Marfrig shares rise 12% after financial announcement and cost cutting
Marfrig's shares gained 12.73% by 4:49 PM, standing at R$ 7.44, the highest level since April 12 on the BM&FBovespa market, following the publication of its first quarter results and the announcement of cost-cutting measures. It was also the biggest gain for the company since September 11, 2011. Earlier, Marfrig announced a major reduction in spending in the second quarter. With these measures, the company estimates it can save R$ 250 million in working capital this year.
The plan includes the sale of three Seara Brasil units (the poultry, pork and processed food division) by the end of June, the closure of plants in Brazil and Argentina and the restructuring of Zenda, which comprises the company's leather operations in Uruguay. The company will also close four distribution centers and reduce its feedlot structure in Brazil, Argentina and Uruguay.
Not even Marfrig's head office will escape the spending cut. Located in the upscale neighborhood of Vila Olimpia, in the city of São Paulo, the company's headquarters will be transferred to a structure attached to the distribution center on the Anhanguera highway (São Paulo).
Information provided by Valor Econômico