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JBS DAY New York 4Q13 and 2013 Results Presentation March 25th, 2014

Disclaimer

This release contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of JBS. These are merely projections and, as such, are based exclusively on the expectations of JBS management concerning the future of the business and its continued access to capital to fund the Companys business plan. Such forward-looking statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry, among other factors and risks disclosed in JBS filed disclosure documents and are, therefore, subject to change without prior notice.

Management Here Today


Wesley Batista CEO of JBS Global Andr Nogueira CEO of JBS USA Denilson Molina CFO of JBS USA Bill Rupp President and COO of Beef USA Bill Lovette CEO of Pilgrims Pride Martin Dooley President and COO of Pork USA Miguel Gularte CEO of JBS Mercosul Gilberto Tomazoni CEO of JBS Foods Eliseo Fernandez Chief Control Officer Eduardo Maciel Finance Director of JBS S.A. Jerry OCallaghan Investor Relations Officer
3

JBS at a Glance

Founded in the 1950s in Midwest of Brazil IPO in 2007 Leadership position in the global food industry Estimated revenues of around US$50 billion in 2014 Presence in 5 continents and sales to more than 150 countries Production facilities in the low cost geographies More than 185,000 employees

Production capacity

Beef
100 thousand heads/day

Chicken
12 million birds/day

Pork
70 thousand hogs/day

Leather
100 thousand hides/day

Lamb
25 thousand lambs/day

Source: Company

JBS 4Q13 Results Highlights

Net revenue of R$27.2 billion, an increase of R$5.4 billion, or 24.6% higher than 4Q12, of which 54% came from organic growth.

Consolidated EBITDA was R$1,873.5 million, an increase of 60.0% over the same period of last year. EBITDA margin for the quarter was 6.9%.

Annualizing 4Q13 EBITDA leverage ended the period at 3.17x.

JBS ended the year with leverage of 3.70x, considering all debt assumed with Seara acquisition and only one quarter of EBITDA.

JBS 2013 Results Highlights

JBS net revenue increased 22.7% compared to prior year and reached R$92.9 billion.

EBITDA totaled R$ 6.1 billion in 2013, 39.0% higher than 2012. EBITDA margin was 6.6%, an increase of 80b.p. over the previous year.

JBS ended the year with Adjusted Net Income of R$1,194.0 and recorded R$926.9 million of net income, 28.9% higher than 2012 and equivalent to R$323.32 per thousand shares.
JBS generated net cash from operating activities of R$2,541.0 million, with positive free cash flow of R$635.1 million in 2013.

Market Analysis

Worlds Food* Surpluses and Deficits


Net intra-regional trade, million tonnes

150 100 50 0 50 Eastern Europe and former Soviet Union 100 150

Central America North America South America Australia

Western Europe

Asia

Middle East & Africa

1965 1990

1970 1995

1975 2000

1980 2005

1985 2010

* Cereals, rice, oilseeds, meals, oils and feed equivalent of meat. Source: The Economist
8

Global Protein Trade Largest Exporters


JBS is present in the main exporter markets
Beef Exports
Others 16.6%

Brazil 19.2%

Canada 3.4%
India* 17.6%

New Zealand 5.8% Mercosul** 9.2% USA 11.9%

Australia 16.3%

Chicken Exports
Others 10.0% Turkey 3.5% China 4.0% Thailand 5.2% E.U. 10.5%

Pork Exports
Brazil 34.5%
Chile 2.6% China 3.5% Others 4.1%

USA 32.5%

Brazil 8.5%
Canada 17.6%

USA 32.3%
Source: USDA 2013 *Buffaloes / **Excluding Brazilian exports

E.U. 31.2%

Meat Consumption Growth Forecast 2011-2020

Meat Consumption Forecast


(Million tons)
338.3

Expected increase in meat demand by country groups between 2010 - 2020


Developed

278.2 228.1

73.6

64.6
12.8

15.6

19%

58.6 11.2 90.8

126.7 105.7

81%

67.5
2001

95.2
Ave 2008-10

122.5

Emerging
2020

Poultry

Pork

Sheep

Beef

Source: FAO - OECD


10

Global Protein Consumption Growth by Species


Strong Global Industry Fundamentals
(MT in mm)

300

250

200

150

100

50

0 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013E 2015E 2017E 2019E 2021E

Source: USDA FAS and FAO

11

Average global per capita meat consumption, from 1960-2030

Consumption (kg/person/year)

1964-66

1997-99

2030

10

15

20

25

30

35

40

45

50

Chicken

Suine

Ovine

Bovine

Source: FAO

12

Consolidated Results

13

4Q13 Consolidated Results


Highlights
[ Net Revenue - R$ billion] [ EBITDA - R$ million] [ Leverage Net Debt/EBITDA]

27,2 21,9
24.6%

5,4

6,9
3.000

1.873,5 1.170,9
60.0%

2.500 2.000
1.500 1.000 500

3.43

4.03 3.40 3.28

3.70

3.17

4Q12

4Q13

4Q12 EBITDA Margin

4Q13

0 4Q12 1Q13 2Q13 3Q13 4Q13

Leverage

EBITDA (R$ million)

Leverage considering annualized 4Q13 EBITDA

Net revenue of R$27.2 billion, an increase of R$5.4 billion, or 24.6% higher than 4Q12, of which 54% came from organic growth.

Consolidated EBITDA was R$1,873.5 million, an increase of 60.0% over the same period of last year. EBITDA margin for the quarter was 6.9%.

Annualizing 4Q13 EBITDA leverage ended the period at 3.17x. JBS ended the year with leverage of 3.70x, considering all debt assumed with Seara acquisition and only one quarter of EBITDA.

Source: Company

14

2013 Consolidated Results


Highlights
EBITDA
[ Net Revenue - R$ billion]
92,9 75,7

[ EBITDA - R$ billion]
7,6 7,1 6,9 5,8 6,6
6,1 4,4
22.7%

[Net Income - R$ million]

4,5

926,9 718,9

24,2 27,2 19,5 21,9 0,9


1Q13

1,7

1,7

1,9

39.0%

338,5
227,9 219,8 140,7

28.9%

1Q13

2Q13

3Q13

4Q13

2012

2013

2Q13

3Q13

4Q13

2012

2013

1Q13

2Q13

3Q13

4Q13

2012

2013

EBITDA margin (%)

JBS net revenue increased 22.7% compared to prior year and reached R$92.9 billion.
In 2013,net revenue increased more than 10% in all quarters.

EBITDA totaled R$ 6.1 billion in 2013, 39.0% higher than 2012.


EBITDA margin was 6.6%, an increase of 80b.p. over the previous year.

JBS ended the year with R$926.9 million of net income, 28.9% higher than 2012 and equivalent to R$323.32 per thousand shares.

JBS Mercosul recorded net revenue of R$25,820.5 million, up 43.3% when compared to 2012. The chicken unit in the USA (PPC) had the best year in its history in 2013 and posted a net revenue of US$8,411.1 million. Acquisition of Seara and union with JBS Chicken Brazil forming JBS Foods.
15

2013 Consolidated Results

Adjusted net income in 2013 was R$1,194.0 million, disregarding the portion of deferred

Adjusted Net Income

income tax liabilities, which refers to the goodwill held by the Parent company. Net income for the year was R$926.9 million, R$323.32 per thousand shares. In 2013 the company generated net cash from operating activities of R$2,541.0. In 4Q13 net cash from operating activities was R$357.8 million .

Operational Net Cash

In 2013 company generated free cash flow of R$635.1 million. In 4Q13 negative free cash flow

Free Cash Generation

of R$230.4 million due to an expressive expansion of Mercosul exports in the period.

In 2013 the total capital expenditure (CAPEX) was R$1,737.3 million, while in 4Q13 the expenditure was R$585.2 million. The main investments in 4Q13 in North America were

Capital Expenditure

destined to the units of Brooks in Alberta, in Canada, and in Mercosul the main investments were concentrated on improving productivity and expanding operations in the beef business in Brazil and JBS Foods.

Source: Company

16

JBS Consolidated Exports Distribution in 2013 and 2012


Greater China* 21,2%

Other 19,2%

Chile 2,7% Canada 3,6% Venezuela 4,4%

2013 US$11,760.6 million

Mexico 14,6%

Increase of 19.6% in 2013 exports compared to 2012


Mexico 14,6% Other 19,4% Greater China* 14,0%

South Korea 4,9% Russia 5,7%

Africa and Middle East 9,8% E.U. 6,1% Japan 8,0%

Chile 3,1% Venezuela 3,3% Canada 5,4%

2012 US$9,830.2 million

Japan 11,0%

South Korea 5,4%

E.U. 6,2%

Russia 7,4%

Africa and Middle East 10,3%

*Considers China and Hong Kong

17

Debt Profile

18

Indebtedness

Leverage

Breakdown by Company

3.000 2.500 2.000 1.500 1.000 500 0 4Q12 1Q13 2Q13 3Q13 4Q13 3.17 3,43 3,40 4,03

3,28

3,70

Subsidaries 37%

Parent Company 63%

Leverage .

EBITDA (R$ million)

Leverage considering annualized 4Q13 EBITDA

Breakdown by Currency & Average Cost

Annualizing 4Q13 EBITDA, that includes Seara results, leverage ended the period at 3.17x. LTM,Net debt/EBITDA was 3.70x in 4Q13, compared to 4.03x in 3Q13, even after the integration of a relevant acquisition and strong foreign exchange variation. The reduction of net debt/EBITDA reflects the management commitment in improving financial efficiencies, consequently, reducing its leverage.

10.8% per annum


R$ 24% USD 76%

6.0% per annum

19

Debt Profile

JBS ended the year with R$9,013.1 million in cash, corresponding to 96% of short-term debt, approximately. Considering credit lines of immediate liquidity of US$1.55 billion from JBS USA, availabilities of the Company represents more than 100% of short-term debt. The percentage of short term debt (ST) in relation to total debt declined from 35% in 3Q13 to 29% in 4Q13.

4Q12

30%

70%

1Q13

28%

72%

2Q13

35%

65%

3Q13

35%

65%

4Q13

29%

71%

Short term

Long term

Net Debt maturity (R$ million)

4.558 3.000 1.084

5.030

5.073 2.651 1.816

418
2014 2015 2016

32
2017 2018 2019 2020 2021

86
2022 2023
20

Source: JBS

Stock Performance

21

Stock Performance

JBS Stock Performance During 2013, JBSS3 substantially outperformed the

PPC Stock Performance (Controlled by JBS) During 2013, PPC stocks substantially outperformed the S&P 500 Index, increasing 129%, while the index increased 31%. As of December,31 2013 PPCs market cap was US$4.7 billion.

Ibovespa Index, decreased 15%.

increasing

47%,

while

the

index

The Average Daily Traded Financial Volume in the year was R$34.3 million, an increase of 34.1% compared to 2012. As of December,31 2013 JBS market cap was R$25.8 billion.

160% 140% 120% 100% 80% 60%

300%

260%
220% 180% 140% 100%

60%

JBSS3

IBOV

PPC

SPX Index

Source: Bloomberg, 100% = 12/31/2013

22

JBS Mercosul

23

JBS Mercosul

Net Revenue (R$ billion)

Net revenue was R$9,203.7 million in the quarter, up 74.6%


25,8
74,6%

over 4Q12. Incorporation of JBS Foods results in 4Q13;

18,0 9,2 5,3 4Q12 5,0 1Q13 5,4 2Q13 6,2

Improvement in the performance of the beef business in


2012 2013

3Q13

4Q13

Brazil; Increase in the number of processed cattle year over year; Exports 81.8% higher when compared to 4Q12.

EBITDA (R$ billion)


12,6% 11,3% 10,0% 11,1% 10,0% 13,7% 10,5%
16,0% 14,0%

12,0%

10,0%

EBITDA totaled R$ 919.7 with EBITDA margin of 10.0%


Increase in direct distribution and customer base; Higher demand in the international market in the beef segment.

8,0%

6,0%

4,0%

2,0%

0,0%

-2,0%

2,5 0,7
0,0

2,7

-4,0%

-6,0%

-8,0%

-10,0%

-12,0%

0,6

0,5

0,7

0,9 2012 2013

-14,0%

-16,0%

-18,0%

-20,0%

4Q12 1Q13 2Q13 3Q13 4Q13

EBITDA Margin (%)

24

JBS Mercosul
Geographic Footprint and Capacity

Operation platform
BRAZIL ~55,000 head per day

90,000 hides per day


PARAGUAY

36 Distribution Centers 09 Related Businesses

ARGENTINA

URUGUAY

25

JBS Uruguay

Footprint

Uruguay Beef Exports


600,0 500,0 400,0 300,0 200,0 Canelones 100,0 Montevideo 0,0

CAGR 14%

2.000,0 CAGR 3.1% 1.800,0 1.600,0 1.400,0 1.200,0 1.000,0 800,0 600,0 400,0 200,0 0,0

JBS Beef Processing Facility

JBS Tannery

Volume ('000 tons)

Revenue (MM US$)

1 beef processing facility 900 head per day

2 Tanneries 8,400 hides per day

Source: FAO and INAC Uruguay Note 1: Exports revenue compound annual growth rate (2003-2013) Note 2: Exports volume compound annual growth rate (2014-2022)

More than 80% of the Uruguayan land dedicated to livestock European Cattle Breed: Major breeds - Hereford and Angus (British). Focus On Niche Markets: Quality rather than quantity.

Market Access: Access to all major beef importing markets.


Uruguay has about 15,000 m (or 135,000 square feet) for each animal in the farm.
26

JBS Paraguay

Footprint

Paraguay Beef Exports


350,0 300,0 250,0 200,0 Asuncin San Antonio 150,0 100,0 50,0 0,0 1.000,0 900,0 800,0 700,0 600,0 500,0 400,0 300,0 200,0 100,0 0,0

JBS Beef Processing Facility

02 beef processing units 1,300 head per day JBS has around 25% of market share in Paraguayan Exports Herd Growth of 8.0% in 2013, the highest in South America.

Volume ('000 tons) Source: FAO and SENACSA

Revenue (MM US$)

Paraguay also registered the highest growth in beef exports, with revenue growing from US$67.7 million to US$904.3 million in the last decade, an increase of 1,237%. High capacity utilization of processing facilities. Production costs are very competitive.
27

JBS Argentina

Footprint

Argentina Beef Exports


700,0 600,0 Colonia Caroya Rosario Pontevedra Venado Tuerto Berazategui 300,0 200,0 100,0 0,0 500,0 400,0 1.800,0 1.600,0 1.400,0 1.200,0 1.000,0 800,0 600,0 400,0 200,0 0,0

JBS Beef Processing Facility

Volume ('000 tons) Source: FAO, IPCVA and USDA

Revenue (MM US$)

5 beef processing units (only 1 active) 1,750 head per day 1 DC in Pillar

Concentration of activities in one plant in order to have efficiency gains Argentina's exports are restricted by the government due to the "Meat For All program, created in 2011 by the present govern ment. Concentration of activities in one plant in order to have efficiency gains , increasing productivity levels in order to reduce operation costs. Production focused on the domestic market due to tariffs on exports. Change in product mix and creation of customized and branded products such as beef nuggets to attend local demand. Argentina has one of the largest beef consumption.
28

JBS Brazil

Brazil has over 200 million head of cattle, the worlds largest commercial herd, with double the size of the second largest country. JBS is present in 17 of 26 states in Brazil, through:
2
MA

1
PA AC

4 1

1 1 1 4 4 3 6
PR PE

6 4

42 beef processing facilities with capacity to


process 45,000 head of cattle per day cattle per period hides per day

3
RO

15 1

MT

3 9 2
MS GO

TO

1
BA

2 3 2
RJ

06 feedlots with capacity to feed 284,000 head of 19 hide facilities with capacity to process 73,000 35 Distribution Centers (12 large + 23 regional)
JBS increased the number of heads processed by about 20% from 2012 to 2013, while total Brazilian slaughter increased 4%. JBS has 9 businesses related to its Beef Industry that add value to by-products in Brazil. Examples are: biodiesel, collagen, casings, etc.
29

MG

5 2

3 4 2
RS

1
SP

ES

2 2 1

SC

Beef Processing Feedlot Tannery Distribution Center

JBS Brazil

Domestic Market Highlights

Export Market Highlights

35 Distribution Centers (12 large + 23 regional)

Successful marketing and advertising campaign

10,000 new clients in 2013

2014: growth expectations due to important events in Brazil

Exports and revenue exports growth of 25% in 2013

A further 30% revenue growth in local currency

Big demand from emerging markets; i.e. Greater China

Fresh Brazilian Beef to the US

JBS unique position due to its US and Brazilian footprint

30

JBS Leather Business


Overview
JBS is the worlds largest hides/leather processor with capacity to process more than 91,000 hides per day with 26 tanneries and finishing units in:
Brazil, Argentina, China, Germany, Italy,

Mexico, South Africa, Vietnam and Uruguay JBS is the main leather supplier to the automotive industry, which shows excellent growth perspectives. More than 90% of our production is directed to the international market. JBS has been adding value internally, reducing the sale of wet blue (first stage of production) and boosting its sales of finished and semi-finished leather, which contributes to an increase of the profitability of this operation.
JBS projects processing 15 million hides in 2014,

generating revenues of more than US$1.5 billion.

Note 1. Not considering leather operations in the US and Australia


31

JBS Related Businesses in Brazil


Recycling and reducing carbon footprint

Largest producer of sausage casings in the world

Environmental Recycler

Biosiesel

Capacity to produce 136,000 tons of biodiesel per year using beef tallow as principal raw material

Casings

Cans

Complementary to JBS Carriers

JBS
Vehicle Sales

Core Business (Meat)


Carriers Collagen Cleaning & Hygiene

71 MM cans manufactured per month, 100% recyclable

Trading

1,200 providing strategic logistics resulting in cheaper freight

CARRIERS

Opportunity to leverage new businesses

Adding value to beef tallow by producing personal hygiene and also cleaning products

COLLAGEN

Pioneer in beef based collagen production


32

Closing Remarks JBS Mercosul

33

JBS USA

34

JBS USA at a Glance

WHERE

JBS USA Beef Including Australia and Canada JBS USA Pork JBS USA Chicken (Pilgrims Pride Corporation PPC)
35

ARE

WE

Why North America / Australia?

NATURAL RESOURCES & CAPACITY TO PRODUCE GRAINS/OILSEEDS

INFRASTRUCTURE

WORKFORCE: QUALITY & AVAILABILITY

STRONG DOMESTIC MARKET

LOW-COST ENERGY

BEST ANIMAL HUSBANDRY PRACTICES

36

Why North America / Australia?

BEEF
EXPORTERS
Others 18% Canada 4% Mercosul

TOP
Brazil 20%

PORK
EXPORTERS
Other 9% Brazil 9% United States 33%

TOP

CHICKEN
EXPORTERS
Middle East 3% Other 4%

TOP

10%
United States 13%

India 19%

Canada 18% EU 31% United States 32%

Australia 17%

Source: USDA WASDE March 2014.

37

Why North America / Australia?


Exports account for 1 of every 5 pounds produced in the U.S.

U.S. Meat Exports as a % of Production (Beef + Pork + Broiler)


20% 18% 16%

14%
12% 10% 8% 6% 4% 2% 0%

jan-04

jan-88

jan-89

jan-90

jan-91

jan-92

jan-93

jan-94

jan-95

jan-96

jan-97

jan-98

jan-99

jan-00

jan-01

jan-02

jan-03

jan-05

jan-06

jan-07

jan-08

jan-09

jan-10

jan-11

jan-12

Exports % Production: Beef + Pork + Chicken


Source: USDA

Exports % Production: Beef + Pork + Chicken, 12 Month Moving Average


38

jan-13

Why North America / Australia?


Examples Where Beef Exports Are Going
Greater China (in million metric tonnes) Japan (US Beef exports do Japan in metric tonnes)

Growth Rate Australia 228% World 102%

1,03 670,9

449,6 0,51 0,50

0,19

2012

2013

2012

2013

USA +70.4% Australia +259%

Source: USDA

39

Why North America / Australia?

2013
EXAMPLES WHERE PORK EXPORTS ARE GOING Colombia +85.4% Chile +41.8% Taiwan +24.7% EXAMPLES WHERE CHICKEN EXPORTS ARE GOING Angola 3rd largest importer in 2013, 456K metric tonnes Iraq + 45%

China + 38.1%
Source: USDA
40

Our Team

ANDRE NOGUEIRA
JBS USA

71,296
EMPLOYEES
IN 4 COUNTRIES & PUERTO RICO
Headcount
7,636 5,087 55,610 2,539 424

BILL LOVETTE
JBS USA CHICKEN (PILGRIMS PRIDE CORPORATION PPC)

BILL RUPP
JBS USA BEEF (CANADA & AUSTRALIA)

DENILSON MOLINA
JBS USA CFO

MARTY DOOLEY
JBS USA PORK
United States Australia Mexico Canada Puerto Rico

41

Human Resources

Turnover Results
Continuously improve employee engagement and drive-down turnover

50% REDUCTION
IN TURNOVER

MORE THAN A OF HOURLY PRODUCTION


EMPLOYEES

Company Turnover Hourly

2007

2008

2009

2010

2011

2012

2013

FROM 2007-2013

2007

2008

2009

2010

2011

2012

2013

42

Human Resources

Safety Results
Meat & Poultry Combined Recordable Rate
6,9 6,2 6,4 6,3

4,60

4,2

2010

2011 JBS Industry

2012

Consistently outperform our competitors

Source: Company

43

Human Resources

Next generation of leaders

200
LEADERSHIP PROGRAM

TRAINEES

IN 2013

44

Sales Growth Historical Performance


JBS USA Holdings Net Sales (US$ Billion)

35.000 30.000 25.000

20.000
15.000 10.000 5.000 0 2007 2008 2009 2010 2011 2012 2013

Acquisitions
McElhaney Cattle Co.
45

Turn Around + Growth = Value Generation

JBS USA EBITDA $ MILLION


1.415,0

JBS USA Acquisitions

McElhaney Cattle Co.

$4.87
BILLION

63,5
2007 2013

Investments 2013 EBITDA

= 3.44 x

46

JBS USA Pork At a Glance

12%
MARKET
S H A R E FOOTPRINT
3 Pork Plants 51,300 Head per Day 1 Lamb Plant 2,800 Head per Day 1 Case Ready Plant

BRANDS

47

JBS USA Pork Where We Are

PORK
3 Processing Facilities; 1 Case Ready Louisville, Kentucky Marshalltown, Iowa Worthington, Minnesota Santa Fe Springs, California (case ready) Daily Processing Capacity: 51,300

LAMB
1 Processing Facility Greeley, Colorado Daily Processing Capacity: 2,800
Plant Case Ready

48
48

JBS USA Pork

8%

Net Revenue (US$ million)

Net Revenue was US$3.5 billion, stable over 2012:


4000,0

3.501,1 3.518,7
3500,0 3000,0

Lower number of processed animals, which resulted in a

-5,3%
2500,0 2000,0

decrease of sales volume that was offset by an increase in


903,3 904,9

1500,0

955,5
1000,0 500,0

842,0

868,5

prices.
2012 2013

0,0

4Q12

1Q13

2Q13

3Q13

4Q13

EBITDA (US$ million)


399,977

4,5%

5,6%

5,8%

9,5% 4,8%

5,4%

6,5%

EBITDA was US$227.6 million, increase of 21% over 2012:


9,0% 5,0%

299,977 1,0%

Increase in selling prices both in the domestic and

227,6
-3,0%

188,1
199,977 -7,0% -11,0%

international markets. EBITDA margin of 9.5% in the 4th quarter 2013.

86,3
99,977

42,7
-0,023

46,8

50,7

43,8

21%

-15,0%

-19,0%

-23,0%

4Q12 1Q13 2Q13 3Q13 4Q13

2012 2013

EBITDA Margin (%)

49

Strategy

BUY
Maintain 70% contract supply Increase supply from medium/smaller producers Increase programs, such as paylean free, marbled, weight sorted

MAKE
Continue to focus on:

SELL

Safety Turnover Labor efficiency All expenses elements Yields Additional automation

Increase Japan chilled Improve converted products volume and margin Expand case ready Expand value-added

50

US Pork - Added Value Products

Swift Premium Dry Rubbed Loin Filet

Swift Premium Dry Rubbed Ribs

Swift Premium Saddle Pack Boneless Pork Chops

Swift Premium Dry Rubbed Boneless Backrib

Swift Premium Ground Pork

51

JBS USA Beef At a Glance

22% 34% 27% U.S. CAN AUS


FOOTPRINT
U.S.
CANADA AUSTRALIA
9 Beef Plants 27,000 Head per Day 11 Feedlots / 1M Head Capacity 1 Hide Plant / 5,000 Hides per Day 1 Beef Plant 4,000 Head per Day 1 Feedlot / 70,000 Head Capacity

MARKET SHARE
BRANDS

8 Beef Plants 8,300 Head per Day 5 Feedlots / 152,000 Head Capacity 5 Lamb Plants / 22,000 Head per Day 1 Hide Plant / 6,000 Hides per Day

52

JBS USA Beef Where We Are

AUSTRALIA
10 beef and small stock slaughtering plants located in New South Wales, Queensland, Victoria and Tasmania 7 distribution centers situated in Sydney, Melbourne, Brisbane, Perth, Adelaide, Dinmore & Townsville 5 cattle feedlots located in Queensland and New South Wales

U.S. & CANADA

10 beef and small stock slaughtering plants located in Brooks, AB CA; Cactus, TX; Grand Island, NE; Greeley, CO; Green Bay, WI; Hyrum, UT; Omaha, NE; Plainwell, MI; Souderton, PA; and Tolleson, AZ.

11 cattle feedlots located in Brooks, AB, CA; Dalhart TX; Hartley, TX; Kersey, CO; Lamar, CO; LaSalle,CO; Malta, ID; Texhoma, OK; Ulysses, KS; Wellton, AZ; and Yuma, CO.

Daily Processing Capacity: 31,000

Daily Processing Capacity: 8,300


53

JBS USA Beef (including Australia and Canada)

Net Revenue (US$ billion)

Net revenue was US$18.6 billion, increase of 6.3% compared


17,5 18,6

to 2012:
Increase in domestic sales volume and in exports in Australia.

-1,0% 6.3%

4,9 4Q12

4,3
1Q13

4,8 2Q13

4,7 3Q13

4,8 4Q13 2012 2013

EBITDA was US$375.8 million, increase of 67.8% compared to 2012:


Increase in domestic market beef prices during the 4th quarter, offsetting the increased costs of raw material.
8,0%

EBITDA (US$ million)


700

2,1%
600 500

-0,6%

3,4% 2,7% 2,4%

1,3% 2,0% 375,8

6,0%

JBS maintained the positive results registered during the year of 2013, a reflection of the focus on operational efficiency, costs reduction and expansion in deals with key customers The operation in Australia continues to deliver solid and consistent results, influenced by strong demand from Asian countries, especially China.

4,0%

2,0%

0,0%

-2,0%

-4,0%

400

-6,0%

-8,0%

-10,0% 300

223,9 161,7 103,3 -25,1 2012 2013 125,3 113,9


68%

-12,0%

-14,0%

200

-16,0%

-18,0%

-20,0%

100

-22,0%

-24,0%

0 -26,0%

-100

4Q12 1Q13 2Q13 3Q13 4Q13

-28,0%

-30,0%

EBITDA Margin (%)

54

Marketing Conditions

Tight supplies forecast in North America as strong signs of heifer

retention & rebuilding occur due to much improved moisture conditions


Global trade for North American and Australian Beef continues to be

strong.
Higher prices will impact demand for North American beef but a

downturn in protein supplies should support.

55

Strategy

Capital investments in multiple ground beef capabilities and value

added production will improve top line revenue opportunities.


Continued alignment of cattle supplies with plants will lessen the impact

of tight supplies.
Strong plant focus on yield improvement in plants. Continued success in aligning with customers to jointly

optimize value with the consumer.

56

JBS USA Chicken Pilgrims Pride Co.

19%
MARKET
S H A R E FOOTPRINT
U.S.
MEXICO PUERTO RICO
31 Chicken Plants 6.5M Birds per Day 3 Chicken Plants 800,000 Birds per Day 1 Chicken Plant

BRANDS

57
57

JBS USA Chicken Where We Are PILGRIMS


25 U.S. & Puerto Rican Processing Facilities

Aibonito, PR Athens, GA Broadway, VA Canton, GA Carrollton, GA


Chattanooga, TN De Queen, AR Douglas, GA Elberton, GA Ellijay, GA Enterprise, AL Gainesville, GA

Guntersville, AL Live Oak, FL Lufkin, TX Marshville, N.C. Mayfield, KY Moorefield, WV Mt. Pleasant, TX Nacogdoches, TX Natchitoches, LA Russellville, AL Sanford, N.C. Sumter, SC Waco, TX

3 Mexican Processing Facilities Queretaro San Luis Potosi Tepeji Del Rio Daily Processing Capacity: 7.5 Million birds

58

JBS USA Chicken (Pilgrims Pride Corporation - PPC)

17%

Net Revenue (US$ billion)

Net Revenue was US$8.4 billion, increase of 3.6% compared


-6,5%

8,1

8,4

to 2012.
Growth in sales resulting primarily from an increase in industry

2,2

2,0

2,2

2,1

2,0

3.6%

prices associated with good demand for poultry products combined with a tight supply.

4Q12

1Q13

2Q13

3Q13

4Q13

2012

2013

EBITDA (US$ million)


1500 1400 1300

EBITDA of US$805.4 million, increase of 100% over 2012 and


9,6% 5,0% 805,4
-5,0% -10,0% 15,0% 10,0%

1200

3,1%

5,8%

12,1% 10,6% 9,6%

margin of 9.6%:
Improved pricing, improved sales mix, improved yields,

5,0% 1100

1000 0,0%

900

800

700

reduction in processing cost and SG&A contributed to improve

600

500

400

300

200

67,4

117,7

265,0 226,1

402,6 197,2
100%

-15,0%

-20,0%

PPC results.

-25,0%

100

-30,0%

4Q12 1Q13 2Q13 3Q13 4Q13

2012 2013

Operating net cash flow was US$878.5 million for the full year,

EBITDA Margin (%)

adding strength to the Company's balance sheet.

59

Strategy

Results- oriented culture consistent with JBS values Delayering and downsizing management driving lower SG&A Growing talent internally and developing people

Be a valued partner with our key customers

Best of class quality management systems Employ greater use of category management Execute effective operator strategy

Accountability and ownership culture

Be the best managed & most respected company in our industry

Relentless pursuit of operational excellence

Export dedicated assets Export tailored products Development of new markets

Strategically grow valued added exports

Best of class yields Best of class live cost and processing costs Optimal sales mix and price Quality, safety and turnover

60

On a Path Toward Growth

Were Ready Operational Efficiency


Improved commitment to quality

Mix and Rationalization


Customer Products Capacity

Renewed Sales & Brand Focus

61

Whats Next

Continue Pushing Operational Efficiencies Generate Superior Returns & Optimize Capital Structure Capture Growth Opportunities

Higher, Less Volatile Earnings

SHAREHOLDER VALUE

62

Whats Next

Leverage Existing Assets

Expand actual plants and lines with high-ROIC investment opportunities $150 million of CapEx expected

Accretive Acquisitions

Chicken: Complementary Geographies or Differentiated Branded chicken Prepared/ Packaged Foods: Branded and differentiated products

About half directed to growth / increase efficiency

Increase Footprint in Attractive Mexico Chicken Industry

Current footprint only covers a portion of the country Opportunity to expand geographically Evaluate bolt-on acquisitions or greenfield opportunities

Leverage JBS capabilities to sell direct to customers in foreign markets Develop brands / products designed for local preferences Focus on value-added products, not just commodity dark meat Capture significant expected growth in chicken demand in foreign markets

Fast Growing ValueAdded Exports

63

JBS Foods

64

JBS Foods at a Glance


JBS Foods is a leading platform with a strong brand portfolio across value added food products in Brazil

JBS Foods is the branded convenience poultry and pork business of JBS in Brazil 2nd largest meat based packaged food Company in Latin America 2nd largest producer and exporter of poultry and pork in Brazil 53 productive units, 20 distribution centers and 45,000 employees Strong domestic and international presence with high growth potential Integrated platform with diversified product portfolio Fully integrated pork and poultry business

JBS Foods

Source: Company Nota 1. Pending regulatory approval

65

JBS Foods: Footprint


National footprint with a production capacity of 4.4 mm bird / day and 85,000 tons of further processed products / month
Industrial Capacity per Product Line 4.4 mm birds / day Industrial Footprint

22,200 hogs / day

80,000 tons of value added further processed products / month Further Processed Products Refrigerated Pasta

Pizza

Lasagna

Breaded Products
Distribution Centers

Hamburger

Ready-to-eat Meals

Production Facilities Footprint

Source: Company

66

Turnaround Under Way


JBS Foods focus on 5 pillars to make a strong and fast turnaround of Seara

Management

Growth

Culture of Excellence

Market Orientated

Performance

67

Our Team and Our Culture Makes the Difference


JBS has built an exceptional team with deep knowledge in the industry

Our Team
Gilberto Tomazoni CEO (30 years) James Cleary International Market (24 years) Srgio Sampaio Production (20 years) Ivo Dreher Financial/Adm (17 years) Osrio Dal Bello Live Production (34 years) Joanita Karoleski Supply Chain (10 years) Almir Peruk Human Resources (25 years) Ronaldo Muller Quality and R&D (27 years)

Culture of Excellence Our Values


Determination Simplicity Discipline Sincerity Meritocracy

What We Believe
Best people in the right place Ownership attitude Leadership by Example Team Work Focus on Details

Ivan Siqueira Industrial (15 years) Eduardo Bernstein Marketing (26 years)
Nelson Teixeira Domestic Sales (26 years)

( Years of experience, occupying leadership positions in the industry)

68

Market Orientated: Streamlining and Repositioning of Brands


JBS Foods is currently rationalizing its brand portfolio and focusing on the quality of its products and services
JBS Foods Brands Pre-Acquisition JBS Foods Brands Repositioning

Premium

Mainstream

Access / Regional

Source: Company

69

Market Orientated: Improved Pricing Strategy


New pricing strategy, focused on results rather than volumes, with strict controls and defined responsibilities
Previous Model New Model

Structure

Decentralized, with lack of standard pricing process and management

Centralized, with standard and structured process Defined roles and responsibilities

Responsible for Price Management

Fragmented, mostly commercial department

Dedicated pricing department

Focus

Volumes, with low commitment to pricing and consequently financial results

Financial results, based on mathematical modeling

Commercial Team Autonomy

High commercial team concentrated pricing strategy

Medium focus on policy execution

Source: Company, Nielsen

70

JBS Foods: Global Positioning and International Growth Strategy


Comprehensive strategy to explore opportunities in further processed foods and international markets
Revenue Breakdown per Category 4Q13 (%) International Growth Strategy

Domestic Market 46%

Fresh Exports 48%

FPP Exports 6%

Revenue Breakdown per Region 4Q13 (%)


Americas 8% Europe 10% CIS / Balkans 4% Middle East 31%

North Africa 10%

Strategic approach Instead of transactional approach Develop strategic partnerships with importers/distributors in our key markets Develop Seara into a recognized global brand for quality poultry, pork and further processed products Increase our presence in the supply of FPP to global QSR customers Improve our product mix by increasing sales of retail packs Specific strategies for new markets (eg. Pork for Japan)

Africa 11%

Japan 12%

Asia / Oceania 14%

Source: Company

71

Improved Performance from Farm to Market


Efficiency gains in live costs, manufacturing and distribution
Stage of Value Chain
Live Costs and Efficient Feed Conversion

Main Initiatives

Cycle optimization through revision of practices and improved feed conversion Implementing best practices in feed nutrition and livestock handling
Increase in Yields and Optimization of Product Mix

Focus on operational excellence with new operational standards Optimization of product mix per industrial unit Product mix more aligned with availability and quality of raw materials, increasing
revenue generation

Improved Distribution Network

Integrated demand planning Renewed logistics network

Renewed Go-To-Market Strategy

Marketing strategy focused on profitability and portfolio simplification Simplification of brand architecture Category management
72

Value Creation Through Management Initiatives in 2014


JBS Foods has identified total potential gains of R$1.2 billion through internal management initiatives

Value of Opportunities Identified in JBS Foods (R$ mm) Price and Sales Strategy Live Animal Industrial Domestic and International Logistics Finance and Administration Non Core Supplies

R$287 mm

R$207 mm

R$472 mm

R$118 mm

R$30 mm

R$87 mm

Total Value of Opportunities: R$1.2 billion

73

Growth Opportunities Through Organic and Inorganic Growth


Additional growth opportunities through capacity expansion and product mix diversification
Idle Capacity We have around 40% in idle capacity of FPP

Numerical Distribution

We are servicing direct 58,000 customers and have potential to increase to 140,000

Strategies for Inorganic Growth


Rationale Recent Movements

Capacity Expansion

Increase processing capacity and geographical diversification

Leasing of BR Frangos production unit in North of Paran

Product Mix Diversification

Increase category diversification

Acquisition of Massa Leve in 2013 Main products include pastas, ready-to-eat meals, pizzas and pastry based products

Share of Birds Slaughter in Brazil LTM Until Sep13 (%)


Others 51%

Share of Pig Slaughter in Brazil 2013 (%)


Others 57%

JBS 17% Player A 32% Source: Company, SIF, SECEX, IBGE, JBS Player A 29%

JBS 14%

74

We Are Confident That We Will Continue to Deliver Value to Our Stakeholders as Our Track Record Shows
Extensive experience in integrating and extracting synergies in acquisitions
Key Initiatives Value Creation in the Acquisition of Pilgrims Pride (US$ mm)
3,825
JBS stake in PPC

64.0%

67.3%

68.0%

75.5%

Swift acquisition (2007)

Pilgrims Pride acquisition (2009)


Value Creation of 250%

Cost reduction

2,730

Margin improvement

SG&A control
144 800 42

110

1,095

Efficiency improvement

Integration of processes
Dec-09
JBS USA acquisition of 64% stake in PPC

Nov-10
Increase ownership to 67.3%

Jan-12

Mar-12/Nov-12

Brand repositioning

JBS USA Acquisition of oversubscription in additional shares PPC rights from Lonnie Bo offering Pilgrim and Don Jackson1

Total JBS Investment

Value Creation Current Market Value of JBS Stake

1 JBS USA acquired 18.7 mm shares from Lonnie Bo Pilgrim, the founder and former controlling shareholder of PPC (US$107.2 mm) and 455.3 thousand shares from Don Jackson, JBS USAs former CEO (US$2.7 mm) 2 PPC market value of US$4,958 mm (as of March 14, 2014)

75

Mission

To be the best in what we set out to do, totally focused on our business, ensuring the best products and services for our customers, solidity for our suppliers, satisfactory profitability for our shareholders and the certainty of a better future to all our employees.