the table below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
03.31.12
|
Provision for losses to the disposable value
|
|
(19,899)
|
|
(8,604)
|
|
10,704
|
|
(17,799)
|
Provision for deterioration
|
|
(3,404)
|
|
(4,010)
|
|
98
|
|
(7,316)
|
Provision for obsolescence
|
|
(629)
|
|
(1,033)
|
|
281
|
|
(1,381)
|
|
|
(23,932)
|
|
(13,647)
|
|
11,083
|
|
(26,496)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
Write-offs
|
|
Exchange rate
variation
|
|
03.31.12
|
Provision for losses to the disposable value
|
|
(41,963)
|
|
(28,337)
|
|
37,695
|
|
-
|
|
204
|
|
(32,401)
|
Provision for deterioration
|
|
(12,841)
|
|
(7,089)
|
|
5,085
|
|
(11)
|
|
16
|
|
(14,840)
|
Provision for obsolescence
|
|
(3,223)
|
|
(2,593)
|
|
1,497
|
|
-
|
|
-
|
|
(4,319)
|
|
|
(58,027)
|
|
(38,019)
|
|
44,277
|
|
(11)
|
|
220
|
|
(51,560)
|
The additions presented in the provision for inventory losses are mainly related to the decrease in the foreign market sales price of chicken griller which occurred in January 2012. The reversals recorded during the quarter are related to the decrease in the critical inventory of chicken griller and to the recovery of the foreign market sales price as from March.
Additionally, during the three month period ended March 31, 2012, there were write-offs of inventories in the amount of R$8,623 at the parent company and R$13,729 in the consolidated (on March 31, 2011, R$9,799 at the parent company and R$10,148 in the consolidated), referring to items suffering deterioration, which have not been recorded in the provision.
Management expects inventories to be recovered in a period of less than 12 months.
11.
BIOLOGICAL ASSETS
The group of biological assets of the Company comprises living animals which are segregated by the categories: poultry, pork and cattle. In addition, these categories were separated into consumable and for production.
In Management’s opinion, the fair value of the biological assets is substantially represented by the cost of formation, mainly due to the short life cycle of the animals
and to the fact that a significant portion of the profitability of our products derives from the manufacturing process and not from obtaining in natura meat (raw materials at slaughtering point). This opinion is supported by a fair value appraisal report prepared by an independent expert, which presented an immaterial difference between the two methodologies. Therefore, Management maintained the biological assets at formation cost.
77
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
During the three month period ended March 31, 2012, Management did not identify any event that could impact the business model or the assumptions utilized in the analysis performed as of December 31, 2011, and considering this, did not update the independent appraisal report that supports the accounting practice adopted by the Company.
The quantities and accounting balances per category of biological assets are presented below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
03.31.12
|
|
|
|
12.31.11
|
|
|
Quantity
|
|
Value
|
|
Quantity
|
|
Value
|
Consumable biological assets
|
|
|
|
|
|
|
|
|
Immature poultry
|
|
96,411
|
|
217,757
|
|
103,087
|
|
207,615
|
Immature pork
|
|
1,665
|
|
259,107
|
|
1,646
|
|
257,692
|
Immature cattle
|
|
75
|
|
84,864
|
|
75
|
|
89,176
|
Total current
|
|
98,151
|
|
561,728
|
|
104,808
|
|
554,483
|
Production biological assets
|
|
|
|
|
|
|
|
|
Immature poultry
|
|
3,942
|
|
51,326
|
|
3,756
|
|
46,987
|
Mature poultry
|
|
5,357
|
|
62,564
|
|
5,569
|
|
62,632
|
Immature pork
|
|
5
|
|
1,073
|
|
5
|
|
945
|
Mature pork
|
|
165
|
|
69,732
|
|
165
|
|
68,624
|
Total non-current
|
|
9,469
|
|
184,695
|
|
9,495
|
|
179,188
|
|
|
107,620
|
|
746,423
|
|
114,303
|
|
733,671
|
78
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
|
Quantity
|
|
Value
|
|
Quantity
|
|
Value
|
Consumable biological assets
|
|
|
|
|
|
|
|
|
Immature poultry
|
|
196,821
|
|
503,406
|
|
209,732
|
|
485,359
|
Immature pork
|
|
3,819
|
|
591,892
|
|
3,803
|
|
581,546
|
Immature cattle
|
|
75
|
|
84,864
|
|
75
|
|
89,176
|
Total current
|
|
200,715
|
|
1,180,162
|
|
213,610
|
|
1,156,081
|
Production biological assets
|
|
|
|
|
|
|
|
|
Immature poultry
|
|
7,847
|
|
101,912
|
|
7,643
|
|
97,458
|
Mature poultry
|
|
11,514
|
|
135,307
|
|
12,006
|
|
132,043
|
Immature pork
|
|
127
|
|
18,397
|
|
125
|
|
18,370
|
Mature pork
|
|
412
|
|
144,236
|
|
409
|
|
139,512
|
Total non-current
|
|
19,900
|
|
399,852
|
|
20,183
|
|
387,383
|
|
|
220,615
|
|
1,580,014
|
|
233,793
|
|
1,543,464
|
79
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The rollforward of biological assets for the period is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
Current
|
|
Non-current
|
|
|
Poultry
|
|
Pork
|
|
Cattle
|
|
Total
|
|
Poultry
|
|
Pork
|
|
Total
|
Balance as of 12.31.11
|
|
207,615
|
|
257,692
|
|
89,176
|
|
554,483
|
|
109,619
|
|
69,569
|
|
179,188
|
Increase due to acquisition
|
|
22,089
|
|
114,081
|
|
61,245
|
|
197,415
|
|
7,157
|
|
11,688
|
|
18,845
|
Increase due to reproduction,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
consuption of ration, medication and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
remuneration of partnership
|
|
640,844
|
|
164,205
|
|
11,650
|
|
816,699
|
|
37,813
|
|
130
|
|
37,943
|
Accumulated amortization
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(35,139)
|
|
(5,694)
|
|
(40,833)
|
Transfer between current and non-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
current
|
|
5,560
|
|
4,888
|
|
-
|
|
10,448
|
|
(5,560)
|
|
(4,888)
|
|
(10,448)
|
Reduction due to slaughtering
|
|
(658,351)
|
|
(281,759)
|
|
(77,207)
|
|
(1,017,317)
|
|
-
|
|
-
|
|
-
|
Balance as of 03.31.12
|
|
217,757
|
|
259,107
|
|
84,864
|
|
561,728
|
|
113,890
|
|
70,805
|
|
184,695
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Current
|
|
Non-current
|
|
|
Poultry
|
|
Pork
|
|
Cattle
|
|
Total
|
|
Poultry
|
|
Pork
|
|
Total
|
Balance as of 12.31.11
|
|
485,359
|
|
581,546
|
|
89,176
|
|
1,156,081
|
|
229,501
|
|
157,882
|
|
387,383
|
Increase due to acquisition
|
|
61,913
|
|
254,049
|
|
61,245
|
|
377,207
|
|
12,945
|
|
15,565
|
|
28,510
|
Increase due to reproduction,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
consuption of ration, medication and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
remuneration of partnership
|
|
1,355,978
|
|
428,415
|
|
11,650
|
|
1,796,043
|
|
78,057
|
|
10,136
|
|
88,193
|
Accumulated amortization
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(72,669)
|
|
(9,899)
|
|
(82,568)
|
Transfer between current and non-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
current
|
|
10,615
|
|
11,051
|
|
-
|
|
21,666
|
|
(10,615)
|
|
(11,051)
|
|
(21,666)
|
Reduction due to slaughtering
|
|
(1,410,459)
|
|
(683,169)
|
|
(77,207)
|
|
(2,170,835)
|
|
-
|
|
-
|
|
-
|
Balance as of 03.31.12
|
|
503,406
|
|
591,892
|
|
84,864
|
|
1,180,162
|
|
237,219
|
|
162,633
|
|
399,852
|
The costs of the breeding animals are amortized using the straight-line method for a period from 15 to 30 months.
12.
RECOVERABLE TAXES
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
State ICMS (VAT)
|
|
255,644
|
|
254,809
|
|
813,278
|
|
754,329
|
PIS and COFINS (Federal Taxes to Fund Social Programs)
|
|
653,541
|
|
608,880
|
|
765,905
|
|
755,270
|
Withholding income tax and social contribution
|
|
122,896
|
|
179,096
|
|
192,694
|
|
211,047
|
IPI (Federal VAT)
|
|
2,170
|
|
1,552
|
|
58,057
|
|
57,241
|
IOF (Tax on Financial Transactions)
|
|
15,762
|
|
-
|
|
15,762
|
|
-
|
Import duty
|
|
608
|
|
273
|
|
12,952
|
|
12,149
|
Other
|
|
841
|
|
826
|
|
2,412
|
|
14,334
|
( - ) Allowance for losses
|
|
(23,340)
|
|
(23,340)
|
|
(161,581)
|
|
(151,829)
|
|
|
1,028,122
|
|
1,022,096
|
|
1,699,479
|
|
1,652,541
|
|
Current
|
|
707,193
|
|
572,720
|
|
1,034,826
|
|
907,929
|
Non-current
|
|
320,929
|
|
449,376
|
|
664,653
|
|
744,612
|
80
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The rollforward of the allowance for losses is presented below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
03.31.12
|
Allowance for losses - State ICMS (VAT)
|
|
(126,792)
|
|
(9,271)
|
|
1,618
|
|
(134,445)
|
Allowance for losses - Withholding income tax and social
|
|
|
|
|
|
|
|
|
contribution
|
|
-
|
|
(321)
|
|
-
|
|
(321)
|
Allowance for losses - PIS and COFINS
|
|
(12,865)
|
|
(3,994)
|
|
6,561
|
|
(10,298)
|
Allowance for losses - IPI (Federal VAT)
|
|
(12,172)
|
|
(2,601)
|
|
-
|
|
(14,773)
|
Allowance for losses other
|
|
-
|
|
(1,744)
|
|
-
|
|
(1,744)
|
|
|
(151,829)
|
|
(17,931)
|
|
8,179
|
|
(161,581)
|
As of March 31, 2012, there were no additions nor reversals in the parent company.
The increase in the balance during the quarter is mainly due to the tax credits derived from exports occurred through the States of Paraná and Santa Catarina, and the related allowances deemed necessary by Management were recorded.
12.1
Tax on Financial Transactions – (“IOF”)
On January 2012, the Company paid IOF over derivative transactions as imposed by PM No. 539 of July 26, 2011 (converted into Law No. 12,543/11), for the period between September 16, 2011 and December 31, 2011, totaling R$15,762. In March 2011, based on regulation issued by Brazilian Federal Revenue it was determined that the derivative transactions taken by the Company were deemed to be hedging so that it recorded a tax credit to be offset against other federal taxes.
13.
NON-CURRENT ASSETS HELD FOR SALE
The rollforward of assets held for sale is set forth below:
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
12.31.11
|
|
Transfers from
property, plant and
equipment
|
|
Transfers to property,
plant and equipment
|
|
Disposal
|
|
03.31.12
|
Lands
|
|
2,738
|
|
55
|
|
-
|
|
(74)
|
|
2,719
|
Buildings and improvements
|
|
2,931
|
|
48
|
|
-
|
|
-
|
|
2,979
|
Machinery and equipment
|
|
289
|
|
818
|
|
(28)
|
|
-
|
|
1,079
|
Facilities
|
|
6
|
|
-
|
|
-
|
|
-
|
|
6
|
Furniture
|
|
-
|
|
9
|
|
-
|
|
-
|
|
9
|
Vehicles and aircraft
|
|
-
|
|
-
|
|
(10)
|
|
(34)
|
|
(44)
|
Others
|
|
16
|
|
-
|
|
-
|
|
-
|
|
16
|
|
|
5,980
|
|
930
|
|
(38)
|
|
(108)
|
|
6,764
|
81
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
12.31.11
|
|
Transfers from
property, plant and
equipment
|
|
Transfers to property,
plant and equipment
|
|
Disposal
|
|
03.31.12
|
Lands
|
|
8,730
|
|
55
|
|
-
|
|
(74)
|
|
8,711
|
Buildings and improvements
|
|
8,162
|
|
48
|
|
-
|
|
-
|
|
8,210
|
Machinery and equipment
|
|
1,637
|
|
819
|
|
(28)
|
|
-
|
|
2,428
|
Facilities
|
|
6
|
|
-
|
|
-
|
|
-
|
|
6
|
Furniture
|
|
-
|
|
9
|
|
-
|
|
-
|
|
9
|
Vehicles and aircraft
|
|
-
|
|
-
|
|
(10)
|
|
(34)
|
|
(44)
|
Others
|
|
472
|
|
-
|
|
-
|
|
-
|
|
472
|
|
|
19,007
|
|
931
|
|
(38)
|
|
(108)
|
|
19,792
|
14.
14. INCOME TAX AND SOCIAL CONTRIBUTION
14.1.
Deferred income tax and social contribution composition
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Assets:
|
|
|
|
|
|
|
|
|
Tax loss carryforwards (corporate income tax)
|
|
408,279
|
|
380,462
|
|
779,489
|
|
765,055
|
Provision for tax losses
|
|
-
|
|
-
|
|
(166,762)
|
|
(166,762)
|
Negative calculation basis (social contribution on net profits)
|
|
165,037
|
|
153,124
|
|
304,437
|
|
297,062
|
Provision for negative calculation basis losses
|
|
-
|
|
-
|
|
(48,443)
|
|
(48,443)
|
Estimated annual effective tax rate - CPC 21
|
|
59,891
|
|
-
|
|
89,491
|
|
-
|
Temporary differences:
|
|
|
|
|
|
|
|
|
Provisions for tax, civil and labor risk
|
|
88,885
|
|
100,433
|
|
144,668
|
|
158,262
|
Provision for estimated losses with doubtful accounts
|
|
7,119
|
|
9,471
|
|
13,863
|
|
12,681
|
Provision for attorney's fees
|
|
-
|
|
4,694
|
|
-
|
|
4,694
|
Provision for property, plant and equipment losses
|
|
1,804
|
|
8,307
|
|
5,485
|
|
11,709
|
Provision for tax credits realization
|
|
7,936
|
|
7,936
|
|
50,489
|
|
47,571
|
Provision for other obligations
|
|
8,059
|
|
20,110
|
|
23,881
|
|
46,229
|
Employees' profit sharing
|
|
6,738
|
|
56,014
|
|
8,330
|
|
72,432
|
Provision for inventories
|
|
9,009
|
|
8,137
|
|
13,976
|
|
12,224
|
Employees' benefits plan
|
|
39,828
|
|
38,323
|
|
93,868
|
|
90,457
|
Amortization on fair value of business combination
|
|
3,592
|
|
4,130
|
|
8,061
|
|
8,753
|
Business combination - Sadia
|
|
-
|
|
-
|
|
1,138,792
|
|
1,139,668
|
Unrealized losses on derivatives
|
|
14,415
|
|
62,644
|
|
14,415
|
|
62,644
|
Unrealized losses on inventories
|
|
-
|
|
-
|
|
2,946
|
|
4,230
|
Adjustments relating to the transition tax regime
|
|
52,051
|
|
63,891
|
|
67,255
|
|
76,102
|
Provision for losses
|
|
12,993
|
|
9,098
|
|
21,986
|
|
10,488
|
Other temporary differences
|
|
23,046
|
|
8,833
|
|
41,206
|
|
23,694
|
|
|
908,682
|
|
935,607
|
|
2,607,433
|
|
2,628,750
|
Liabilities:
|
|
|
|
|
|
|
|
|
Temporary differences:
|
|
|
|
|
|
|
|
|
Provision for recovery BFPP - Brasil Foods Previdência Privada
|
|
1,829
|
|
1,829
|
|
1,829
|
|
1,829
|
Revaluation reserve
|
|
164
|
|
341
|
|
164
|
|
341
|
Depreciation on rural activities
|
|
-
|
|
409
|
|
60,051
|
|
68,832
|
Adjustments relating to the transition tax regime
|
|
349,976
|
|
337,804
|
|
576,292
|
|
531,056
|
Business combination - Sadia
|
|
-
|
|
-
|
|
1,181,109
|
|
1,181,582
|
Other temporary differences
|
|
425
|
|
223
|
|
(2,775)
|
|
8,257
|
|
|
352,394
|
|
340,606
|
|
1,816,670
|
|
1,791,897
|
Certain subsidiaries of the Company in Brazil have tax loss carry forwards and
negative basis of social contribution of R$34,469 and R$34,290, respectively, (R$31,650 and R$31,470 on December 31, 2011), for which the Company have not recorded a related deferred tax asset. If there was any expectation that such tax credits would be realized the amount to be recognized in the balance would be R$11,703 (R$10,745 as of December 31, 2011).
82
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
As disclosed to the market on February 9, 2012, the Company´s Board of Directors approved the merger of the wholly-owned subsidiary Sadia with BRF, which will be implemented on December 31, 2012. The main purpose of this merge is to maximize synergies and to rationalize activities, with consequent reductions in administrative and operating costs and increased productivity.
The decision to merge Sadia into BRF resulted in the recognition of a loss for 2011 of approximately R$215,205 on the allowance for tax loss carryforwards, which will not be recovered after the merger. The value of the loss reflects Management's best estimate at the date of the publication of these quarterly financial information, considering the available conditions. The final value of the impact of the merger of Sadia into BRF will be known on December 31, 2012.
As per the requirements of paragraph 28 of CVM Deliberation No. 673/11, during this quarter the Company started to disclose the income tax expense based on the best estimate of the annual weighted effective tax rate for the fiscal period ending December 31, 2012. As a consequence, the income tax expense for the three month period ended March 31, 2012 was adjusted by a credit in the amount of R$59,891 at the parent company and R$89,491 in the consolidated financial information, as disclosed in note 14.3. For the same period of year 2011 this adjustment was not made because the effective rate calculated resembled the estimated effective rate for the year.
14.2.
Estimated time of realization
Management considers that deferred tax assets related to temporary differences will be realized as the lawsuits are resolved. The deferred tax assets resulting from temporary differences of employee benefits will be realized at the payment of the projected obligations.
Management estimates that the deferred tax assets originated from tax losses carry forwards and negative basis of social contribution are expected to be realized as set forth below:
83
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
Year
|
|
Value
|
|
Value
|
2012
|
|
-
|
|
292,164
|
2013
|
|
32,620
|
|
32,911
|
2014
|
|
53,709
|
|
54,021
|
2015
|
|
57,273
|
|
57,607
|
2016
|
|
70,362
|
|
70,721
|
2017-2019
|
|
309,741
|
|
310,987
|
2020-2021
|
|
49,611
|
|
50,310
|
|
|
573,316
|
|
868,721
|
When assessing the likelihood of the realization of deferred tax assets, Management considers whether it is more likely than not that some or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those temporary differences are deductible.
Management considers the scheduled reversal of deferred tax liabilities, projected taxable income and tax-planning strategies when performing this assessment. Based on the level of historical taxable income and projections for future taxable income, management believes that it is more likely than not that the Company will realize the benefits of these deductible differences. The amount of the deferred tax asset is considered realizable, however, could be impacted in the short term if estimates of future taxable income during the carryforward period are reduced.
14.3.
Income and social contribution taxes reconciliation
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Income before taxes and participations
|
|
142,519
|
|
417,310
|
|
193,083
|
|
472,730
|
Nominal tax rate
|
|
34.00%
|
|
34.00%
|
|
34.00%
|
|
34.00%
|
|
|
(48,456)
|
|
(141,885)
|
|
(65,648)
|
|
(160,728)
|
Tax expense at nominal rate
|
|
|
|
|
|
|
|
|
Adjustments of taxes and contributions on:
|
|
|
|
|
|
|
|
|
Equity interest in income of affiliates
|
|
7,782
|
|
96,190
|
|
1,922
|
|
706
|
Exchange rate variation on foreign investments
|
|
(3,024)
|
|
12,641
|
|
(15,148)
|
|
3,300
|
Difference of tax rates on earnings from foreign subsidiaries
|
|
-
|
|
-
|
|
(47,162)
|
|
74,005
|
Results from foreign subsidiaries
|
|
-
|
|
-
|
|
(387)
|
|
(2,144)
|
Profit sharing
|
|
(1,274)
|
|
(832)
|
|
(671)
|
|
(1,310)
|
Donations
|
|
(105)
|
|
(68)
|
|
(547)
|
|
(989)
|
Penalties
|
|
(6,567)
|
|
(151)
|
|
(4,149)
|
|
(127)
|
Investment grant
|
|
3,517
|
|
1,479
|
|
3,517
|
|
1,479
|
Estimated annual effective tax rate - CPC 21
|
|
59,893
|
|
-
|
|
89,491
|
|
-
|
Other adjustments
|
|
(1,086)
|
|
(1,216)
|
|
(1,446)
|
|
(177)
|
|
|
10,680
|
|
(33,842)
|
|
(40,228)
|
|
(85,985)
|
Current income tax
|
|
-
|
|
-
|
|
(38,205)
|
|
(4,775)
|
Deferred income tax
|
|
10,680
|
|
(33,842)
|
|
(2,023)
|
|
(81,210)
|
84
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The taxable income, current and deferred income tax from foreign subsidiaries is presented below:
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
Taxable income from foreign subsidiaries
|
|
(153,829)
|
|
86,772
|
Current income taxes expense from foreign subsidiaries
|
|
3,264
|
|
(2,962)
|
Deferred income taxes benefit from foreign subsidiaries
|
|
(68)
|
|
429
|
The Company determined that the total profit accounted for by holdings of their foreign wholly-owned subsidiaries will not be redistributed. Such resources will be utilized for investments in the subsidiaries, and thus no deferred income taxes were recognized. The total of undistributed earnings correspond to R$1,853,368 as of March 31, 2012 (R$2,057,655 as of December 31, 2011).
The Brazilian income taxes are subject to review for a 5-year period, during which the tax authorities might audit and assess the company for additional taxes and penalties, in case inconsistencies are found. Subsidiaries located abroad are taxed in their respective jurisdictions, according to the tax legislation of each country.
15.
JUDICIAL DEPOSITS
The Company’s judicial deposits are restricted assets until the final settlement of the disputes to which they are related. The rollforward of the judicial deposits is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
Write-offs
|
|
03.31.12
|
Tax
|
|
29,286
|
|
20,214
|
|
-
|
|
-
|
|
49,500
|
Labor
|
|
67,540
|
|
11,938
|
|
(19,803)
|
|
-
|
|
59,675
|
Civil, commercial and other
|
|
13,756
|
|
110
|
|
-
|
|
(4,737)
|
|
9,129
|
|
|
110,582
|
|
32,262
|
|
(19,803)
|
|
(4,737)
|
|
118,304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
Write-offs
|
|
03.31.12
|
Tax
|
|
92,993
|
|
35,916
|
|
(7,509)
|
|
(442)
|
|
120,958
|
Labor
|
|
115,880
|
|
13,988
|
|
(26,329)
|
|
(239)
|
|
103,300
|
Civil, commercial and other
|
|
19,388
|
|
1,558
|
|
-
|
|
(7,301)
|
|
13,645
|
|
|
228,261
|
|
51,462
|
|
(33,838)
|
|
(7,982)
|
|
237,903
|
85
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
16.
INVESTMENTS
16.1.
Investments breakdown
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Investment in associates
|
|
6,035,753
|
|
6,022,132
|
|
25,175
|
|
19,505
|
Fair value of assets and liabilities acquisitions
|
|
2,487,611
|
|
2,486,827
|
|
-
|
|
-
|
Goodwill based on expectation of future profitability
|
|
1,293,818
|
|
1,293,818
|
|
-
|
|
-
|
Advance for future capital increase
|
|
335,312
|
|
329,812
|
|
-
|
|
-
|
Other investiments
|
|
834
|
|
834
|
|
894
|
|
894
|
|
|
10,153,328
|
|
10,133,423
|
|
26,069
|
|
20,399
|
86
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
16.2.
Summarized financial information of subsidiaries and affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sadia S.A.
|
|
VIP S.A.
Empr. e
Particip.
Imob.
|
|
Avipal
Construtora
S.A.
|
|
Avipal Centro
Oeste S.A.
|
|
PSA Labor.
Veter. Ltda.
|
|
Perdigão
Trading S.A.
|
|
PDF Partici-
pações Ltda.
|
|
Heloísa Ind.
Com.
Produtos
Lácteos Ltda.
|
|
Establec.
Levino
Zaccardi
|
|
Crossban
Holdings
GmbH
|
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
|
03.31.12
|
Current Assets
|
|
4,094,017
|
|
29,939
|
|
132
|
|
266
|
|
101
|
|
101
|
|
1
|
|
32,540
|
|
5,987
|
|
87,854
|
Non-current Assets
|
|
6,830,847
|
|
103,110
|
|
-
|
|
-
|
|
11,600
|
|
2,346
|
|
-
|
|
61,278
|
|
2,760
|
|
1,086,127
|
Current Liabilities
|
|
(3,555,828)
|
|
(281)
|
|
(5)
|
|
-
|
|
-
|
|
(412)
|
|
-
|
|
(9,512)
|
|
(1,804)
|
|
(2,770)
|
Non-current Liabilities
|
|
(2,362,294)
|
|
(1,008)
|
|
(72)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,759)
|
|
(5,562)
|
|
(4,379)
|
Shareholders Equity
|
|
(5,006,742)
|
|
(131,760)
|
|
(55)
|
|
(266)
|
|
(11,701)
|
|
(2,035)
|
|
(1)
|
|
(82,547)
|
|
(1,381)
|
|
(1,166,832)
|
|
Net Revenue
|
|
3,352,665
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
12,623
|
|
2,306
|
|
139
|
Net income (loss)
|
|
161,479
|
|
(1,421)
|
|
1
|
|
1
|
|
268
|
|
47
|
|
-
|
|
(2,759)
|
|
256
|
|
(140,506)
|
|
|
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
|
12.31.11
|
Current Assets
|
|
4,977,392
|
|
46,982
|
|
131
|
|
265
|
|
99
|
|
100
|
|
1
|
|
37,430
|
|
6,633
|
|
90,700
|
Non-current Assets
|
|
5,903,429
|
|
87,620
|
|
-
|
|
-
|
|
11,334
|
|
2,301
|
|
-
|
|
52,708
|
|
2,916
|
|
1,237,696
|
Current Liabilities
|
|
(3,818,241)
|
|
(391)
|
|
(5)
|
|
-
|
|
-
|
|
(412)
|
|
-
|
|
(8,011)
|
|
(6,859)
|
|
(2,721)
|
Non-current Liabilities
|
|
(2,088,931)
|
|
(1,029)
|
|
(72)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2,321)
|
|
(173)
|
|
(4,387)
|
Shareholders Equity
|
|
(4,973,649)
|
|
(133,182)
|
|
(54)
|
|
(265)
|
|
(11,433)
|
|
(1,989)
|
|
(1)
|
|
(79,806)
|
|
(2,517)
|
|
(1,321,288)
|
|
Net Revenue
|
|
13,407,814
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
3,138
|
|
10,275
|
|
583
|
Net income (loss)
|
|
716,080
|
|
85,172
|
|
3
|
|
2
|
|
584
|
|
115
|
|
-
|
|
(1,029)
|
|
1,331
|
|
324,602
|
87
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
16.3.
Rollforward of direct investments – Parent Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sadia S.A.
|
|
VIP S.A.
Empr. e
Particip.
Imob
|
|
Avipal
Centro
Oeste S.A.
|
|
PSA
Labor.
Veter. Ltda
|
|
Avipal
Constru-
tora S.A.
|
|
Perdigão
Trading pações
S.A.
|
|
UP!
Alimen-
tos Ltda
|
|
PDF
Partici-
pações
Ltda
|
|
Heloísa Ind.
Com.
Produtos
Lácteos
Ltda.
|
|
Establec.
Levino
Zaccardi
|
|
Crossban
Holdings
GmbH
|
|
Total
|
03.31.12
|
|
12.31.11
|
a) Capital share as of March 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of share
|
|
100.00%
|
|
65.49%
|
|
100.00%
|
|
88.00%
|
|
100.00%
|
|
100.00%
|
|
50.00%
|
|
1.00%
|
|
100.00%
|
|
90.00%
|
|
100.00%
|
|
|
|
|
Total number of shares and membership interests
|
|
1,673,567,393
|
|
14,249,459
|
|
6,963,854
|
|
5,463,850
|
|
445,362
|
|
100,000
|
|
1,000
|
|
1,000
|
|
46,000,000
|
|
100
|
|
1
|
|
|
|
|
Number of shares and membership interest held
|
|
1,673,567,393
|
|
9,331,971
|
|
6,963,854
|
|
4,808,188
|
|
445,362
|
|
100,000
|
|
500
|
|
10
|
|
46,000,000
|
|
90
|
|
1
|
|
|
|
|
b) Subsidiaries' information as of March 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital stock
|
|
5,351,529
|
|
40,061
|
|
5,972
|
|
5,564
|
|
445
|
|
100
|
|
1
|
|
1
|
|
103,500
|
|
40
|
|
4,618
|
|
|
|
|
Shareholders' equity
|
|
5,006,742
|
|
131,760
|
|
266
|
|
11,701
|
|
55
|
|
2,035
|
|
29,712
|
|
1
|
|
82,547
|
|
1,381
|
|
1,166,832
|
|
|
|
|
Fair value adjustments
|
|
2,487,611
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
Goodwill based on expectation of future profitability
|
|
1,293,818
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
Income for the period
|
|
161,479
|
|
(1,421)
|
|
1
|
|
268
|
|
1
|
|
47
|
|
11,736
|
|
-
|
|
(2,759)
|
|
256
|
|
(140,506)
|
|
|
|
|
c) Balance of investments as of March 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance of the investment in the beginning of the year
|
|
8,634,918
|
|
87,221
|
|
265
|
|
10,072
|
|
54
|
|
1,988
|
|
8,988
|
|
-
|
|
79,806
|
|
973
|
|
1,308,304
|
|
10,132,589
|
|
8,673,372
|
Equity pickup
|
|
161,479
|
|
(931)
|
|
1
|
|
236
|
|
1
|
|
47
|
|
5,868
|
|
-
|
|
(2,759)
|
|
229
|
|
(140,506)
|
|
23,665
|
|
1,198,522
|
Unrealized profit in inventory
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
8
|
|
-
|
|
8
|
|
(368)
|
Goodwill in the acquisition of non-controlling entities
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
22
|
|
22
|
|
(11,932)
|
Foreign-exchange rate variation
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(96)
|
|
(8,798)
|
|
(8,894)
|
|
97,945
|
Other comprehensive income
|
|
(8,226)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
7,830
|
|
(396)
|
|
(62,995)
|
Advance for future capital increase
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
5,500
|
|
-
|
|
-
|
|
5,500
|
|
329,812
|
Dividends and interests on shareholders' equity
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(120,602)
|
Acquisition of companies
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
28,835
|
Balance of investments as of March 31, 2012
|
|
8,788,171
|
|
86,290
|
|
266
|
|
10,308
|
|
55
|
|
2,035
|
|
14,856
|
|
-
|
|
82,547
|
|
1,114
|
|
1,166,852
|
|
10,152,494
|
|
10,132,589
|
88
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The gains resulting from foreign exchange rate variation on the investments in subsidiaries abroad, whose functional currency is Brazilian Reais, totaling a loss of R$44,554 on March 31, 2012 (gain of R$9,707 on March 31, 2011), are recognized in financial income/expenses groups in the statement of income of the period.
The exchange rate variation resulting from the investment in the subsidiary Plusfood Groep B.V. and its controlled companies, whose functional currency is the Euro, was recorded in the equity pickup adjustments, in the subgroup of shareholders’ equity.
On March 31, 2012, the subsidiaries do not have any significant restriction to transfer dividends or repay their loans or advances to the parent company.
As of March 31, 2012, the market cap of Excelsior Alimentos S.A., a subsidiary of Sadia, corresponded to R$16,084 (R$16,077 as of December 31, 2011).
16.4.
Summary financial information of joint ventures and affiliates
|
|
|
|
|
|
|
|
|
|
|
Coligada
|
|
Controlada em conjunto
|
|
|
|
|
UP!
|
|
|
|
K&S
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Current assets
|
|
21,190
|
|
12,941
|
|
8,093
|
|
7,712
|
Non-current assets
|
|
25
|
|
21
|
|
8,438
|
|
8,388
|
Current liabilities
|
|
(6,360)
|
|
(3,974)
|
|
(5,810)
|
|
(5,204)
|
Non-current liabilities
|
|
-
|
|
-
|
|
(402)
|
|
(379)
|
|
|
14,855
|
|
8,988
|
|
10,319
|
|
10,517
|
|
|
|
UP!
|
|
K&S
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Net revenues
|
|
17,583
|
|
13,792
|
|
7,853
|
|
7,547
|
Operational expenses
|
|
(3,204)
|
|
3,568
|
|
(2,214)
|
|
(2,332)
|
Net income (loss)
|
|
5,868
|
|
2,431
|
|
(197)
|
|
(263)
|
|
Participation %
|
|
|
|
50%
|
|
|
|
49%
|
For the three month period ended March 31, 2012, there were no increases in capital or commitments by the companies for contributions in joint ventures and affiliates.
89
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
17.
PROPERTY, PLANT & EQUIPMENT
Property, plant and equipment rollforward is set forth below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
Rate
p.a. %
|
|
12.31.10
|
|
Additions
|
|
Disposal
|
|
Reversal
|
|
Transfers
|
|
Transfers to
held for sale
|
|
Transfers from
held for sale
|
|
12.31.11
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land
|
|
-
|
|
151,896
|
|
-
|
|
(490)
|
|
-
|
|
87
|
|
(55)
|
|
-
|
|
151,438
|
Buildings and improvements
|
|
-
|
|
1,820,908
|
|
207
|
|
(5,173)
|
|
-
|
|
37,281
|
|
(1,608)
|
|
-
|
|
1,851,615
|
Machinery and equipment
|
|
-
|
|
2,507,100
|
|
11,856
|
|
(16,595)
|
|
-
|
|
76,813
|
|
(4,778)
|
|
28
|
|
2,574,424
|
Facilities
|
|
-
|
|
320,757
|
|
-
|
|
(2,107)
|
|
-
|
|
12,313
|
|
-
|
|
-
|
|
330,963
|
Furniture
|
|
-
|
|
51,629
|
|
311
|
|
(1,588)
|
|
-
|
|
2,796
|
|
(241)
|
|
-
|
|
52,907
|
Vehicles and aircrafts
|
|
-
|
|
48,247
|
|
131
|
|
(1,920)
|
|
-
|
|
6,816
|
|
-
|
|
10
|
|
53,284
|
Others
|
|
-
|
|
114,199
|
|
-
|
|
(70)
|
|
-
|
|
3,432
|
|
-
|
|
-
|
|
117,561
|
Construction in progress
|
|
-
|
|
231,222
|
|
178,330
|
|
-
|
|
-
|
|
(111,474)
|
|
-
|
|
-
|
|
298,078
|
Advances to suppliers
|
|
-
|
|
10,670
|
|
31,003
|
|
-
|
|
-
|
|
(29,944)
|
|
-
|
|
-
|
|
11,729
|
|
|
|
|
5,256,628
|
|
221,838
|
|
(27,943)
|
|
-
|
|
(1,880)
|
(1)
|
(6,682)
|
|
38
|
|
5,441,999
|
Depreciation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buildings and improvements
|
|
3.45
|
|
(518,985)
|
|
(14,292)
|
|
3,780
|
|
-
|
|
(36)
|
|
1,560
|
|
-
|
|
(527,973)
|
Machinery and equipment
|
|
6.03
|
|
(996,119)
|
|
(35,773)
|
|
10,528
|
|
-
|
|
13
|
|
3,960
|
|
-
|
|
(1,017,391)
|
Facilities
|
|
3.57
|
|
(92,596)
|
|
(3,295)
|
|
1,076
|
|
-
|
|
17
|
|
-
|
|
-
|
|
(94,798)
|
Furniture
|
|
6.25
|
|
(20,687)
|
|
(191)
|
|
853
|
|
-
|
|
6
|
|
232
|
|
-
|
|
(19,787)
|
Vehicles and aircrafts
|
|
14.29
|
|
(11,839)
|
|
(744)
|
|
1,635
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(10,948)
|
Others
|
|
3.51
|
|
(29,242)
|
|
(4,126)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(33,368)
|
|
|
|
|
(1,669,468)
|
|
(58,421)
|
|
17,872
|
|
-
|
|
-
|
(1)
|
5,752
|
|
-
|
|
(1,704,265)
|
Provision for losses
(2)
|
|
|
|
(24,433)
|
|
(2,100)
|
|
-
|
|
21,227
|
|
-
|
|
-
|
|
-
|
|
(5,306)
|
|
|
|
|
3,562,727
|
|
161,317
|
|
(10,071)
|
|
21,227
|
|
(1,880)
|
(1)
|
(930)
|
|
38
|
|
3,732,428
|
(1)
Net transfer to intangible assets (note 18).
(2
) Refers to provision for losses on assets
lost on a fire
in Nova Mutum plant occurred in March 2011 and that was determined to be lower than the previous estimated amount.
90
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Rate
|
|
|
|
|
|
|
|
|
|
|
|
Transfer to
|
|
Transfers from
|
|
Exchange rate
|
|
|
|
|
p.a. %
|
|
12.31.11
|
|
Additions
|
|
Disposal
|
|
Reversal
|
|
Transfers
|
|
held for sale
|
|
held for sale
|
|
variation
|
|
03.31.12
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land
|
|
-
|
|
634,667
|
|
-
|
|
(490)
|
|
-
|
|
1,037
|
|
(55)
|
|
-
|
|
(343)
|
|
634,816
|
Buildings and improvements
|
|
-
|
|
4,980,559
|
|
11,133
|
|
(2,677)
|
|
-
|
|
79,195
|
|
(1,608)
|
|
-
|
|
(1,043)
|
|
5,065,559
|
Machinery and equipment
|
|
-
|
|
5,603,340
|
|
31,056
|
|
(24,934)
|
|
-
|
|
99,587
|
|
(4,779)
|
|
28
|
|
3,349
|
|
5,707,647
|
Facilities
|
|
-
|
|
1,315,047
|
|
74
|
|
(2,108)
|
|
-
|
|
28,838
|
|
-
|
|
-
|
|
(27)
|
|
1,341,824
|
Furniture
|
|
-
|
|
87,472
|
|
1,300
|
|
(1,567)
|
|
-
|
|
4,775
|
|
(241)
|
|
-
|
|
(353)
|
|
91,386
|
Vehicles and aircrafts
|
|
-
|
|
78,328
|
|
301
|
|
(2,112)
|
|
-
|
|
28,102
|
|
-
|
|
10
|
|
(342)
|
|
104,287
|
Others
|
|
-
|
|
191,337
|
|
20
|
|
(156)
|
|
-
|
|
6,064
|
|
-
|
|
-
|
|
(20)
|
|
197,245
|
Construction in progress
|
|
-
|
|
620,209
|
|
350,726
|
|
(23)
|
|
-
|
|
(213,893)
|
|
-
|
|
-
|
|
(318)
|
|
756,701
|
Advance to suppliers
|
|
-
|
|
32,878
|
|
53,421
|
|
-
|
|
-
|
|
(38,682)
|
|
-
|
|
-
|
|
1
|
|
47,618
|
|
|
|
|
13,543,837
|
|
448,031
|
|
(34,067)
|
|
-
|
|
(4,977)
|
(1)
|
(6,683)
|
|
38
|
|
904
|
|
13,947,083
|
Depreciação
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buildings and improvements
|
|
3.42
|
|
(1,168,298)
|
|
(30,194)
|
|
3,983
|
|
-
|
|
(374)
|
|
1,560
|
|
-
|
|
6,652
|
|
(1,186,671)
|
Machinery and equipment
|
|
5.89
|
|
(2,077,472)
|
|
(68,204)
|
|
22,875
|
|
-
|
|
505
|
|
3,960
|
|
-
|
|
(4,029)
|
|
(2,122,365)
|
Facilities
|
|
3.57
|
|
(376,121)
|
|
(10,259)
|
|
1,394
|
|
-
|
|
(118)
|
|
-
|
|
-
|
|
34
|
|
(385,070)
|
Furniture
|
|
6.25
|
|
(40,713)
|
|
(4,384)
|
|
1,042
|
|
-
|
|
(57)
|
|
232
|
|
-
|
|
22
|
|
(43,858)
|
Vehicles and aircrafts
|
|
14.29
|
|
(16,856)
|
|
(2,076)
|
|
1,682
|
|
-
|
|
44
|
|
-
|
|
-
|
|
23
|
|
(17,183)
|
Others
|
|
3.03
|
|
(31,568)
|
|
(5,972)
|
|
25
|
|
-
|
|
-
|
|
-
|
|
-
|
|
12
|
|
(37,503)
|
|
|
|
|
(3,711,028)
|
|
(121,089)
|
|
31,001
|
|
-
|
|
-
|
(1)
|
5,752
|
|
-
|
|
2,714
|
|
(3,792,650)
|
Provision for losses
(2)
|
|
|
|
(34,439)
|
|
(2,960)
|
|
-
|
|
21,267
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(16,132)
|
|
|
|
|
9,798,370
|
|
323,982
|
|
(3,066)
|
|
21,267
|
|
(4,977)
|
(1)
|
(931)
|
|
38
|
|
3,618
|
|
10,138,301
|
(1)
Net transfer to intangible assets (note 18)
.
(2
)
Refers to provision for losses on assets
lost on a fire
in Nova Mutum plant occurred in March 2011 and that was determined to be lower than the previous estimated amount.
91
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The consolidated acquisitions during the three month period ended March 31, 2012 are substantially represented by construction in progress in the total amount of R$350,726 and advances to suppliers of R$53,421 which comprise mainly:
|
|
|
BR GAAP and IFRS
|
Consolidated
|
Description
|
|
03.31.12
|
Expansion projects of industrial units
|
|
100,340
|
Transformation of turkey´s plant into chicken' plant in Carambeí (PR)
|
|
35,430
|
Improvements in productive units and poultry farm
|
|
31,874
|
Car fleet renewal
|
|
22,648
|
Regularization of corporate licenses
|
|
13,583
|
Implementation of cooked pasta for lasagna in Ponta Grossa (PR)
|
|
10,578
|
New pizza production line in Embu das Artes (SP)
|
|
10,366
|
Construction of a new sausage factory in Lucas do Rio Verde (MT)
|
|
8,575
|
The disposals are mainly related to obsolete items in the total amount of R$3,525 and assets that suffered a fire amounting to R$1,487, recorded within other operating results.
The Company has fully depreciated items still in operation. These items are presented below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Cost
|
|
|
|
|
|
|
|
|
Buildings and improvements
|
|
13,906
|
|
16,322
|
|
115,557
|
|
116,700
|
Machinery and equipment
|
|
289,131
|
|
294,400
|
|
626,359
|
|
613,800
|
Facilities
|
|
7,943
|
|
8,430
|
|
78,897
|
|
83,107
|
Furniture
|
|
5,222
|
|
5,455
|
|
15,440
|
|
16,656
|
Vehicles and aircrafts
|
|
2,694
|
|
1,171
|
|
4,438
|
|
3,173
|
Others
|
|
2,130
|
|
1,283
|
|
2,130
|
|
1,283
|
|
|
321,026
|
|
327,061
|
|
842,821
|
|
834,719
|
As of March 31, 2012, the Company had capitalized interests in the amount of R$10,722 (R$3,296 as of March 31, 2012). The weighted interest rate utilized to determine the amount of capitalized interests was 6.89% p.a..
On March 31, 2012, the Company had no commitments assumed related to acquisition and/or construction of properties, except those disclosed in note 22, item 22.2.
92
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
The property, plant and equipment that are held as collateral for transactions of different natures is set forth below:
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
03.31.12
|
|
12.31.11
|
|
|
Type of collateral
|
|
Book value of
the collateral
|
|
Book value of
the collateral
|
Land
|
|
Financial/Labor/Tax/Civil
|
|
61,090
|
|
61,090
|
Buildings and improvements
|
|
Financial/Labor/Tax/Civil
|
|
956,009
|
|
946,898
|
Machinery and equipment
|
|
Financial/Labor/Tax
|
|
1,186,809
|
|
1,165,489
|
Facilities
|
|
Financial/Labor/Tax
|
|
267,579
|
|
264,105
|
Furniture
|
|
Financial/Labor/Tax/Civil
|
|
15,941
|
|
15,087
|
Vehicles and aircrafts
|
|
Financial/Tax
|
|
1,448
|
|
1,512
|
Others
|
|
Financial/Labor/Tax/Civil
|
|
361,472
|
|
260,034
|
|
|
|
|
2,850,348
|
|
2,714,215
|
|
|
|
|
BR GAAP and IFRS
|
Consolidated
|
03.31.12
|
|
12.31.11
|
Type of collateral
|
|
Book value of
the collateral
|
|
Book value of
the collateral
|
Land
|
|
Financial/Labor/Tax/Civil
|
|
232,087
|
|
160,432
|
Buildings and improvements
|
|
Financial/Labor/Tax/Civil
|
|
2,338,775
|
|
1,966,168
|
Machinery and equipment
|
|
Financial/Labor/Tax
|
|
2,522,816
|
|
2,304,484
|
Facilities
|
|
Financial/Labor/Tax
|
|
792,617
|
|
687,453
|
Furniture
|
|
Financial/Labor/Tax/Civil
|
|
24,745
|
|
299,269
|
Vehicles and aircrafts
|
|
Financial/Tax
|
|
18,218
|
|
19,403
|
Others
|
|
Financial/Labor/Tax/Civil
|
|
442,017
|
|
307,456
|
|
|
|
|
6,371,275
|
|
5,744,665
|
The Company is not allowed to assign these assets as security for other transactions or to sell them.
18.
INTANGIBLE
Intangible assets are comprised of the following items:
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
Rate
p.a. %
|
|
Cost
|
|
Accumulated
amortization
|
|
03.31.12
|
|
12.31.11
|
Goodwill
|
|
-
|
|
1,546,653
|
|
-
|
|
1,546,653
|
|
1,546,653
|
Software
|
|
20.00
|
|
124,459
|
|
(24,164)
|
|
100,295
|
|
105,023
|
Patents
|
|
20.00
|
|
2,422
|
|
(184)
|
|
2,238
|
|
2,836
|
Outgrowers loyalty
|
|
12.50
|
|
4,925
|
|
(572)
|
|
4,353
|
|
3,556
|
|
|
|
|
1,678,459
|
|
(24,920)
|
|
1,653,539
|
|
1,658,068
|
93
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Rate
p.a. %
|
|
Cost
|
|
Accumulated
amortization
|
|
03.31.12
|
|
12.31.11
|
Goodwill
|
|
-
|
|
2,975,324
|
|
-
|
|
2,975,324
|
|
2,973,815
|
Brands
|
|
-
|
|
1,256,000
|
|
-
|
|
1,256,000
|
|
1,256,000
|
Software
|
|
20.00
|
|
290,246
|
|
(156,877)
|
|
133,369
|
|
138,236
|
Relationship with suppliers
|
|
42.00
|
|
135,000
|
|
(128,123)
|
|
6,877
|
|
9,598
|
Patents
|
|
16.92
|
|
5,034
|
|
(833)
|
|
4,201
|
|
4,894
|
Outgrowers loyalty
|
|
12.50
|
|
4,925
|
|
(571)
|
|
4,354
|
|
3,556
|
|
|
|
|
4,666,529
|
|
(286,404)
|
|
4,380,125
|
|
4,386,099
|
The intangible assets rollforward is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
12.31.11
|
|
Additions
|
|
Disposal
|
|
Transfers
|
|
03.31.12
|
Cost:
|
|
|
|
|
|
|
|
|
|
|
Software
|
|
126,118
|
|
-
|
|
(3,539)
|
|
1,880
|
|
124,459
|
Patents
|
|
3,057
|
|
-
|
|
(635)
|
|
-
|
|
2,422
|
Outgrowers loyalty
|
|
3,922
|
|
1,003
|
|
-
|
|
-
|
|
4,925
|
Goodwill:
|
|
1,546,653
|
|
-
|
|
-
|
|
-
|
|
1,546,653
|
Eleva Alimentos
|
|
1,273,324
|
|
-
|
|
-
|
|
-
|
|
1,273,324
|
Batavia
|
|
133,163
|
|
-
|
|
-
|
|
-
|
|
133,163
|
Ava
|
|
49,368
|
|
-
|
|
-
|
|
-
|
|
49,368
|
Cotochés
|
|
39,590
|
|
-
|
|
-
|
|
-
|
|
39,590
|
Paraiso Agroindustrial
|
|
16,751
|
|
-
|
|
-
|
|
-
|
|
16,751
|
Heloísa
|
|
26,165
|
|
-
|
|
-
|
|
-
|
|
26,165
|
Perdigão Mato Grosso
|
|
7,636
|
|
-
|
|
-
|
|
-
|
|
7,636
|
Incubatório Paraiso
|
|
656
|
|
-
|
|
-
|
|
-
|
|
656
|
|
|
1,679,750
|
|
1,003
|
|
(4,174)
|
|
1,880
|
|
1,678,459
|
Amortization:
|
|
|
|
|
|
|
|
|
|
|
Software
|
|
(21,095)
|
|
(5,841)
|
|
2,772
|
|
-
|
|
(24,164)
|
Patents
|
|
(221)
|
|
(40)
|
|
77
|
|
-
|
|
(184)
|
Outgrowers loyalty
|
|
(366)
|
|
(206)
|
|
-
|
|
-
|
|
(572)
|
|
|
(21,682)
|
|
(6,087)
|
|
2,849
|
|
-
|
|
(24,920)
|
|
|
1,658,068
|
|
(5,084)
|
|
(1,325)
|
|
1,880
|
|
1,653,539
|
94
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
12.31.11
|
|
Additions
|
|
Disposal
Transfers
|
|
Business
combination
(*)
|
|
|
|
Exchange rate
variation
|
|
03.31.12
|
Cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software
|
|
289,311
|
|
34
|
|
(4,146)
|
|
-
|
|
4,977
|
|
70
|
|
290,246
|
Relationship with suppliers
|
|
135,000
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
135,000
|
Patents
|
|
5,687
|
|
-
|
|
(635)
|
|
-
|
|
-
|
|
(18)
|
|
5,034
|
Trademarks
|
|
1,256,000
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,256,000
|
Outgrowers loyalty
|
|
3,922
|
|
1,003
|
|
-
|
|
-
|
|
-
|
|
-
|
|
4,925
|
Goodwill:
|
|
2,973,815
|
|
-
|
|
-
|
|
6,376
|
|
-
|
|
(4,867)
|
|
2,975,324
|
Sadia
|
|
1,293,818
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,293,818
|
Eleva Alimentos
|
|
1,273,324
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,273,324
|
Batavia
|
|
133,163
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
133,163
|
Ava
|
|
49,368
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
49,368
|
Cotochés
|
|
39,590
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
39,590
|
Paraiso Agroindustrial
|
|
16,751
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
16,751
|
Plusfood
|
|
15,974
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(28)
|
|
15,946
|
Perdigão Mato Grosso
|
|
7,636
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
7,636
|
Sino dos Alpes
|
|
4,050
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
4,050
|
Incubatório Paraiso
|
|
656
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
656
|
Heloísa
|
|
26,165
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
26,165
|
Avex
|
|
63,094
|
|
-
|
|
-
|
|
6,376
|
|
-
|
|
(2,654)
|
|
66,816
|
Danica
|
|
50,226
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(2,185)
|
|
48,041
|
|
|
4,663,735
|
|
1,037
|
|
(4,781)
|
|
6,376
|
|
4,977
|
|
(4,815)
|
|
4,666,529
|
Amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software
|
|
(151,075)
|
|
(8,997)
|
|
3,160
|
|
-
|
|
-
|
|
35
|
|
(156,877)
|
Relationship with suppliers
|
|
(125,402)
|
|
(2,721)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(128,123)
|
Patents
|
|
(793)
|
|
(119)
|
|
77
|
|
-
|
|
-
|
|
2
|
|
(833)
|
Outgrowers loyalty
|
|
(366)
|
|
(205)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(571)
|
|
|
(277,636)
|
|
(12,042)
|
|
3,237
|
|
-
|
|
-
|
|
37
|
|
(286,404)
|
|
|
4,386,099
|
|
(11,005)
|
|
(1,544)
|
|
6,376
|
|
4,977
|
|
(4,778)
|
|
4,380,125
|
(*)
Refers to the preliminary adjustment in the goodwill generated by the acquisition of Avex S.A.
The Company performed the impairment tests of its assets based on the fair value, that was determined based on a discounted cash flow model, in accordance with the allocation level of goodwill and intangible assets to the groups of cash generating units during the last quarter of 2011. For the three month period ended March 31, 2012, Management did not identify any event that could indicate an impairment of such assets and therefore, the test was not performed during the current quarter.
95
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
19.
LOANS AND FINANCING
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
Charges (% p.a.)
|
|
Weighted average
rate (% p.a.)
|
|
WAMT
(*)
|
|
Current
|
|
Non-
current
|
|
Balance
03.31.12
|
|
Balance
12.31.11
|
Local currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Working capital
|
|
6.74% (6.74% on 12.31.11)
|
|
6.74% (6.74% on 12.31.11)
|
|
0.6
|
|
442,266
|
|
1,494
|
|
443,760
|
|
457,105
|
BNDES, FINEM, development bank credit lines
|
|
FIXED RATE / TJLP + 3.92% (TJLP
|
|
|
|
|
|
|
|
|
|
|
|
|
and other secured debts
|
|
+ 4.52% on 12.31.11)
|
|
7.06% (7.81% on 12.31.11)
|
|
2.6
|
|
201,991
|
|
427,973
|
|
629,964
|
|
669,820
|
|
|
TJLP + 4.10% (TJLP + 4.10% on
|
|
10.10% (10.10% on
|
|
|
|
|
|
|
|
|
|
|
Export credit facility
|
|
12.31.11)
|
|
12.31.11)
|
|
1.2
|
|
251,724
|
|
332,920
|
|
584,644
|
|
634,907
|
|
|
FIXED RATE / IGPM + 1.65%
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing programs
|
|
(IGPM + 1.24% on 12.31.11)
|
|
1.92% (1.74% on 12.31.11)
|
|
16.9
|
|
10
|
|
19,297
|
|
19,307
|
|
12,459
|
|
|
|
|
|
|
|
|
895,991
|
|
781,684
|
|
1,677,675
|
|
1,774,291
|
Foreign currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances on export contracts - ACC's
|
|
1.57%
|
|
1.57%
|
|
0.4
|
|
280,911
|
|
-
|
|
280,911
|
|
-
|
|
|
LIBOR / FIXED RATE / CDI + 1.47%
|
|
3.39% (3.20% on 12.31.11)
|
|
|
|
|
|
|
|
|
|
|
|
|
(LIBOR / CDI + 2.73% on 12.31.11)
|
|
e.r. (US$ and other
|
|
|
|
|
|
|
|
|
|
|
Export credit facility
|
|
e.r. (US$ and other currencies)
|
|
currencies)
|
|
3.4
|
|
427,711
|
|
661,306
|
|
1,089,017
|
|
1,218,236
|
|
|
UMBNDES + 2.57% (UMBNDES +
|
|
6.21% (5.91% on 12.31.11)
|
|
|
|
|
|
|
|
|
|
|
BNDES, FINEM, development bank credit lines
|
|
2.32% on 12.31.11) e.r. (US$ and
|
|
e.r. (US$ and other
|
|
|
|
|
|
|
|
|
|
|
and other secured debts
|
|
other currencies)
|
|
currencies)
|
|
1.5
|
|
20,072
|
|
24,370
|
|
44,442
|
|
50,594
|
|
|
|
|
|
|
|
|
728,694
|
|
685,676
|
|
1,414,370
|
|
1,268,830
|
|
|
|
|
|
|
|
|
1,624,685
|
|
1,467,360
|
|
3,092,045
|
|
3,043,121
|
(*)
Weighted average maturity term (in years).
96
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
Explanatory Notes
(in thousands of Brazilian Reais)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Charges (% p.a.)
|
|
Weighted average
rate (% p.a.)
|
|
WAMT
(*)
|
|
Current
|
|
Non-
current
|
|
Balance
03.31.12
|
|
Balance
12.31.11
|
Local currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6.82% (6.82% on
|
|
|
|
|
|
|
|
|
|
|
Working capital
|
|
6.82% (6.82% on 12.31.11)
|
|
12.31.11)
|
|
0.5
|
|
946,070
|
|
1,494
|
|
947,564
|
|
954,947
|
BNDES, FINEM, development bank credit lines
|
|
FIXED RATE / TJLP + 4.63% (TJLP
|
|
8.19% (8.42% on
|
|
|
|
|
|
|
|
|
|
|
and other secured debts
|
|
+ 4.65% on 12.31.11)
|
|
12.31.11)
|
|
2.5
|
|
446,218
|
|
911,906
|
|
1,358,124
|
|
1,441,355
|
|
|
TJLP + 4.24% (TJLP + 4.23% on
|
|
10.24% (10.23% on
|
|
|
|
|
|
|
|
|
|
|
Export credit facility
|
|
12.31.11)
|
|
12.31.11)
|
|
1.1
|
|
353,932
|
|
332,920
|
|
686,852
|
|
737,115
|
|
|
FIXED RATE / IGPM + 1.62% (IGPM
|
|
1.90% (1.08% on
|
|
|
|
|
|
|
|
|
|
|
Financing programs
|
|
+ 1.20% on 12.31.11)
|
|
12.31.11)
|
|
16.2
|
|
873
|
|
19,297
|
|
20,170
|
|
14,900
|
|
|
IGPM + 4.90% (IGPM + 4.93% on
|
|
8.10% (9.92% on
|
|
|
|
|
|
|
|
|
|
|
PESA
|
|
12.31.11)
|
|
12.31.11)
|
|
8.0
|
|
729
|
|
178,748
|
|
179,477
|
|
181,389
|
|
|
|
|
|
|
|
|
1,747,822
|
|
1,444,365
|
|
3,192,187
|
|
3,329,706
|
Foreign currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.69% (1.18% on
|
|
|
|
|
|
|
|
|
|
|
Advances on export contracts
|
|
1.69% (1.18% on 12.31.11)
|
|
12.31.11)
|
|
0.5
|
|
463,332
|
|
-
|
|
463,332
|
|
150,143
|
|
|
|
|
7.15% (7.25% on
|
|
|
|
|
|
|
|
|
|
|
Bonds
|
|
7.15% (7.25% on 12.31.11)
|
|
12.31.11)
|
|
7.2
|
|
28,062
|
|
1,804,279
|
|
1,832,341
|
|
1,903,688
|
|
|
LIBOR / FIXED RATE / CDI + 1.65%
|
|
2.95% (2.81% on
|
|
|
|
|
|
|
|
|
|
|
|
|
(LIBOR / CDI + 2.26% on 12.31.11)
|
|
12.31.11) e.r. (US$ and
|
|
|
|
|
|
|
|
|
|
|
Export credit facility
|
|
e.r. (US$ and other currencies)
|
|
other currencies)
|
|
2.5
|
|
1,288,279
|
|
1,164,670
|
|
2,452,949
|
|
2,506,056
|
|
|
|
|
9.72% (8.25% on
|
|
|
|
|
|
|
|
|
|
|
Working capital
|
|
9.72% (8.25% on 12.31.11)
|
|
12.31.11)
|
|
0.6
|
|
3,321
|
|
397
|
|
3,718
|
|
3,899
|
|
|
UMBNDES + 2.28%
|
|
5.97% (5.93% on
|
|
|
|
|
|
|
|
|
|
|
BNDES, FINEM, development bank credit lines
|
|
(UMBNDES+2.35% on 12.31.11) e.r.
|
|
12.31.11) v.c. (US$ and
|
|
|
|
|
|
|
|
|
|
|
and other secured debts
|
|
(US$ and other currencies)
|
|
other currencies)
|
|
1.6
|
|
59,597
|
|
80,846
|
|
140,443
|
|
160,038
|
|
|
|
|
|
|
|
|
1,842,591
|
|
3,050,192
|
|
4,892,783
|
|
4,723,824
|
|
|
|
|
|
|
|
|
3,590,413
|
|
4,494,557
|
|
8,084,970
|
|
8,053,530
|
(*)
Weighted average maturity term (in years).
97
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM
THE ORIGINAL PREVIOUSLY ISSUED IN
PORTUGUESE)
ITR –
Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS
S.A.
Explanatory
Notes
(in thousands of Brazilian
Reais)
19.1.
Working capital
Rural credit
: The
Company and its subsidiaries entered into short term rural credit loans with
several commercial banks, under a Brazilian Federal government program that
offers an incentive to investments in rural activities.
Industrial credit
notes
: The Company issued Industrial Credit Notes, receiving
credits from official funds, such as: Fund for Worker Support (“FAT”),
Constitutional Fund for Financing the Midwest (“FCO”) and Constitutional Fund
for Financing the Northwest (“FNE”). The notes are paid on a monthly basis and
have maturity dates between 2012 and 2023. These notes are secured by a pledge
of machinery and equipment and real estate mortgages.
Working capital in foreign
currency
: Refers to credit lines taken from financial institutions
and utilized primarily for short term working capital and import operations of
subsidiaries located in Argentina. The loans are denominated in Argentine Pesos
and US Dollars, maturing in 2012.
18.
19.
19.1.
19.2.
BNDES,
FINEM, development bank credit lines and other secured debts
The
Company and its subsidiaries have several outstanding obligations with National
Bank for Economic and Social Development (“BNDES”). The loans were entered into
for the acquisition of machinery, equipment and expansion of productive
facilities.
FINEM
: The Company has credit lines of Loans
Financing Projects ("FINEM") which are subject to the variations of UMBNDES
currency basket, which is composed of the currencies in which BNDES obtains its
resources. The impact of interest reflects the daily fluctuation of the
currencies in the basket. The values of principal and interest are paid in
monthly installments, with maturities between 2012 and 2019 and are secured by
pledge of equipment, facilities and mortgage on properties owned by the
Company.
PESA
: The
wholly-owned subsidiary Sadia entered into a loan obtained through the PESA
subject to the variations of the IGPM plus interest of 4.90% p.a., secured by
endorsements and pledges of public debt securities, presented in note
8.
19.3.
Fiscal
incentives
State Tax Incentive Financing
Programs
: Under the terms of these programs, the Company was
granted with credits proportional to the payment of ICMS generated by
investments in the construction or expansion of industrial facilities. The
credit facilities have a term of 20 years and fixed or variable interest rates
based on the IGPM plus a spread.
98
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
19.4.
Export credits facilities
Pre-export facilities
: Generally are denominated in U.S. Dollars, maturing between 2012 and 2019. The export prepayment credit facilities are indexed by the LIBOR of three to twelve months plus a spread. Under the terms of each one of these credit facilities, the Company enters into loans guaranteed by accounts receivable related to the export of its products.
Trade-related facilities
:
Denominated in U.S. Dollars and maturities ranging from one to seven years. The commercial credit lines are indexed by the LIBOR plus a spread with quarterly, semi-annual or annual payments. The funds obtained from these lines are utilized for purchase imported raw materials and other working capital needs.
BNDES facilities – EXIM:
These funds are used to finance exports and are subject to the variations of TJLP, maturing in 2014. Settlement occurs in local currency without the risk associated with foreign currencies variations.
Advances on for foreign exchange rate contracts
:
The advances on foreign exchange rate contracts (“ACCs”) are liabilities with commercial banks, where the principal is settled through exports of products, as they are shipped. Interests are paid in the settlement of the foreign exchange rate contracts and such contracts are guaranteed by the actual exported goods. When the export documents are presented to the financing banks, these obligations start to be called advances for delivered foreign exchange rate contracts (“ACEs”) and are written off only upon the final payment by the overseas customer. The regulation of the Brazilian Central Bank allows companies to obtain short-term financing under the terms of the ACCs with maturity within 360 days from the date of shipment of the exports, or short-term financing under the terms of the ACEs with maturity within 180 days from the date of the shipment of the exports. These loans are denominated in US Dollars.
19.5.
Bonds
BFF notes
:
On January 28, 2010, BFF International Limited issued senior notes in the total value of US$750,000, whose notes are guaranteed by BRF and by Sadia, with a nominal interest rate of 7.25% p.a. and effective rate of 7.31% p.a. maturing on January 28, 2020.
Sadia Bonds
:
In the total value of US$250,000, such bonds are guaranteed by BRF and by Sadia, with an interest rate of 6.88% p.a. and maturing on May 24, 2017.
99
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
19.6.
Loans and financing maturity schedule
The maturity schedule of the loans and financing balances is as follow:
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.12
|
2012
|
|
1,624,685
|
|
3,590,413
|
2013
|
|
252,374
|
|
527,659
|
2014
|
|
431,718
|
|
658,200
|
2015
|
|
60,710
|
|
269,098
|
2016 onwards
|
|
722,558
|
|
3,039,600
|
|
|
3,092,045
|
|
8,084,970
|
19.7.
Guarantees
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Total of loans and financing
|
|
3,092,045
|
|
3,043,121
|
|
8,084,970
|
|
8,053,530
|
Mortgage guarantees
|
|
642,303
|
|
724,589
|
|
1,427,503
|
|
1,584,501
|
Related to FINEM-BNDES
|
|
409,135
|
|
490,835
|
|
978,446
|
|
1,134,809
|
Related to FNE-BNB
|
|
106,388
|
|
108,192
|
|
322,277
|
|
324,130
|
Related to tax incentives and other
|
|
126,780
|
|
125,562
|
|
126,780
|
|
125,562
|
Statutory lien on assets purchased with financing
|
|
38,128
|
|
36,046
|
|
40,302
|
|
38,454
|
Related to FINEM-BNDES
|
|
6,217
|
|
7,168
|
|
8,391
|
|
9,489
|
Related to FINAME-BNDES
|
|
-
|
|
-
|
|
-
|
|
87
|
Related to leasing
|
|
31,911
|
|
28,866
|
|
31,911
|
|
28,866
|
Related to tax incentives and other
|
|
-
|
|
12
|
|
-
|
|
12
|
The wholly-owned subsidiary Sadia is the guarantor of a loan obtained by Instituto Sadia de Sustentabilidade at the BNDES. The loan was obtained with the purpose of allowing the implementation of biodigesters in the properties of the outgrowers which take part in the Sadia’s integration system, targeting the reduction of the emission of Greenhouse Gases. The value of these guarantees on March 31, 2012, totaled R$80,465 (R$79,893 as of December 31, 2011).
Sadia is guarantor of loans related to a special program, which aimed the local development of outgrowers in the central region of Brazil. The proceeds of such loans shall be utilized to improve farm conditions and will be paid in 10 years, taking as collateral the land and equipment acquired by the outgrowers though this program. The total of guarantee as of March 31, 2012, amounted to R$511,335 (R$509,550 as of December 31, 2011).
On March 31, 2012, the Company contracted bank guarantees in the amount of R$642,832 (R$646,462 as of December 31, 2011) offered mainly in litigation which were discussed the use of tax credits. These guarantees have an average cost of 1.09% p.a. (1.10% p.a. as of December 31, 2011).
100
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
19.8.
Commitments
In the normal course of the business, the Company enters into agreements with third parties such as purchase of raw materials, mainly corn, soymeal and hog, where the agreed prices can be fixed or to be fixed. The agreements consider the market value of the commodities on the date of these financial statements and are set forth below:
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.12
|
2012
|
|
375,577
|
|
608,824
|
2013
|
|
235,138
|
|
382,426
|
2014
|
|
219,579
|
|
340,438
|
2015
|
|
214,406
|
|
334,265
|
2016
|
|
107,582
|
|
227,441
|
2017 onwards
|
|
483,067
|
|
1,036,747
|
|
|
1,635,349
|
|
2,930,141
|
The Company entered into leasing agreements denominated “built to suit” in which office facilities will be build by third parties. The agreements terms are 10 years from the signing date as well as the charge of rent expenses. If the Company defaults on its obligations, it will be subject to fines and/or rent falling due, according to each contract.
The estimated schedule of future payments related to the built to suit agreement is set forth below:
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.12
|
2012
|
|
7,186
|
|
7,861
|
2013
|
|
17,173
|
|
18,073
|
2014
|
|
17,173
|
|
18,073
|
2015
|
|
17,173
|
|
17,173
|
2016
|
|
17,173
|
|
17,173
|
2017 onwards
|
|
95,853
|
|
95,853
|
|
|
171,731
|
|
174,206
|
101
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
20.
ACCOUNTS PAYABLE
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.11
|
Domestic Suppliers
|
|
|
|
|
|
|
|
|
Third parties
|
|
1,197,055
|
|
1,184,004
|
|
2,362,953
|
|
2,335,113
|
Related parties
|
|
46,527
|
|
30,932
|
|
7,651
|
|
5,930
|
|
|
1,243,582
|
|
1,214,936
|
|
2,370,604
|
|
2,341,043
|
Foreign Suppliers
|
|
|
|
|
|
|
|
|
Third parties
|
|
50,225
|
|
53,592
|
|
299,389
|
|
340,300
|
Related parties
|
|
2,166
|
|
2,168
|
|
-
|
|
-
|
|
|
52,391
|
|
55,760
|
|
299,389
|
|
340,300
|
|
|
1,295,973
|
|
1,270,696
|
|
2,669,993
|
|
2,681,343
|
Accounts payable to suppliers are not subject to interest charges and are generally settled in average within 38 days.
The information on accounts payable involving related parties is presented in note 29. The related parties in the consolidated statements refer to transactions with the affiliated UP!.
102
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
21.
OTHER FINANCIAL ASSETS AND LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
12.31.10
|
Derivative financial instruments
|
|
|
|
|
|
|
|
|
Cash flow hedge
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Non-deliverable forward (NDF)
|
|
54,859
|
|
21,045
|
|
54,859
|
|
21,045
|
Currency option contracts
|
|
-
|
|
267
|
|
-
|
|
267
|
Exchange rate contracts (Swap)
|
|
1,351
|
|
1,048
|
|
1,351
|
|
1,048
|
|
|
56,210
|
|
22,360
|
|
56,210
|
|
22,360
|
Liabilities
|
|
|
|
|
|
|
|
|
Non-deliverable forward (NDF)
|
|
(43,015)
|
|
(107,828)
|
|
(43,015)
|
|
(107,828)
|
Currency option contracts
|
|
-
|
|
(1,575)
|
|
-
|
|
(1,575)
|
Exchange rate contracts (Swap)
|
|
(54,631)
|
|
(69,835)
|
|
(90,905)
|
|
(112,590)
|
|
|
(97,646)
|
|
(179,238)
|
|
(133,920)
|
|
(221,993)
|
|
Derivatives not designated as hedge accounting
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Non-deliverable forward (NDF)
|
|
426
|
|
-
|
|
426
|
|
515
|
Live cattle forward contracts
|
|
9
|
|
29
|
|
9
|
|
29
|
Live cattle option contracts
|
|
395
|
|
551
|
|
395
|
|
551
|
Live cattle future contracts
|
|
-
|
|
4
|
|
-
|
|
4
|
|
|
830
|
|
584
|
|
830
|
|
1,099
|
Liabilities
|
|
|
|
|
|
|
|
|
Non-deliverable forward (NDF)
|
|
(34)
|
|
-
|
|
(147)
|
|
(47)
|
Live cattle option contracts
|
|
(794)
|
|
(203)
|
|
(794)
|
|
(203)
|
Exchange rate contracts (Swap)
|
|
(37,357)
|
|
(48,158)
|
|
(37,357)
|
|
(48,158)
|
Dollars future contracts
|
|
(513)
|
|
(292)
|
|
(513)
|
|
(292)
|
Live cattle future contracts
|
|
(123)
|
|
-
|
|
(123)
|
|
-
|
|
|
(38,821)
|
|
(48,653)
|
|
(38,934)
|
|
(48,700)
|
Current assets
|
|
57,040
|
|
22,944
|
|
57,040
|
|
23,459
|
Current liabilities
|
|
(136,467)
|
|
(227,891)
|
|
(172,854)
|
|
(270,693)
|
The collateral given in the transactions presented above are disclosed in note 8.
22.
LEASES
The Company is lessee in several contracts, which can be classified as operating or finance lease.
22.1.
Operating lease
The minimum future payments of operating lease agreements not cancelable, in total and for each of the following years, are presented below:
103
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and
IFRS
|
|
Parent company
|
|
Consolidated
|
|
03.31.12
|
|
03.31.12
|
2012
|
50,756
|
|
57,883
|
2013
|
52,097
|
|
54,653
|
2014
|
38,667
|
|
40,819
|
2015
|
24,190
|
|
26,320
|
2016
|
13,418
|
|
15,548
|
2016 onwards
|
34,407
|
|
45,233
|
|
213,535
|
|
240,456
|
The payments of lease agreements recognized as expense in the current period amounted to R$7,001 (R$11,847 as of March 31, 2011) at the parent company and R$20,126 in the consolidated on March 31, 2012 (R$65,813 as of March 31, 2011).
22.2.
Financial lease
The Company contracts finance leases for acquisitions mainly of machinery, equipment, vehicles and software.
During the first quarter of 2012, the Company contracted several finance leasing transactions in order to renew its cars fleet. As a consequence, the Company recorded a financial debt of R$39,177 at the parent company and R$70,398 in its consolidated statement.
The Company controls the leased assets which are presented below:
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
Average annual
interest rate %
|
|
03.31.12
|
|
12.31.11
|
Cost
|
|
|
|
|
|
|
Machinery and equipment
|
|
|
|
25,158
|
|
20,537
|
Software
|
|
|
|
18,415
|
|
-
|
Vehicles
|
|
|
|
39,414
|
|
32,641
|
|
|
|
|
82,987
|
|
53,178
|
Accumulated depreciation
|
|
|
|
|
|
|
Machinery and equipment
|
|
24.94
|
|
(15,147)
|
|
(12,792)
|
Software
|
|
20.00
|
|
(979)
|
|
-
|
Vehicles
|
|
13.09
|
|
(2,639)
|
|
(1,379)
|
|
|
|
|
(18,765)
|
|
(14,171)
|
|
|
|
|
64,222
|
|
39,007
|
(*)
The period of depreciation of leased assets corresponds to the lower amount between term of the contract and the life of the asset, as determined by CVM Deliberation No. 645/10.
104
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Average annual
interest rate %
|
|
03.31.12
|
|
12.31.11
|
Cost
|
|
|
|
|
|
|
Machinery and equipment
|
|
|
|
29,621
|
|
24,999
|
Software
|
|
|
|
18,415
|
|
-
|
Vehicles
|
|
|
|
79,658
|
|
51,498
|
|
|
|
|
127,694
|
|
76,497
|
Accumulated depreciation
|
|
|
|
|
|
|
Machinery and equipment
|
|
25.53
|
|
(18,708)
|
|
(15,992)
|
Software
|
|
20.00
|
|
(979)
|
|
-
|
Vehicles
|
|
13.60
|
|
(4,574)
|
|
(2,094)
|
|
|
|
|
(24,261)
|
|
(18,086)
|
|
|
|
|
103,433
|
|
58,411
|
(*)
The period of depreciation of leased assets corresponds to the lower amount between term of the contract and the life of the asset, as determined by CVM Deliberation 645/10.
The future minimum payments required are segregated as follows, and were recorded as current and non-current liabilities:
|
|
|
BR GAAP and IFRS
|
|
|
Parent Company
|
|
|
03.31.12
|
|
|
Present value of
minimum payments
|
|
Interest
|
|
Minimum future
payments
|
2012
|
|
22,599
|
|
2,477
|
|
25,076
|
2013
|
|
23,470
|
|
2,857
|
|
26,327
|
2014
|
|
7,359
|
|
1,269
|
|
8,628
|
2015
|
|
5,249
|
|
1,011
|
|
6,260
|
2016 onwards
|
|
3,549
|
|
718
|
|
4,267
|
|
|
62,226
|
|
8,332
|
|
70,558
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
|
Present value of
minimum payments
|
|
Interest
|
|
Minimum future
payments
|
2012
|
|
39,375
|
|
4,208
|
|
43,583
|
2013
|
|
41,909
|
|
4,922
|
|
46,831
|
2014
|
|
8,465
|
|
1,397
|
|
9,862
|
2015
|
|
5,249
|
|
1,011
|
|
6,260
|
2016 onwards
|
|
3,549
|
|
718
|
|
4,267
|
|
|
98,547
|
|
12,256
|
|
110,803
|
The terms used in contracts for both modalities, with respect to renewal, adjustment and option to purchase, are market practices. In addition, there are no clauses or contingent payments relating to restrictions on dividends, interest payments on equity or additional debt funding.
105
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
23.
SHARE BASED PAYMENT
The rules for the stock options plan granted to executives, were disclosed in the annual financial statements for the year ended December 31, 2011 (see note 23) and has not changed during this period.
The breakdown of the outstanding granted options is presented as follow:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
|
|
Quantity
|
|
Price of converted share
|
|
Share price
|
Grant date
|
|
Beginning of
the year
|
|
End of the
year
|
|
Options
granted
|
|
Outstanding
options
|
|
Granting
date
|
|
Updated
IPCA
|
|
at 03.31.12
|
'
09/27/07
(*)
|
|
09/27/10
|
|
09/27/12
|
|
1,329,980
|
|
442,890
|
|
37.70
|
|
48.23
|
|
36.00
|
05/03/10
|
|
02/05/11
|
|
02/05/15
|
|
1,540,011
|
|
1,288,900
|
|
21.35
|
|
26.02
|
|
36.00
|
07/01/10
|
|
06/30/11
|
|
06/30/15
|
|
36,900
|
|
36,900
|
|
24.75
|
|
26.02
|
|
36.00
|
05/02/11
|
|
05/01/12
|
|
05/01/16
|
|
2,463,525
|
|
2,428,125
|
|
30.85
|
|
32.15
|
|
36.00
|
|
|
|
|
|
|
5,370,416
|
|
4,196,815
|
|
|
|
|
|
|
(*)
Sadia’s stock options plan converted to BRF
The rollforward of the outstanding granted options for the three month period ended March 31, 2012, is presented as follows:
|
|
|
BR GAAP and IFRS
|
|
Consolidated
|
Quantity outstanding options as of December 31, 2011
|
4,277,946
|
Exercised
|
(7,300)
|
Canceled
|
(73,831)
|
Quantity outstanding options as of March 31, 2012
|
4,196,815
|
The weighted average strike prices of the outstanding options is R$31.91 (thirty one Brazilian Reais and ninety one cents), and the weighted average of the remaining contractual term is 40 months. As of March 31, 2012, all of the outstanding options granted on September 27, 2007, corresponding to 442,890 options are exercisable.
The Company presented in shareholders’ equity the fair value of the options in the amount of R$26,027 (R$22,430 as of December 31, 2011). In the statement of income for the three month period ended March 31, 2012 the amount recognized as expense was R$3,598 (expense of R$1,809 as of March 31, 2011).
During the three month period ended March 31, 2012, the Company’s executives exercised 7,300 shares, with an average price of R$26.02 (twenty six Brazilian Reais and two cents) totaling R$190. In order to comply with this commitment, the Company utilized treasury shares with an acquisition cost of R$21.63 (twenty one Brazilian Reais and sixty three cents), recording a gain in the amount of R$32 as capital reserve.
106
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
The fair value of the stock options was measured indirectly using the Black-Scholes pricing model, as disclosed in the annual financial statements for the year ended December 31, 2011 (note 23).
24.
SUPPLEMENTARY RETIREMENT PLAN AND OTHER BENEFITS TO EMPLOYEES
The Company offers supplementary retirement plans and other benefits to their employees. The characteristics of the supplementary retirement plans, as well as the other employee benefits offered by the Company, were disclosed in the annual financial statements for the year ended December 31, 2011 (note 24) and has not changed during this period.
The actuarial liabilities and the related effects in the statement of income are presented below:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Liabilities
|
|
Statement of income
|
|
|
03.31.12
|
|
12.31.11
|
|
03.31.12
|
|
03.31.11
|
Retirement supplementary plan - BFPP
|
|
-
|
|
-
|
|
-
|
|
(1,950)
|
Retirement supplementary plan - FAF
|
|
-
|
|
-
|
|
12,465
|
|
12,963
|
Medical plan
|
|
88,380
|
|
85,156
|
|
(3,224)
|
|
(2,344)
|
Penalty F.G.T.S. (Government Severance indemnity fund for
|
|
|
|
|
|
|
|
|
employees, guarantee fund for lengh of service)
|
|
117,867
|
|
113,393
|
|
(4,474)
|
|
(6,455)
|
Reward for working time
|
|
34,311
|
|
33,107
|
|
(1,204)
|
|
(2,395)
|
Other
|
|
35,524
|
|
34,389
|
|
(1,135)
|
|
(899)
|
|
|
276,082
|
|
266,045
|
|
2,428
|
|
(1,080)
|
25.
PROVISION FOR TAX, CIVIL AND LABOR RISK
The Company and its subsidiaries are involved in certain legal proceedings arising from the regular course of business, which include civil
,
administrative, tax, social security and labor lawsuits.
The Company classifies the risk of adverse decisions in the legal suits as “probable”, “possible” or “remote”. The provisions recorded relating to such proceedings fairly reflect the probable losses as determined by the Company’s Management, based on legal advice and reasonably reflect the estimated and probable losses.
In case the Company is involved in judicial proceedings for which the amount is not known or cannot be reasonably estimated, but the probability of losses is probable, the amount will not be recorded, however, its nature will be disclosed.
107
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
The Company’s Management believes that its provisions for tax, civil and labor contingencies, accounted for according to CVM Deliberation No. 594/09, is sufficient to cover eventual losses related to its legal proceedings, as presented below:
25.1.
Contingencies for probable losses
The rollforward of the provisions for tax, civil and labor risks is summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
|
Parent company
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
Transfers
|
|
Payments
|
|
Price index
update
|
|
03.31.12
|
Tax
|
|
128,513
|
|
4,092
|
|
(2,374)
|
|
(25,112)
|
|
(77)
|
|
3,051
|
|
108,093
|
Labor
|
|
53,555
|
|
12,619
|
|
-
|
|
-
|
|
(27,074)
|
|
1,516
|
|
40,616
|
Civil, commercial and other
|
|
26,372
|
|
1,856
|
|
-
|
|
-
|
|
(1,980)
|
|
879
|
|
27,127
|
|
|
208,440
|
|
18,567
|
|
(2,374)
|
|
(25,112)
|
|
(29,131)
|
|
5,446
|
|
175,836
|
Current
|
|
68,550
|
|
|
|
|
|
|
|
|
|
|
|
53,975
|
Non-current
|
|
139,890
|
|
|
|
|
|
|
|
|
|
|
|
121,861
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
12.31.11
|
|
Additions
|
|
Reversals
|
|
Transfers
|
|
Payments
|
|
Price index
update
|
|
03.31.12
|
Tax
|
|
231,623
|
|
4,133
|
|
(5,648)
|
|
(25,112)
|
|
(2,373)
|
|
6,303
|
|
208,926
|
Labor
|
|
105,162
|
|
25,803
|
|
-
|
|
-
|
|
(45,134)
|
|
3,366
|
|
89,197
|
Civil, commercial and other
|
|
45,174
|
|
2,035
|
|
-
|
|
-
|
|
(3,420)
|
|
1,614
|
|
45,403
|
Contingent liabilities
|
|
571,741
|
|
-
|
|
(9,254)
|
|
-
|
|
-
|
|
-
|
|
562,487
|
|
|
953,700
|
|
31,971
|
|
(14,902)
|
|
(25,112)
|
|
(50,927)
|
|
11,283
|
|
906,013
|
Current
|
|
118,466
|
|
|
|
|
|
|
|
|
|
|
|
97,822
|
Non-current
|
|
835,234
|
|
|
|
|
|
|
|
|
|
|
|
808,191
|
During the three month period ended March 31, 2012, the Company, for better presentation of the amounts related to tax contingencies, considered some reclassifications of items that were not under litigation from tax provisions to other obligations, as well as certain lawyers’ fees. In addition, based on labor judicial decisions occurred during the quarter, the Company settled several labor lawsuits that were being discussed.
25.2.
Contingencies classified as a risk of possible loss
The Company has other contingencies of labor and social security, civil and tax nature, which expected loss evaluated by management and supported by legal advice is classified as possible, and therefore no provision has been recognized. Tax lawsuits totaled R$5,623,185 (R$5,295,018 as of December 31, 2011), from which
R$556,489 (R$565,909 as of December 31, 2011) were recorded at the estimated fair value resulting from business combinations with Sadia, as determined by paragraph 23 of CVM Deliberation No. 580/09, presented in the table of item 25.1. The main natures of these contingencies are properly disclosed in the annual financial statements for the period ended December 31, 2011 (note 25.2).
108
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
26.
SHAREHOLDERS’ EQUITY
26.1.
Capital stock
On March 31, 2012 and December 31, 2011, the capital subscribed and paid by the Company was R$12,553,417,953.36 (twelve billion, five hundred and fifty three million, four hundred and seventeen thousand, nine hundred and fifty three Brazilian Reais and thirty six cents), composed of 872,473,246 book-entry shares of common stock without par value. The realized value of the capital stock in the balance sheet is net of the expenses with public offering in the amount of R$92,947.
The Company is authorized to increase the capital stock, irrespective of amendments to the bylaws, up to the limit of 1,000,000,000 shares of common stock, in book-entry form, and without par value.
26.2.
Breakdown of capital stock by nature
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
Common shares
|
|
872,473,246
|
|
872,473,246
|
Treasury shares
|
|
(3,012,142)
|
|
(3,019,442)
|
Outstanding shares
|
|
869,461,104
|
|
869,453,804
|
26.3.
Rollforward of outstanding shares
109
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
Quantity outstanding of shares
|
|
|
03.31.2012
|
|
12.31.11
|
Shares at the beggining of the year
|
|
869,453,804
|
|
871,692,074
|
Purchase of share (treasury)
|
|
-
|
|
(2,630,100)
|
Sale of shares (share based payment)
|
|
7,300
|
|
391,830
|
Shares at the end of the year
|
|
869,461,104
|
|
869,453,804
|
26.4.
Treasury shares
The Company has 3,012,142 shares in treasury, with an average cost of R$21.63 (twenty one Brazilian Reais and sixty three cents) per share, with a market value corresponding to R$108,437. The decrease of the numbers of shares is due to the exercise of the options of the executives of the Company.
27.
GOVERNMENT GRANTS
27.1
Grants related to income through tax benefits
As of March 31, 2012, the amount related to grants for investment in the Company totaled R$10,343 (R$49,144 as of December 31, 2011), being accounted for at the parent company as a reserve for tax incentives in the shareholders’ equity.
28.
EARNING PER SHARE
110
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
|
|
|
|
|
|
|
03.31.12
|
|
12.31.11
|
Basic numerator:
|
|
|
|
|
Net income for the period attributable to BRF shareholders
|
|
153,199
|
|
383,468
|
|
|
|
|
|
Basic denominator:
|
|
|
|
|
Shares of common stock
|
|
872,473,246
|
|
872,473,246
|
Weighted average number of outstanding shares basic (except treasury
|
|
|
|
|
shares)
|
|
869,453,964
|
|
871,710,398
|
Net earnings (loss) per share - basic - R$
|
|
0.1762
|
|
0.4399
|
|
|
|
|
|
|
|
03.31.12
|
|
12.31.11
|
Diluted numerator:
|
|
|
|
|
Net income for the period attributable to BRF shareholders
|
|
153,199
|
|
383,468
|
|
|
|
|
|
Diluted denominator:
|
|
|
|
|
Weighted average number of outstanding shares - basic (except treasury
|
|
|
|
|
shares)
|
|
869,453,964
|
|
871,710,398
|
Number of potential shares (stock options)
|
|
249,418
|
|
1,767,394
|
Weighted average number of outstanding shares - diluted
|
|
869,703,382
|
|
873,477,792
|
Net earnings per share - diluted - R$
|
|
0.1762
|
|
0.4390
|
On March 31, 2012, from the total of 4,196,815 outstanding options granted to the Company’s executives, 2,871,015 (2,928,905 as of December 31, 2011) were not considered in the calculation of the diluted earnings per share due to the fact that the strike price was higher than the average market price of the common shares during the year and, therefore, the effect was anti-diluted.
29.
RELATED PARTIES – PARENT COMPANY
During its operations, rights and obligations are contracted between related parties, resulting from transactions of purchase and sale of products, transactions of loans agreed on normal conditions of market for similar transactions, based on contract.
111
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
29.1.
Transactions and balances
The balances of the assets and liabilities are demonstrated below:
|
|
|
|
|
|
|
Balance sheet
|
|
|
03.31.12
|
|
12.31.11
|
Accounts receivable
|
|
|
|
|
UP! Alimentos Ltda.
|
|
2,766
|
|
2,935
|
Perdigão Europe Ltd.
|
|
191,616
|
|
161,869
|
Perdigão International Ltd.
|
|
238,516
|
|
247,000
|
Sadia
|
|
92,504
|
|
41,905
|
Sadia Alimentos
|
|
700
|
|
-
|
Heloísa
|
|
31
|
|
311
|
|
|
526,133
|
|
454,020
|
Dividends and interest on the shareholders' equity receivable
|
|
|
|
|
Avipal S.A. Construtora e Incorporadora
|
|
5
|
|
5
|
|
|
5
|
|
5
|
Loans contracts
|
|
|
|
|
Perdigão Trading S.A.
|
|
(648)
|
|
(632)
|
Perdigão International Ltd.
|
|
(2,404)
|
|
(1,815)
|
Highline International Ltd.
|
|
(3,323)
|
|
(3,421)
|
Establecimiento Levino Zaccardi y Cia. S.A.
|
|
4,247
|
|
4,372
|
|
|
(2,128)
|
|
(1,496)
|
Trade accounts payable
|
|
|
|
|
Sino dos Alpes Alimentos Ltda.
|
|
85
|
|
85
|
UP! Alimentos Ltda.
|
|
7,650
|
|
5,930
|
Perdigão International Ltd.
|
|
2,137
|
|
2,138
|
Sadia
|
|
38,107
|
|
22,877
|
Sadia Alimentos
|
|
29
|
|
-
|
Heloísa
|
|
685
|
|
2,070
|
|
|
48,693
|
|
33,100
|
Advance for future capital increase
|
|
|
|
|
PSA Laboratório Veterinário Ltda.
|
|
100
|
|
100
|
Sadia
|
|
277,712
|
|
277,712
|
Heloísa
|
|
57,500
|
|
52,000
|
|
|
335,312
|
|
329,812
|
Other rights and obligations
|
|
|
|
|
BFF International
|
|
971
|
|
971
|
Avex
|
|
80
|
|
-
|
Perdigão Trading S.A.
|
|
410
|
|
410
|
Establecimiento Levino Zaccardi y Cia S.A.
|
|
1,911
|
|
1,181
|
Sadia
|
|
6,326
|
|
1,079
|
Heloísa
|
|
-
|
|
34
|
Perdigão International Ltd.
(*)
|
|
(1,756,969)
|
|
(1,763,378)
|
VIP S.A. Empreendimentos e Participações Imobiliárias
|
|
(3)
|
|
(3)
|
Avipal Centro Oeste S.A.
|
|
(38)
|
|
(38)
|
|
|
(1,747,312)
|
|
(1,759,744)
|
(*)
The amount corresponds to advances for export pre-payment
112
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
|
|
|
|
|
|
|
Statement of income
|
|
|
03.31.12
|
|
03.31.11
|
Revenue
|
|
|
|
|
UP! Alimentos Ltda.
|
|
800
|
|
1,233
|
Perdigão Europe Ltd.
|
|
145,165
|
|
129,228
|
Perdigão International Ltd.
|
|
816,405
|
|
620,733
|
Sadia
|
|
315,954
|
|
106,897
|
|
|
1,278,324
|
|
858,091
|
Cost of goods sold
|
|
|
|
|
UP! Alimentos Ltda.
|
|
(31,065)
|
|
(28,583)
|
Establecimiento Levino Zaccardi y Cia. S.A.
|
|
(2,174)
|
|
(2,060)
|
Sadia
|
|
(159,046)
|
|
(35,246)
|
Heloísa
|
|
(9,795)
|
|
-
|
|
|
(202,080)
|
|
(65,889)
|
Financial income, net
|
|
|
|
|
Perdigão Trading S.A.
|
|
(19)
|
|
(17)
|
Perdigão International Ltd.
|
|
(16,719)
|
|
(8,758)
|
|
|
(16,738)
|
|
(8,775)
|
All the companies listed above are controlled by BRF, except for UP! Alimentos Ltda. which is an affiliated company.
The Company entered into loan agreements with Instituto Perdigão de Sustentabilidade. On March 31, 2012, the total receivable is R$6,837 (R$6,634 as of December 31, 2011), being remunerated to interest rate of 12% p.a..
On March 28, 2012, the wholly-owned subsidiary Sadia granted a loan to Instituto Sadia de Sustentabilidade in the amount of R$2,500.
The parent company and its subsidiaries carry out intercompany loans. Below is a summary of the balances and rates charged for the transactions in excess of R$10,000 on the date of closing of these quarterly financial information:
|
|
|
|
|
|
|
Counterparty
|
|
Balance
03.31.12
|
|
Interest rate
|
Creditor
|
|
Debtor
|
|
BFF International Ltd.
|
|
Perdigão International Ltd.
|
|
767,500
|
|
8.0% p.a. - US$
|
BFF International Ltd.
|
|
Wellax Food Comércio
|
|
522,023
|
|
8.0% p.a. - US$
|
Crossban Holdings GmbH
|
|
Sadia GmbH
|
|
18,467
|
|
3.0% p.a. + ER - US$
|
Crossban Holdings GmbH
|
|
Plusfood Holland B.V.
|
|
91,071
|
|
3.0% p.a. - EUR
|
Plusfood Holland B.V.
|
|
Plusfood Groep B.V.
|
|
71,351
|
|
3.0% p.a. - EUR
|
Plusfood Groep B.V.
|
|
Plusfood Wrexam
|
|
14,255
|
|
3.0% p.a. + ER - GBP
|
Plusfood Groep B.V.
|
|
Plusfood B.V.
|
|
55,354
|
|
3.0% p.a. - EUR
|
Sadia GmbH
|
|
BRF Foods LLC
|
|
26,515
|
|
7.0% p.a. + ER - US$
|
Sadia International Ltd.
|
|
Wellax Food Comércio
|
|
105,988
|
|
Libor + ER - US$
|
Sadia Overseas Ltd.
|
|
Wellax Food Comércio
|
|
464,856
|
|
7.0% p.a. + ER - US$
|
Wellax Food Comércio
|
|
Sadia GmbH
|
|
16,788
|
|
1.0% p.a. + ER - US$
|
Wellax Food Comércio
|
|
Qualy B.V.
|
|
15,008
|
|
Euribor a.t. + 0.10% + ER - US$
|
113
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
29.2.
Other related parties
The Company entered into an operating lease agreement with FAF and for the three month period ended March 31, 2012 the amount of rent paid was R$2,613 (R$2,680 as of March 31, 2011). The amount of rent is agreed at market value.
29.3.
Granted guarantees
All the relationships between the Company and its subsidiaries were disclosed irrespective of the existence or not of transactions between these parties.
All the transactions and balances among the companies were eliminated in the consolidation and refer to commercial and/or financial transactions.
29.4.
Management remuneration
The key management personnel includes the directors and officers, members of the executive committee and the chief of internal audit. On March 31, 2012, there were 26 professionals (27 professionals as of December 31, 2011) at the parent company and in the consolidated.
The total remuneration and benefits paid to these professionals are demonstrated below:
|
|
|
|
|
|
|
BR GAAP and IFRS
|
|
|
Consolidated
|
|
|
03.31.12
|
|
12.31.11
|
Salary and profit sharing
|
|
20,049
|
|
18,290
|
Short term benefits of employees
(a)
|
|
332
|
|
381
|
Post-employment benefits
|
|
30
|
|
43
|
Stock-based payment
|
|
1,661
|
|
476
|
|
|
22,072
|
|
19,190
|
(a)
Includes medical plan, educational expenses and others.
The value of the profit sharing in the results paid to each director in any period is related especially to the net income of the Company and to the assessment of the performance of the director during the fiscal year by the Board of Directors.
The supplementary members of the Board of Directors and of the Fiscal Council are compensated for each meeting that they attend to. The members of the Board of Directors and Fiscal Council have no employment connection with the Company and do not provide services of any kind.
When the management and employees attain the age of 61 years, retirement is mandatory.
114
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
30.
NET SALES
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Gross sales
|
|
|
|
|
|
|
|
|
Domestic sales
|
|
1,703,077
|
|
1,477,760
|
|
3,586,558
|
|
3,305,320
|
Foreign sales
|
|
1,142,972
|
|
1,007,587
|
|
2,417,471
|
|
2,439,801
|
Dairy products
|
|
719,710
|
|
740,357
|
|
752,810
|
|
737,303
|
Food service
|
|
149,440
|
|
111,037
|
|
399,697
|
|
380,232
|
|
|
3,715,199
|
|
3,336,741
|
|
7,156,536
|
|
6,862,656
|
Sales deductions
|
|
|
|
|
|
|
|
|
Domestic sales
|
|
(305,854)
|
|
(276,920)
|
|
(595,085)
|
|
(614,861)
|
Foreign sales
|
|
29
|
|
-
|
|
(58,387)
|
|
(57,230)
|
Dairy products
|
|
(113,352)
|
|
(110,099)
|
|
(119,046)
|
|
(109,489)
|
Food service
|
|
(17,729)
|
|
(16,931)
|
|
(46,896)
|
|
(60,582)
|
|
|
(436,906)
|
|
(403,950)
|
|
(819,414)
|
|
(842,162)
|
Net sales
|
|
|
|
|
|
|
|
|
Domestic sales
|
|
1,397,223
|
|
1,200,840
|
|
2,991,473
|
|
2,690,459
|
Foreign sales
|
|
1,143,001
|
|
1,007,587
|
|
2,359,084
|
|
2,382,571
|
Dairy products
|
|
606,358
|
|
630,258
|
|
633,764
|
|
627,814
|
Food service
|
|
131,711
|
|
94,106
|
|
352,801
|
|
319,650
|
|
|
3,278,293
|
|
2,932,791
|
|
6,337,122
|
|
6,020,494
|
31.
RESEARCH AND DEVELOPMENT COST
Consists of expenditures on internal research and development of new products, recognized when incurred in the statement of income. The total expenditure on research and development for the three month period ended March 31, 2012, is R$5,957 at the parent company and R$7,539 in the consolidated (R$4,020 at the parent company and R$5,403 in the consolidated as of March 31, 2011).
115
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
32.
EXPENSES WITH EMPLOYEE’S REMUNERATION
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Salaries and social charges
|
|
314,175
|
|
255,007
|
|
639,814
|
|
570,536
|
Social security cost
|
|
100,599
|
|
67,551
|
|
201,427
|
|
143,205
|
Government severance indemnity fund for
|
|
|
|
|
|
|
|
|
employees, guarantee fund for length of service
|
|
23,085
|
|
19,150
|
|
46,180
|
|
39,888
|
Medical assistance and outpacient care
|
|
8,606
|
|
12,478
|
|
25,892
|
|
30,400
|
Retirement supplementary plan
|
|
2,205
|
|
1,927
|
|
3,597
|
|
3,012
|
Employees profit sharing
(a)
|
|
(37,329)
|
|
9,854
|
|
22,396
|
|
50,288
|
Other benefits
|
|
61,627
|
|
28,397
|
|
123,379
|
|
52,082
|
Provision for contingencies
|
|
15,489
|
|
8,648
|
|
32,066
|
|
12,853
|
|
|
488,457
|
|
403,012
|
|
1,094,751
|
|
902,264
|
(a)
The credit balance for the three month period ended March 31, 2012 refers to the reversal of the provision for the employees profit sharing for the fiscal year of 2011 net of R$17,049 of expenses from the current period.
33.
OTHER OPERATING INCOME (EXPENSES), NET
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Income
|
|
|
|
|
|
|
|
|
Proceeds from the disposal of property, plant and equipment
|
|
|
|
1,326
|
|
-
|
|
-
|
Insurance indemnity
|
|
|
|
5,721
|
|
5,460
|
|
5,803
|
Employees benefits
|
|
|
|
-
|
|
12,465
|
|
12,963
|
Recovery of expenses
|
|
|
|
7,819
|
|
3,157
|
|
30,797
|
Provision reversal
(a)
|
|
|
|
-
|
|
81,155
|
|
-
|
Scrap sales
|
|
|
|
-
|
|
-
|
|
2,561
|
Other
|
|
|
|
82
|
|
8,304
|
|
5,225
|
|
|
|
|
14,948
|
|
110,541
|
|
57,349
|
Expenses
|
|
|
|
|
|
|
|
|
Loss from the disposal of property, plant and equipment
|
|
|
|
-
|
|
(4,221)
|
|
(2,344)
|
Idleness costs
|
|
|
|
(10,759)
|
|
(29,953)
|
|
(26,081)
|
Insurance claims costs
|
|
|
|
(6,892)
|
|
(10,266)
|
|
(6,897)
|
Employees profit sharing
|
|
|
|
(9,854)
|
|
(74,304)
|
|
(50,288)
|
Stock options plan
|
|
|
|
(1,809)
|
|
(3,598)
|
|
(1,809)
|
Management profit sharing
|
|
|
|
(1,913)
|
|
(4,861)
|
|
(1,913)
|
Other employees benefits
|
|
|
|
(5,058)
|
|
(10,037)
|
|
(12,093)
|
Provision for tax and labor risks
|
|
|
|
(28,535)
|
|
(8,241)
|
|
(28,535)
|
Other operating expenses
|
|
|
|
(2,077)
|
|
(7,002)
|
|
(11,016)
|
|
|
|
|
(66,897)
|
|
(152,483)
|
|
(140,976)
|
|
|
|
|
(51,949)
|
|
(41,942)
|
|
(83,627)
|
(a)
Refers to the reversal of the provision for the employees profit sharing for the fiscal year of 2011 net of R$17,049 of expenses from the current period.
116
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
34.
FINANCIAL INCOME (EXPENSES), NET
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Financial income
|
|
|
|
|
|
|
|
|
Interest on marketable securities
|
|
3,582
|
|
2,750
|
|
6,954
|
|
6,834
|
Exchange rate variation on marketable securities
|
|
-
|
|
385
|
|
-
|
|
-
|
Interests on other assets
|
|
11,234
|
|
8,160
|
|
6,773
|
|
13,343
|
Exchange rate variation on other assets
|
|
-
|
|
2,758
|
|
-
|
|
3,738
|
Monetary variation on assets
|
|
-
|
|
-
|
|
-
|
|
2,798
|
Interests on financial assets classified as:
|
|
9,649
|
|
13,362
|
|
23,884
|
|
30,847
|
Available for sale
|
|
-
|
|
-
|
|
3,637
|
|
13,516
|
Held for trading
|
|
9,649
|
|
13,362
|
|
17,824
|
|
13,565
|
Held to maturity
|
|
-
|
|
-
|
|
2,423
|
|
3,766
|
Gains from derivative transactions
|
|
15,302
|
|
2,040
|
|
10,053
|
|
2,040
|
Interest income on loans to related parties
|
|
197
|
|
172
|
|
4,802
|
|
2,540
|
Gains from the translation of foreign investments
|
|
-
|
|
-
|
|
144,035
|
|
9,707
|
Adjustment to present value
|
|
-
|
|
2,148
|
|
-
|
|
2,149
|
Exchange rate variation on loans and financing
|
|
-
|
|
20,702
|
|
-
|
|
59,789
|
Exchange rate variation on other liabilities
|
|
47,411
|
|
3,964
|
|
80,819
|
|
13,867
|
Other
|
|
892
|
|
-
|
|
6,718
|
|
10,076
|
|
|
88,267
|
|
56,441
|
|
284,038
|
|
157,728
|
Financial expenses
|
|
|
|
|
|
|
|
|
Interest on loans and financing
|
|
(43,098)
|
|
(32,248)
|
|
(107,782)
|
|
(107,803)
|
Exchange rate variation on loans and financing
|
|
(4,705)
|
|
(509)
|
|
(9,925)
|
|
(590)
|
Interest on liabilities
|
|
(6,534)
|
|
(2,530)
|
|
(17,548)
|
|
(2,683)
|
Exchange rate variation on liabilities
|
|
-
|
|
(1,917)
|
|
-
|
|
(6,298)
|
Monetary variation on liabilities
|
|
-
|
|
-
|
|
-
|
|
(6,144)
|
Financial expenses from the acquisition of raw materials
|
|
(2,466)
|
|
(6,589)
|
|
(2,842)
|
|
(6,589)
|
Losses from derivative transaction
|
|
-
|
|
(18,092)
|
|
-
|
|
(19,855)
|
Losses from the translation of foreing investments
|
|
-
|
|
-
|
|
(188,589)
|
|
-
|
Interest expenses on loans to related parties
|
|
(16,738)
|
|
(8,774)
|
|
(550)
|
|
(927)
|
Adjustment to present value
|
|
(85)
|
|
(753)
|
|
(4,423)
|
|
(753)
|
Exchange rate variation on marketable securities
|
|
(697)
|
|
(2,809)
|
|
(5,376)
|
|
(49,330)
|
Exchange rate variation on other assets
|
|
(1,314)
|
|
(2,575)
|
|
(16,630)
|
|
(3,648)
|
Other
|
|
(2,389)
|
|
(2,531)
|
|
(5,320)
|
|
(5,372)
|
|
|
(78,026)
|
|
(79,327)
|
|
(358,985)
|
|
(209,992)
|
|
|
10,241
|
|
(22,886)
|
|
(74,947)
|
|
(52,264)
|
117
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
35.
STATEMENT OF INCOME BY NATURE
The Company has opted to disclose its statement of income by function and thus presents below the details by nature:
|
|
|
|
|
|
|
|
|
|
|
BR GAAP
|
|
BR GAAP and IFRS
|
|
|
Parent company
|
|
|
|
Consolidated
|
|
|
03.31.12
|
|
03.31.11
|
|
03.31.12
|
|
03.31.11
|
Costs of goods sold
|
|
|
|
|
|
|
|
|
Costs of goods
|
|
2,051,638
|
|
1,781,012
|
|
3,572,669
|
|
3,289,340
|
Depreciation
|
|
98,048
|
|
78,943
|
|
193,736
|
|
171,181
|
Amortization
|
|
370
|
|
218
|
|
481
|
|
3,096
|
Salaries and employees benefits
|
|
365,318
|
|
318,641
|
|
763,540
|
|
604,685
|
Other
|
|
216,852
|
|
192,667
|
|
463,216
|
|
406,616
|
|
|
2,732,226
|
|
2,371,481
|
|
4,993,642
|
|
4,474,918
|
Selling expenses
|
|
|
|
|
|
|
|
|
Depreciation
|
|
4,779
|
|
3,663
|
|
7,790
|
|
5,282
|
Amortization
|
|
51
|
|
17
|
|
306
|
|
3,585
|
Salaries and employees benefits
|
|
100,943
|
|
84,744
|
|
230,819
|
|
203,218
|
Other
|
|
280,034
|
|
250,638
|
|
714,519
|
|
642,869
|
|
|
385,807
|
|
339,062
|
|
953,434
|
|
854,954
|
Administrative expenses
|
|
|
|
|
|
|
|
|
Depreciation
|
|
619
|
|
590
|
|
1,703
|
|
836
|
Amortization
|
|
5,666
|
|
1,286
|
|
8,509
|
|
1,884
|
Salaries and employees benefits
|
|
45,924
|
|
29,835
|
|
66,551
|
|
47,415
|
Other
|
|
(6,341)
|
|
18,481
|
|
8,965
|
|
33,941
|
|
|
45,868
|
|
50,192
|
|
85,728
|
|
84,076
|
36.
INSURANCE COVERAGE – CONSOLIDATED
The Company adopts the policy of contracting insurance coverage for assets subject to risks in amounts sufficient to cover any claims, considering the nature of its activity.
|
|
|
|
|
|
|
Assets covered
|
|
Coverage
|
|
03.31.12
|
Not reviewed
|
Insured
amounts
|
|
Amount of
coverage
|
|
|
Fire, lightning, explosion, windstorm, deterioration of
|
|
|
|
|
|
|
refrigerated products, breakdown of machinery, loss
|
|
|
|
|
Inventories and property, plant and equipments
|
|
of profit and other
|
|
22,371,433
|
|
692,696
|
National transport
|
|
Road risk and civil liability of cargo carrier
|
|
16,819,983
|
|
236,063
|
International transport
|
|
Transport risk during imports and exports
|
|
8,869,379
|
|
54,677
|
General civil liability for directors and officers
|
|
Third party complaints
|
|
27,003,655
|
|
35,472
|
118
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
37.
NEW RULES AND PRONOUNCEMENTS NOT ADOPTED
The interpretations and amendments to the rules existent below, applicable to the following accounting periods, were published by IASB and it application to the financial statements of the Company to be filed with CVM (the Brazilian Securities Commission) only if there is a Deliberation by that agency, therefore, there was no anticipated adoption of these rules.
IAS 1 – Presentation of Items of Others Comprehensive Income
In June 2011, the IASB revised IAS 1. The change in IAS 1 deals with aspects related to disclosure of other comprehensive income items and establishes the need to separate items which will not be further reclassified to the net income (for example: realization of the deemed cost) and items that can be further reclassified to the net income, such as gains and losses deferred cash flow hedge. The revised standard is effective for annual reporting periods beginning on or after July 1, 2012. The Company is assessing the impact of adopting this standard on its Financial Statements.
IAS 19 – Employee Benefits
In June 2011, the IASB revised IAS 19. The change addresses issues related to accounting and disclosure of employee benefits. The revised standard is effective for annual reporting periods beginning on or after January 1, 2013. The Company is assessing the impact of adopting this standard on its Financial Statements.
IAS 27 – Consolidated and Separate Financial Statements
In May 2011, the IASB revised IAS 27. The change addresses issues related to investments in subsidiaries, jointly-controlled entities and associate companies, when an entity prepares separate financial statements. The revised standard is effective for annual reporting periods beginning on or after January 1, 2013. The Company understands that this change will not impact its Financial Statements since Separate Financial Statements are not presented.
IAS 28 – Investments in associates and joint ventures
In May 2011, the IASB revised IAS 28. The change addresses issues related to investments in associate companies and establishes the rules for using the equity accounting method for investments in associate companies and jointly-controlled entities. The revised standard is effective for annual reporting periods beginning on or after January 1, 2013. The Company is assessing the impact of adopting this standard on its Financial Statements.
IFRS 7 – Financial Instruments - Disclosures: Offsetting of Financial Assets and
Liabilities
119
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
In December 2011, the IASB issued a revision of the rule establishing requirements for disclosure of compensation arrangements of financial assets and liabilities. This standard is effective for annual periods beginning on or after January 1, 2013. The Company is evaluating the impact of adopting this standard on its Financial Statements.
IFRS 9 – Financial Instruments
In October 2010, the IASB revised IFRS 9. The change of this standard addresses the first stage of the project of replacement of IAS 39. The date of application of this standard was extended to January 1, 2015. The Company is evaluating the impact of adopting this standard and any differences from IAS 39 in its Financial Statements.
IFRS 10 – Consolidated Financial Statements
In May 2011, the IASB issued IFRS 10. This standard provides the principles for the presentation and preparation of financial statements of the Consolidated Financial Statement when the entity controls one or more entities. The standard provides additional guidance to assist in determining control when there is doubt in the assessment. This standard is effective for annual reporting periods beginning on or after January 1, 2013. The Company is evaluating the impact of the adoption of this amendment in its Financial Statements.
IFRS 11 – Joint Arrangements
In May 2011, the IASB issued IFRS 11. This standard deals with aspects related to the accounting treatment for jointly-controlled entities and joint operations. This standard also limit the use of proportional consolidation just for joint operations, and also establish the equity accounting method as the only method acceptable for joint ventures. This standard is effective for annual reporting periods beginning on or after January 1, 2013. The Company is assessing the impact of adopting this standard on its Financial Statements
IFRS 12 – Disclosure of Interests in Other Entities
In May 2011, the IASB issued IFRS 12. This standard deals with aspects related to the disclosure of nature and risks related to interests owned in subsidiaries, jointly-controlled entities and associate companies. This standard is effective for annual reporting periods beginning on or after January 1, 2013. The Company is assessing the impact of adopting this standard on its Financial Statements.
120
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL
PREVIOUSLY ISSUED IN PORTUGUESE)
ITR –
Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS
S.A.
BREAKDOWN OF THE CAPITAL BY
OWNER
IFRS
13 – Fair Value Measurement
In May
2011, the IASB issued IFRS 13. This standard establishes fair value and
consolidates in a single standard the aspects of fair value measurement and
establishes the requirements of disclosure related to fair value. This standard
is effective for annual reporting periods beginning on or after January 1, 2013.
The Company is assessing the impact of adopting this standard on its Financial
Statements.
38.
SUBSEQUENT EVENTS
As
disclosed through the “Announcement to the Market” issued on April 27, 2012,
with the purpose of improving the financial liquidity, the Company and its
wholly-owned subsidiaries Perdigão International Ltda. and Perdigão Europe hired
a credit line Revolver Credit Facility (“RFC"), in the amount of US$500,000,
with a 3 years maturity term in two tranches (USD and EUR), from a syndicate
comprised of 19 global banks, lead by Santander, Morgan Stanley and HSBC. In
different levels the following financial institutions also entered into the
syndicate: Banco Bradesco, Banco do Brasil, Bank of China, The Bank of Nova
Scotia, The Bank of Tokyo-Mitsubishi, BNP Paribas, Mizuho Corporate Bank,
Standard Chartered Bank, Sumitomo Mitsui Banking, ING Bank, Rabobank Curaçao,
Bank of Taiwan, Deutsche Bank, Mega International Commercial Bank, United Taiwan
Bank, Credit Agricole Corporate and Investment Bank.
The
transaction was structured to allow the Company to utilize the credit line at
anytime, throughout the 3 years and will yield interest indexed to LIBOR plus a
spread which may range from 1.6% p.a. to 2.5% p.a. considering the credit rating
classification of the Company’s long term debt.
121
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
39.
APPROVAL OF THE FINANCIAL STATEMENTS
The financial statements was approved and its disclosure authorized by the Board of Directors on April 27, 2012.
BOARD OF DIRECTORS
|
|
|
|
Chairman
|
Nildemar Secches
|
Vice-Chairman
|
Paulo Assunção de Souza
|
|
|
Member
|
Allan Simões Toledo
|
Independent Member
|
Décio da Silva
|
Independent Member
|
José Carlos Reis de Magalhães Neto
|
Board Member
|
Luis Carlos Fernandes Afonso
|
Independent Member
|
Luiz Fernando Furlan
|
Independent Member
|
Manoel Cordeiro Silva Filho
|
Independent Member
|
Pedro de Andrade Faria
|
Independent Member
|
Walter Fontana Filho
|
FISCAL COUNCIL / AUDIT COMITTEE
|
|
|
|
Chairman and Financial Specialist
|
Attílio Guaspari
|
Members
|
Decio Magno Andrade Stochiero
|
Members
|
Manuela Cristina Lemos Marçal
|
BOARD OF EXECUTIVE OFFICERS
|
|
|
|
Chief Executive Officer
|
José Antônio do Prado Fay
|
Vice President of Finance, Administration and Investor Relations
|
Leopoldo Viriato Saboya
|
Vice President of Strategy and M&A
|
Nelson Vas Hacklauer
|
Vice President of Human Resources
|
Gilberto Antônio Orsato
|
Vice President of Operations and Technology
|
Nilvo Mittanck
|
Vice President of Foreign Market
|
Antônio Augusto de Toni
|
Vice President of Local Market
|
José Eduardo Cabral Mauro
|
Vice President of Dairy Operations
|
Fábio Medeiros M. da Silva
|
Vice President of Food Service
|
Ely David Mizrahi
|
Vice President of Supply Chain
|
Luiz Henrique Lissoni
|
Vice President of Corporate Affairs
|
Wilson Newton de Mello Neto
|
Marcos Roberto Badollato
Controller
Renata Bandeira Gomes do Nascimento
Accountant - CRC 1SP 215231/O-3
122
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
The shareholding position of the largest shareholders, management, members of the Board of Directors and Audit Committee of the Company is presented below (not reviewed):
|
|
|
|
|
|
|
|
|
|
|
03.31.12
|
|
12.31.11
|
Shareholders
|
|
Quantity
|
|
%
|
|
Quantity
|
|
%
|
Main shareholders
|
|
|
|
|
|
|
|
|
Shareholders' that take part of voting agreement
|
|
232,893,626
|
|
26.69
|
|
240,061,726
|
|
27.52
|
Tarpon
|
|
69,988,490
|
|
8.02
|
|
69,988,490
|
|
8.02
|
Management
|
|
|
|
|
|
|
|
|
Board of directors
|
|
9,721,600
|
|
1.11
|
|
9,721,600
|
|
1.11
|
Executives
|
|
116,910
|
|
0.01
|
|
100,932
|
|
0.01
|
Treasury shares
|
|
3,012,142
|
|
0.35
|
|
3,019,442
|
|
0.35
|
Other
|
|
556,740,478
|
|
63.82
|
|
549,581,056
|
|
62.99
|
|
|
872,473,246
|
|
100.00
|
|
872,473,246
|
|
100.00
|
The shareholding position of the controlling shareholders that belong to the voting agreement and/or holders of more than 5% of the voting stock is presented below (not reviewed):
|
|
03.31.12
|
|
12.31.11
|
Shareholders
|
|
Quantity
|
|
%
|
|
Quantity
|
|
%
|
Caixa de Previd. dos Func. Do Banco do Brasil
(1)
|
|
111,519,618
|
|
12.78
|
|
111,364,918
|
|
12.76
|
Fundação Petrobrás de Seguridade Social - Petros
(1)
|
|
89,500,982
|
|
10.26
|
|
89,866,382
|
|
10.30
|
Fundação Sistel de Seguridade Social
(1)
|
|
11,726,232
|
|
1.34
|
|
11,725,832
|
|
1.34
|
Fundação Vale do Rio Doce de Seg. Social - Valia
(1)
|
|
16,671,890
|
|
1.91
|
|
23,629,690
|
|
2.71
|
FPRV1 Sabiá FIM Previdenciário
(2)
|
|
3,474,904
|
|
0.40
|
|
3,474,904
|
|
0.41
|
Tarpon
|
|
69,988,490
|
|
8.02
|
|
69,988,490
|
|
8.02
|
|
|
302,882,116
|
|
34.71
|
|
310,050,216
|
|
35.54
|
Other
|
|
569,591,130
|
|
65.29
|
|
562,423,030
|
|
64.46
|
|
|
872,473,246
|
|
100.00
|
|
872,473,246
|
|
100.00
|
(1)
The pension funds are controlled by employees that participate in the respective companies.
(2)
Investment fund held solely by the
Fundação de Assistência e Previdência Social
of BNDES-FAPES. The shares of common stock currently held by this fund are tied to the voting agreement signed by the Pension Funds.
The Company is bound to arbitration in the Market Arbitration Chamber, as established by the arbitration clause in the by-laws.
123
(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
BREAKDOWN OF THE CAPITAL BY OWNER
To the Shareholders and Officers
BRF – Brasil Foods S.A.
Itajaí - SC
We have reviewed the accompanying individual and consolidated interim financial information of BRF – Brasil Foods S.A. (“Company”), contained in the Quarterly Information Form (ITR) for the quarter ended March 31, 2012, which comprise the balance sheet as at March 31, 2012 and the related statements of income, comprehensive income, changes in equity and cash flow for the three-month period then ended, including other explanatory information.
Management is responsible for the preparation of individual interim financial information in accordance with Accounting Pronouncement CPC 21 - Interim Financial Statements and the consolidated interim financial information in accordance with CPC 21 and with International Standard IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board (IASB), as well as for the presentation of this information in a manner consistent with the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of the Quarterly Information (ITR). Our responsibility is to express a conclusion on this interim financial information based on our review.
Scope of the review
We conducted our review in accordance with Brazilian and International Standards on Review Engagements (NBC TR 2410 and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity). A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion on the individual interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the accompanying individual interim financial information included in the quarterly information referred to above is not prepared, in all material respects, in accordance with CPC 21 applicable to the preparation of quarterly financial
information (ITR), consistently with the rules issued by the Brazilian Securities and Exchange Commission.
124
(A free translation from Portuguese into English of Independent Auditor’s Report on Review of Quarterly Information)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
INDEPENDENT AUDITOR’S REPORT ON REVIEW OF QUARTERLY INFORMATION
Conclusion on the consolidated interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial information included in the quarterly information referred to above is not prepared, in all material respects, in accordance with CPC 21 and IAS 34, applicable to the preparation of quarterly financial information (ITR), consistently with the rules issued by the Brazilian Securities and Exchange Commission.
Approval of Sadia S.A.’s business combination
As mentioned in note 1.2, on July 13, 2011, the Administrative Council for Economic Defense ("CADE") approved the merger between the Company and Sadia S.A.. At the same date CADE, the Company and Sadia S.A. agreed and signed a Term Performance Commitment ("TCD"), which formalizes the Company and Sadia S.A. are committed to be compliant with TCD’s requirements, as also mentioned in the same note. Therefore the merger’s approval is subject to the TCD requirements compliance. On March 20, 2012, the Company and Sadia S.A. agreed and signed with Marfrig Alimentos S.A., an asset exchange and other agreements, which formalizes the main terms and conditions to complete the transaction described in note 1.2, which is also subject to restrictive conditions, which is CADE’s approval. Our conclusion does not contain any qualification relating to this matter.
Other matters
Statements of value added
We have also reviewed the individual and consolidated statements of value added for the three-month period ended March 31, 2012, prepared under the responsibility of Company management, the presentation of which in the interim information is required by the rules issued by the Brazilian Securities and Exchange Commission applicable to preparation of Quarterly Information, and as supplementary information under the IFRS, which does not require the presentation of the statement of value added. These statements have been subject to the same review procedures previously described and, based on our review, nothing has come to our attention that causes us to believe that they are not prepared, in all material respects, in accordance with the overall individual and
consolidated interim financial statements.
125
(A free translation from Portuguese into English of Independent Auditor’s Report on Review of Quarterly Information)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
INDEPENDENT AUDITOR’S REPORT ON REVIEW OF QUARTERLY INFORMATION
Audit of prior year and review of corresponding figures of the same period of prior year
The individual and consolidated financial information contained in the quarterly information related to the balance sheet as of December 31, 2011 and income statement, of comprehensive income, cash flow statement, and statements of changes in equity and value added for the quarter ended March 31, 2011, presented for comparison purposes, were audited and reviewed, respectively, by other independent auditors, who issued an unqualified opinion thereon dated March 22, 2012, and an unqualified review report thereon dated May 13, 2011.
São Paulo, April 27, 2012.
Ernst & Young Terco Auditores Independentes S.S.
CRC-SC-000048/F-0
Antonio Humberto Barros dos Santos
Contador CRC-1SP161745/O-3 S-SC
126
(A free translation from Portuguese into English of Independent Auditor’s Report on Review of Quarterly Information)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
INDEPENDENT AUDITOR’S REPORT ON REVIEW OF QUARTERLY INFORMATION
The Fiscal Council of BRF - Brasil Foods S.A., in fulfilling its statutory and legal duties, reviewed:
(i)
the conclusion issued by Ernst & Young Terco Auditores Independentes;
(ii)
the Management Report; and
(iii)
the quarterly financial information (parent company and consolidated) for the three month period ended on March 31, 2012.
Based on the documents reviewed and on the explanations provided, the members of the Fiscal Council, undersigned, issued an opinion for the approval of the financial information identified above.
São Paulo, April 26, 2012.
Attílio Guaspari
Chairman and Financial Expert
Decio Magno Andrade Stochiero
Committee Member
Manuela Cristina Lemos Marçal
Committee Member
127
(CONVENIENCE TRANSLATION
INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR – Quarterly Information – March 31, 2012 – BRF – BRASIL FOODS S.A.
OPINION OF THE FISCAL COUNCIL
In compliance with the dispositions of sections V and VI of article 25 of CVM Instruction No. 480/09, the executive board of BRF – Foods Brasil S.A., states:
(i)
reviewed
, discussed and agreed with the Company's quarterly financial statement for the three month period ended on March 31, 2012; and
(ii)
reviewed, discussed and agreed with conclusions expressed in the review report issued by Ernst & Young Terco Auditores Independentes for the Company's quarterly financial information for the three month period ended on March 31, 2012.
São Paulo, April 26, 2012.
José Antônio do Prado Fay
Chief Executive Officer Director
Leopoldo Viriato Saboya
Chief Financial, Administrative and IR Officer
Nelson Vas Hacklauer
Strategy and M&A Executive Officer
Gilberto Antônio Orsato
Human Resources Executive Officer
Nilvo Mittanck
Operations and Technology Executive Officer
Antônio Augusto de Toni
Export Market Executive Officer
José Eduardo Cabral Mauro
Local Market Executive Officer
Fábio Medeiros Martins da Silva
Dairy Product Operations Executive Officer
Ely David Mizrahi
Food Service Executive Officer
Luiz Henrique Lissoni
Supply Chain Executive Officer
Wilson Newton de Mello Neto
Corporate Affairs Executive Officer
128
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: April 30, 2012
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By:
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/s/ Leopoldo Viriato Saboya
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Name:
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Leopoldo Viriato Saboya
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Title:
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Financial and Investor Relations Director
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