Good morning, and welcome to JBS S.A. and JBS USA first quarter of 2024 results conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will be given at that time. As a reminder, this conference is being recorded. Any statements eventually made during this conference call in connection with the company's business outlook, projections, operating and financial targets, our potential growth should be understood as merely forecast based on the company's management expectation in relation to the future of JBS. Such expectation are highly depend on market conditions, on Brazil's overall economic performance, and on industry and international market behavior, and therefore, are subject to change. Present with us today, Gilberto Tomazoni, Global CEO of JBS, Guilherme Cavalcanti, Global CFO of JBS, Wesley Batista Filho, CEO of JBS USA, and Cristiane Assis, Investor Relations Director. Now, I will turn the conference over to Gilberto Tomazoni, Global CEO of JBS. Mr. Tomazoni, you may begin your presentation. Excuse me, Mr. Tomazoni, you may unmute your microphone, please. Good morning, everyone. Thank you very much for your participation in our results teleconference. Before delving into the results, I want to take this opportunity to express my solidarity with the victims on the catastrophe caused by the rains in Rio Grande do Sul, especially our more than 16,000 team members in the state. The world has been following the situation with sadness, and the dedication of our entire team has been essential for help our team members, our partners, along with their families, and the impact community recover. Once again, I want to express my deep admiration and gratitude for the extraordinary work that everyone has been doing to offer support during this tragic event. As a company, we have mobilized them to provide donations of essential items for assistance to people in the region, such as food, hygiene, and clean products, water, clothing, and blankets. Shifting to our results that we are releasing today, JBS had a solid first quarter, reinforce that we are on the path to recover, as indicated in the previous periods. We added nearly 2 percentage points to our consolidated EBITDA margins compared to the fourth quarter of 2023, and almost five points compared to the first quarter of 2023, achieving a margin of 70.2% for the period. I would like to highlight Seara's results. With a double-digit margin already achieved in the first quarter, the closing of some operation gaps, the normalization of grain costs, and the growth involved in domestic market, reinforce our promised prospect for Seara this year. We maintain our focus of identifying consumer preference and capturing operational opportunities. The focus on key customers, brand growth, and consolidation of the business in Europe, along with the pursuit of operational excellence, are reflected in the Pilgrim's strong performance. Business margins saw a significant increase, jumping from 6.5% in the first quarter in 2023, to 11% in the first quarter of 2024. U.S. pork margins similarly increased from 2.5% to 16.4% over the same period. Both the poultry and pork business are benefit from reduction of grain price, as well as the rebalance of supply and demand. I want to highlight that the strength of our results, once again, reinforce the importance of geographical and protein diversification. In a traditional weaker quarter of the global protein industry, the beef business in Brazil and Australia capture cow-calf cycle high in both countries. While JBS Beef North America continues to experience weak margins due to where we are in the region-scale cycle in season conditions, as previously noted. We achieved net profit of $332.3 million for the period, with net revenue of $18 billion and adjusted EBITDA of $1.3 million.... Our priority remain the leverage. The leverage rate decreased from 40.42 x in dollars in the fourth quarter of 2022, to 3.66 in dollars in the first quarter of 2024. The results from the quarter emphasize our confidence in JBS' long-term strategy, focus, and ex- on expanding our global multi-protein platform, and consolidation our portfolio of strong brands and value-added products. In this regard, we have made numerous investments over the past few years that will begin to yield results. In Brazil, we will open a new in natura pork plant and prepared food plant this year in Dourados industrial complex in Mato Grosso do Sul. We also announced in April that we will double the capacity of our Campo Grande beef facility in the same state, one of the recently approved China export facilities. In Jeddah, Saudi Arabia, we are finalizing our third Halal value-added products facility. In San Sebastián, in Spain, we will begin operation at the Biotech Foods cultivated protein plant. We remain focused on what we control to become increasingly competitive in each market where we operate. For this reason, we have an absolute focus on our operation, cost management, productivity increase, portfolio optimization, and prices, regardless of geographically or economic fluctuation. We are confident that the strength of our platform, combined with our financial performance and our commitment to excellence and innovation, will allow JBS to continue its growth trajectory, generate value for our stakeholders, and the communities in which we operate. Thank you again for your participation in this results call, and now I will pass the floor to Guilherme, who will detail our numbers. Guilherme, please. Thank you, Tomazoni. Let's now move to the operational and financial highlights of the first quarter of 2024. Starting on slide 15, please. Net revenue in the first quarter, 2024, was $18 billion. Adjusted EBITDA totaled $1.3 billion, and represents a margin of 7.2% for the quarter. Net profit was $332 million in the first quarter. Moving on to the next slide, operating cash flow in the quarter was $25 million. Free cash flow for the quarter was negative, at $625 million. As we anticipated in the last earnings conference call, we estimated that the cash consumption would be half of the amount reported in the same period last year, which happened. Despite this cash consumption, which is common to the first quarter due to the seasonality of the period, the improvement is mainly explained by the increase in results from practically all of our business units. Also on this slide, capital expenditures in the quarter was approximately $284 million, 55% of which was maintenance CapEx. This amount is 26% lower than the first quarter, 2023, and is in line with our estimate of the year of $1.3 billion. Now, moving to slide 17, net debt ended up the first quarter at $15.9 billion, reflecting an increase in $569 million compared to the previous quarter. A change that is in line with the cash consumption of the quarter, and expected considering the seasonality of this time of the year. Leverage in dollars reduced from 4.42x to 3.66x, and in reais from 4.32 to 3.7 in the quarterly comparison, confirming the deleveraging path that we had indicated in previous calls. For the second quarter, we expect another significant decrease in this indicator to around 3x. A simple leverage exercise without considering guidance, to achieve a leverage at the end of the year of 2.5x, our consolidated margin for 2024 should be close to 7.5%. Considering that the first quarter is seasonally weaker and the margin was already 7.2%, it is reasonable to think about this level of leverage for the end of the year, thus align it with our policy of maintaining leverage ratio between two and 3x in the long term. It's worth mentioning that we reduced gross debt in $666 million in the first quarter, mainly due to the payment of short and long-term bank debts. We will continue to reduce gross debt in the second quarter. I will now briefly go through the business units. Starting with Seara on slide 18, net revenue for the quarter remained stable in relation to the same period of the previous years at $2.1 billion. However, as we had indicated, profitability has already returned to normalized double-digit levels. This improvement is the result of the intense focus on operational excellence, on the management team, on reducing costs, especially grains, and on better balance of global supply and demand, on commercial execution, and on the maturation process of Seara's new plants. Thus, the EBITDA margin grew by more than 10 percentage points in the annual comparison, reaching 11.6% in the first quarter. Moving now to slide 19, JBS Brazil recorded net revenue 22% higher than the first quarter last year, driven by higher volume sold. The favorable cattle cycle had a positive impact on sales volume, both in domestic and international markets, due to the greater availability of animals for slaughter. This cycle has also contributed to reduce the prices of live cattle, as a consequence, has boosted profitability in a positive way. Moving to slide 20, and now we're speaking in dollars and in US GAAP. JBS Beef North America net revenue grew 6% year-over-year in the quarter as a result of the increase in average prices and volumes. However, profitability was still under pressure in considering the more challenging cattle cycle, given that the price of live cattle increased more than wholesale price. In slide 21, JBS Australia, in the quarter, the growth in revenue in the annual comparison is the result of higher volumes sold in both domestic and international markets. The growth in profitability in the annual comparison mainly reflected the greater availability of cattle in the market, given the more favorable cattle cycle and efficiency gains in several areas of our business in Australia. Turning now to you, JBS USA Pork net revenue for the quarter was 6% higher compared to the first quarter last year, due to the increase in average prices in the period. In addition to the improvement in commercial dynamics, profitability in the quarter was positively impacted by lower average grain costs, reduction in the average pork price, and continuous efforts aimed at expanding value-added portfolio, in addition to improving commercial, operational, and logistic execution. Pilgrim's Pride, as highlighted on the slide 23, recorded an increase in net revenues of 5% in the first quarter of 2024 compared to the last year. The first quarter brought the fruits of the strategy already implemented, allowing the company to grow ahead of the markets together with the key customers. The portfolio of branded products continued to expand and contribute to the diversification. These efforts, combined with an intense focus on operational excellence, resulted in an increased profitability in the period. As you can see, the results for the first quarter were very encouraging, as we had indicated in the last earnings conference calls. Therefore, we are optimistic about our deleveraging and free cash flow generation trajectory for the year. At this time, I would like to open for our question and answer session. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, click the Raise Hand button. If at any point your question is answered, you can remove yourself from the queue by clicking Lower Hand. And our first question comes from Priya Ohri-Gupta with Barclays. Please, Priya, you may proceed. Great. Thank you so much for taking the questions. Guilherme, congratulations on the deleveraging so far. It sounds like you expect to continue to pay down debt in the second quarter. Given where your cash balance is, and typically second quarter starting, when you seasonally generate free cash flow or positive free cash flow, how should we think about, first, the amount of debt that you would look to bring down in second quarter, I think, to get to that 3x level that you had mentioned on the call? And then secondly, as you think about repaying this debt, you know, what type of an approach do you take? Do you look to sort of maximize your deleveraging by thinking about the price of the bonds, and going for lower priced, or do you think about, NPV benefits that, taking out certain bonds could bring? Thank you. Thank you, Priya, for your question. First, the payment of the debt that we intend to do in the second quarter has not impacted on the 3x that I mentioned, because I mentioned 3x net debt, so debt less cash. So, again, the amount, how much I will pay in the second quarter won't affect our... This estimate for 3x in the second quarter. Now, in terms of paying down debt, you're right, I finished the first quarter with $3.5 billion in cash on hand, + $3.2 billion in revolving facilities. This cash on hand I have access. I don't need all that cash to operate, even in a more volatile scenario. But of course, we are always more conservative. We paid $660 million in debt in the first quarter. In the second quarter, we intend to pay at least $500 million in gross debt. So currently, I'm working with the payment of $500 million in gross debt. If you look at our debt breakdown, we have 13% more as its local debentures in Brazil. In fact, 11% of our debt is local debentures in Brazil, which I just announced that a repurchase of BRL 1.8 billion and an issuance of BRL 1.5 billion-BRL 1.8 billion. So just I'm getting better rates and better tenors in making this exchange in the local debentures. The $500 million debt I intend to pay in the second quarter, given that our commercial banks now, it's only 3% of our debt, and this is rural credit, which has a very low cost of debt, and in fact, a positive carry. You're right that I have to think about repurchasing bonds. The strategy we are still analyzing with what will be NPV or gross debt or average cost of debt. I would say that having a lower average cost of debt improves our free cash flow for the period. So I would say that this would be a parameter to decrease the average cost of debt, because then I decrease my financial expenses and increase my Free Cash Flow for the years, giving me even more flexibility going forward. But of course, this will all depend on the studies and the level, and the level of the bonds in the secondary market by the time that we decide to do this. Okay. Wonderful. That's, that's helpful, and, I believe on the call earlier this morning, you mentioned that the objective is to maintain that leverage sort of in the 2.5-3x area, because anything sort of in the lower part of that two to 3x corridor is, is not as efficient. First, can you just walk us through that piece? And then as you think about sort of this faster pace of deleveraging, it sounds like, you know, you could start to think about things like M&A or dividends. Secondly, just walk us through how you would prioritize those and the timing of sort of that happening, relative to when some of the deleveraging will come through in the back half? Thank you. Okay, Priya, so good question. So first, our long-term target is not 2.5-3s, it is two to 3 x. So our long-term goal is to be between two and 3 x net debt to EBITDA. Okay? So an average of two and 2.5. If we start to get too much below 2 x net debt to EBITDA or too low, as what has happened in 2021, for example, we were more aggressive in returning capital to the shareholders, and also we did M&A. In the last five years, we generated more than $10 million in cash, which will be applied in $4 billion in expansion CapEx, $3.2 billion in acquisitions, $3 billion in dividends, and $3 billion in share repurchase. Because the leverage was going down, and if you start to be with a lower debt, you decrease your returns to the equity holders, and it's not so efficient. So in case our deleveraging is faster, and going to the lower range or even below 2x, we will for sure open opportunities for M&A and dividends. But M&A, it's opportunistic. We will not do. First comes the target and the opportunity, and if it makes sense, if it creates value, if it's accretive, and then we think about the leverage, not the other way around. So if the M&A has an opportunity, regardless of the leverage, if it's an opportunity to create value for all stakeholders, that's the priority. But generally, those M&A situations, they takes more time, and if we deleverage more fast, then we have a good opportunity of M&A, dividends, increase, could be an alternative. Could we potentially see the dividend increase this year outside of possibly what may be paid with regards to the listing? Just my last follow-up is, if you could give us any update on where you are with the listing process. Thank you. Yeah. We already promised $450 million, in basically BRL 1 per share, if in case the listing is approved. So, and, and of course, we didn't start the discussions of other levels of dividends, but again, it will all depend on the deleveraging path. We don't need to make this decision now. Let's see how the year goes, and how fast the deleverage happens. For then, we think about, if we increase or not, the level of dividends. In terms of the listing, we saw that we make the, the filings on March 27, and, we're still in the process and waiting for, answers from, from SEC, but it's in the normal course of the process. Thank you so much. ... Our next question comes from Ben Theurer with Barclays. Please go ahead. Yeah. Good morning, and thanks for taking my question. Tomazoni, maybe just following along the lines from Priya, what we've just talked about, and coming back to M&A, and what's opportunistic and what's creating value for shareholders. So, clearly we've all seen certain news article about Oscar Mayer in the US potentially being up for that. So, as it relates to that, what is opportunistic for you and creates value, given the potential for synergies here of integrating that? Would that something or somewhere else, would that be something that you would consider as a good target, as it would allow you to also further vertically integrate and create value? Just like if you have some general comments on that, that would be much appreciated. Hi, Ben. Thank you for that question. We have, along these years, to say that our strategy in terms of growth will be in aquaculture. We want to transform aquaculture the same we have done with chicken and pork, to become a relevant actor in this arena. We start with a small operation in Australia, but our focus on to grow in this segment. And then we have mentioned that value added in brand is one of our priority, and this is to be in Brazil, will be in U.S., and be all of the world. We want that this part of value added in brand grow in our portfolio. And the other business, like chicken and pork, remain our priority for growth. I cannot mention a specific the target that you have mentioned, because it's part of the strategy of the company, evaluate all of the times the opportunities we have. But what I can say to you that the value added in brand is part of our strategy, but should be things that is aligned with the strategy, but makes sense in terms of value creation, yeah? And this is the binomial that we are looking for, make aligned with the strategy and make sense of economic. Okay, perfect. Tomazoni, that's very helpful. Then, maybe another question with Wesley on the call as well. Just wanted to dig a little bit into the dynamics right now in U.S. beef and what you're seeing. So it's a two-fold question. So, one, I think you mentioned on the call earlier this morning about being weaker than about a year ago, and I think this is obviously U.S. beef specific, but just if you could clarify that, and where it's ultimately coming from, that softness, whereas a year ago. Then, second, the most recent data we've been looking at, it hasn't been that complete, but it doesn't feel like there is yet much of confirmation as to heifer retention. Just wanted to get your comments on what you're seeing on the ground in terms of, like, what type of cattle comes into the slaughter, and if you're sensing a little bit of a switch and potential for heifer retention to be happening right now? Ben, good morning. On U.S. beef, for sure, you know, compared to last year, and it's simple to see; it's just look at the spreads of, you know, what the USDA publishes, and it's going to be a more challenging year this year compared to previous year. And it's simple; it's a lower availability of cattle, and on the demand side, obviously, you know, the consumer, with, you know, with overall inflation and every other, or many other categories, obviously, makes it more difficult for the consumer to have a higher demand for beef. So, on the export markets, it's not very dramatic, but we obviously have, you know, our Australian business doing very well and our Brazilian business doing very well with volumes and exporting, obviously, that creates competition for the U.S. beef. So for sure, it's a tougher challenge, a tougher market than last year for beef. And, just to be very clear, that's beef. When we talk about second quarter for pork, we expect second quarter for pork to be, if anything, even though we see a tighter packer margin, we have our own live production, so should balance it out. And if anything, we think that Q2 has the potential to be better than Q1 for pork, and I wanted to make that very clear. You know, across the board, we're pretty optimistic about our other businesses. So the US beef business being tougher this year is, it's... When I just talk about the second quarter being tougher, it's beef specific for sure. Even in the US, with chicken, with pork, we expect it to be actually, if anything, better the second quarter than the first quarter. And same thing goes for our Australian business and everything. So this is beef specific. When it comes to heifer retention, Ben, you're right that we haven't seen a very clear and definite data that indicates that heifer retention has significantly started, but we see signs, initial signs that you know, we look at it with optimism. One of them is, like I've been saying in this, in the earnings calls for a while, you know, relatively speaking, it's a better year from a precipitation, from a water perspective compared to previous year. It's not perfect everywhere. You have the northern plains being a little bit more still pretty dry, but overall it's better than last year. So, I see that with optimism. And the other thing is the reduction we're seeing in cattle processed year-over-year. When you, you know, qualify that data a little bit, you know, we're seeing a 13% drop in cow-calf, you know, cow-calf culling. So that's, you know, what... It's still not as low as it should be, to have a you know, a clear understanding of you know, of heifer retention, but it's a 13% decrease, so it's not irrelevant. And even within the fed cattle being processed, it's a... You know, we're down 3.3%, quarter-over-quarter, Q1 over Q1 previous year. And if you open that in steer and heifer, it's a 3% decline in steer and a 3.8% in heifer. Again, I'm not saying that those are definite signs that we are well underway in heifer retention. I don't- I'm not saying that, but we look at those signs with optimism. Thanks for that, Wesley. And then one last question on Seara. Clearly, very strong first quarter, double-digit margins. How is the second quarter coming together? Is that just a level you think you can, you can kind of run through, or were there certain specifics in 1Q that potentially not repeated to 2Q as it relates to the profitability? Ben, in reality, I mentioned in the beginning that Seara was able to catch part of the gaps that were identified. Remain opportunity to keep improving our personal excellence and capturing these gaps. This is one thing. We are not end of the process, we are in the process. It's a part. Of course, the main part of the grain benefit or practically all of the grain benefit is already in our results. But the potential of Seara, because of the, as I mentioned before, the capture of the gaps, Seara is not still at the full potential capacity. We expect that Seara keep growing its margin, its margin. Thanks, Tomazoni. Our next question comes from Carlos Laboy, with HSBC. Please go ahead. Good morning, Guilherme. Can you please give us an update on where you stand in terms of the SEC filings, the next steps, as you look forward toward the New York Stock Exchange listing? Okay. So again, as I mentioned before, we did the filings on March 27th, and we are waiting for SEC response. So depends on the level of questions that might come or not from the process, because it's a back-and-forth process. And at some point, SEC will have no more questions, and then we can ask for a registration. And then once we have a clear go-ahead of SEC for the registration, then we can call a general assembly, and then put it to vote, and so on. Mm-hmm. Thank you. Our next question comes from Carla Casella, with JP Morgan. Please go ahead. couple questions that are follow-up, and then one new one. I think one of the prior callers had asked about Oscar Mayer, which may be for sale from Kraft. Did you say how something like that might fit into your portfolio, or if that's anything that could be of interest to you? Would you even look at it? Carla, I just mentioned before to Ben that our strategy is to grow and value-added and brand, grow in aquaculture, grow in chicken. We are investing in Brazil in this direction that for growing value-added and brand. We are evaluate all of the opportunities in this arena, and I cannot comment on one specific target that you mentioned, but I say, it's part of our strategy to grow in value-added and brand. Of course, it's one of the important things, fit with our strategy. The second should be make sense in terms of value creation to the company. Okay, great. I'm sorry I missed that. And then pork was so strong, I'm just wondering if you saw any outperformance in markets like California or Massachusetts, where some of your competitors may not have enough of the Prop 12 kind of hog supply. Is there any of that driving some of your strength there? Carol, good morning. We obviously got prepared with this very early on, but I wouldn't say that a lot of our strong performance comes from that specifically. It's obviously, you know, being prepared and being able to service our customers in those markets, especially California, which is a huge market, is important for sure. Especially to keep, you know, our strategy of key customers and being able to, you know, to continue that strategy. It's very important, I'm not downplaying that, but I wouldn't say that the strong performance of pork comes fundamentally first from something like that. It's buy, make, sell, it's, you know, performing well on the three points. Okay, great. And then a follow-up on, you mentioned when talking about the debt structure, that you refinanced some of the Reais debt. Did you say what rate? I didn't see any change in the rates in your debt schedule. I'm just wondering what, when you refinanced and maybe how much you were able to improve the rate? Okay. So, Carla, basically, I announced the repurchase of BRL 1.8 billion of local debentures that have maturities in different maturities, but more or less on 2030. And I'm issuing other tranches in the same amount, maturing in longer terms, with 20 years, 15 years. So basically, we will extend the maturities, but the interest rates of those local debentures, the rates are inflation, so IPCA, the Brazilian inflation, plus a spread. This spread, we will only know in the book building that will be done in May 2024. And because we—how it works, we put a ceiling rate, but then as the demand is higher, we compress the rate. So I cannot say now how much will be the difference in rates from the ones that I'm repurchasing and the ones that I'm issuing, but for sure, I'm standing extending the tenors. But it also depends on how much people choose this from 10, 15 or 20 years. Okay, great. That's super helpful. Thank you. And then just one last one. You did another bond exchange this quarter. Are you now, are all of your, 100% of your bonds now all registered and exchanged? No. The last ones that we did in September 2023, the 10s and 30s, that is maturing 2034 and 2053, they are not registered yet. I asked... When we filed the listing in March 2027, we filed together the ask for regist- for the registers of those bonds. That so far is still 144A. And then SEC probably will answer everything together, both all the filings together. Okay, great. Thank you so much. Our next question comes from Guilherme Palhares with Santander. Please go ahead. Morning, everyone. Just a follow-up from the conference call in Portuguese. Wesley, you mentioned there are other 2 percentage points of margins to be captured in the U.S. beef market. If you could just go into detail, where are those gains? Are those on the industrial side or on the commercial side? If you could give more details on that, that would be appreciated. And sorry if I missed the initial speeches, but Guilherme, if you could go through that equation that you usually share in terms of the break-even in terms of cash flow for the year, that would be also appreciated. Thank you. Guilherme, good morning. I would say out of the 2%, 1.5% is operations in the plants, and half a percentage point is in sales. But I would also mention to you that, like, you know, you probably noticed already that, you know, when we first did this call, you know, I spoke about this a year ago, we were talking about 2% sort of thing, and we've got that, and we found some more opportunities. So I wouldn't... If we're able to close this other 2%, I wouldn't be surprised if we found another 1%-2% opportunities, because, you know, that, I don't think that 2%, this extra 2% I'm talking about brings us to perfection. Things just brings where we see our operations should be performing. And that's what we have mapped so far. But I would say 1.5 to operations and 0.5% more on the commercial side. Hi, Guilherme. So our break-even EBITDA analysis continues to be the same. So capital expenditures of $1.3 billion for the year, and if you look on page six of the press release, the capital expenditure of the first quarter is in line with this forecast. Also, interest expenses, $1.1 billion, also first quarter was in line with that. Leasing of $500 million, first quarter was also in line with this amount. And biological assets, we put in this analysis $650 million of working capital consumptions for biological assets, in case the grain prices may stay the same. So if you look on the first quarter, the biological asset consumption was much lower because of the fall in the grain prices. So these, again, biological assets consumption depends a lot on the grain prices, so that's one that is not fixed, basically, as the others. But again, the analysis continues to be the same because grain prices, we don't know if it can fall more or go up. So continues to be this $3.5 billion EBITDA, and remember that any EBITDA above that, then we have to subtract 25% of our effective tax rate. Thank you, Guilherme. Thank you, Wesley. Just a follow-up, Wesley, you said 75% of the true percentage margin benefit is on the industrial side. If you could just mention where do you think the gaps are on the industry, right? So is it about dressing? Is it about automation? Where do you see the gaps, and where do you envision the operations being best practices going forward? Nothing coming from automation or anything that would require a CapEx for us, which it is, is performing well from an efficiency perspective. Efficiency here, meaning labor efficiency and mix at the plant level, getting the right products in the right buckets. It's more things that are 100% in our control without extra CapEx. That makes perfect sense. Thank you.