Industrias Bachoco reported a net loss of Ps. 106.9 million (US$8.13 million) for the third quarter of 2011, compared to a gain of Ps. 635.1 million (US$48.3 million) in the third quarter of 2010, according to the company's latest financial report.
Chicken products sales in the third quarter grew 0.7% compared to the same time in 2010, which resulted from a 3.9% increase in sales volume, partially offset by a 3.1% decrease in chicken prices as industry supply for chicken products rose during the period. Sales of table eggs increased 8.8%, driven by a 16.3% increase in prices, partially offset by a 6.4% drop in sales volume.
“The third quarter’s results were sharply affected by several external conditions that lead the company to post negative net income in the quarter," said CEO Rodolfo Ramos. "Mainly, the continuous increase in the cost of grain and oversupply conditions within the Mexican poultry industry, which led to a reduction in our chicken prices while compared with the same quarter of 2010. On a positive note, total sales increased across the company’s main product lines, preserving positive EBITDA (earnings before interest, tax, depreciation, and amortization) for the quarter, while adequate administration of our financial instruments softened the impact of the peso’s depreciation when compared to the U.S. dollar."
According to the company, Bachoco’s aim for the next year will be to maintain strict cost and expense controls and productivity improvements while serving the relevant markets and maintaining a healthy financial position.