JBS S.A.

Wesley Batista - Global CEO, JBS Gilberto Tomazoni - CEO, JBS Food Miguel Gularte - CEO, JBS Mercosul Andre Nogueira - CEO, JBS USA Jerry O’Callaghan - IR Officer.

Lauren Thoress - UBS Farha Aslam - Stephens Alex Robarts - Citibank Bryan Hunt - Wells Fargo Carla Cazella - JPMorgan Luca Cipiccia - Goldman Sachs Jose Jordan - Deutsche Bank

Thank you. Thank you very much.

Good morning to you all. As we present these results this morning we will go through our presentation which is available on our website and I will make mention to the page numbers as we talk about each in the presentation.

Starting on Page 4 of our presentation, looking at consolidated highlights for the second quarter of 2015. Firstly with regard to net sales we had a substantial increase in net sales when compared with the same quarter in 2014.

We went from just under R$29 billion to almost R$39 billion quarter-on-quarter an increase of 34 plus percent in net sales. In terms of EBITDA, EBITDA went from R$2.4 billion to practically R$3.6 billion with EBITDA margin going from 8.4% to 9.2%, an increase of 47% in EBITDA when comparing the quarters.

And we can see that the EBITDA growth was substantially greater than the revenue growth in the period. Moving onto Page 5, in our presentation, our consolidated net income was R$80 million in the quarter, $0.03 per share as against R$254 million or $0.09 per share in the previous quarter.

The net income was affected by our FX hedging expenses in the quarter. To recall, at the end of the 2014 the reais against the dollar was at R$2.60 to the dollar, that was at about R$3.20 by the end of the first quarter and back to about R$3.10 at the end of the second quarter.

Today that number is close to R$3.50. So we've had a consistent hedging policy around our dollar exposure in reais overall this period and although we had some expenses and our net income was affected in the quarter as a result of that policy.

We believe that the strategy continues to be effective through a longer period of time. When we see what is happening in emerging market currencies, generally speaking, when we see what's happening with commodities - hard and soft commodities.

As we see the recovery of the economy in the U.S. and the strength of the U.S.

dollars, we are convinced that it is prudent to maintain disposition and to know exactly what our risk is rather than to be exposed to the volatility associated with the Brazilian real and with emerging market currencies as a whole. Cash generation in the second quarter was R$675 million as against R$147 million in the same period last year, 350 plus percent increase in cash generation in the period.

Moving onto Page 6 in our presentation and looking at net debt, and at leverage very important more and more we look at our net debt position in U.S. dollars and although we made acquisitions and we paid for the acquisition we made in Mexico right at the end of the second quarter in 2015.

Our net debt in U.S. dollars remained the same at the end of the second quarter this year as compared to the end of the second quarter in 2014.

Leverage, we had a leverage of 3.2x at the end of the second quarter in 2014 and that reduced to 2.4x at the end of the second quarter this year. And if we take into account and do a pro forma addition of the EBITDA generated on an annualized basis of the acquisitions that we made over the last six months or just over six months including the Tyson Brazil acquisition, the Tyson Mexico acquisition, the Big Frango acquisition, the Céu Azul acquisition and also the Primo acquisition in Australia, which was finalized at the end of the first quarter of 2015.

Thus we’ve had only one quarter of results in these consolidated numbers we are presenting today. If we annualize the EBITDA associated with all those businesses, we’re talking about an incremental EBITDA of about R$1 billion more than $300 million and that would reduce our leverage from 2.4x at the end of the period to 2.3x.

Moving onto Page 7 in our presentation, and to talk a little bit about our exposure in terms of revenues by currency. If we look today at the split between our revenues and reais, and our revenues in dollar associated currencies, we've got 84% of our revenues in U.S.

dollars and 16% in reais, which is the portion of our revenues generated from sales into domestic Brazilian market. And this is prior to the acquisition of Moy Park and of the Cargill pork business, which we announced at the end of the second quarter.

So the position will be even more skewed towards U.S. dollars when those acquisitions are concluded.

On Page 8 of our presentation a little bit our historical performance. Firstly, if we look at our last 12 months numbers, we had revenue of about R$138 billion and an EBITDA of R$13.2 billion in the period and that’s equivalent to a 9.6% EBITDA margin for the last 12 months to the 30 of June this year.

If we update these numbers with the exchange rate at the end of the second quarter and if we had the pro forma revenue associated with the acquisitions which I just mentioned, we would have had an EBITDA LTM of R$15.2 million and our revenues would have reached R$160 billion. Also on Page 8, we’ve got numbers that stretch over a longer period of time from 2007 up until the LTM 2015 and I think it's important to point out to find out the consistency with which we’ve grown our business and at the same time we’ve grown the profitability of our business.

We've gone fromR$14 billion in 2007 to almost R$140 billion LTM. But more importantly, our EBITDA has grown greater than our revenues have grown we’ve gone from a 4.3% EBITDA margin at the beginning of this period to an almost 10% EBITDA margin last 12 months.

Now to talk a little bit about business units and starting with JBS Foods in Brazil, which is our poultry and pork and prepared foods business. We've had revenue increase again comparing the second quarter 2014 with the second quarter of 2015 from R$3 billion to R$4.46 billion, an increase of almost 45% in revenues in the period.

In light with those revenues we've seen a greater increase in the performance of this business. We went from R$440 million in EBITDA the second quarter in 2014 to R$790 million in the second quarter of 2015, an increase of almost 80% year-on-year with the EBITDA margin going from 14.3% in the second quarter last year to 17.7% in the second quarter of this year.

We have seen that this revenue growth strength coming from both organic and inorganic actions. We've seen revenue growth of practically 30% in the prepared products in the domestic market in Brazil.

We’ve also seen a continuous improvement in the quality indicators, level of service and execution associated with our business in Brazil with our value added branded business in Brazil. We've seen the substantial enlargement of our customer base particularly in the small and medium retail sector.

Just to give you an idea of numbers, we've increased our customer base by 19,000 customers from the end of the second quarter of 2014 to the end of the second quarter in 2015. And we've seen successful strategy associated with our international business as well.

We move to Page 11, in our presentation we can see some of the actions we've taken with the Seattle brand outside the Brazil. So we're doing promotions at the point of sale and we’re marking our products under our own brands worldwide in Brazil.

But also on Page 11, we’ve got some numbers associated with the domestic market. So we have the market divided into four different categories frozen products, processed products, margarine, and pizzas.

And we can see the market share increased that JBS Foods has had in each one of these categories when comparing the 12 month period. We’ve seen an increase in the size of the market of each one of these businesses, but more importantly we’ve seen an increase in the market share of JBS foods in each one of these categories.

And in pizzas are 9.7 percentage point increase and margarines are 1.2% and process products at 2.3% point increase and in frozen products almost 11 percentage point increase in the market share of JBS foods in each one of this categories. We also had substantial number of items launched.

New SKUs launched, 46 new SKUs launched in the first half of this year and some examples of those are demonstrated on Page 11. Some of the new SKUs that we have been launching innovative products, convenient products in the domestic market.

Moving on to Page 12 in our presentation in JBS market so we saw revenues increased by almost 15% from R$16.3 billion to R$7.2 billion in the comparable period. EBITDA down from R$634 million to R$377 million down 40% in the period from an EBITDA margin declining almost in half from 10.1% to 5.2%.

This margin compression was primarily due to tightcattle supply and relevant reduction in the Brazilian beef exports. The highlights of the quarter were an increase in participation in the industrialized further process category where we posted an increase in volume and prices both in the domestic Brazilian market and also in the external market associated with these products.

We continue to invest in marketing and in product portfolio innovation in our beef business in Brazil and we are observing as we enter the second half of 2015, an improved supply in the demand balance and a recovery of exports to major markets, which in our view will improve the performance of this business as we go into the second half of the year. The good example is the reopening of the Chinese market for Brazilian beef which we opened in June of this year.

This is a relevant market and we’ve already seen relevant demand coming out of this market at the beginning of the third quarter. 80% of the capacity in Brazil which is approved for that market is JBS capacity.

So, we will have a relevant participation in exports to the Chinese market. We have also seen some other markets reopening for Brazilian product.

Saudi Arabia is on the verge of reopening and there is a perspective that trade between Brazil and the U.S. will start in not too distant future.

Moving onto Page 13 in our presentation and to talk about our beef business in the U.S. which includes Australia and Canada.

These numbers are in U.S. dollars.

We have seen revenue increase of 11.5% from $12.3 billion in the second quarter of 2014 to $5.95 billion in the second quarter of 2015. EBITDA increased from a $108 million to $228 million, a 110% increase in EBITDA margin went from 2% to 3.8% in the period.

We’ve seen volume and price improvement both into domestic U.S. market and in exports.

We consolidated the pre more numbers at the beginning of the second quarter of 2015. So, this is the first quarter where we have those numbers presented to the public.

We have seen a resilient demand in the U.S. market for beef with growth and exports primarily from Australia.

Basically what we’ve seen is a decline in domestic production in the U.S. associated with herd retention and a corresponding increase in exports to compensate for the lack of cattle available in the U.S.

market. So although prices have increased quite substantially, domestically in the U.S.

market, consumption has not declined, imports compensating for the lack of domestic production. We've seen Australian exports increase quite substantially in the first half of this year and particularly in the second quarter, to the U.S.

and elsewhere. The currency in Australia is favorable towards the export market and we particularly are very focused on increasing and diversifying our exports out of Australia.

And finally on this point we've seen strong count that has the retention, in the U.S. which is good news for medium and long term for our business.

We've seen cow numbers growing by 2.5% and heifer numbers growing by relevant 6.5%. These are the numbers that were presented recently by the USDA.

Moving onto Page 14 in our presentation, and our pork business in the U.S. we've seen a decline of 22.7% in revenues associated with this business, from R$1.028 billion to R$795 million primarily because of the decline in the average price of products sold which is associated with an increase in the number of animals that came to the market, number of hogs that came to the market in the quarter.

EBITDA went from R$113.8 million to R$64.6 million, a decline of 43%, EBITDA margin from 11.1% to 8.1% to the period. We did see quite a lot of demand coming out of the export market and we think that will increase in the second half of this year particularly as a result of liquidation of chaos in the Asian market.

Our exports in the second quarter of 2015 were up about 35% when compared with the same period last year and we think we will continue to see strong demand in the export market and also in relation to this business, we've increased our participation in value added products in the domestic market. We've got some examples of photographs on the slide on Page 14, we've had quite a substantial increase in the sale of these value added products domestically in the U.S.

market organic growth. On our -- chicken business in the U.S., JBS USA Chicken Pilgrim's Pride Corporation, they already published their numbers, so those numbers are been available for the last couple of weeks, but just quickens up this year.

Sales were down 6.1% from R$2.186 billion to R$2.054 billion primarily again as a result of the decrease and the average price of the product sold, but EBITDA was up from R$338.6 million to R$425.8 million, an increase in EBITDA margin from 15.5% to 20.7%, an increase of 25.7% in EBITDA year-over-year, basically as a result of our focus on operational excellence. We have an effective strategy in product portfolio and management of sales channels and geographic portfolio on sales channel, diversification, meaning good product mix which optimizes our risk management and the pricing of our products.

At the beginning of this third quarter we had the integration of Tyson Mexi [ph] Corporations and they are progressing according to plan and we will be reporting numbers as we finalize the second, the third quarter of this year. Moving on to talk briefly about exports.

Our exports in the quarter were just under R$4 billion, highlight for exports to Greater China, China and Hong Kong basically grouped together here, we had 14.7% of our sales to that destination. We should see an increase in that percentage now as we move into the second half of the year and as Brazilian beef exports, which we have some quite relevant volume into that market.

Secondly we've got very traditional markets, we have particularly for poultry products out of Brazil and also for our beef products out of South America, Africa, and the Middle East, a very consistent market for our products. We're also increasing our sales around South America, 11.7% of our total exports went to countries in South America and we export to South America not only from Brazil, Paraguay and Uruguay and Argentina but also we export products out of Australia into South America, and out of North America into South America.

Mexico is a very traditional market of ours as well. We have relevant distribution as well as having operations we have relevant distribution in the Mexican market and we have a strong presence also in the Japanese market as a result of our exports out of Australia and out of the U.S., Japan being quite import dependent particularly for high quality value added type beef cuts.

We also had relevant exports to the U.S. that's primarily because of the Australian exports product into the U.S.

to compensate for the reduction in production within the U.S. market.

Moving onto Page 19, in our presentation, to talk a little bit about our CapEx and about our cash generation. Our total CapEx in the second quarter of 2015 was just over R$2 billion.

Half of which approximately is associated with the acquisition of Tyson in Mexico. The other half is associated with expansion and modernization of facilities, about 50% of it, and the other 50% is associated with maintenance.

Regarding cash generation, we generated net cash from operations of R$675 million in the quarter and free cash flow from -- after CapEx was negative, R$1.415 billion to primarily to the payment of the Tyson Mexico operation at the end of the quarter R$400 million U.S. dollars which is about R$1.24 billion.

Our debt profile on Page 20, little bit about our repo profile. We already spoke about net leverage which declined from 3.2X to 2.4X, and if we take into consideration the annualized EBITDA associated with the recent acquisitions, that would have been 2.3X at the end of the quarter with net debt at R$34.8 billion.

When we look at net debt in U.S. dollars, as I mentioned and regardless of the acquisitions we made in the payment of the Tyson deal recently as well, net debt in U.S.

dollars at the end of the second quarter this year was almost exactly equal to what it was at the end of the second quarter last year. The breakdown by currency, 87% of our debt today is in U.S.

dollars and 13% in reais, and we've got the cost of that under 5% in dollars and above 13% in reais pretty much matching our revenue by currencies as well. The breakdown is just over 50% with commercial banks with whom we have strong relationships around the world and 47% in the debt capital market.

The breakdown by company, almost 50% of our debt is at JBS SA., 38% at JBS USA and 13% at JBS Foods. At the end of the quarter, Page 21 in our presentation, at the end of the quarter we just -- we had just under R$14 billion in cash, equivalent to 87% of our short term debt and if we add on the committed lines we have in the U.S.

of $1.6 billion which are fully committed lines at the end of the quarter. The sum of our cash position in these fully committed lines would represent almost 120% of our short term debt which was 33% of our net debt at the end of the quarter.

Our debt maturity, again, I think it's important to look at the amount of liability management we did over the last couple of years. We've extended the maturity quite substantially, we can see we've got no relevant maturities until 2020 and thereafter, R$8 billion in 2020, R$3.5 billion in 2021, and R$11.5 billion thereafter.

So with that, that concludes our presentation, I'd like to pass you onto Wesley Batista, our CEO for some comments before we open up for Q&A. Wesley?

Very good, Jerry, and good morning all. I'd like to talk about some highlights on the second quarter and summarize some performance of our second quarter and as well to talk about where we see our business today and where we see our business going forward.

So, when we - some important highlights here, when we see our topline growth, we have been growing our business substantially and we keep growing business 34%, 35% growth quarter-on-quarter, but the good thing and more important than the topline growth that we have been able to grow our operating performance greater than our sales growth. So clearly the EBITDA is growing a bit more than our revenue so our EBITDA – EBITDA margin is expanding, we have been able to keep expanding our EBITDA margin.

We have been saying this for quite a while. We believe JBS we built unique protein platform globally, well diversified in terms where we operate, in terms of the proteins that we are and as well our product mix.

And we see this, very beneficial through this diversification in product portfolio in terms of geographic as well as in terms different proteins. We have been able to stabilize and to our margins and to have consistent in our margins and we see this very beneficial because sometimes one protein is performing better.

Other protein is suffering, but when we consolidate our business we see this very beneficial and is a unique company in the sector that has this diversification. So we feel this great.

We are expanding our value added business. We are expanding our prepared food portfolio and we are investing our brands.

We are very happy with the results that we are getting so everyday more and this is where we keep going - is to keep expanding our value added portfolio and product mix that aggregates value true product innovation through our brands. So when we look inside of each business, we’re very happy where we are, we follow JBS food business unit, we are growing our business substantially in Brazil.

We are investing our brands, launching new products, and we have been able to expand our market share and the good thing as well is that their category is growing, Brazil even though we are facing challenge in Brazil in terms of Brazilian economy, but the flows category, the other categories that we are is growing nicely in Brazil and we - on top of this nice growth we have been able to even grow more than the market. So when we look our beef business clearly has been the challenge business unit in the first quarter and the second quarter.

So margin declined. The good news on this business that we saw a big rebalanced industry - rebalanced in term of capacity and supply cattle available.

So - and as well export is improving Brazil and with the opening of China and as well to the improvement in some key markets for Brazil, we are seeing our improvement in the export for beef in Brazil. We are already seeing a much better margins in the business currently.

As we speak we had a great July so we are going to see - we are very confident we are going to see a good margin expansion in the third quarter and going forward. So we are very positive even though we suffered in these first two quarters.

So chicken in U.S. business is doing very well.

We are very focused on excellence and acquisition and we are very satisfied where we are. Our Australian business with the premium acquisition is going well and is performing well and as well our beef business in North America is performing good comparing to the market.

So we are very positive that the beef business in U.S. we passed the worst moment and we strongly believe that we are going to see going forward this coming quarter 2016-2017.

Our improvements specially - increase in cattle availability that we believe that this is going to happen we are seeing cattle retention in the U.S. and this is we are going to collect fruits in the coming quarters and in the coming years.

Our pork business continue performing well and we are very excited about the acquisition that we agree with Cargill that is going to be very complimentary to our pork business in the U.S. So overall when we see our business we are satisfied where we are.

We are confident that due to diversification that I mentioned before portfolio diversification platform of this thing. We strongly believe that we are going to deliver consistent margins going forward and we still believe that we can keep - even grow our margins more than our topline.

So talking about the net income – our net income was affected this quarter by our hedging strategy, we remember that the real close at 3.10 in the end of the second quarter and now the real is almost 3.50. So just in 45 days we saw big devaluation in the real.

So our hedged strategy is going to be very, very effective and we strongly believe that this is the right thing to do. When we see all the things that is going on globally, China, commodity price, the U.S.

economy is doing better so we are going to see rate increase in U.S. the question is not if it’s when and also the challenge on the Brazilian economy.

We strongly believe that we need and should be hedged not be exposed in real. We want to be fully hedged in dollar and again this quarter we are at this point the benefit is far greater than the costs that we incurred in the second quarter.

So, we still holding our hedging position and our strategy did not change and we are confident that this is the right thing to do. Hedging our exposure we know how much this is going to cost us to be exposed to the U.S.

dollar. You don't know what's going to happen but you know how much can be the costs.

So we keep holding hedging strategy. So with that, we will stop here and ask the operator please open to Q&A, operator please.

Thank you.

Yes, hi, good morning everyone. My questions are directed to your Brazilian businesses, I guess first I'll ask the ever popular question about how high is up on margin the JBS Food?

It seems like you were hitting another quarter of almost 80% margins. And you talked about organic and inorganic growth.

So just curious to get your perspective on, we look at organic growth, we look at synergies and cost reduction and kind of pull that together, how sustainable are these margins and how much of this is more one-time in nature because of the benefits that you think flowing through? And the second question is on Brazil and thanks for the description of the better second half, but I'm just trying to get a bit more confidence about why we should the margins actually turned positive as opposed to get less negative, can you talk a little bit about the components of that?

I know you mentioned a few factors, but I'm just trying to get a better sense of what kind of turn that around. Thank you.

So Lauren talking about first margin in JBS for the sustainability, actually they are all the way around is not a onetime benefit is we have been incurring in cost, due to the fact that we did several position in JBS foods over this less 12s and more close over this less six months. Actually they're all the real around.

If we normalize the margins in this companies or in this plans that we acquired in this less six or 12 months, then the JBS Foods margin was going to be even higher in our calculation. The impact on this is around 1% so if we normalize these companies and these plans in the same level that our current business is performing, our margin was going to be over where we are by 1%.

So look we see this sustainable. Actually our business is even performing better as we speak, we already in middle of the third quarter, the business is even performing better than the second quarter.

Export in Brazil is benefiting. In export some markets close to U.S.

so volume is growing nicely in Brazil in chicken, so this benefiting the Brazilian chicken business. And as well the domestic market we are growing and performing well.

So we are very, very confident. We don’t see any reason that we cannot keep delivering this kind of margin and to be honest, we see them higher margin in this coming quarters.

So about moving to the beef business, so why I'm confidence and I’m seeing already a good margin improvement is basically two things Lauren, is export is much more - much normal now in terms of volume. So Brazil got hurted by - in the fourth and second quarter by some markets that import a lot of volume from Brazil like Russia.

So we’re seeing a good normalization in terms of volume, and as well the opening of China is going to help quite a lot. But also that is very important the industry do they decline in margin and we are part of the industry, the industry did equalization in terms of supply availability and as well the industry capacity.

So we are seeing, we saw and we are seeing a lot of beef plants close in Brazil and this is putting much more balance in the industry comparing to the first and second quarter. So this two main things is the two key factors that you know with strong delivery we are going to see a good margin recover and improvement then we are as we speak we are already saw this in July and we are seeing this as we speak.

So we are very confident that margin in the beef sector Brazil is going to take over and then again we are very, very confident that our JBS Foods business is going to keep delivering strong margin.

Can I ask just as a quick follow-up, what are you seeing with respect to consumer demand for beef in Brazil on a sequential quarter-over-quarter basis?

We’re seeing even Brazil is facing some economic challenge. We are not seeing the consumers decline or demand decline in Brazil.

We saw big decline in exports, so in the first half of this year, export declined by 15%, so this is a big number but in domestic market we are not seeing decline in consumers demand, and I tell what - I can tell you in all of our business. So, in the dairy business that we run here in Brazil, that JBS is too shareholder, we are not seeing decline in volume or and also in JBS Foods all the frozen, and you can see in the graph the frozen factor in Brazil went up - grew 7.5% in the category and as well process product 7.2%.

I think it is more and more – Lauren, when you see some economics challenge in any country, the industry that suffer more is industry that is doing good type of business in the automobile industry, real estate and we are seeing this in Brazil. But food people are still buying and we are not seeing decline

Okay, good to know. Thank you.

Thank you.

Hi, good morning. You are in the unique position and that you have broader operations both in North America as well as Australia.

And in your discussion, you highlighted that amount of imports into the U.S. of foreign beef, that's definitely keeping profitability in the North American beef sector, a bit challenged.

So for JBS USA, given your Australian assets, are you okay with the increase in the amount of these coming into the U.S.? And some color would be really helpful in terms of how you expect your U.S.

water operations to perform over the next six months with that increased beef coming into the U.S.?

Great, Andre, I will ask Andre for that, please can you -

Thanks Farha. I'm not sure if we did.

The [indiscernible] put in a new challenge for the U.S., but the reality is the amount that we bought off lean beef is, or exact the amount in reduction of the lean production is U.S. is more related to the reduction - the 27% reduction of the cow, queue in U.S.

that is also replaced by this amount of lean beef that came from outside of U.S. Of course we operate on this one, we bought a lot of these beefs and has been a – for our operation Australia, I’m not sure if this change anything the reality of the cattle price in U.S.

because of the availability and the price - the beef price in U.S. I think the replacement are very specific type of beef.

And I think that as U.S. come back next year and the following year to produce more, I think that the import will decline a little bit in U.S.

we export more and the profitability will be much more related to price of cattle and price of beef in U.S. and outside of U.S.

That's helpful. And then just a follow-up broadly, how are you seeing the M&A landscape around the world?

Where you seeing the best opportunity and in particular - are there particular types of businesses that are more interesting for JBS and particular geographies you're targeting?

We are now in strong position in this last quarter, the Cargill pork business in the U.S. and as well the Moy Park business in the U.K.

So we are not looking anything now. We are going to approve, we are going to wait the approval and close these transactions.

We are very confident that we are going to generate strong amount of cash in this coming quarters. We’ve strong believe that our balance sheet will keep in very health and even we’ve these acquisitions we still believe that we can reduce leverage.

So, at this point we are not looking, we are not active in M&A but answering your question in terms of location, in terms of -- I have been very clear with the market that we want to grow our business when is the appropriate time for us in value added products in package food business in North America, Australia, their regions and JBS foods. We have been growing our business and this is a business that in the right time, we want to keep growing this business.

In Europe, we did the Moy Park acquisition, we are going to learn and is our first sizable investment in Europe. So we want to first should get to know more the UK market and the European market before we decide that is going to be a strategical region for us.

So at this point, North America, Australia and JBS foods is there. The business and the regions that we have more interest but I again, after the two acquisitions that we did, we are very committed to close this transaction and to integrate this business and to generate cash, to keep our leverage in a comfortable level and so this is where we are.

That’s helpful. Thank you very much.

Thank you, Farha.

Yes, hi everybody. Thanks very much.

Hi. Two questions.

First, going back to the JBS foods business. Very interesting.

The revenue per kilo trends the question relates to the process domestic revenue per kilo. It looks like from the first quarter to the second quarter, in that key process category.

You’ve got about a 5% increase in terms of your average selling price. Now that’s doubled in magnitude of your competitors increase in the same period but at the same time you’re also getting market share and I guess, it sounded also like you staggered a little bit the industry pricing increases, at least the price increase that were being put through by the market leaders.

So I guess, just thinking about that interesting revenue per hectoliter, per kilo growth excuse me. Is this coming from mix?

If you could, kind of, help us understand. Is it channel mix?

Is it product mix that’s giving you this list on your selling prices year-to-date. You talked about 19,000 points of sale coming on stream year-on-year in the domestic market.

Were these in point for sale that were helping to drive these revenue per kilo and where might we think about your pricing in the domestic process n JBS foods and the second half given that. I think we should all feel a little bit more pressure on the dollar packaging cost in such.

That’s the first question. Thanks.

Hi Alex. You bettered.

In reality you mentioned all of the factors. It’s a combination of increase the number of clients.

If you compare the last quarter for the last year with this quarter. We increased 18,000 new clients new customers.

19.

19,000 new customers and this is one thing we are not present in this point of sales. We’re increased we’re put our product there.

The second with this in addition when we increase these number of point of sales. We’re able to offset say it in terms of margins better channel you go from the big ones to the small ones.

This means you increase margins just because weeks of channel. The secondary we improve our mix even in all of these three channels even in the biggest one.

And we launched new product since we start develop our brand we launched a lot of new products these new products came with high margins. The combination of channels, product mix.

In our advertising, because we’re reposition our brand we’re making advertising the reason what we advertise in our quality, because you want to increase where you have the product is a combination of advertise mix of products in mix of channels is the result of this increase in terms of guide. But we increased our volume in 2%, but even the promotional resume because we are focused on not we’re not focused to gain market share.

We’re getting market share because of this reason, but we’re our focus is to gain the preference of the consumers. And we’re focused on that and we’re focused to create value.

So thank you now that’s helpful so in the second half do you think you might look to take some prices technically to set up to offset some of the maybe dollar packaging, pressure or what it just be a continuation perhaps of your positive mix that kind of can drive the revenue per kilo in the second do you think?

Our focus is remain the same, but you never know how will be happen in the future because you have a competitors. And but our – we are we just initiated in July we’re we keep the tenants and I don’t know in the future.

But I believe some cost in terms of the grain, grain could be affect in terms of our margins then if the grain affect our margin we’re try to put part of the cost would apply could be say it’s very difficult o say we’re remained confident that we can deliver for the next quarter even higher margin is when we had this quarter.

Okay, okay, thank you and the second question just understanding a little bit more the thinking behind the share repurchase program I mean it sounds like you said in your prepared comments I mean you kind of confirmed that like there’s no bid debt maturities really over the next few years since 2012. You’re at the level of leverage that you kind of guiding us through in the mid two ranges.

And so this almost R$2 billion in share repurchases over next then should we think about this as something that you plan to use tactically is it also perhaps signaling that maybe you’re not out in the looking at M&A targets for right now. And any comment about the thinking behind the share purchase program would be helpful.

Thanks very much.

Alex basically look we want to have the option we approve in our Board the share buyback program. We have been leaving our share buyback program open.

We see this is a practical insurance we believe that this should be open. We don’t intend show at this point we don’t intend show to compromise any thinking of our leverage with the share buyback we are going to use the share buyback option to be used.

First of all without compromising our leverage secondly we’re going to using this more is tactical strategy.

Okay thanks very much.

Good morning. It’s actually Dave Cook on for Bryan.

A couple from me. U.S.

pork exports to China are down meaningfully for the year thus far I think I have seen 40% decline sided. Can you talk about what you attribute that decline mostly to is it currency, is it the shutdown on the West Coast ports or the – or the U.S.

use of Ractopamine.

The combination of all the three factors and some liquidation that we saw, and we heard in China that put more availability [indiscernible] that's what we expect that is changing now if you see the grasp of hard cost in China in the last several weeks have been up very dramatically. So price of pork meat in China several weeks have been much higher.

So we expect that this trend would change, but they have the limitation of free of Ractopamine so we need to spot only product that fit that specification.

Is that something that U.S. or whatever move away from using in pork?

I think that, the March we will define that. If U.S.

export - again pork on U.S. 30% we will export, correct, and this is growing.

So the pork industry and hard industry in U.S. rely each they more in export, and because U.S.

so competitive, this new contingent relating to that is if demand globally change, usually defined as a U.S. production.

I think that we have to-date part of the production as Ractopamine free, I believe that is we'll grow and demand continue to grow for this specific type of product.

Okay. And given recent devaluation of the Chinese currency, how do you think that impacts Chinese imports?

I think that’s both directions very small it’s quite of irrelevant so the percent is do not make any difference by seeing the difference in cost of produced protein in China and they import protein and I think that this is absolute relevant.

Okay. And on U.S.

beef supply when do you think you’d start seeing a meaningful increase in the supply of cattle?

That's a little bit more challenge to say I think that is very late if the retention - if you see the retention to grow the herds continue to be a strong and become even stronger due to be more into back of 2016. If the retention go more for the normal level we will see some impact in the first part of 2016 I think that we would I believe that we’ll start to seen in the first part of 2016.

Okay. And your Primo acquisition you closed on the how is that performing thus far relative to expectations?

So we have only three months with the liquidation we I think that we it’s not performed in the level that we expect that this will perform that is over 15%, it perform the same level that was performing before, but in the last several weeks we start to see improvement on that. So it's performed the way that was before but a red point major action that we go to what we expect that 15%, the integration is doing very well, we have a new Management team in place, so we're very confident that we will deliver more than we expect originally.

Okay. And the last one from me, Pilgrim's Pride management has mentioned a couple times, zero based budgeting, is that an initiative you all are working on within the broader JBS organization and if so can you discuss any progress or goals that you have with that?

Yes, just lastly, yes, we have been using zero budget for quite a while, for quite a long time in our business this right here in Brazil, and we have the zero budget today across all of our business and so Pilgrim's Pride. So we implement and we’re everyday implementing more and more in Pilgrim's pride, but we have been able to do this for quite a while in all the part of our business.

Thank you.

Hi, I may have missed it, but did you say the EBITDA contribution from Primo in the quarter and was that all included in JBS USA beef?

Yes, Carla. The Primo results is included as Australia is included in the JBS USA beef, Primo also is part of this, is included.

Could you say how much of the EBITDA increase in the quarter was related to Primo?

No. We did not say that how much the EBITDA increase due to the fact that previous is now included, what Andre said is that the business is performing the same level that was when we acquired.

We are running the business just three months and we expect that this business is going to deliver 15% type of margin. So this is what we said, so, the impact in the quarter inside of the business unit is not meaningful.

So this is going to be more meaningful when we hit this levels that with strong belief we can deliver this kind of margin that I mentioned.

That's great. And then also on the USA beef side, did you provide the hedging, the amount hedging gain you have in the quarter?

As I said in the previous quarter, since we start this year we are -- our MTM [ph] for hedge gain, we are doing the MTM for our cash position tool. So, if I have a cash position cattle and I had cattle we’re doing the mark to mark in both positions, so with that we reduce a lot, so we just recognize that both when we give the cattle and month by month we recognize the two valuations, so it's very small now that we have both with mark to mark it's not relevant anymore.

Okay. Great, thank you so much.

Yes, good morning everyone. Thanks for taking my question.

Just a quick follow up on some of the previous discussion, on Brazil, on the point of sale expansion you mentioned about 19,000; 20,000 incremental point of sales, could you discuss how much more upside there is to that and also how that grabbing more of this, how that process works how you see that [indiscernible] – maybe just an update on that as a follow-up to the previous discussion, that would be great?

Look, if you consider all of the - customer we have now is around 1,200.

120,000

120,000. And if our main competitor in the market say that they have above 200,000, that means we are in the same business, we are in the same category, I believe that we can go with these numbers too.

But our strategy to reach this level of customers, is different go-to-market because there is some parts of the country is not economic to go by itself, maybe our own teams – own service teams and our trucks to distribute, then we are using distributors to reach this point of sales. In a way it's productive to go there.

We are not saying, I want to increase - we are not a target for number of clients, we open new route, we check if the route is profitable, we fix and then we go to another route. We are looking in terms of how we grow in productive way.

Are there obvious areas where you are under index, let's say is it more of a regional penetration, is more across the country your intensity or the depths of your penetration could be greater, are there some obvious areas where the gap is, I wouldn't say easiest to close but easier to identify at least.

It's incredible but interior of [indiscernible] we are huge gap in terms of number of clients, because they are traditional to buy for other brands and then we are investing our brand to become more well known in the market, and the peoples trying to beat our product and then we are now, - before we need to knock the door and I want to sell to you, now some clients call us, I want to have your product. We are not in the countryside main gap, our main gap is in the big cities, where it's easier together, but you need to get in a productive way, it's very important I just not to mention number of clients, we are made for crafted for each clients, customers, sorry.

Perfect. Thank you very much.

Hi, good morning, everyone. Just couple of questions.

The first is on the whole beef capacity issue, obviously your competitors have been talking about how many plants they closed during the quarter etcetera. And in general, it looks like an industry-wide move, I just be curious if you can give us some color as to what your role was on that?

If you can remind us how many plants you opened over the last couple of years and did you close any in the second quarter? What was your variation in capacity contributing to the change in the industry?

Actually we - not only the second quarter, so we started in the first quarter. So, in the first quarter and in the second quarter we closed six plants in these two quarters and as the market got much difficult in terms of export and so, and also the availability of cattle decline, so yes, we are part, so we are the leader in this market and we close this plant as well.

Great. And I guess maybe premature to think but once the exports go back up in Russia and some places if they do and depending on how successful you are in China than the U.S.

et cetera, is it projected that some of these plants industry-wide will open within a couple of years and are they ready to do so within a month or two notice if the demand -

Look, I feel not only the demand, I think what’s going to happen is, if the demand get back and if the demand recover and also if the industry start to see a change in cycle and see more cattle available to be processed, and so, I think the industry can put some of these plants back but for me it’s clear that now the industry is balanced in terms of cattle availability and also demand and for me it is clear that the industry is not going to put back any plans until the industry see a sustainable demand recover and as well cattle availability.

Great. And if I can just have one more question on the two pending deals and I realize that there is a review period that has to be followed and you never know what’s going to happen but what’s your advisors latest estimate of when you can close on Moy Park and on Cargill and specifically on the Cargill deal given that it involves some integration et cetera like Moy Park.

Is there any internal activity that you’re doing to prepare for that, so that after three, four months or whatever it takes you can hit the ground running once the green light goes on?

Yes sure. On Moy Park, what our advisors, our legal advisors telling us, that we expect to get the approval in Europe sometime in the end of September or October.

So second half of September and to the end of October. So, this is what we are seeing now and our advisors telling us.

About Cargill, we are working with the [indiscernible] in the U.S. is harder to predict.

Our advisors, they are telling us that they believe we can close this deal sometime this year. But we cannot guarantee if we're going to get the approval this year but we see a good chance that we can get the approval sometime in these coming months.

So yes, we are active working, our team in the U.S. are active in working with Cargill and planning everything, integration, everything and as well Park, we’re going to be ready if we get approval anytime in Moy Park from September 15, we’re going to be ready to close the deal and with Cargill as well, we are working closely with them to be ready to get approval in anytime in this coming months.

Super. Thanks a lot.

So I would like to thank you all again to be in the second quarter earnings call with us this morning. And like I mentioned, we’re confident that the company has a very strong global platform and we are very satisfied where we are and we think we can do more and this is where we are going.

We have been disciplined to execute our strategies and we’re going to keep focus and committed with our targets and we look forward for a great second half of 2015 and 2016 as well. So, thank you all and have a good morning.