Industrias Bachoco announced its unaudited results corresponding to the fourth quarter of 2018 and all of 2018, with both periods ending on December 3, 2018.
The financial information was presented in millions of nominal pesos (MXN), in accordance with the International Financial Reporting Standards (IFRS).
Bachoco in figures
Among the relevant figures, net sales grew 2.6 percent in the fourth quarter of 2018 and 5.2 percent in all 2018, compared to the same period of 2017.
The EBITDA margin was 5.9 percent in the fourth quarter of 2018 and 8.3 percent in 2018, while the earnings per share was of MXN1.32 (US$0.07) in the fourth quarter of 2018 and MXN5.72 (US$0.30) in 2018.
Results in Mexico and the US
Rodolfo Ramos, general director of Bachoco, commented: "We finished this quarter a very challenging second semester of 2018 in the two countries in which we participate. Although with a tendency to improve, a large part of the prevailing conditions in the third quarter continued into the fourth quarter of 2018."
According to Ramos, a poultry industry resuming its regular growth rates was observed in Mexico during the quarter, improving the balance between supply and demand compared to the third quarter of the year. "These conditions, in addition to seasonal effects, allowed us to improve prices, compared to the previous quarter," he said.
He also noted that with respect to cost of sales, "the volatility of the exchange rate during the quarter partially offset the benefits of lower raw material costs in terms of U.S. dollars. Increases in fuel prices negatively affected our operating expenses compared to the same period of 2017."
With regard to the United States, "We continued to observe conditions of meat oversupply, which put pressure on chicken prices. However, this negative impact was partially offset by the integration of our Albertville operation which, as a net meat buyer, captured benefits from the price decrease,” Ramos said.
The bottom line
As a result, Bachoco achieved an increase in total sales of 2.6 percent in the fourth quarter of 2018, when compared to the same period of 2017, with positive results in terms of both operating and net profit.
"Our EBITDA was MNX916.1 million (US$47.95 million), lower than the EBITDA of the same quarter of 2017. For the fourth quarter, our EBITDA margin was 5.9 percent and our earnings per share were of MXN1.32 (US$0.07).
Throughout 2018, the company continued with positive results, as total sales increased by 5.2 percent, with an EBITDA margin of 8.3 percent and earnings per share of MXN5.72 (US$0.30).
Bachoco’s general director emphasizes that its financial structure remained solid and allowed them to continue with the growth plans. At the end of the year they had a net cash of MXN13.414 billion (US$700 million) and registered a CAPEX of MXN1.996 billion (US$104 million) in the year.
"We continue to focus on capturing efficiencies through all our processes and being close to our customers, which we believe is the key to continue growing."
