Brazil's JBS, the world's largest beef producer, said on Tuesday its first-quarter profit fell 21 percent as deferred tax charges and operating costs rose, but the results exceeded the average of analysts' estimates.
The Sao Paulo-based meat packer reported consolidated net income of 116.1 million reais ($58.05 million) for the three months ended March 31 compared with 147.0 million reais a year earlier.
That beat the 107 million reais average estimate of 8 analysts surveyed by Thomson Reuters I/B/E/S.
Net sales, or sales minus sales taxes, rose 9.1 percent to 16.01 billion reais. The cost of goods sold, though, jumped 10.6 percent.
JBS, which began as a family-owned butcher shop, appears to have regained its appetite for expansion after making an offer last month for bankrupt rival Independencia. The company's creditors accepted JBS's offer on Tuesday.
The company also announced this month that it would lease the poultry assets of Frangosul, a local poultry producer owned by France's Doux.
JBS shares lost 6.2 percent on the Sao Paulo BM&FBovespa stock exchange on Tuesday. The Bovespa index of the most traded Sao Paulo stocks shed 2.3 percent weighed on by the prospect of more economic strife in Europe with the threat that Greece could abandon the euro.
In a ratings report this week, Fitch Ratings said the company had a strong business profile with its dominant position in meats but had an above average risk profile due to cyclical risks in the sector and the aggressive expansion drive that has catapulted the company to the top in the ranking of beef producers.
Last month JBS's U.S. poultry subsidiary, Pilgrim's Pride , posted a profit of $39.6 million for the first quarter, compared with losses of $120 million in the year-earlier period.