Minerva delivered what it promised: a swift integration of Marfrig’s assets, record revenue of R$15.5 billion, and EBITDA of R$1.4 billion. The R$2.5 billion in free cash flow, the highest in its history, should have cemented the bull case. It looked like something to frame — but the market refused to hang it. The stock plunged almost 14%, marking its worst session since joining Brazil’s benchmark index.
The issue isn’t how much Minerva generated — it’s how. Much of the cash miracle came from north of the Equator: beef cuts stuck in the U.S. under tariff and quota restrictions turned into R$1.6 billion in cash. Frozen meat became hot liquidity — and temporary relief. The company flipped its cash conversion cycle to –31 days from –16, by unloading Marfrig-inherited inventories, stretching supplier terms, and accelerating receivables.
BTG Pactual called the quarter “record-breaking but fragile.” The bank estimates Minerva now finances more than two months of sales through third parties, while annualized financial expenses top R$3 billion. The gross margin, at 16.5%, is among the lowest of the decade. Management admits the newly integrated plants are still performing “below their historical levels,” meaning ramp-up may be over, but maturity is not yet in sight.
CFO Edison Ticle insists that “many said the acquisition was expensive, but it’s clearly value-accretive.” Maybe so. But the market’s reaction shows there’s a difference between generating cash and burning fat. Minerva solved the liquidity puzzle — now it must prove the flow won’t dry up. For now, on B3’s trading grill, there’s more smoke than steak.
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