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Published on 04/11/2016
Published on 11/19/2015
BRF Has Enough Revenues to Overcome Crisis and Fulfill All 2018 Payments
03/07/2018 - 13h48
FROM SÃO PAULO
As long as international markets don't sever their ties with BRF, the food giant should have sufficient funds to overcome the financial turbulence that was provoked by Federal Police investigations.
The conglomerate, which came into fruition as a result of the Sadia-Perdigão merger, has approximately R$ 10 billion (US$ 3.1 billion) in available funds: R$ 7 billion (US$ 2.2 billion) in revenues and a R$ 3 billion emergency credit line (US$ 938 million) provided by a syndicate of banks.
BRF's gross debt is a hefty R$ 20 billion (US$ 6 billion), but the resources it has on hand should be enough to cover its short-term commitments. The company has to pay off R$ 4.5 billion (US$ 1.4 billion) this year and another R$ 4 billion (US$ 1.25 billion) next year.
However, according to sources who are up to par with the company's situation, the company intends to continue generating revenue as opposed to accessing its credit. BRF's situation would only begin deteriorating if several countries decided to interrupt the importation of its products, thus affecting revenues.
Up until now, the federal government has only barred three of BRF's plants from exporting to 12 different countries after the company was suspected of rigging lab samples and after accusations arose that its animals were contaminated with a type of salmonella that does not affect human health.
Following the arrest of former CEO Pedro Faria on Monday (the 5th), banks have been in touch with the company in order to make sure it will be in a position to pay off its debt. Their assessment for the time being is to remain alert, but they do not believe the situation has reached a critical point.
Translated by THOMAS MATHEWSON