JBS S.A. reports 1Q07 net sales of R$1.1 billion and EBITDA margin of 14.4%

JBS S.A. reports 1Q07 net sales of R$1.1 billion and EBITDA margin of 14.4% São Paulo, April 25, 2007 JBS S.A. (Bovespa: JBSS3), the largest beef producer and exporter in Latin America and the world s third largest beef company in terms of slaughtering capacity, announces today the results for the 1Q07. The Company s operating and financial information is presented in Brazilian Reais (R$), in accordance to Brazilian generally accepted accounting principles. Financial statements for the quarter ended March 31, 2006 were prepared for comparability purposes and do not include the results from the operations of the Hygiene and Cleaning division due to the partial spin-off that occurred on December 31, 2006, as explained on the notes to the financial statements. For this reason, the referred financial statements are being denominated as Pro Forma and should not be considered for the purposes dividend calculation or any purposes other than to provide comparable information for the analysis of the Company s operational performance. Contact IR Sérgio Longo Director of Finance and IR André Menezes IR Manager Email: ri@jbs.com.br Phone: (11) 3144-4055 Website: www.jbs.com.br 1Q07 Conference Call Date: Thursday, April 26, 2007 > Portuguese 12 p.m. (Brasília Time) 11 a.m. (US ET) Phone: (+55 11) 2101-4848 Replay: (+5511) 2101-4848 > English 1 p.m. (Brasília Time) 12 p.m. (US ET) Phone: +1 (973) 935-8893 Replay: +1 (973) 341-3080 Code: 8707295 PERIOD HIGHLIGHTS Net revenues growth of 22.6% to R$1.1 billion, from R$886.1 million in the same period of last year; Export and domestic net revenues growth of 24.8% and 19.6%, respectively. For the quarter, net revenues from exports reached R$626.0 million from R$501.5 in the 1Q06, while domestic sales reached R$460.2 million from R$384.6 million in the same period of last year; EBITDA growth of 28.4% to R$156.2 million from R$121.7 million in the 1Q06, with a margin of 14.4%; compared to 13.7% in the same period of the previous year; Net income for the quarter decreased by 67.0% to R$10.6 million, compared to R$32.3 million in the 1Q06, mainly due to nonrecurrent expenses related the Company s initial public offering in the amount of R$50.6 million; 58% of net sales for the quarter exported to over 110 countries in 5 continents, although not a individual country was responsible for more than 15% of the company s net export revenues; 1

JBS S.A. Founded in 1953, JBS is the third largest beef company in the world in terms of slaughtering capacity (22.6 thousand heads/day) and the largest beef producer and beef exporter in Latin America; The Company s net sales have grown at an average rate of 29.5% since 1999, driven by the company s ability to increase slaughtering capacity and sales in the domestic and international markets; In the 1Q07, 58% of net sales for the year exported to over 110 countries in 5 continents, although not a individual country was responsible for more than 15% of the company s net export revenues; Continuous growth in exports, driven by the competitiveness of the Brazilian beef industry and the quality of JBS products quality (an increase in export volumes and revenues of 35.9% and 24.8%, respectively, in comparison to the 1Q06); Strong EBITDA margin of 14.4% in the 1Q07 compared to 13.7% in the 1Q06; Competitive advantages include low cost production, excellent track record in sanitary issues, modern strategically located operations, high distribution capacity and leading presence in both Brazil and Argentina, in the domestic and export markets. Currently, JBS conducts its operations through the following facilities: 19 slaughterhouses located in the states of Acre, Goiás, Mato Grosso, Mato Grosso do Sul, Minas Gerais, Rondônia and São Paulo, out of which 5 are also able to process beef; 5 slaughterhouses located in 3 provinces of Argentina (Buenos Aires, Entre Rios e Santa Fé), out of which 4 are able to process beef; 1 beef canning plant located in the state of Rio de Janeiro; and 1 vegetable canning plant located in the state of Minas Gerais. In terms of logistics, the Company is supported by 4 distribution centers (3 in the state of São Paulo and 1 in the state of Minas Gerais), 1 inland container terminal located near the port of Santos, state of São Paulo, and subsidiaries is Chile, Egypt, the United States, Russia and the United Kingdom, which distribute and market JBS products in those countries. The following map sets forth the location of JBS facilities, as well as the regions in which cattle is raised in Brazil and Argentina: 2

Brazil AC RO Slaughterhouse Slaughterhouse/Processing plant Distribution center Canned vegetables plant Canned beef plant Container terminal JBS operational footprint MT GO MG MS RJ SP Head of cattle (in thousands) 2.500 7.500 7.500 12.500 12.500 17.500 Argentina 17.500 22.500 Over 22.500 SUMMARY OF THE PERIOD During the 1Q07, JBS continued its growth and leadership consolidation in the markets where it operates. The Company posted a substantial increase in revenues, with net sales totaling R$1.1 billion for the quarter, driven by its ability to increase slaughtering capacity and sales, both in the domestic and international markets. It also improved operationally, posting an EBITDA margin of 14.4%, compared to 13.7% in the same period of last year. In accordance to its expansion strategy, and taking advantage of opportunities for consolidation within the sector, as well as the opening and growth of international markets, in January of 2007, JBS, through Swift-Armour Argentina S.A., acquired a plant in Berazategui, Buenos Aires, with a slaughtering capacity of approximately 1,000 heads per day. Also in January of 2007, the Company acquired 100% of the shares of the North American company SB Holdings and its subsidiaries, Tupman Thurlow, Astro Sales International and Austral Foods for US$11.9 million. SB Holdings is one of the largest industrialized beef distributors in the North American market and is the proprietor of the Hereford, Manco Pride and Rip n Ready brands. This recent acquisition provided JBS with direct access to the processed beef market in the United States. On March 19, 2007, the Company entered into a joint venture agreement with Mr. Jay Earl Link, an American entrepreneur in the beef jerky business, pursuant to which each of Mr. Link and JBS will own 50% of a new company that will produce and market beef jerky in Brazil and in the United States. 3

THE BEEF INDUSTRY According to the USDA, with an estimated 187.7 million heads of cattle in 2007, Brazil has the world s largest cattle herd for commercial purposes. Over the last 15 years, the Brazilian beef industry has undergone an intense process of internationalization and Brazilian beef exports increased from less than 5% of domestic beef production in the early 1990s to approximately 20.0% in 2006. This has occurred despite the fact that Brazil has access to less than 50.0% of the world s fresh beef markets, since countries from the Pacific Block such as the US, Canada, Mexico, Japan and South Korea prohibit the importing of fresh beef from Brazil. Brazilian beef exports have grown by 25.7% on average from 2000 to 2006, as a result of: Increased productivity in the Brazilian beef sector and reduced production costs; Expanded marketing and advertising efforts; An increased number of export destinations; and A gradual reduction of sanitary and trade barriers. In spite of sanitary and commercial restrictions imposed by some of the leading beef importing countries, Brazilian exports are expected to continue growing primarily due to: A growth in demand in industrialized and developing countries; A continuous reduction of sanitary barriers; A reduction of cattle herd in Russia and the consequent decrease in its production capacity; A reduction of subsidies to cattle ranchers and exporters in the European Union, which has been negatively affecting its production and increasing its deficit; and Beef imports expected in China as a result of the significant growth in its beef consumption. BRAZILIAN BEEF MARKET Brazil offers several competitive advantages in producing beef when compared to its competitors in the international market, which contribute to its consolidation as the world s leading beef producer and exporter. These competitive advantages include: Low Production Cost: Brazil has the lowest production cost among major global producers; High Growth Potential: Brazil currently has the largest commercial cattle herd in the world and large amounts of available grazing land, with an estimated capacity to sustantially increase its existing cattle herd and beef production; Disease-Resistant Breeding Practices: Unlike most other major beef producers (including the United States and the European Union), Brazilian cattle are grass-fed and/or are provided vegetable-based feed, which is largely viewed as a factor that eliminates the risk of an outbreak of bovine spongiform encephalopathy (commonly referred to as mad cow disease ), or BSE, 4

among Brazilian cattle. In addition, Brazilian beef is characterized by its low fat content and lack of use of chemicals and growth hormones (used by other countries), which are key factors used in marketing Brazilian beef, primarily to developed nations; Strong domestic market demand: Brazil has a very large domestic market, which currently consumes approximately 80.0% of its beef production. Domestic market sales increase revenue through an optimization of the value of the carcass, a competitive advantage when compared to other world beef producers; FINANCIAL HIGHLIGHTS 1Q07 R$ million 1Q07 1Q06 Var.% Net Sales Revenue 1,086.10 886.1 22.6% Domestic Market 460.2 384.6 19.6% Exports 626.0 501.5 24.8% Gross Profit 257.6 204.4 26.0% Gross Margin 23.7% 23.1% Net Income 10.6 32.3-67.2% Net Margin 1.0% 3.6% EBITDA 156.2 121.7 28.4% EBITDA Margin 14.4% 13.7% Sales Volumes (thousands of tons) Beef Exports 103.6 76.2 35.9% Beef Domestic Market 189.2 167.9 12.7% Total 292.7 244.1 19.9% (*) Net income for the quarter decreased by 67.0% to R$10.6 million, mainly due to non-recurrent expenses related the Company s initial public offering in the amount of R$50.6 million; Net Sales Revenue R$ million Net sales revenue increased by 22.6%, from R$886.1 million in the 1Q06 to R$1.1 billion in the 1Q07, primarily due to a growth of 19.9% in the total sales volume and to an increase in the average sales price compared to the same period of last year. The increase in volume is a result of higher exports for the quarter, which grew by 35.9%, and to a growth of 12.7% in domestic sales in comparison to the same period of last year. 5

Net Sales Revenue (R$ million) Combined Pro Forma Consolidated CAGR: 29,5% 3,158 3,577 3,968 650 1,914 1,292 1,212 890 22,6 % 886 1,086 1999 2000 2001 2002 2003 2004 2005 2006 1Q06 1Q07 Export revenues as a percentage of the Company s total net revenues increased from 57% in the 1Q06 to 58% in the 1Q07, while domestic sales accounted for 42% of net revenues, from 43% in the same period of last year, as demonstrated below. Net Revenues Distribution 1Q06 Net Revenues Distribution 1Q06 Net Revenues Distribution 1Q07 Net Revenues Distribution 1Q07 Domestic Market 43% Domestic Market 42% Export 57% Export 58% Net Revenues: R$886 millions Net Revenues: R$1,086 millions 6

Beef Domestic Market Beef Domestic Market 1Q07 1Q06 Var. % Net Sales Revenue (R$ million) Fresh and Chilled Beef 312.4 267.4 16.8% Processed Beef 67.3 53.8 25.2% Others 80.5 63.4 26.9% TOTAL 460.2 384.6 19.6% Volume (thousands of tons) Fresh and Chilled Beef 138.5 122.6 12.9% Processed Beef 12.6 9.8 28.3% Others 38.1 35.5 7.4% TOTAL 189.2 167.9 12.7% Average Sales Price (R$/kg) Fresh and Chilled Beef 2.26 2.18 3.4% Processed Beef 5.34 5.47-2.4% Others 2.11 1.79 18.2% TOTAL 2.43 2.29 6.2% For the 1Q07, JBS reported net revenues in the domestic market of R$460.2 million, a 19.6% increase over the 1Q06. This is primarily due to a 12.7% growth in sales volumes, which rose from 167.9 thousand tons in the 1Q06 to 189.2 thousand tons in the 1Q07, as well as to a growth of 6.2% in average sales prices in comparison to the same period of last year. Fresh beef volumes in the domestic market grew by 12.9% to 138.5 thousand tons, from 122.6 thousand tons in the 1Q06. This growth is attributable to a recovery of average sales price in Brazil during the quarter, which had been affected by the outbreak of the avian influenza that occurred in several countries in 2006. The outbreak of the avian influenza resulted in lower poultry consumption in international markets, reducing poultry exports from Brazilian producers which, having no other alternative, allocated their export production towards the domestic market. With an increase in supply, poultry prices in the domestic market were reduced, pressuring prices of other sources of protein to follow this reduction. Recovering poultry exports from Brazil has decreased the competition between poultry and fresh beef and resulted in an increase of average sales prices, with a consequent growth in fresh beef volumes sold in the domestic market during the period. Processed beef volumes have increased by 28.3% to 12.6 thousand tons in the 1Q07, from 9.8 thousand tons in the 1Q06, primarily due to the launching of a new line of ready-to-eat meals in Brazil in the end of 2006, the entrance of JBS in the foodservice business with product sales to restaurants and an increase in the consumption of the Company s products. As a consequence, processed beef 7

sales as a percentage of total net sales in the domestic market increased from 14% in the 1Q06 to 15% in 1Q07. The average sales price of processed beef has decreased by 2.4% in the 1Q07, mainly driven by the product mix sold throughout the quarter. Beef Domestic Market Distribution 1Q06 Beef Domestic Market Distribution 1Q06 Beef Domestic Market Distribution 1Q07 Beef Domestic Market Distribution 1Q07 Outros 17% Outros 18% Processed Beef 14% Fresh Beef 69% Processed Beef 15% Fresh Beef 67% Net Revenues: R$384 millions Net Revenues: R$460 millions Beef Exports Beef Exports 1Q07 1Q06 Var. % Net Sales (R$ million) Fresh and Chilled Beef 436.3 322.7 35.2% Processed Beef 189.7 178.9 6.1% TOTAL 626.0 501.5 24.8% Volume (thousands of tons) Fresh and Chilled Beef 73.0 48.8 49.6% Processed Beef 30.5 27.4 11.6% TOTAL 103.6 76.2 35.9% Average Sales Prices (R$/kg) Fresh and Chilled Beef 5.97 6.61-9.6% Processed Beef 6.21 6.54-5.0% TOTAL 6.04 6.58-8.2% Average Sales Prices (US$/kg) Fresh and Chilled Beef 2.83 3.01-5.8% Processed Beef 2.95 2.97-1.0% TOTAL 2.87 3.00-4.3% JBS net export revenues rose by 24.8% to R$626.0 million compared to R$501.5 million for the 1Q06, despite the appreciation of the Brazilian Real that occurred during the period. This result was mainly driven by increased sales volumes of both fresh and processed beef sold throughout the quarter. 8

The factors that caused the increase in volumes are the following: An increase in exports to the European Union, due mainly to a reduction of subsidies to cattle ranchers and exporters, which has been negatively affecting its production and increasing its deficit; Increased exports to Russia due to a gradual reduction of its cattle herd and the consequent decrease in its production capacity; Increased volumes exported to Africa, especially to Argelia and Egypt, one of the countries where the Company maintains a subsidiary to market and distribute its products; Opening of new markets in Latin America and growth of exports to other Latin American countries; An increase in exports to Asia (i.e.: Hong Kong); Expectations with regards to the international beef industry remain optimistic primarily due to (i) the growth in demand in industrialized and developing countries, (ii) a gradual reduction of sanitary and economic barriers imposed by some of the leading consuming and importing countries, (iii) a reduction of cattle herd in Russia and the consequent decrease in its production capacity, (iv) a reduction of subsidies to cattle ranchers and exporters in the European Union, which has been negatively affecting its production and (v) beef imports expected in China as a result of the significant growth in its beef consumption. Average export sales prices have decreased by 4.3% for the quarter, mainly driven by the product mix sold during the quarter, as the Company began to export higher volumes to Eastern European and Middle Eastern countries. In terms of product mix sold by the Company in international markets, fresh beef sales increased to 70% of total export revenues from 64% in the 1Q06, mainly driven by the increase in volumes sold during the period. Export Net Revenues Distribution 1Q06 Export Net Revenues Distribution 1Q06 Export Net Revenues Distribution 1Q07 Export Net Revenues Distribution 1Q07 Processed Beef 36% Processed Beef 30% Fresh Beef 64% Fresh Beef 70% Net Revenues: R$501 millions Net Revenues: R$626 millions For the quarter, Europe has remained JBS main export destination, mainly driven by increased export volumes as a result of the factors described above. 9

Exports Destinations 1Q06 Exports Destinations 1Q06 Exports Destinations 1Q07 Exports Destinations 1Q07 USA 15% Russia 15% Others 36% United Kingdom 12% Others 30% United Kingdom 10% Russia 8% Spain 4% USA 10% Spain 2% Hong Kong 4% Germany 5% Egypt 6% Italy 6% Holland 6% Germany 5% Egypt 5% Hong Kong 5% Italy 8% Holland 8% Income Statement Analysis R$ million 1Q07 V% 1Q06 V% Net Sales Revenue 1.086,1 100,0% 886,1 100,0% Cost of Goods Sold -828,5-76,3% -681,7-76,9% Gross Margin 257,6 23,7% 204,4 23,1% Selling Expenses -99,9-9,2% -77,6-8,8% General and Administrative Expenses -20,6-1,9% -23,2-2,6% Net Financial Income (Expenses) -57,0-5,2% -42,2-4,8% Initial Public Offering Expenses -50,6-4,7% 0,0 0,0% Operating Income 29,6 2,7% 61,5 6,9% Non Operating Income (Exepnses) 0,1 0,0% 0,1 0,0% Income Tax and Social Contribution -19,6-1,8% -29,4-3,3% Minority Interest 0,5 0,0% 0,0 0,0% Net Income 10,6 1,0% 32,3 3,6% Net sales revenue increased by 22.6%, from R$886.1 million in the 1Q06 to R$1.1 billion in the 1Q07, primarily due to a growth of 19.9% in the total sales volume and to an increase in the average sales price of 2.2% compared to the same period of last year. The increase in volume is a result of higher 10

exports for the quarter, which grew by 35.9%, and to a growth of 12.7% in domestic sales in comparison to the same period of last year. Cost of goods sold increased by 21.5% to R$828.5 million in the 1Q07 from R$681.7 million in the 1Q06, primarily due to an increase in the volume of cattle slaughtered to meet the growing demand for the Company s products and to increased volumes sold during the quarter. As net sales revenue increased at a faster rate than cost of goods sold, the Company s gross profit increased by 26.0% to R$257.6 million in the 1Q07 from R$204.4 million in the 1Q06. Gross margin increased to 23.7% in 1Q07 from 23.1% in the same quarter of last year. General and administrative expenses fell to 1.9% as a percentage of net sales from 2.6% in the 1Q06 due to the growth in revenues posted for the quarter. Selling expenses increased to R$99.9 million from R$77.6 million in the 1Q06 mainly due to the increase in total sales volumes during the period. The Company also posted non-recurrent expenses totaling R$50.6 million, which are related to its initial public offering. As a result of the factors described above, JBS net income decreased by 67.0% to R$10.6 million in the 1Q07 from R$32.3 million in the 1Q06. EBITDA increased by 28.4% to R$156.2 million, compared to R$121.7 million in the 1Q06, while EBITDA margin grew to 14.4% compared to 13.7% in the same quarter of last year. EBITDA and EBITDA margin Combined Pro Forma Consolidated 11.8% CAGR: 50,6% Margin (%) 565 14.4% 14.2% 13.7% 9.6% 9.1% 345 9.3% 287 6.0% 5.7% 4.9% 153 178 28% 156 122 32 51 73 1999 2000 2001 2002 2003 2004 2005 2006 1Q06 1Q07 11

INVESTMENTS The Company s aggregate capital expenditures in property, plant and equipment, including acquisitions, were R$213.3 million and R$15.2 million for the 1Q07 and 1Q06, respectively. During the quarter, JBS invested primarily in the following projects: Increase of the production capacity of its processed beef plant located in Andradina, São Paulo from 30 tons to 100 tons per day; Increase of the production capacity of its plant located in Barra do Garça, Mato Grosso from 1,300 head of cattle slaughtered and deboned per day to 2,500 head of cattle slaughtered and deboned per day; Increase of the production capacity of its plant located in Campo Grande, Mato Grosso do Sul from 1,300 head of cattle slaughtered and deboned per day to 3,000 head of cattle slaughtered and deboned per day; Increase of the production capacity of its plant located in Vilhena, Rondônia, from 900 head of cattle slaughtered and deboned per day to 2,200 head of cattle slaughtered and deboned per day; Construction of a beef jerky production plant in Santo Antônio da Posse, São Paulo, which is currently in its final phase; Increase of the production capacity of its plant located in Barretos, São Paulo from 1,600 head of cattle slaughtered and deboned per day to 2,500 head of cattle slaughtered and deboned per day; Acquisition of new trucks to be used for product transportation; and Other investments such as acquisition of new equipment and maintenance of the Company s facilities; DEBT LEVEL R$ million 1Q07 2006 Var. % Short-term Loans 1.073,4 653,6 64,2% Long-term Loans 1.869,0 2.040,0-8,4% Total Debt 2.942,4 2.693,6 9,2% Cash and Marketable Securities 1.468,9 261,1 462,6% Net Debt 1.473,5 2.432,5-39,4% Net Debt/EBITDA 2,5x 4,3x 12

JBS issued 9.375% notes (Reg. S) due 2011 in an aggregate principal amount of US$200.0 million on February 6, 2006 and US$75.0 million on February 14, 2006. Interest on these notes accrues at a rate of 9.375% per annum and is payable quarterly. The principal amount of these notes is payable in full on February 7, 2011. On August 4, 2006, the Company issued 10.50% notes (144A/Reg. S) due 2016 in an aggregate principal amount of US$300.0 million. Interest on these notes accrues at a rate of 10.50% per annum and is payable semiannually. The principal amount of these notes is payable in full on August 4, 2016. The increase in cash and marketable securities refers to the proceeds from the Company s primary offering of 150,000,000 million of its common shares, which began on March 28, 2007, as described on this page of this report. RECENT EVENTS In accordance to its expansion strategy, and taking advantage of opportunities for consolidation within the sector, as well as the opening and growth of international markets, in January of 2007, JBS, through Swift-Armour Argentina S.A., acquired a plant in Berazategui, Buenos Aires, with a slaughtering capacity of approximately 1,000 heads per day. Also in January of 2007, the Company acquired 100% of the shares of the North American company SB Holdings and its subsidiaries, Tupman Thurlow, Astro Sales International and Austral Foods for US$11.9 million. SB Holdings is one of the largest industrialized beef distributors in the North American market and is the proprietor of the Hereford, Manco Pride and Rip n Ready brands. This recent acquisition provided JBS with direct access to the processed beef market in the United States. For the year 2006, SB Holdings consolidated net sales revenue totaled US$55.7 million. On March 19, 2007, the Company entered into a joint venture agreement with Mr. Jay Earl Link, an American entrepreneur in the beef jerky business, pursuant to which each of Mr. Link and JBS will own 50% of a new company that will produce and market beef jerky in Brazil and in the United States. JBS will contribute its beef jerky facility in the City of Santo Antônio da Posse, São Paulo, to the joint venture. This facility is currently being built and it estimated to be valued at approximately US$10.0 million when completed. Mr. Link will contribute US$4.0 million in cash and two beef jerky facilities located in the United States (with an estimated aggregate value of US$6.0 million) to the joint venture. It is expected that the joint venture will enter into credit facilities in the approximate amount of US$30.0 million in order to finance its working capital requirements. INITIAL PUBLIC OFFERING On March 28, 2007, in accordance to the terms of CVM Instruction 358, of January 3, 2002, and article 53 of CVM Instruction 400, of December 29, 2003, JBS S.A. initiated a public offering for a primary and secondary distribution of 200,000,000 of it common shares, representing 23.5% of its capital, being 150,000,000 million shares related to the primary offer and 50,000,000 shares related to the secondary offer, all of them listed at the São Paulo Stock Exchange (Bovespa) in the Novo Mercado 13

segment, under the symbol JBSS3, at the price of R$8.00 per share, with proceeds totaling R$1.6 billion. The Company has received a total of R$1.2 billion as proceeds from the primary offer, before the deduction of commissions and related expenses. JBS will use the majority of the net proceeds from this offering to: (i) additional investments in, and purchase of equipment for, its plants in order to increase their operating capacity; (ii) the acquisition of companies or assets that have not yet been identified in the beef industry; and (iii) strengthening working capital. Decisions as to the use of proceeds for operating capacity expansion or for acquisitions will only be made after economical and legal evaluations are made on the investment opportunities in order to identify how they will add value to the Company s shareholders. Although JBS strategy contemplates acquisitions as a way to accelerate its future growth, while the Brazilian and Argentine markets are very fragmented and offer several acquisition opportunities, it is not possible to forecast when an acquisition may occur or the amounts involved in future transactions. Any acquisition that may be made by the Company will be communicated to the market in accordance to the applicable legislation. The table below summarizes the estimated and approximate percentages and the intended use of the net proceeds from the primary offer: Use of Proceeds % Investments in, and purchase of equipment for, JBS plants and acquisition of companies or assets 70% Working Capital 30% 14

CONTACTS Corporate Headquarters Avenida Marginal Direita do Tietê, 500 Cep: 05111-100 São Paulo SP Brasil Phone: (+55 11) 3144-4000 Fax: (+55 11) 3144-4279 www.jbs.com.br Sérgio Longo Director of Finance and Investor Relations Phone: (5511) 3144-4224 E-mail: sergiolongo@jbs.com.br André Gustavo Menezes Investor Relations Manager Phone: (5511) 3144-4055 E-mail: ir@jbs.com.br This release contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of JBS. These are merely projections and, as such, are based exclusively on the expectations of JBS management concerning the future of the business and its continued access to capital to fund the Company s business plan. Such forward-looking statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry, among other factors and risks disclosed in JBS filed disclosure documents and are, therefore, subject to change without prior notice.. 15

FINANCIAL STATEMENTS JBS S.A. and its Subsidiaries BALANCE SHEETS (In thousands of Reais) Company Consolidated 31.03.07 31.12.06 31.03.07 31.12.06 ASSETS CURRENT ASSETS Cash and cash equivalents 1,187,581 54,375 1,221,931 68,629 Marketable securities 206,113 145,346 246,941 192,442 Trade accounts receivable from customers 708,215 665,782 747,879 692,819 Inventories 631,764 563,935 785,016 657,504 Taxes recoverable 437,405 424,941 546,361 567,264 Prepaid expenses 7,639 1,936 10,336 2,956 Other current assets 46,063 43,494 68,184 68,938 TOTAL CURRENT ASSETS 3,224,780 1,899,809 3,626,648 2,250,552 LONG-TERM ASSETS Long-term assets Account receivable from related parties 34,067 67,523 - - Judicial deposits and others 5,665 4,742 8,915 5,626 Deferred income tax and social contribution 16,853 16,050 25,572 23,492 Taxes recoverable 24,129 24,129 33,670 34,752 Total Long-term assets 80,714 112,444 68,157 63,870 Permanent assets Advances for investments in subsidiaries - 35,051 - - Investments in subsidiaries 516,460 367,822 20,988 - Other investments 10 10 10 10 Property, plant and equipment 1,034,002 899,176 1,311,542 1,125,218 Intangible assets 9,615 9,615 23,806 24,340 Deferred charges - - - 847 Total Permanent assets 1,560,087 1,311,674 1,356,346 1,150,415 TOTAL LONG-TERM ASSETS 1,640,801 1,424,118 1,424,503 1,214,285 TOTAL ASSETS 4,865,581 3,323,927 5,051,151 3,464,837 16

JBS S.A. and its Subsidiaries BALANCE SHEETS (In thousands of Reais) Company Consolidated 31.03.07 31.12.06 31.03.07 31.12.06 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Trade accounts payable to suppliers 354,981 271,460 415,806 309,294 Loans and financings 981,276 579,128 1,073,432 653,638 Payroll and taxes payable 90,466 73,142 114,045 84,447 Other current liabilities 39,385 41,545 42,405 51,886 TOTAL CURRENT LIABILITIES 1,466,108 965,275 1,645,688 1,099,265 LONG-TERM Loans and financings 1,868,978 2,039,977 1,868,978 2,039,977 Deferred income tax and social contribution 61,984 62,665 61,984 62,665 Accrual for contingencies 49,568 47,207 50,056 53,005 Other Long-term liabilities 25,255 25,758 32,037 26,471 TOTAL LONG-TERM LIABILITIES 2,005,785 2,175,607 2,013,055 2,182,118 Minority interest (1,280) 409 SHAREHOLDERS' EQUITY Capital stock 91,748 52,524 91,748 52,524 Capital reserve 1,160,776-1,160,776 - Revaluation reserve 129,199 130,521 129,199 130,521 Retained earnings 11,965-11,965 - TOTAL SHAREHOLDERS' EQUITY 1,393,688 183,045 1,393,688 183,045 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 4,865,581 3,323,927 5,051,151 3,464,837 17

JBS S.A. and its Subsidiaries STATEMENTS OF INCOME FOR THE PERIOD OF THREE MONTHS ENDED MARCH 31, 2007 AND 2006 (In thousands of Reais) Company Consolidated 2007 2006* 2007 2006* GROSS SALES REVENUE Sales of products: Income from sales of products - domestic market 494,980 407,082 550,766 449,791 Income from sales of products - exports 522,879 413,407 651,607 509,559 1,017,859 820,489 1,202,373 959,350 SALES DEDUCTIONS Returns and discounts (37,973) (16,189) (46,267) (26,595) Sales taxes (62,196) (46,644) (69,968) (46,644) (100,169) (62,833) (116,235) (73,239) NET SALE REVENUE 917,690 757,656 1,086,138 886,111 Cost of goods sold (670,046) (562,241) (828,495) (681,667) GROSS INCOME 247,644 195,415 257,643 204,444 OPERATING INCOME (EXPENSE), NET General and administrative expenses (14,853) (16,062) (20,567) (23,157) Selling expenses (89,073) (69,764) (99,894) (77,586) Financial income (expense), net (39,857) (20,456) (56,983) (42,190) Equity (21,711) (26,448) - - Initial Public Offering expenses (50,564) - (50,564) - (216,058) (132,730) (228,008) (142,933) OPERATING INCOME 31,586 62,685 29,635 61,511 NON-OPERATING INCOME (EXPENSE), NET 68 (181) 60 129 INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION 31,654 62,504 29,695 61,640 Income tax and social contribution (21,814) (30,243) (22,074) (29,395) Deferred income tax and social contribution 803-2,489 - (21,011) (30,243) (19,585) (29,395) INCOME BEFORE MINORITY 10,643 32,261 10,110 32,245 Minority interest 533 16 NET INCOME 10,643 32,261 10,643 32,261 Net income per thousands of Group share 12.52 62.57 Statement of EBITDA (Earning before income tax and social contribution, interest, depreciation and amortization and non-operating income (expense), net Income before income tax and social contribution 31,654 62,504 29,695 61,640 Financial income (expense), net 39,857 20,456 56,983 42,190 Depreciation and amortization 13,873 12,813 19,047 17,987 Non-operating income (expense), net (68) 181 (60) (129) Equity 21,711 26,448 - - Initial Public Offering expenses 50,564-50,564 - AMOUNT OF EBITDA 157,591 122,402 156,229 121,688 18