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Industrias Bachoco Announces Second Quarter 2018 Results

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Industrias Bachoco Announces Second Quarter 2018 Results

PR Newswire

CELAYA, Mexico, July 23, 2018 /PRNewswire/ -- Industrias Bachoco, S.A.B. de C.V., "Bachoco" or "the Company", (NYSE:IBA, BMV: Bachoco)) announced today its unaudited results for the second quarter ("2Q18") and first half ("1H18") 2018 ended on June 30, 2018. All figures have been prepared in accordance with International Financial Reporting Standard ("IFRS"), and are presented in nominal million Mexican Pesos ("$").

HIGHLIGHTS 2018

  • Net sales increased 7.3% in 2Q18 and 9.4% in 1H18
  • EBITDA margin was 12.2% for 2Q18 and 13.0% in 1H18
  • Earnings per basic and diluted share totaled $2.62 for 2Q18 and $4.72 for 1H18

CEO COMMENTS

Mr. Rodolfo Ramos Arvizu, Chief Executive Officer of Bachoco, stated: "This second quarter was challenging in both our Mexico and U.S. operations.

"In Mexico, cost of raw materials increased, in part due to a weaker Mexican peso, offsetting the increases in prices leading to pressure in margins.

"In the U.S. we observed atypical lower prices in the white meat market which combined with higher cost of raw materials, resulted in a difficult comparison vs 2Q17.

"Overall, the good balance between supply and demand allowed us to observe a net increase in price of our main products and to increase total sales by 7.3% in the quarter and 9.4% in the semester, compared to the same periods of 2017.

"Our EBITDA margin for the quarter was 12.2% which is lower than the EBITDA of the second quarter of 2017. As a result, our EBITDA for the first half of the year was 13.0%, compared to 13.2% EBITDA margin of the same period of 2017.

"Regarding 1H18, our results improved in general as we increase our EBITDA by 8.3% and our net income by 19.4%.

"We are entering the 3Q and we are observing prices in Mexico trending down as it is typical for a 3Q, however raw material cost is going down and the exchange rate on the Mexican peso vs the US dollar has strengthened. At the same time, we keep working to capture efficiencies across our processes in order to be the best option for our customers."

EXECUTIVE SUMMARY

The following financial information is expressed in millions of nominal pesos, except for amounts per share or per ADR, with comparative figures for the same period in 2017.

QUARTERLY RESULTS






NET SALES BY GEOGRAPHY





In millions of pesos


2Q18

2Q17

Change



$

$

$

%

Net Sales


16,213.6

15,116.3

1,097.4

7.3

Net sales in Mexico


11,553.9

11,386.6

167.3

1.5

Net sales in the U.S.


4,659.7

3,729.7

930.1

24.9











NET SALES BY SEGMENT





In millions of pesos


2Q18

2Q17

Change



$

$

$

%

Net Sales


16,213.6

15,116.3

1,097.4

7.3

Poultry


14,731.9

13,662.8

1,069.2

7.8

Other


1,481.7

1,453.5

28.2

1.9



NET VOLUME SOLD BY SEGMENT






In tons




Change



2Q18

2Q17

Volume

%

Total sales volume:


551,287

545,600

5,687

1.04

Poultry


431,315

420,604

10,711

2.55

Others


119,972

124,996

-5,024

-4.02







The Company's 2Q18 net sales totaled $16,213.6 million, $1,097.4 million or 7.3% more than   $15,116.3 million reported in 2Q17.  The increase is a result of better prices in poultry and balanced feed.

In 2Q18, sales of our U.S. operations represented 28.7% of our total sales compared to 24.7% in 2Q17.

GROSS PROFIT

In millions of pesos


2Q18

2Q17

Change



$

$

$

%

Cost of sales


13,108.3

11,502.1

1,606.2

14.0

Gross profit


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