provide portability of benefits for workers who move from employer to employer within one industry. These plans are supported by multiple employers and maintained under collective bargaining agreements. Bimbo Bakeries USA ("BBU") currently participates in 34 MEPPs covering more than 15,000 associates.
Mexico(Millions of pesos)
Net Sales17,739 17,775 18,698 18,966 ,584
17,709
Note: Figures expressed in millions of pesos, while consolidated results exclude inter-company transactions.
1Q 2Q 3Q 4Q
US & Canada(Millions of pesos)
24,741 25,672
21,548
18,415 19,986 20,400 21,165
18,216
1Q 2Q 3Q 4Q
Latin America(Millions of pesos)
5,073 5,159 5,653 6,046
4,839 4,994 4,980 5,592
1Q 2Q 3Q 4Q
Europe(Millions of pesos)
1,451 1,637 1,918 1,890
1,219 1,269 1,399 1,436
MexicoNet sales in the fourth quarter declined 2.0% YoY, to Ps. 18,584 million, due to continued pressure on volumes arising from the weak consumption environment and pricing initiatives taken in the fourth quarter of 2013 related to the excise tax; nonetheless, ongoing commercial and point of sale efforts helped generate volume growth in key categories such as bread, buns and cakes. On a cumulative basis, sales declined 1.5%.
US & Canada
Sales in US & Canada rose 21.3% in the period, to Ps. 25,672 million, primarily reflecting the Canada Bread acquisition, which accounted for
18.7%, as well as the benefit of the FX rate. While changing marketplace dynamics impacted performance in the US, key categories such as sweet
baked goods and breakfast saw continued momentum. Following a record 2013, net sales in the US came under pressure with a more
challenging competitive landscape. Cumulative sales rose 13.3%.
Net sales in the region totaled Ps. 6,046 million in the quarter, with growth in local currencies in almost every country, most notably Brazil, Chile, Uruguay and Central America. Innovation, new product launches and ongoing market penetration efforts helped drive growth in the region. Net sales for the full year rose 7.5%.
EuropeNet sales in Europe rose 31.6% to Ps. 1,890 million in the quarter, of which 29.9% correlates to the UK operation acquired as part of the Canada Bread transaction; continued growth in Iberia, notably in the bread, sweet baked goods, buns and snacks categories, also supported growth in the period. For the full year, net sales rose 29.6%.
1Q 2Q 3Q 4Q
Page 2
Fourth Quarter and Full Year 2014
Gross Profit(Millions of pesos)
52.9 53.7 53.2
52.8 52.4
52.9
52.2
Gross Profit51.1
24,134 26,303 26,662
21,999 22,670 23,296 24,410
20,999
1Q 2Q 3Q 4Q
Note: Figures expressed in millions of pesos, while consolidated results exclude inter-company transactions.
Operating Expenses(% of net sales)
47.6
Consolidated gross profit in the quarter increased 9.2%, while the margin decreased 80 basis points. Lower prices for certain raw materials helped generate an increase of 8.5% for the full year.
Operating ExpensesExpressed as a percentage of sales, operating expenses in the quarter
45.7
44.5
44.9
43.5
44.2
45.1
42.7
decreased 240 basis points to 42.7%. This reflected lower distribution costs, strict expense controls and efficiencies and waste reduction initiatives in the US. For the full year, operating expenses as a percentage of sales remained flat at 44.7%.
1Q 2Q 3Q 4Q
Page 3
Fourth Quarter and Full Year 2014
Profit before Other Income & Expenses (Millions of pesos) Profit before Other Income & Expenses5.4
8.8 9.1 9.5
8.3 8.9 7.8
4,851
5.4
3,577
4,475
3,945 3,964
3,617
2,219 2,225
1Q 2Q 3Q 4Q
Note: Figures expressed in millions of pesos, while consolidated results exclude inter-company transactions.
Profit before other income & expenses in the fourth quarter and full year posted a solid growth of 34.1% and 15.8%, respectively. The margin expanded 160 basis points in the quarter and 60 basis points for the full year.
4.8
3.7
Operating Income(Millions of pesos)
7.3 8.0
7.6
5.8
3,938
3,277 3,383
5.7
3.0
Operating Income1,968
1,537
2,483
2,610
1,556
1Q 2Q 3Q 4Q
Note: Figures expressed in millions of pesos, while consolidated results exclude inter-company transactions.
Page 4
Fourth Quarter and Full Year 2014
During the quarter, operating income decreased 40.4% to Ps. 1,556 million, with a 260 basis point contraction in the margin, to 3.0%.
During the quarter, the Company incurred in significant charges on the
"other income and expenses" which include:
i) a Ps. 1,990 million (US $136 million) non-cash charge reflecting the impact that a lower US interest rate had on the provision for multi-employer pension plans in the US
ii) higher restructuring costs in the US related to the asset reconfiguration strategy and optimization of the manufacturing and distribution network in the amount of Ps. 634 million (US $46 million)
(Millions of pesos)
(628) (606)(559) (632) (753)
Comprehensive Financing ResultComprehensive financing resulted in a Ps. 1,104 million cost in the fourth quarter, compared to a Ps. 753 million cost in the same period of last year. This is primarily the result of incremental interest expense related to
(799)
(974)
(1,104)
the Canada Bread acquisition in May 2014. Hence, FX gains & losses during the year posted a non-material result not withstanding weaker currencies in several countries against the dollar
1Q 2Q 3Q 4Q
Net Majority Income(Millions of pesos)
Net Majority Income1.3
1.0
3.6 3.4
3.4
2.2
2.8
-0.5
The Company registered a net majority loss of Ps. 231 million in the
(0) (0)
524 430
941
1,612 1,5091,701 1,309
(231)
quarter, while on a cumulative basis net majority income totaled Ps. 3,513 million, a decline of 18% from 2013. This was due to the aforementioned non-cash MEPPs charge and a higher effective tax rate of 42.5% compared to 37.7% in the year ago period, this increase primarily reflects:
1Q | 2Q | 3Q | 4Q | i) | the lower deductibility of certain fringe benefits in Mexico |
ii) | a higher taxable base due to inflationary gains related to financial | ||||
debt | |||||
iii) | no longer carrying deferred income tax benefit in Brazil. |
2013 2014
millions of pesos
% of net sales
Page 5
Fourth Quarter and Full Year 2014
EBITDA(Millions of pesos)
Operating Income plus Depreciation and Amortization (EBITDA)7.8
10.3 11.1
10.8
10.8
10.4
7.1
3,196 2,955
9.9
4,651
4,265
5,478 5,300
4,817 4,974
1Q 2Q 3Q 4Q
Note: Regional results do not reflect inter-company royalties, while consolidated results exclude inter-company transactions.
millions of pesos
% of net sales
2013 2014
EBITDA in the quarter increased 6.6% to Ps. 5,300 million, while the margin contracted 40 basis points to 10.4%. For the full year, EBITDA increased 6.6% with a margin of 9.8%. It is important to note that the EBITDA was unaffected since the charge related to MEPPS was non- cash.
Financial Structure
The Company's cash position as of December 31, 2014 totaled Ps. 2.6 billion, compared to Ps. 2.4 billion on December 31, 2013.
Total debt at December 31, 2014 was Ps. 62.2 billion, an increase of Ps.
21.9 billion compared to the same period last year.
The total debt to EBITDA ratio was 3.4 times. On a pro-forma basis, taking into account 5 months of pro-forma EBITDA of Canada Bread, the total debt to EBITDA ratio was 3.2 times.
The average maturity and cost of the Company's financial debt is 8.9 years and 4.4%, respectively. Long-term debt comprises 97% of the total. Of total debt, 70% is denominated in US dollars, 29% in Canadian dollars and 1% in Mexican pesos, maintaining a natural economic and accounting hedge. Both, the amortization profile and currency composition are aligned with the Company's cash flow generation.
Page 6
Fourth Quarter and Full Year 2014
Conference Call Information
The 4Q2014 and Full Year conference call will be held on Friday, February 27, 2015 at 11:00 am Eastern time (10:00 am Central time). To
participate in the call, please dial: domestic US +1(877) 317-6776,
international +1(412) 317-6776; conference ID: GRUPO BIMBO. Webcast for this call can also be accessed at Grupo Bimbo's website at http://www.grupobimbo.com/ir.
An instant replay of the conference call will be available through March 7,
2015. To access the replay, please dial domestic US +1(877) 344-7529, international +1(412) 317-0088; conference ID: 10059483.
Grupo Bimbo is the largest baking Company in the world in terms of volume and sales. Grupo Bimbo has 167 plants and approximately 1,700 sales centers strategically located in 22 countries throughout the Americas, Europe and Asia. Its main product lines include fresh and frozen sliced bread, buns, cookies, snack cakes, english muffins, bagels, pre-packaged foods, tortillas, salted snacks and confectionery products, among others. Grupo Bimbo produces over 10,000 products and has one of the largest direct distribution networks in the world, with more than 2.4 million points of sale, more than 52,000 routes and more than 129,000 associates. Grupo Bimbo's shares have traded on the Mexican Stock Exchange since 1980 under the ticker symbol BIMBO.
Note on Forward-Looking Statements
This announcement contains certain statements regarding the expected financial and operating performance of Grupo Bimbo, S.A.B. de C.V., which are based on current financial information, operating levels, and market conditions, as well as on estimations of the Board of Directors of the Company related to possible future events. The results of the Company may differ in regards with those expressed on these statements, due to different factors that are beyond the Company's control, such as: adjustments in price levels, variations in the costs of its raw materials, changes in laws and regulations, or economic or political conditions not foreseen in the countries where the Company operates. Therefore, the Company is not responsible for such differences in the information and suggests that readers review such statements prudently. Moreover, the Company will not undertake any obligation to publicly release any revisions to the statements due to variations of such factors after the date of this press release.
Page 7
Fourth Quarter and Full Year 2014
CONSOLIDATED INCOME STATEMENT (M ILLIONS OF M EX ICA N PESOS) | 2013 | 2014 | ||||||||
CONSOLIDATED INCOME STATEMENT (M ILLIONS OF M EX ICA N PESOS) | 1Q % | 2Q % | 3Q % | 4Q % | ACCUM % | 1Q % | 2Q % | 3Q % | 4Q % | ACCUM % |
NET SALES | 41,086 100.0 | 42,921 100.0 | 44,478 100.0 | 46,138 100.0 | 174,623 100.0 | 41,558 100.0 | 44,941 100.0 | 49,429 100.0 | 51,122 100.0 | 187,051 100.0 |
M EXICO US & CANADA EUROPE LATIN AM ERICA | 17,739 43.2 18,216 44.3 1,219 3.0 4,839 11.8 | 17,775 41.4 19,986 46.6 1,269 3.0 4,994 11.6 | 18,698 42.0 20,400 45.9 1,399 3.1 4,980 11.2 | 18,966 41.1 21,165 45.9 1,436 3.1 5,592 12.1 | 73,178 41.9 79,767 45.7 5,323 3.0 20,405 11.7 | 17,709 42.6 18,415 44.3 1,451 3.5 5,073 12.2 | 17,692 39.4 21,548 47.9 1,637 3.6 5,159 11.5 | 18,110 36.6 24,741 50.1 1,918 3.9 5,653 11.4 | 18,584 36.4 25,672 50.2 1,890 3.7 6,046 11.8 | 72,095 38.5 90,375 48.3 6,897 3.7 21,931 11.7 |
COST OF GOODS SOLD GROSS PROFIT | 20,086 48.9 20,999 51.1 | 20,252 47.2 22,670 52.8 | 21,181 47.6 23,296 52.4 | 21,728 47.1 24,410 52.9 | 83,247 47.7 91,376 52.3 | 19,559 47.1 21,999 52.9 | 20,807 46.3 24,134 53.7 | 23,126 46.8 26,303 53.2 | 24,460 47.8 26,662 52.2 | 87,953 47.0 99,098 53.0 |
M EXICO US & CANADA EUROPE LATIN AM ERICA | 9,479 53.4 9,152 50.2 459 37.7 1,979 40.9 | 9,860 55.5 10,172 50.9 490 38.7 2,235 44.8 | 10,577 56.6 10,089 49.5 565 40.4 2,146 43.1 | 11,258 59.4 10,477 49.5 570 39.7 2,203 39.4 | 41,173 56.3 39,891 50.0 2,084 39.2 8,564 42.0 | 9,994 56.4 9,345 50.7 591 40.7 2,208 43.5 | 10,421 58.9 10,921 50.7 714 43.6 2,214 42.9 | 10,501 58.0 12,626 51.0 809 42.2 2,502 44.3 | 10,885 58.6 12,438 48.5 802 42.4 2,643 43.7 | 41,802 58.0 45,330 50.2 2,916 42.3 9,568 43.6 |
OPERATING EXPENSES PROFIT (LOSS) BEFORE OTHER INCOM E (EXPENSES), NET | 18,780 45.7 2,219 5.4 | 19,093 44.5 3,577 8.3 | 19,333 43.5 3,964 8.9 | 20,793 45.1 3,617 7.8 | 77,999 44.7 13,377 7.7 | 19,774 47.6 2,225 5.4 | 20,188 44.9 3,945 8.8 | 21,828 44.2 4,475 9.1 | 21,811 42.7 4,851 9.5 | 83,602 44.7 15,496 8.3 |
M EXICO US & CANADA EUROPE LATIN AM ERICA | 1,537 8.7 970 5.3 (96) (7.9) (209) (4.3) | 2,067 11.6 1,474 7.4 (69) (5.5) 126 2.5 | 2,680 14.3 1,249 6.1 (49) (3.5) (39) (0.8) | 3,036 16.0 816 3.9 (44) (3.1) (221) (4.0) | 9,320 12.7 4,510 5.7 (259) (4.9) (343) (1.7) | 1,592 9.0 689 3.7 (58) (4.0) (25) (0.5) | 2,313 13.1 1,623 7.5 (2) (0.1) (20) (0.4) | 2,778 15.3 1,578 6.4 5 0.2 86 1.5 | 3,646 19.6 970 3.8 41 2.2 165 2.7 | 10,328 14.3 4,860 5.4 (14) (0.2) 207 0.9 |
OTHER (EXPENSES) INCOM E NET OPERATING PROFIT | (251) (0.6) 1,968 4.8 | (1,094) (2.5) 2,483 5.8 | (581) (1.3) 3,383 7.6 | (1,007) (2.2) 2,610 5.7 | (2,932) (1.7) 10,444 6.0 | (688) (1.7) 1,537 3.7 | (668) (1.5) 3,277 7.3 | (537) (1.1) 3,938 8.0 | (3,294) (6.4) 1,556 3.0 | (5,187) (2.8) |
OTHER (EXPENSES) INCOM E NET OPERATING PROFIT | (251) (0.6) 1,968 4.8 | (1,094) (2.5) 2,483 5.8 | (581) (1.3) 3,383 7.6 | (1,007) (2.2) 2,610 5.7 | (2,932) (1.7) 10,444 6.0 | (688) (1.7) 1,537 3.7 | (668) (1.5) 3,277 7.3 | (537) (1.1) 3,938 8.0 | (3,294) (6.4) 1,556 3.0 | |
OTHER (EXPENSES) INCOM E NET OPERATING PROFIT | (251) (0.6) 1,968 4.8 | (1,094) (2.5) 2,483 5.8 | (581) (1.3) 3,383 7.6 | (1,007) (2.2) 2,610 5.7 | (2,932) (1.7) 10,444 6.0 | (688) (1.7) 1,537 3.7 | (668) (1.5) 3,277 7.3 | (537) (1.1) 3,938 8.0 | (3,294) (6.4) 1,556 3.0 | 10,309 5.5 |
M EXICO US & CANADA EUROPE LATINOAM ERICA | 1,635 9.2 676 3.7 (98) (8.0) (261) (5.4) | 2,070 11.6 1,031 5.2 (72) (5.7) (556) (11.1) | 2,631 14.1 898 4.4 (52) (3.7) (111) (2.2) | 3,222 17.0 9 0.0 (323) (22.5) (316) (5.7) | 9,558 13.1 2,614 3.3 (545) (10.2) (1,244) (6.1) | 1,575 8.9 94 0.5 (74) (5.1) (65) (1.3) | 2,326 13.1 1,033 4.8 (39) (2.4) (66) (1.3) | 2,727 15.1 1,145 4.6 (28) (1.4) 63 1.1 | 3,499 18.8 (1,881) (7.3) (67) (3.6) 75 1.2 | 10,129 14.0 392 0.4 (208) (3.0) 7 0.0 |
INTEGRAL COST OF FINANCING INTEREST PAID (NET) (EXCHANGE) GAIN LOSS M ONETARY (GAIN) LOSS EQUITY IN RESULTS OF ASSOCIATED COM PANIES EXTRAORDINARY CHARGES INCOM E BEFORE TAXES INCOM E TAXES PROFIT BEFORE DISCONTINUED OPERATIONS NET M INORITY INCOM E NET M AJORITY INCOM E EARINGS BEFORE INTERESTS, TAXES, DEPRECIATON AND AM | (799) (1.9) (681) (1.7) (130) (0.3) 12 0.0 (2) (0.0) 0 0.0 1,168 2.8 539 1.3 629 1.5 105 0.3 524 1.3 3,196 7.8 | (606) (1.4) (675) (1.6) 72 0.2 (2) (0.0) (45) (0.1) 0 0.0 1,832 4.3 771 1.8 1,061 2.5 120 0.3 941 2.2 4,265 9.9 | (632) (1.4) (726) (1.6) 81 0.2 13 0.0 (20) (0.0) 0 0.0 2,731 6.1 1,077 2.4 1,653 3.7 144 0.3 1,509 3.4 4,817 10.8 | (753) (1.6) (767) (1.7) 5 0.0 9 0.0 29 0.1 0 0.0 1,886 4.1 484 1.0 1,401 3.0 92 0.2 1,309 2.8 4,974 10.8 | (2,791) (1.6) (2,850) (1.6) 27 0.0 32 0.0 (38) (0.0) 0 0.0 7,616 4.4 2,871 1.6 4,745 2.7 462 0.3 4,283 2.5 17,251 9.9 | (628) (1.5) (675) (1.6) 32 0.1 15 0.0 (10) (0.0) 0 0.0 900 2.2 366 0.9 533 1.3 103 0.2 430 1.0 2,955 7.1 | (559) (1.2) (716) (1.6) 132 0.3 25 0.1 (13) (0.0) 0 0.0 2,705 6.0 969 2.2 1,737 3.9 125 0.3 1,612 3.6 4,651 10.3 | (974) (2.0) (988) (2.0) (2) (0.0) 16 0.0 (10) (0.0) 0 0.0 2,955 6.0 1,118 2.3 1,837 3.7 135 0.3 1,701 3.4 5,478 11.1 | (1,104) (2.2) (1,044) (2.0) (70) (0.1) 10 0.0 (25) (0.0) 0 0.0 427 0.8 513 1.0 (86) (0.2) 144 0.3 (231) (0.5) 5,300 10.4 | (3,264) (1.7) (3,423) (1.8) 92 0.0 66 0.0 (58) (0.0) 0 0.0 6,987 3.7 2,967 1.6 4,020 2.1 507 0.3 3,513 1.9 18,384 9.8 |
M EXICO US & CANADA EUROPE LATIN AM ERICA | 2,071 11.7 1,278 7.0 (75) (6.2) (93) (1.9) | 2,519 14.2 1,636 8.2 (49) (3.9) 148 3.0 | 3,059 16.4 1,648 8.1 (28) (2.0) 120 2.4 | 3,912 20.6 1,227 5.8 (52) (3.6) (132) (2.4) | 11,562 15.8 5,789 7.3 (204) (3.8) 43 0.2 | 2,072 11.7 801 4.4 (47) (3.3) 123 2.4 | 2,782 15.7 1,727 8.0 (9) (0.5) 127 2.5 | 3,188 17.6 1,977 8.0 11 0.6 270 4.8 | 3,970 21.4 1,082 4.2 (18) (0.9) 336 5.6 | 12,012 16.7 5,588 6.2 (63) (0.9) 857 3.9 |
Regional results do not reflect royalties, while consolidated results exclude inter-company transactions.
INDIRECT M ETHOD DEC DEC
INCOM E (LOSS) BEFORE INCOM E TAXES 7,616 6,987
+ (-) ITEMS NOT REQUIRING CASH - -
+ (-) ITEMS RELATED TO INVESTING ACTIVITIES 6,845 8,102
+ (-) ITEMS RELATED TO FINANCING ACTIVITIES 2,791 3,264
CASH FLOW BEFORE INCOM E TAX 17,252 18,353
CASH FLOW PROVIDED OR USED IN OPERATION (8,631) (2,160)
NET CASH FLOWS PROVIDED OF OPERATING ACTIVITIES 8,621 16,193
NET CASH FLOW FROM INVESTING ACTIVITIES (6,885) (29,708) FINANCING ACTIVITIES 1,736 (13,515) NET CASH FLOW FROM FINANCING ACTIVITIES (4,314) 13,597
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (2,577) 82
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 741 49
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF PERIOD 4,277 2,440
CASH AND CASH EQUIVALENTS AT END OF PERIOD 2,440 2,571
distributed by |