Grupo Bimbo has booked mixed first-quarter results, with higher sales but pressure on profitability.
The bakery group said that net earnings were hit by integration and restructuring expenses and a higher effective tax rate. Net majority income fell to MXN985m (US$51.8m) in the quarter, compared to MXN1.43bn in the comparable period of last year.
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Operating income was also slightly down year-on-year. EBIT dipped to MXN3.65bn compared to MXN3.88bn in the prior year. Operating profit margins saw a 130 basis point contraction in the quarter to 5.5%. Bimbo said it was “in line” with the company’s plans, as it closed two North American facilities, integrated the Donuts Iberia business in Europe and opened a new production plant in Cordoba, Argentina.
While investments dampened profitability, Bimbo stressed sales were higher in the three-month period. Revenue increased to MXN66.51bn, up from MXN57.08bn last year. This 16.5% increase reflected positive forex impact, “solid” organic growth in Mexico and the contribution of the recently-acquired Donuts Iberia business.
