Marfrig, the Brazilian meat processing giant, has reported record profits for its 2020 financial year thanks to weaker farmgate beef prices for most of the year coupled with bumper demand at retail level.

Announcing its full-year results this week, Marfrig reported a 130% increase in operating profits for 2020 to just over €1.1bn, as operating profit margins widened from 6.8% to 11.6% last year.

Adjusted earnings (EBITDA) almost doubled to €1.4bn as earnings margins grew to a very healthy 14.2%. The company saw its pre-tax profits increase fourfold last year to just under €745m.

Overall, Marfrig recorded a 35% increase in sales last year to a record €10bn. The double-digit growth in sales was driven by record beef exports from South America last year, mostly to China and Hong Kong.

Marfrig’s net debt position at year-end stood at just under €2.2bn, leaving the group with a modest borrowing level of just 1.6 times earnings. Based on the strong performance in 2020, Marfrig announced it would pay a shareholder dividend totalling more than €20m.

Based in São Paulo, Marfrig processes more than 11m cattle every year at its 21 processing plants. The group said it produced just over 3.4m tonnes of beef last year between its operations in the US and South America. The company also has operations in plant-based foods thanks to a joint venture with US commodities giant Archer Daniels Midland (ADM).

Marfrig is valued at more than €1.6bn based on its current share price.