Read this Thursday’s edition of the FolhaMercado newsletter (2) – 03/02/2023 – Market

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Hapvida and GPA plummet after balance sheets

Two large companies listed on the Brazilian Stock Exchange saw their shares plummet this week after the release of balance sheets that negatively surprised analysts and investors.

Hapvidaa vertical health company (end-to-end operations management model), lost BRL 10 billion in market value with the shares falling 32% on Wednesday.

• What scared the market the most was the cash loss ratio (ratio between the cost of procedures and the amount paid by users), which reached 72.9%up 8.1 points compared to 2021, when the pandemic was still hitting the country hard.

The GPA (Grupo Pão de Açúcar)owner of the retail brands Pão de Açúcar, Compre Bem, Market Extra and the Colombian Éxito, saw its shares fall 8.11% this Wednesday after they fell 7.16% on Tuesday.

• The group justified the losses due to the increase in tax and labor contingencies in the period. Without these factors, the damage would have been BRL 146 million.

• For analysts interviewed by Sheetthe company opted to take advantage of the result in the red and list all the negative indicators at once, so as not to contaminate the following quarters.

• Experts also consider that there is a reflection of the Americanas case, which should also appear in other results: as a precaution, the companies will expose all risks involving their earnings and operations.

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Greatest in history

With the profit of BRL 43.34 billion in the fourth quarter of 2022, an increase of 37.6% compared to the same period of 2021, Petrobras recorded the highest annual profit in the history of Brazilian companies.

You BRL 188.3 billion in 2022, which are an advance of 76.6% compared to the 2021 level, they surpass Vale’s result that year, when it reached a profit of R$ 129.1 billion.

Which explains: Petrobras’ record profit came thanks to the rise in the average price of a barrel of oil in the year (advance of 43.1% compared to 2021).

• The state-owned company also attributed the result to higher margins on the sale of fuels, better financial results and gains from co-participation agreements in Assignment of Rights fields.

Dividends: Petrobras would have to distribute more BRL 35.8 billion but the new management proposed retaining R$ 6.5 billion of this total in a statutory reserve, which will be evaluated by shareholders at a meeting.

• The high distribution of dividends by the state-owned company was the target of strong criticism from the PT and its allies in the Bolsonaro administration.

• Last year, the Brazilian oil company was the second company that most distributed earnings in the world, with US$ 21.7 billion (R$ 112.4 billion, at current exchange rates), behind only the Anglo-Australian mining company BHP Billiton, according to manager Janus Henderson.

• The new government intends to reverse this strategy, expanding investments, resuming operations in segments abandoned by the company and suspending sales of assets – the Ministry of Mines and Energy asked for a pause in these sales for 90 days.

More numbers: during the year, the Brazilian state-owned company had revenue of BRL 641.2 billion, an increase of 41.7% in relation to the previous year. Ebitda (earnings before interest, taxes, depreciation and amortization), an indicator that measures cash generation, grew 45.1% to BRL 340.5 billion.

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Mass layoffs on iFood

iFood confirmed this Wednesday (1st) that it dismissed 355 professionals, or 6.3% of the company’s staff, in different areas within the company.

• “The current world economic scenario has required companies to take immediate action in the search for new routes to face these adversities. It was no different with iFood”, said the leader of the meal delivery market in Brazil.

the cuts come less than a month after the company closed an agreement with Cade (Administrative Council for Economic Defense) on its exclusivity contracts with restaurants.

• As understood, iFood will not be able to close this type of agreement with brands that have 30 or more establishments, in addition to contracts lasting up to two years.

Last yearthe delivery app was rated at $5.4 billion (R$28.1 billion) after Dutch group Prosus bought Just Eat Takeaway’s one-third stake in the company.

• Prosus now has full control of iFood through Movile, the company that owns the restaurant delivery app.

Layoffs in the sector: other iFood competitors also promoted mass shutdowns this year, amid the wave of cuts in technology companies.

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The new rules for bacon

The new rules for the manufacture and sale of bacon came into force this Wednesday (1st).

From now on, only the product that is made from pork belly can be called bacon, that is, classic bacon.

How was: food could also be obtained from any boneless muscle near the belly, provided the terms ‘special’ or ‘extra’ were included in its trade name.

Yes but…Consumers need to be careful. The new standard makes it possible to produce ‘generic bacon’, made from other parts of the pig.

• Smoked cuts of pork loin, shank or shoulder, with or without bones, may be sold under the names “loin bacon”, “ham bacon”, “panel bacon” and so on.

Establishments registered with the Ministry of Agriculture will have a period of one year to adapt to the conditions indicated in the current regulation.

• Products manufactured by the end of this period will be allowed to be sold until the end of the validity period.