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Industrias Bachoco Announces Fourth Quarter And Full Year 2018 Results

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CELAYA, Mexico, Jan. 30, 2019 /PRNewswire/ -- Industrias Bachoco, S.A.B. de C.V., "Bachoco" or "the Company", (NYSE:IBA, BMV: Bachoco)) announced its audited results for the fourth quarter ("4Q18") and full year ("2018") results ending December 31, 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 2.6% in 4Q18 and 5.2% in year 2018 vs equivalent periods of 2017.
  • EBITDA margin was 5.9% for 4Q18 and 8.3% for the whole year.
  • Earnings per basic and diluted share totaled $1.32 for 4Q18 and $5.72 for the year.

CEO COMMENTS

Mr. Rodolfo Ramos Arvizu, Chief Executive Officer of Bachoco, stated "With 4Q18, we ended a challenging second half of the year in both geographies in which we participate. Even when improving, most of the conditions prevailing in 3Q18 continued into 4Q18.

In Mexico, during the quarter we observed a poultry industry returning to normalized growth rates, improving the balance between supply and demand when compared to 3Q18. These conditions and seasonality effects lead us to better prices vs the previous quarter. Regarding cost of sales, volatility on the exchange rate during the quarter offset the benefits of lower raw material costs in dollar terms. Increases in fuel prices had a negative impact on our SG&A when compared to the same period of 2017.

In the US, we kept observing oversupply conditions on proteins which put pressure on chicken prices. However, this negative impact was partially compensated by the integration of our Albertville operation which, as a meat buyer, captured the benefits of these low-price conditions.

Overall, we reached an increase in total sales of 2.6% in 4Q18 when compared to 4Q17, with positive results in operating and net income.  Our EBITDA was $916.1 million which is lower than the EBITDA of the same quarter of 2017. For the fourth quarter, our EBITDA margin was 5.9% and our earnings per basic and diluted share was $1.32

For the full year of 2018, we continued delivering positive results. We increased total sales by 5.2%, with an EBITDA margin of 8.3% and earnings per share of $5.72.  

Our financial structure remained solid and allowed us to keep with our growth plans. We reported a net cash position of $13,414.3 and CAPEX of $1,996.3 million.

We continue to be very focused on capturing efficiencies across all our processes and being close to better serve our customers as we know this is key for our growth."

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


4Q18

4Q17

Change



$

$

$

%

Net sales


15,421.0

15,032.6

388.4

2.6

Net sales in Mexico


10,942.4

10,329.4

613.0

5.9

Net sales in the U.S.


4,478.6

4,703.2

(224.6)

(4.8)






NET SALES BY SEGMENT





In millions of pesos


4Q18

4Q17

Change



$

$

$

%

Net sales


15,421.0

15,032.6

388.4

2.6

Poultry


13,972.8

13,559.9

412.9

3.0

Other


1,448.3

1,472.7

(24.5)

(1.7)






NET VOLUME SOLD BY SEGMENT





In tons




Change



4Q18

4Q17

Volume

%

Total sales volume:


568,380

585,965

(17,585)

(3.0)

Poultry


458,298

461,653

(3,355)

(0.7)

Others


110,082

124,312

(14,231)

(11.4)







The Company's 4Q18 net sales totaled $15,421.0 million, $388.4 million or 2.6% more than $15,032.6 million reported in 4Q17.  The increase is mainly a result of higher prices of our main business lines when compared to 4Q17, partially offset by lower volume sold.

In 4Q18, sales of our U.S. operations represented 29.0% of our total sales; this compares with 31.3% it represented in 4Q17.

GROSS PROFIT





In millions of pesos


4Q18

4Q17

Change



$

$

$

%

Cost of sales


13,272.2

12,775.2

497.0

3.9

Gross profit


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