INDUSTRIAS BACHOCO, S.A.B. DE C.V. CELAYA, Mexico, Oct. 22, 2014 /PRNewswire/ -- Industrias Bachoco, S.A.B. de C.V., "Bachoco" or "the Company", (NYSE: IBA; BMV: Bachoco) announced today its unaudited results for the third quarter ("3Q14") and accumulated ("9M14") 2014 results ended September 30, 2014. All figures have been prepared in accordance with International Financial Reporting Standard ("IFRS"), and are presented in nominal million Mexican Pesos ("$").
HIGHLIGHTS- 2014 vs. 2013
-- Net sales increased 12.5% in 3Q14.
-- EBITDA margin was 16.4% for 3Q14 and 14.9% in the 9M14.
-- Earnings per basic and diluted share totaled $1.87 for 3Q14 and $4.78
for the 9M14.
CEO COMMENTS
Mr. Rodolfo Ramos Arvizu, Chief Executive Officer of Bachoco, stated: "For Bachoco, a third quarter used to be the weakest quarter for the year in terms of profitability; this year, the quarter did not follow that pattern, as favorable conditions present in the second quarter were extended into the third one.
Flexibility in our processes and implementation of new procedures, allowed us to take advantage of the conditions the industry offered and to achieve sound results.
In general, during the quarter we observed a very stable supply in our main product lines in both the US and Mexican markets; this, combined with the downtrend in our main raw material prices, allowed us to post a reduction in our production cost, contributing to our profits.
The Company remained in a healthy financial condition as net cash reached $7,766.3 million, as the cash and equivalents has increased 36.6% since the beginning of the year."
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 2013.
QUARTERLY RESULTS
NET SALES BY GEOGRAPHY
----------------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Net sales 10,615.0 9,437.0 1,178.0 12.5
--------- -------- ------- ------- ----
Net sales in Mexico 8,480.9 7,296.8 1,184.1 16.2
------------------- ------- ------- ------- ----
Net sales in the U.S. 2,134.1 2,140.2 (6.1) (0.3)
--------------------- ------- ------- ---- ----
NET SALES BY SEGMENT
--------------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Net sales 10,615.0 9,437.0 1,178.0 12.5
--------- -------- ------- ------- ----
Poultry 9,705.5 8,484.1 1,221.4 14.4
------- ------- ------- ------- ----
Other 909.5 952.9 (43.4) (4.6)
----- ----- ----- ----- ----
NET VOLUME SOLD BY SEGMENT
--------------------------
In tons Change
------
3Q14 3Q13 Volume %
---- ---- ------ ---
Total sales volume: 452,957 441,226 11,731 2.7
------------------- ------- ------- ------ ---
Poultry 368,713 354,178 14,535 4.1
------- ------- ------- ------ ---
Others 84,244 87,048 (528) (0.6)
------ ------ ------ ---- ----
The Company's 3Q14 net sales totaled $10,615.0 million, $1,178.0 million or 12.5% more than $9,437.0 million reported in 3Q13. The increase is a result of more volume of chicken sold and solid chicken and swine prices during the quarter; this result was partially offset with decreases in sales volume in the rest of our business lines when compared to the same quarter of 2013.
In 3Q14, sales of our U.S. operations remained strong and represented 20.1% of our total sales; this compares with 22.7% in 3Q13.
GROSS PROFIT
------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Cost of sales 8,138.2 8,155.5 (17.2) (0.2)
------------- ------- ------- ----- ----
Gross profit 2,476.8 1,281.5 1,195.3 93.3
------------ ------- ------- ------- ----
Gross margin 23.3% 13.6% - -
------------ ---- ---- --- ---
In 3Q14 the cost of sales totaled $8,138.2 million, $17.2 million or 0.2% lower than $8,155.5 million reported in 3Q13; the decrease in the cost of sales, despite the increase in volume sold, was mainly attributed to a steady decrease in the cost of main raw materials, and improvement in our production indexes in general, so that our average cost per unit was around 3% lower than the average cost per unit in 3Q13.
The gross profit was $2,476.8 million and a gross margin of 23.3% in 3Q14; this profit is much higher than a gross profit of $1,281.5 million and a gross margin of 13.6% reported in 3Q13.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ("SG&A")
----------------------------------------------------
In millions of pesos
3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Total SG&A 945.2 827.5 117.7 14.2
---------- ----- ----- ----- ----
Total SG&A expenses in 3Q14 were $945.2 million, $117.7 million or 14.2% more than the $827.5 million reported 3Q13. This increase is mainly attributed to higher sales and administrative expenses as our volume sold increased.
Total SG&A expenses as a percentage of net sales represented 8.9% in 3Q14 compared to 8.8% in 3Q13.
OTHER INCOME (EXPENSE), NET
---------------------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Other income (expense), net 0.6 (80.9) 81.5 (100.8)
--------------------------- --- ----- ---- ------
This item mainly includes the sale of unused assets as well as hens and other by-products. We record such sales as expenses when the sale price is below the book value of those assets.
In 3Q14, we recorded other income of $0.6 million, compared with other expenses of $80.9 million reported in 3Q13; the other income in 3Q is mainly attributed to gains in the sale of several unused assets.
OPERATING INCOME
----------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Operating income 1,532.2 373.1 1,159.1 310.7
---------------- ------- ----- ------- -----
Operating margin 14.4% 4.0% - -
---------------- ---- --- --- ---
Operating income in 3Q14 totaled $1,532.2 million, which represents an operating margin of 14.4%, an important increase when compared to operating income of $373.1 million and a 4.0% operating margin reported in 3Q13.
The increase in operating income is mainly attributed to higher gross income in 3Q14 and more stable expenses.
NET FINANCIAL INCOME
--------------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Net Financial Income 53.1 60.8 (7.7) (12.7)
-------------------- ---- ---- ---- -----
Financial Income 85.8 95.0 (9.2) (9.7)
---------------- ---- ---- ---- ----
Financial Expense 32.7 34.2 (1.5) (4.4)
----------------- ---- ---- ---- ----
In 3Q14, the Company reported net financial income of $53.1 million, compared to income of $60.8 million reported in the same period of 2013.
The decrease was mainly due to lower effective interest rates in our excess cash investments.
TAXES FOR THE PERIOD
--------------------
In millions of pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Total Taxes 461.1 80.0 381.1 476.4
----------- ----- ---- ----- -----
Income tax 226.7 114.9 111.8 97.3
---------- ----- ----- ----- ----
Deferred income tax 234.5 (34.8) 269.3 (773.9)
------------------- ----- ----- ----- ------
Starting this year we will observe a higher amount in income taxes totally attributed to a higher tax rate, which increased from 21% to 30% in our main subsidiary in Mexico.
Total taxes for the 3Q14 were $461.1 million, compared with total taxes of $80.0 million in the same period of 2013.
NET INCOME
----------
In millions of
pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Net income 1,124.2 353.5 770.7 218.0
---------- ------- ----- ----- -----
Net margin 10.6% 3.7% - -
---------- ---- --- --- ---
Non-Controlling
Interest income 0.7 (0.4) 1.09 (310.5)
---------------- --- ---- ---- ------
Net controlling
interest income 1,123.4 353.5 770.0 217.8
---------------- ------- ----- ----- -----
Basic and diluted
income per
share(1) 1.87 0.59 - -
----------------- ---- ---- --- ---
Basic and diluted
income per
ADR(2) 22.47 7.07 - -
----------------- ----- ---- --- ---
Weighted average
Shares
outstanding(3) 600,000 600,000 - -
---------------- ------- ------- --- ---
(1) In pesos
(2) in pesos, an ADR equal to
twelve shares
(3) In thousands of shares
The net income for 3Q14 was $1,124.2 million, representing a basic and diluted income of $1.87 pesos per share, compared with a lower net income of $353.5 million, which represented $0.59 pesos of basic and diluted income per share in 3Q13. The important increase is mainly attributed to a higher operating income.
This income represents a net margin of 10.6% and 3.7% for 3Q14 and 3Q13, respectively.
EBITDA AND
ADJUSTED
EBITDA
----------
In millions of
pesos 3Q14 3Q13 Change
------
$ $ $ %
--- --- --- ---
Net
controlling
interest
income 1,123.4 353.5 770.0 217.8
------------ ------- ----- ----- -----
Income tax
expense
(benefit) 461.1 80.0 381.1 476.1
---------- ----- ---- ----- -----
Result in
associates 0.7 0.4 0.4 110.5
----------- --- --- --- -----
Net finance
(income)
expense (53.1) (60.8) 7.7 (12.7)
----------- ----- ----- --- -----
Depreciation
and
amortization 209.3 188.7 20.5 10.9
------------- ----- ----- ---- ----
EBITDA 1,741.5 561.8 1,179.6 210.0
------ ------- ----- ------- -----
EBITDA Margin
(%) 16.4% 6.0% - -
------------- ---- --- --- ---
Other expense
(income) net (0.6) 80.9 (81.5) (100.8)
------------- ---- ---- ----- ------
Adjusted
EBITDA 1,740.8 642.7 1,098.1 170.9
-------- ------- ----- ------- -----
Adjusted
EBITDA Margin 16.4% 6.8% - -
-------------- ---- --- --- ---
Net sales 10,615.0 9,437.0 1,178.1 12.5
--------- -------- ------- ------- ----
EBITDA in 3Q14 reached $1,741.5 million, representing an EBITDA margin of 16.4%, compared to EBITDA of $561.8 million in 3Q13, with an EBITDA margin of 6.0%.
The adjusted EBITDA in 3Q14 reached $1,740.8 million, representing an adjusted EBITDA margin of 16.4%, compared to adjusted EBITDA of $642.7 million in 3Q13, with an adjusted EBITDA margin of 6.8%.
ACCUMULATED RESULTS
NET SALES BY GEOGRAPHY
----------------------
In millions of pesos 9M14 9M13 Change
------
$ $ $ %
--- --- --- ---
Net Sales 30,867.2 29,972.4 894.8 3.0
--------- -------- -------- ----- ---
Net sales in Mexico 24,696.5 23,527.8 1,168.7 5.0
------------------- -------- -------- ------- ---
Net sales in the U.S. 6,170.8 6,444.6 (273.8) (4.2)
--------------------- ------- ------- ------ ----
NET SALES BY SEGMENT
--------------------
In millions of pesos 9M14 9M13 Change
------
$ $ $ %
--- --- --- ---
Net Sales 30,867.2 29,972.4 894.8 3.0
--------- -------- -------- ----- ---
Poultry 28,168.4 27,169.7 998.7 3.7
------- -------- -------- ----- ---
Other 2,698.9 2,802.7 (103.9) (3.7)
----- ------- ------- ------ ----
NET VOLUME SOLD BY
SEGMENT
------------------
In tons Change
------
9M14 9M13 Volume %
---- ---- ------ ---
Total sales volume: 1,345,459 1,292,525 52,934 4.8
------------------- --------- --------- ------ ---
Poultry 1,108,829 1,037,866 56,043 5.6
------- --------- --------- ------ ---
Others 236,630 254,659 (3,109) (1.3)
------ ------- ------- ------ ----
During the first 9M14, net sales totaled $30,867.2 million, $894.8 million or 3.0% more than $29,972.4 million reported in the same period of 2013. The increase in sales is attributed to higher volume sold and better prices, mainly in the chicken business, as compared with the first 9M13.
In 9M14, sales of our U.S. operations represented 20.0% of our total sales, compared with 21.5% in 9M13.
ACCUMULATED OPERATING
RESULTS
---------------------
In millions of pesos 9M14 9M13 Change
------
$ $ $ %
--- --- --- ---
Cost of Sales 24,143.9 24,705.3 (561.3) (2.3)
------------- -------- -------- ------ ----
Gross Profit 6,723.3 5,267.1 1,456.2 27.6
------------ ------- ------- ------- ----
Total SG&A 2,737.2 2,448.8 288.4 11.8
---------- ------- ------- ----- ----
Other Income (expense) (40.8) 31.7 (72.5) (228.9)
--------------------- ----- ---- ----- ------
Operating Income 3,945.3 2,850.0 1,095.3 38.4
---------------- ------- ------- ------- ----
Net Financial Income 164.0 111.6 52.3 46.9
-------------------- ----- ----- ---- ----
Income Tax 1,236.6 595.1 641.5 107.8
---------- ------- ----- ----- -----
Net Income 2,872.7 2,366.6 506.2 21.4
---------- ------- ------- ----- ----
In 9M14 the cost of sales totaled $24,143.9 million, $561.3 million or 2.3% lower than $24,705.3 million reported 9M13; the decrease in the cost of sales is attributed to production indexes improvements and lower prices of our main raw materials.
As a result, we reached a gross profit of $6,723.3 million and a gross margin of 21.8% in 9M14, a higher result than $5,267.1 million of gross profit and a margin of 17.6% reached in the same period of 2013.
Total SG&A expenses in 9M14 were $2,737.2 million, $288.4 million or 11.8% more than the $2,448.8 million reported 9M13. This increase is mainly attributed to higher volume sold and additional expenses incurred in the implementation of procedures to further improve the services we provide in our markets. Total SG&A expenses as a percentage of net sales represented 8.9% in 9M14 compared to 8.2% in 9M13.
In 9M14 we had other expenses of $40.8 million, compared with other income of $31.7 million reported in 9M13; this is mainly attributed to losses in the sale of several unused assets.
The operating income in 9M14 was $3,945.3 million, which represents an operating margin of 12.8%, an improvement from an operating income of $2,850.0 million and an operating margin of 9.5% in 9M13.
The net financial income in 9M14 was $164.0 million higher when compared to net financial income of $111.6 million in 9M13, mainly attributed to higher interest income resulting from the high levels of cash and lower interest expenses.
Total taxes were $1,236.6 million as of September 30, 2014. These taxes include $709.1 million of income tax and $527.5 million of deferred income taxes; this figure compares to total taxes of $595.1 million, which includes income taxes of $833.4 and a positive amount in deferred income tax of $238.3 million in 9M13; the increase is attributed to a higher rate, which increased from 21% to 30%, in our main subsidiary in Mexico.
All the above result in a net income in the 9M14 of $2,872.7 million or 9.3% of net margin, which represents $4.78 pesos of earnings per share, meanwhile in the 9M13 the net income totaled $2,366.6 million, 7.9% of net margin and $3.94 pesos of net income per share.
EBITDA AND
ADJUSTED
EBITDA
----------
In millions
of pesos 9M14 9M13 Change
------
$ $ $ %
--- --- --- ---
Net
controlling
interest
profit 2,869.6 2,363.2 506.4 21.4
------------ ------- ------- ----- ----
Income tax
expense
(benefit) 1,236.6 595.1 641.5 107.8
---------- ------- ----- ----- -----
Result in
associates 3.1 3.4 (0.3) (8.3)
----------- --- --- ---- ----
Net finance
(income)
expense (164.0) (111.6) (52.4) 46.9
----------- ------ ------ ----- ----
Depreciation
and
amortization 647.9 557.0 90.9 16.3
------------- ----- ----- ---- ----
EBITDA 4,593.2 3,407.0 1,186.2 34.8
------ ------- ------- ------- ----
EBITDA Margin
(%) 14.9% 11.4% - -
------------- ---- ---- --- ---
Other expense
(income) net 40.8 (31.7) 72.5 (228.9)
------------- ---- ----- ---- ------
Adjusted
EBITDA 4,634.0 3,375.3 1,258.7 37.3
-------- ------- ------- ------- ----
Adjusted
EBITDA
Margin 15.0% 11.3% - -
-------- ---- ---- --- ---
Net sales 30,867.2 29,972.4 894.8 3.0
---------- -------- -------- ----- ---
EBITDA in 9M14 reached $4,593.2 million, representing an EBITDA margin of 14.9%, compared to EBITDA of $3,407.0 million in 9M13, with an EBITDA margin of 11.4%.
The adjusted EBITDA in 9M14 reached $4,634.0 million, representing an adjusted EBITDA margin of 15.0%, compared to adjusted EBITDA of $3,375.3 million in 9M13, with an adjusted EBITDA margin of 11.3%.
BALANCE SHEET
BALANCE SHEET DATA
------------------
In millions of
pesos Sept 30, 2014 Dec. 31, 2013 Change
------
$ $ $ %
--- --- --- ---
TOTAL ASSETS 32,924.6 28,781.6 4,143.0 14.4
------------ -------- -------- ------- ----
Cash and cash
equivalents 10,548.2 7,721.0 2,827.2 36.6
------------- -------- ------- ------- ----
Accounts
receivable 1,499.0 2,227.8 (728.8) (32.7)
----------- ------- ------- ------ -----
TOTAL LIABILITIES 9,842.7 8,630.4 1,212.3 14.0
----------------- ------- ------- ------- ----
Accounts payable 2,839.3 2,818.9 20.4 0.7
---------------- ------- ------- ---- ---
Short-term debt 1,128.5 557.6 570.9 102.4
--------------- ------- ----- ----- -----
Long-term debt 1,653.3 1,510.2 143.1 9.5
-------------- ------- ------- ----- ---
TOTAL
STOCKHOLDERS'
EQUITY 23,081.9 20,151.1 2,930.8 14.5
-------------- -------- -------- ------- ----
Capital stock 1,174.4 1,174.4 0.0 0.0
------------- ------- ------- --- ---
Cash and equivalents as of September 30, 2014 totaled $10,548.2 million, up $2,827.2 million or 36.6% from $7,721.0 million as of December 31, 2013.
Total debt as of September 30, 2014 was $2,781.8 million, compared to $2,067.8 million reported as of December 31, 2013, mainly as a result of higher short-term bank debt.
Net cash as of September 30, 2014 was $7,766.3 million, compared with a net cash of $5,653.2 million as of December 31, 2013.
CAPITAL EXPENDITURES
--------------------
In millions of pesos 9M14 9M13 Change
------
$ $ $ %
--- --- --- ---
Capital Expenditures 826.0 419.4 406.6 96.9
-------------------- ----- ----- ----- ----
Total CAPEX for the 3Q14 was $351.1 million and $826.0 million in 9M14, mainly allocated toward organic growth and productivity projects across all of our facilities.
STOCK INFORMATION
-----------------
As of September 30, 2014
------------------------
Total Shares 600,000,000
------------ -----------
Total free float 26.75%
---------------- -----
Total shares in treasury 0
------------------------ ---
Market cap (millions of pesos) $40,140
------------------------ -------
SHARE PRICE
-----------
Mexican Stock Exchange The New York Stock
Exchange
---------------------- -------------------
Ticker Symbol: Bachoco Ticker Symbol: IBA
In nominal pesos per
Share In U.S. Dollar per ADR
Month High Low Close High Low Close
----- ---- --- ----- ---- --- -----
Sept-
14 67.04 62.80 66.90 61.24 56.89 59.74
----- ----- ----- ----- ----- ----- -----
Aug-
14 64.40 59.37 62.23 58.70 53.16 56.89
---- ----- ----- ----- ----- ----- -----
Jul-
14 60.72 57.88 58.62 56.35 53.00 53.14
---- ----- ----- ----- ----- ----- -----
Jun
2014 58.13 56.03 58.13 53.77 51.77 53.77
----- ----- ----- ----- ----- ----- -----
May
2014 56.00 47.58 56.00 51.59 42.60 51.59
----- ----- ----- ----- ----- ----- -----
Apr
2014 48.62 47.43 47.99 44.45 43.03 44.10
----- ----- ----- ----- ----- ----- -----
Mar
2014 44.79 42.00 44.79 28.03 27.07 27.82
----- ----- ----- ----- ----- ----- -----
Feb
2014 32.34 28.97 31.80 30.35 27.02 30.01
----- ----- ----- ----- ----- ----- -----
Jan
2014 34.27 31.82 32.92 33.89 29.91 32.12
----- ----- ----- ----- ----- ----- -----
Source: yahoo finances
ANALYST COVERAGE
----------------
Institution Analyst name E-mail
----------- ------------ ------
JPMORGAN Pedro Leduc pedro.a.leduc@jpmorgan.com
-------- ----------- --------------------------
GBM Miguel Mayorga mmayorga@gbm.com.mx
--- -------------- -------------------
ACTINVER Carlos Hermosillo chermosillo@actinver.com.mx
-------- ----------------- ---------------------------
BBVA BANCOMER Fernando Olvera fernando.olvera@bbva.com
------------- --------------- ------------------------
INTERACCIONES Raul Ochoa rmochoa@interacciones.com
------------- ---------- -------------------------
APPENDICES
For reference, some figures have been translated into millions of U.S. dollars ("USD") using an exchange rate of $13.42 per USD $1.00, which corresponds to the rate at the close of September 30, 2014, according to Mexico's National Bank.
-- Consolidated Statement of Financial Position
-- Consolidated Statement of Income
-- Consolidated Statement of Cash Flows
-- Derivatives Position Report
CONFERENCE CALL INFORMATION
The Company will host its third quarter 2014 earnings call, on Thursday, October 23rd, 2014. The earnings call will take place at 9:00 am Central Time (10:00 am ET).
To participate in the earnings call, please dial:
Toll free in the U.S.: 1-888-771-4371
Toll free in Mexico: 001-866-779-0965
A current list of available local and international free phone telephone numbers: https://www.yourconferencecenter.com/AlternateNumbers/alternatenumbers.aspx?100374&t=A&o=UFktKifxGsNLar
Confirmation Number: 38287864
Visit the following link to access the webcast:
http://www.media-server.com/m/p/278opx9d
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
-Unaudited-
In U.S. Dollar Sept 30 December 31
In million pesos 2014 2014 2013*
---------------- ---- ---- ----
TOTAL ASSETS $2,453.4 32,924.6 28,781.6
======== ======== ========
Total current assets 1,386.5 18,606.3 15,324.3
------- -------- --------
Cash and cash equivalents 786.0 10,548.2 7,721.0
Total accounts receivable 111.7 1,499.0 2,227.8
Inventories 341.8 4,586.8 4,158.4
Other current assets 147.0 1,972.3 1,217.2
Total non current assets 1,066.9 14,318.3 13,457.2
------- -------- --------
Net property, plant and
equipment 883.1 11,851.8 11,652.4
Other non current Assets 183.8 2,466.5 1,804.8
TOTAL LIABILITIES $733.4 9,842.7 8,630.4
====== ======= =======
Total current liabilities 369.5 4,958.4 4,370.8
----- ------- -------
Notes payable to banks 84.1 1,128.5 557.6
Accounts payable 211.6 2,839.3 2,818.9
Other taxes payable and other
accruals 73.8 990.7 994.3
Total long-term liabilities 364.0 4,884.2 4,259.6
----- ------- -------
Long-term debt 123.2 1,653.3 1,510.2
Other non current
liabilities 4.7 62.9 48.2
Deferred income taxes 236.1 3,168.1 2,701.2
TOTAL STOCKHOLDERS' EQUITY $1,720.0 23,081.9 20,151.1
======== ======== ========
Capital stock 87.5 1,174.4 1,174.4
Commission in shares issued 29.8 399.6 399.6
Repurchased shares 7.5 101.1 99.6
Retained earnings 1,598.8 21,455.8 18,586.2
Others accounts -
6.8 - 91.5 - 148.1
Non controlling interest 3.2 42.4 39.3
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $2,453.4 32,924.6 28,781.6
======== ======== ========
*Audited
Consolidated Statement of Income
Third Quarter Results, ended September 30:
-Unaudited-
U.S. Dollar
In
millions
pesos 2014 2014 2013 Change
--------- ---- ---- ---- ------
Net
sales $791.0 10,615.0 9,437.0 12.5%
Cost
of
sales 606.4 8,138.2 8,155.5 -0.2%
----- ------- -------
Gross
profit 184.6 2,476.8 1,281.5 93.3%
SG&A 70.4 945.2 827.5 14.2%
Other
income
(expenses),
net 0.0 0.6 (80.9) -100.8%
--- --- -----
Operating
income 114.2 1,532.2 373.1 310.7%
Net
finance
income 4.0 53.1 60.8 -12.7%
Income
tax 34.4 461.1 80.0 476.1%
---- ----- ----
Net
Income $122.1 1,124.2 353.5 218.0%
====== ======= =====
Non-
controlling
interest 0.1 0.74 (0.35) -310.5%
Net
controlling
interest
profit 83.8 1,123.4 353.5 217.8%
Basic
and
diluted
earnings
per
share 1.87 1.87 0.59 217.8%
Basic
and
diluted
earnings
per
ADR 22.47 22.47 7.07 217.8%
Weighted
average
Shares
outstanding(1) 600,000 600,000 600,000 0.0%
EBITDA
Result $129.8 1,741.5 561.8 210.0%
====== ======= =====
Gross
margin 23.3% 23.3% 13.6%
Operating
margin 14.4% 14.4% 4.0%
Net
margin 10.6% 10.6% 3.7%
EBITDA
margin 16.4% 16.4% 6.0%
1 In thousands
Consolidated Statement of Income
Accumulated results, for the nine months ended September 30:
-Unaudited-
U.S. Dollar
In
millions
pesos 2014 2014 2013 Var.
--------- ---- ---- ---- ----
Net
sales $2,300.1 30,867.2 29,972.4 3.0%
Cost
of
sales 1,799.1 24,143.9 24,705.3 -2.3%
------- -------- --------
Gross
profit 501.0 6,723.3 5,267.1 27.6%
Selling,
general
and
administrative
expenses 204.0 2,737.2 2,448.8 11.8%
Other
income
(expenses),
net - 3.0 (40.8) 31.7 -228.9%
------------------- ----- ----
Operating
income 294.0 3,945.3 2,850.0 38.4%
Net
finance
income 12.2 164.0 111.6 46.9%
Income
tax 92.1 1,236.6 595.1 107.8%
---- ------- -----
Net
income $318.4 2,872.7 2,366.6 21.4%
====== ======= =======
Non-
controlling
interest 0.2 3.13 3.41 -8.3%
Net
controlling
interest
profit 214.3 2,869.6 2,363.2 21.4%
Basic
and
diluted
earnings
per
share 4.78 4.78 3.94 21.4%
Basic
and
diluted
earnings
per
ADR 57.40 57.40 47.26 21.4%
Weighted
average
Shares
outstanding(1) 599,940 599,940 599,985
EBITDA
Result $342.3 4,593.2 3,407.0 34.8%
====== ======= =======
Gross
margin 21.8% 21.8% 17.6%
Operating
margin 12.8% 12.8% 9.5%
Net
margin 9.3% 9.3% 7.9%
EBITDA
margin 14.9% 14.9% 11.4%
1 In thousands
Consolidated Statement of Cash Flows
As of September 30:
-Unaudited-
U.S. Dollar
In million of pesos 2014 2014 2013
------------------- ---- ---- ----
NET MAJORITY INCOME BEFORE
INCOME TAX $306.2 4,109.3 2,958.3
------ ------- -------
ITEMS THAT DO NOT REQUIRE
CASH: - - -
ITEMS RELATING TO INVESTING
ACTIVITIES: 53.1 712.3 715.5
---- ----- -----
Depreciation and others 48.3 647.9 557.0
Income (loss) on sale of
plant and equipment 5.0 67.5 158.5
Other Items (0.2) (3.1) -
ITEMS RELATING TO FINANCING
ACTIVITIES: 7.9 106.5 96.6
--- ----- ----
Interest income (expense) 7.9 106.5 96.6
Other Items - - -
NET CASH GENERATED FROM NET
INCOME BEFORE TAXES 367.2 4,928.1 3,770.4
----- ------- -------
CASH GENERATED OR USED IN
THE OPERATION: (58.5) (785.4) 1,361.1
Decrease (increase) in
accounts receivable 3.8 51.5 244.3
Decrease (increase) in
inventories (34.6) (464.1) 1,490.4
Decrease (increase) in
accounts payable (31.8) (427.1) (595.5)
Decrease (increase) in
other liabilities 4.0 54.2 221.9
NET CASH FLOW FROM
OPERATING ACTIVITIES 308.7 4,142.7 5,131.4
----- ------- -------
NET CASH FLOW FROM
INVESTING ACTIVITIES (60.2) (808.1) (427.1)
----- ------ ------
Acquisition of property,
plant and equipment (61.6) (826.0) (419.4)
Proceeds from sales of
property plant and
equipment 1.5 20.0 49.2
Other Items (0.2) (2.1) (56.9)
CASH FLOW SURPLUS
(REQUIREMENTS OF) TO BE
USED IN FINANCING
ACTIVITIES 248.5 3,334.6 4,704.3
----- ------- -------
Net cash provided by
financing activities: 63.5 851.9 (1,052.2)
---- ----- --------
Proceeds from loans 59.2 794.0 592.0
Principal payments on loans (6.5) (87.6) (1,001.3)
Dividends paid - - (350.4)
Other items 10.8 145.5 (292.5)
Net increase (decrease) in
cash and equivalents 222.0 2,979.7 2,662.9
Cash and investments at the
beginning of year $500.5 6,716.9 5,138.1
------ ------- -------
CASH AND INVESTMENTS AT END
OF PERIOD $722.5 9,696.6 7,801.0
====== ======= =======
DERIVATIVES POSITION REPORT
Third Quarter 2014
Thousands of Mexican Pesos, as of September 30, 2014 ANEXO 1
TYPE OF FINANCIAL OBJECTIVE NOTIONAL VALUE OF THE RELATED COMMODITY REASONABLE VALUE AMOUNTS DUE GUARANTIES REQUIRED
INSTRUMENT BY YEAR
---------- --- ---
2Q-2014 1Q-2014 2Q-2014 1Q-2014
------- ------- ------- -------
Forwards and knock out forwards. Hedge and negotiation $9,531 $13.42 $12.99 $284.18 $-54.53 2014 The deals consider the possibility
of margin calls but not another
kind of guarantee
-------------------------------- --------------------- ------ ------ ------ ------- ------- ---- -----------------------------------
Futures for corn, soybean meal
and soy oil Hedge $77,942 CORN CORN -$ 7,557 -$ 285 41% in 2014 and 59% in 2015
------------------------------ ----- ------- ------------ ------------- ----------------------------
In USD per Bushel In USD per Bushel
month price month price
Dec-2014 $3.210
Mar-2015 $3.335 Jul-2014 $4.2430
Dec-2015 $3.568 Sep-2014 $4.1880
SOYBEAN MEAL SOYBEAN MEAL
In USD per ton In USD per ton
month price month price
Jan-2015 $306.8 Aug-2014 $430.7
Mar-2015 $304.0 Sep-2014 $392.6
May-2015 $302.7 Jan-2015 $366.5
Jul-2015 $304.3 Mar-2015 $368.2
Oct-2015 $305.5 May-2015 $369.5
Dec-2015 $305.7 Jul-2015 $371.0
SOY OIL SOY OIL
In UScents per pound In UScents per pound
month price month price
Jul-2015 $34.27 Aug-2014 $38.95
Oct-2015 $34.31 Sep-2014 $39.04
Oct-2014 $39.02
Dec-2014 $39.15
-------- ------
Options of Corn Hedge and negotiation -$ 4,647 CORN CORN -$ 4,647 $ - 2014
--------------- --------------------- -------------------- ------------ ------------- ----
In USD per Bushel In USD per Bushel
month price month price
Dec-2014 $3.21 Dec-2014 $3.90
Options of soybean meal Hedge and negotiation $ - SOYBEAN MEAL SOYBEAN MEAL $ - -$ 431 2014
----------------------- --------------------- --------------------- ------------- ------------- ----
In USD per ton In USD per ton
month price month price
May-2014 $491.50
-------- -------
Options of soy oil Hedge and negotiation -$ 234 SOY OIL SOY OIL -$ 234 $ - 2014
------------------ --------------------- --------------------- ------------- ------------- ----
In UScents per pound In UScents per pound
month price month price
Aug-2014 $38.95
Sep-2014 $39.04
Oct-2014 $39.02
Dec-2014 $33.45 Dec-2014 $39.15
-The total financial instruments not exceed 5% of total assets as of September 30, 2014.
-The notional value represents the net position as of September 30, 2014, at the exchange rate of $13.42 per one dollar.
A negative value means an unfavorable effect for the Company.
Third Quarter 2014
Thousands of Mexican Pesos, as of September 30, 2014 PROBABLE SCENARIO
TYPE OF FINANCIAL REASONABLE VALUE VALUE OF THE RELATED COMMODITY EFFECT ON THE EFFECT ON THE CASH FLOW(3)
INSTRUMENT INCOME STATEMENT
---------- ----------------
Reference Value
---------------
-2.5% 2.5% 5.0% -2.5% 2.5% 5.0%
---- --- --- ---- --- ---
Forwards and Knock Out Forwards (1) $284 $13.09 $13.76 $14.09 Direct $46 $222 $341
---------------------------------- ---- ------ ------ ------ ------ --- ---- ----
-5% 5% 10% -5% 5% 10%
Futures of Corn: (2) -$ 7,557 $3.0 $3.4 $3.5 The effect will materialize as the inventory is
consumed -$ 11,395 -$ 3,719 $118
---------------------- ----------------------------------------------- --------- -------- ----
Futures of Soybean Meal: (2) $291.5 $322.1 $337.5
Futures for Soy Oil (2) $32.6 $36.0 $37.7
---------------------- ----- ----- -----
Options for Corn -$ 4,647 $ - $ - $ - -$ 5,723 -$ 3,571 -$ 2,494
---------------- ---------------------- ---------------- ----------------- ----------------- ---------- -------- --------
Options of Soybean Meal $ - $ - $ - $ - $ - $ - $ -
----------------------- ------------------------ ---------------- ----------------- ---------------- ------------- ----------- -----------
Options of Soy Oil -$ 234 $32.6 $36.0 $37.7 -$ 338 -$ 130 -$ 25
------------------ ----------------------- ----- ----- ----- ----------- --------- ----------
(1) The reference value is the exchange rate of $13.42 per USD as of September 30, 2014.
(2) The reference values are; the future of corn for December 2014, $3.21 USD, the future of soybean meal for January 2015, $306.8 USD/ton, and the future for soy oil for July 2015, $34.27 Us cents per lb.
All the evaluations are performed according with the corresponding future, here only the first month futures are shown.
(3) The Company has credit lines with the majority of its counterparts, so that the effect in cash flow is lower than the amount shown.
-A negative value means an unfavorable effect for the Company.
Third Quarter 2014
Thousands of Mexican Pesos, as of September 30, 2014 STRESS SCENARIO
TYPE OF FINANCIAL REASONABLE VALUE VALUE OF THE RELATED COMMODITY EFFECT ON THE INCOME STATEMENT EFFECT ON THE CASH FLOW
INSTRUMENT
----------
Reference Value
---------------
-50% -25% 25% 50% -50% -25% 25% 50%
--- --- --- --- --- --- --- ---
Forwards and Knock Out $284 $6.71 $10.07 $16.78 $20.14 Direct -$4,481 -$2,098 $1,294 $2,485
Forwards
--------
COMPANY DESCRIPTION
Industrias Bachoco is the leader in the Mexican poultry industry, and one of the largest poultry producers globally. The Company was founded in 1952, and became a public company in 1997, via a public offering of shares on the Mexican and The New York Stock Exchange. Bachoco is a vertically integrated company headquartered in Celaya, Guanajuato located in Central Mexico. Its main business lines are: chicken, eggs, balanced feed, swine, and turkey and beef value-added products. Bachoco owns and manages more than a thousand facilities, organized in nine production complexes and 64 distribution centers in Mexico, and a production complex in the United States. Currently the Company employs more than 24,000 people.
The Company is rated AA+ (MEX), representing high credit quality by Fitch Mexico, S.A. de C.V., and HR AA+ which signals that the Company and the offering both have high credit quality by HR Ratings de Mexico S.A. de C.V.
DISCLAIMER
The document contains certain information that could be considered forward looking statements concerning anticipated future events and performance of the Company. The statements reflect management's current beliefs based on information currently available and are not guarantees of future performance and are based on our estimates and assumptions that are subject to risks and uncertainties, including those described in our Annual Information Form, which could cause our actual results to differ materially from the forward-looking statements contained in this document. Those risks and uncertainties include risks associated with ownership in the poultry industry, competition for investments within the poultry industry, shareholder liability, governmental regulation, and environmental matters. As a result, there can be no assurance that actual results will be consistent with these forward-looking statements. Except as required by applicable law, Industrias Bachoco, S.A.B. de C.V., undertakes no obligation to publicly update or revise any forward-looking statement.
Contact Information:
Claudia Cabrera, IR
claudia.cabrera@bachoco.net
T. +52(461)618-3555
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/industrias-bachoco-announces-third-quarter-2014-results-349204911.html
SOURCE Industrias Bachoco, S.A.B. de C.V.
