2Q26 Preview: Moving Slowly, But Forward; Maintain OW

Research evidence excerpt

2Q26 Preview: Moving Slowly, But Forward; Maintain OW

al correlation with Adj. EPS - 26E (R$) 0.09 (0.03)-129.4%

industry spreads would suggest, but we believe the company’s business model Adj. EPS - 27E (R$) 0.35 0.04 -87.6%

Adj. EBITDA - 26E (R$ mn) 13,198 12,992 -1.6%

(good exposure to patties and premium export markets) helps at these industry Adj. EBITDA - 27E (R$ mn) 13,122 13,011 -0.8%

troughy levels. We are cutting our full year forecast for National Beef by 22%

to a 0.8% margin, which implies a 30bps y/y decline and is weaker than the Quarterly Forecasts (FYE Dec)

company’s expectation of a “flat to higher” margin in 2026. Tracking industry Adj. EPS (R$)

spreads and falling retail prices, we cut our 2H projections. 2025A 2026E 2027E

Q1 0.86 (0.12)A

• BRF businesses are showing marginal improvement. We estimate BRF Q2 0.32 0.06

EBITDA of R$2.6bn and a 15.6% margin. Our price tracker shows pork cuts Q3 0.19 (0.04)

Q4 (0.12) 0.07

stabilizing in May/June after a weak start to the year, and our channel checks FY 0.79 (0.03) 0.04

point to sequentially improving prepared foods demand in key channels

through March/April/May and early June, from a very weak January. In the Style Exposure

Brazil In Natura chicken market, our margin tracker shows spreads improving

sequentially, driven by lower feed costs, though still slightly below 1H25 levels

given tough comps. In international markets, margins have improved

sequentially since April, largely explained by solid Halal prices since the

Middle East conflict and higher sales to China. We continue to observe a

healthy margin trend for BRF; 2H should benefit from higher export sales

versus 2H25, when Brazil faced report bans due to avian flu.

• South America Beef is driven by volumes. We think results should move