Gruma: reports second quarter 2024 results

San Pedro Garza Garcia / MX. (gr) «We are very pleased with our results in the second quarter of the financial year, where once again Gruma’s resilience and adaptability to its current market environment were highlighted. Our value-add products in the United States continue to grow at a steady pace despite the strong momentum in growth for private label SKUs on the back of a weaker consumer. In Mexico and Europe, strong demand continues to drive the business despite logistics challenges, which affected volumes in Q2-2024, and the Central American and Asia and Oceania divisions continue to deliver steady and solid results. Through our continued perseverance and focus, Gruma reached consolidated Ebitda growth of 17 percent and profitability grew 19 percent in terms of Ebitda per ton,» Mexico’s Gruma S.A.B. de C.V. said in its statement for the second quarter 2024.

Consolidated Results Of Operations

Sales volume decreased 1 percent compared to Q2-2023, to 1,079 thousand metric tons, driven mainly by price sensitivity in the food service channel in the US and logistic challenges in Europe that prevented the normal distribution of corn milling products across the continent. Net sales remained flat at USD 1.7 billion mainly due to price adjustments made in Mexico in line with the traditional method across the country, in addition to lower volume sold. Sales from non- Mexican operations represented 72 percent of consolidated figures. Cost of sales (COGS) decreased 5 percent to USD 1.0 billion due to efficiencies in all divisions. As a percentage of net sales, COGS improved to 61.9 percent from 65.0 percent. Selling, general and administrative expenses (SG+A) increased 7 percent to USD 409.9 million due to a rise in logistics costs; higher marketing costs; and greater commissions paid. As a percentage of net sales, SG+A increased to 24.7 percent from 23.1 percent. Other income, net, was USD 3.4 million compared to an expense of USD 12.2 million last year. The change resulted mainly from gains on Gruma’s hedging positions and the payment of insurance claims on damaged assets due to bad weather conditions in Mexico during 4Q23. Operating income increased by 23 percent to USD 226.9 million. Operating margin expanded 260 basis points to 13.7 percent from 11.1 percent. Ebitda increased 17 percent to USD 286.3 million, and Ebitda margin increased 250 basis points to 17.2 percent from 14.7 percent. Ebitda from non-Mexican operations represented 80 percent of consolidated figures. Net comprehensive financing cost declined by 53 percent to USD 18.8 million, mainly due to a decline in debt outstanding as a result of debt payments and a weaker Mexican Peso (MXN). Gruma’s net balance sheet monetary positions also decreased as a result of a weaker MXN, contributing to this change. Income taxes were USD 71.3 million, a 48 percent increase compared to Q2-2023, due to higher pretax earnings resulting from the dynamics mentioned above. The effective tax rate for the quarter was 34.2 percent compared to 33.3 percent in Q2-2023. Majority net income increased 42 percent to USD 136.9 million. For additional info please read the company’s PDF file below (372 KB):

20240724-GRUMA-Q22024.