INDUSTRIAS BACHOCO, S.A.B. DE C.V. INDUSTRIAS BACHOCO ANNOUNCES SECOND QUARTER 2021 RESULTS
Celaya, Guanajuato, Mexico - July 26th, 2021
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 ('2Q21') and first half ('1H21') 2021 ended on June 30, 2021. All figures have been prepared in accordance with International Financial Reporting Standard ('IFRS') and are presented in nominal million Mexican Pesos ('$'), except earnings per share.
HIGHLIGHTS- 2021 vs. 2020
| · | Net sales increased 27% in 2Q21 and increased 25% in 1H21 |
| · | EBITDA margin was 11.7% for 2Q21 and 13.3% for the 1H21 |
| · | SG&A as percentage of net sales was 8.3% and 8.4% for 2Q21 and 1H21 respectively. |
CEO COMMENTS
Mr. Rodolfo Ramos Arvizu, Chief Executive Officer of Bachoco, stated, 'During this quarter we continued to observe a good balance between supply and demand. Even though costs were higher, our focus on efficiencies drove us to achieve good results in our second quarter of 2021.
We reached an increase in total sales of 27% for 2Q21 when compared to the same period of 2020. This led us to a gross margin of 19.0% for 2Q21 compared to the 11.3% of 2Q20.
Regarding our cost of sales, raw material prices continued to be high in USD terms. This meant an increase in our total cost of sales of 16% when compared to the same quarter of 2020. However, our efforts and focus towards efficiencies in our processes permitted us to offset part of this increase.
In terms of expenses, we kept our SG&A under control as a percentage of sales, we reported 8.3% for the quarter and 8.4% for the first half of 2021, which is lower compared to the 9.5% and 9.8% for the respective periods of 2020.
As a result, our operating profit for the quarter was $2,088.8 million, which is significantly higher than 2Q20 where we saw most of the negative impacts of COVID-19.
We reported an EBITDA of $2,437.4 million in 2Q21, which is higher than the $437.6 million reported in 2Q20. The EBITDA margins for each of those two periods were 11.7% and 2.7%, respectively. For the first half of the year, our EBITDA margin was 13.3%, compared to 4.3% EBITDA margin of the same period of 2020.
Contact Information
inversionistas@bachoco.net / T. +52(461)618 3555
CAPEX for the quarter was $1,307.5 million compared to $992.4 million for the same period of 2020. This was achieved while ending with a net cash position of $19,490.6 million by the end of 2Q21.
To our commitment of continually adding value to our shareholders, in 2Q21 we reported earnings per share of $2.46 and for the first half of 2021 we reported earnings per share of $5.96.
We will remain focused on efficiencies across all of our processes which will allow us to supply our markets and customers as best as we can and as we have done through the years'.
Executive Summary
The following financial information is expressed in millions of nominal pesos, except for amounts per share and per ADR, with comparative figures for the same periods of 2021.
QUARTERLY RESULTS
| NET SALES BY GEOGRAPHY | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net Sales | 20,860.9 | 16,431.9 | 4,429.0 | 27.0 | ||||||||||||
| Net sales in Mexico | 15,937.6 | 11,339.9 | 4,597.6 | 40.5 | ||||||||||||
| Net sales in the U.S. | 4,923.4 | 5,092.0 | (168.6 | ) | (3.3 | ) |
| NET SALES BY SEGMENT | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Net Sales | 20,860.9 | 16,431.9 | 4,429.0 | 27.0 | ||||||||||||
| Poultry | 18,170.5 | 14,796.3 | 3,374.1 | 22.8 | ||||||||||||
| Other | 2,690.5 | 1,635.6 | 1,054.9 | 64.5 |
NET VOLUME SOLD BY SEGMENT
| In tons | Change | |||||||||||||||
| 2Q21 | 2Q20 | Volume | % | |||||||||||||
| Total sales volume: | 583,661 | 554,677 | 28,984.5 | 5.2 | ||||||||||||
| Poultry | 441,486 | 433,484 | 8,002.1 | 1.8 | ||||||||||||
| Others | 142,175 | 121,192 | 20,982.4 | 17.3 |
The Company's 2Q21 net sales totaled $20,860.9 million; $4,429.0 million or 27.0% more than the $16,431.9 million reported in 2Q20. The increase was mainly a result of higher prices and higher volume sold in our main business lines.
In 2Q21, sales of our U.S. operations represented 23.6% of our total sales compared to a 31.0% in the same period of 2020. The decrease was mainly a result of a lower exchange rate in 2Q21 vs the same period of 2020.
| GROSS PROFIT | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Cost of sales | 16,901.1 | 14,574.5 | 2,326.6 | 16.0 | ||||||||||||
| Gross profit | 3,959.8 | 1,857.4 | 2,102.5 | 113.2 | ||||||||||||
| Gross margin | 19.0 | % | 11.3 | % | - | - |
2
In 2Q21, cost of sales was $16,901.1 million; $2,326.6 million or 16.0% higher than the $14,574.5 million reported in 2Q20. This increase was due to higher unit cost in our main business lines as a result of higher raw material prices in USD terms.
The Company´s gross profit in 2Q21 was $3,959.8 million, higher than the gross profit of $1,857.4 million in 2Q20, with a gross margin of 19.0% for 2Q21 vs 11.3% in 2Q20. The result of this quarter compares to a difficult 2Q20, when mobility restrictions due to COVID-19 negatively affected some of the markets that we serve, which resulted in oversupply conditions throughout the industry.
| Selling, general and administrative expenses ('SG&A') | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Total SG&A | 1,729.2 | 1,567.0 | 162.2 | 10.4 |
Total SG&A expenses in 2Q21 were $1,729.2 million; $162.2 million higher than the $1,567.0 million reported in 2Q20. Total SG&A expenses as a percentage of net sales were 8.3% in 2Q21 and 9.5% in 2Q20.
| other income (expense), net | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Other income (expense), net | (141.8 | ) | (207.5 | ) | 65.7 | (31.7 | ) |
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 2Q21, we recorded other expenses of $141.8 million, compared with other expenses of $207.5 million reported in 2Q20.
| OPERATING INCOME | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Operating income | 2,088.8 | 82.8 | 2,005.9 | 2,421.5 | ||||||||||||
| Operating margin | 10.0 | % | 0.5 | % | - | - |
Operating income in 2Q21 totaled $2,088.8 million; $2,005.9 million higher than the $82.8 million reported in 2Q20. This represents an operating margin of 10.0% for 2Q21, higher when compared to the same period of 2020. The increase in operating income is mainly attributed to efficiencies in our processes and better market conditions compared to 2Q20, which is allowing us to pass to our sales price the increases observed in raw materials costs.
| NET FINANCIAL INCOME | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net Financial Income | (97.0 | ) | (122.3 | ) | 25.3 | (20.7 | ) | |||||||||
| Financial Income | 2.1 | (42.3 | ) | 44.4 | (105.0 | ) | ||||||||||
| Financial Expense | 99.1 | 80.0 | 19.1 | 23.8 |
In 2Q21, the Company reported net financial expenses of $97.0 million, compared to the net financial expenses of $122.3 million reported in the same period of 2020.
3
| TAXES FOR THE PERIOD | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Total Taxes | 548.7 | (11.2 | ) | 559.9 | (4,986.2 | ) | ||||||||||
| Income tax | 804.5 | (407.6 | ) | 1,212.1 | (297.4 | ) | ||||||||||
| Deferred income tax | (255.9 | ) | 396.4 | (652.3 | ) | (164.5 | ) |
As a result of a higher operating income, Total taxes for the 2Q21 were $548.7 million compared with total taxes of $(11.2) million in the same period of 2020.
| NET INCOME | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net income | 1,443.2 | (28.2 | ) | 1,471.4 | (5,214.7 | ) | ||||||||||
| Net margin | 6.9 | % | (0.2 | )% | - | - | ||||||||||
| Basic and diluted earnings per share1 | 2.46 | (0.06 | ) | 2.5 | n/a | |||||||||||
| Basic and diluted earnings per ADR2 | 29.55 | (0.70 | ) | 30.2 | n/a | |||||||||||
| Weighted average Shares outstanding3 | 599,743 | 599,787 | - | - |
1 In pesos
2 in pesos, one ADR equals to twelve shares
3 In thousands of shares
For the 2Q21 we had Net income of $1,443.2 million, representing a basic and diluted income per share of $2.46 compared with a negative net income of $28.2 million, which compares with $(0.06) pesos of net income per share in 2Q20. This increase was attributed to higher operating results. Net margin in 2Q21 was a positive 6.9% compared to a negative 0.2% reported in 2Q20.
| EBITDA | ||||||||||||||||
| In millions of pesos | 2Q21 | 2Q20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net income | 1,476.8 | (34.8 | ) | 1,511.6 | (4,343.0 | ) | ||||||||||
| Income tax expense (benefit) | 548.7 | (11.2 | ) | 559.9 | (4,986.2 | ) | ||||||||||
| Result in associates | (33.6 | ) | 6.6 | (40.2 | ) | (610.2 | ) | |||||||||
| Net finance (income) expense | 97.0 | 122.3 | (25.3 | ) | (20.7 | ) | ||||||||||
| Depreciation and amortization | 348.6 | 354.8 | (6.2 | ) | (1.7 | ) | ||||||||||
| EBITDA | 2,437.4 | 437.6 | 1,999.8 | 457.0 | ||||||||||||
| EBITDA Margin (%) | 11.7 | % | 2.7 | % | - | - | ||||||||||
| Net revenues | 20,860.9 | 16,431.9 | 4,429.0 | 27.0 |
EBITDA in 2Q21 reached $2,437.4 million, representing an EBITDA margin of 11.7%, compared to an EBITDA of $437.6 million in 2Q20, with an EBITDA margin of 2.7%.
ACCUMULATED RESULTS
| NET SALES BY GEOGRAPHY | ||||||||||||||||
| In millions of pesos | 1H21 | 1H20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net Sales | 40,218.6 | 32,170.3 | 8,048.2 | 25.0 | ||||||||||||
| Net sales in Mexico | 30,566.9 | 22,407.5 | 8,159.4 | 36.4 | ||||||||||||
| Net sales in the U.S. | 9,651.6 | 9,762.8 | (111.2 | ) | (1.1 | ) |
4
| NET SALES BY SEGMENT | ||||||||||||||||
| In millions of pesos | 1H21 | 1H20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net Sales | 40,218.6 | 32,170.3 | 8,048.2 | 25.0 | ||||||||||||
| Poultry | 35,154.3 | 28,959.1 | 6,195.2 | 21.4 | ||||||||||||
| Other | 5,064.2 | 3,211.2 | 1,853.0 | 57.7 |
NET VOLUME SOLD BY SEGMENT
| In metric tons | Change | |||||||||||||||
| 1H21 | 1H20 | Volume | % | |||||||||||||
| Total sales volume: | 1,141,743 | 1,142,694 | (951.2 | ) | (0.1 | ) | ||||||||||
| Poultry | 858,464 | 890,651 | (32,187.3 | ) | (3.6 | ) | ||||||||||
| Others | 283,279 | 252,043 | 31,236.0 | 12.4 |
During the first half of 2021, net sales totaled $40,218.6 million; $8,048.2 million or 25.0% more than $32,170.3 million reported in the same period of 2020. The increase in sales is mainly attributable to higher prices of our main business lines when compared to the first half of 2020.
In 1H21, sales of our U.S. operations represented 24.0% of our total sales, compared with 30.3% in 1H20. The decrease was mainly a result of the appreciation of the Mexican peso in the first half of 2021.
| OPERATING RESULTS | ||||||||||||||||
| In millions of pesos | 1H21 | 1H20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Cost of Sales | 32,040.7 | 28,131.8 | 3,908.9 | 13.9 | ||||||||||||
| Gross Profit | 8,177.9 | 4,038.5 | 4,139.4 | 102.5 | ||||||||||||
| Total SG&A | 3,366.5 | 3,139.7 | 226.8 | 7.2 | ||||||||||||
| Other Income (expense) | (163.6 | ) | (212.0 | ) | 48.4 | (22.8 | ) | |||||||||
| Operating Income | 4,647.7 | 686.8 | 3,960.9 | 576.7 | ||||||||||||
| Net Financial Income | 222.6 | 2,304.2 | (2,081.6 | ) | (90.3 | ) | ||||||||||
| Income Tax | 1,352.6 | 849.1 | 503.5 | 59.3 | ||||||||||||
| Net Income | 3,517.8 | 2,141.9 | 1,375.8 | 64.2 |
In 1H21, the cost of sales totaled $32,040.7 million; $3,908.9 million or 13.9% higher than the $28,131.8 million reported in 1H20.
As a result, we reached a gross profit of $8,177.9 million and a gross margin of 20.3% in 1H21, when compared to $4,038.5 million of gross profit and margin of 12.6% reached in the same period of 2020.
Total SG&A expenses in 1H21 were $3,366.5 million; $226.8 million or 7.2% more than the $3,139.7 million reported in 1H20. In 1H21 total SG&A expenses as a percentage of net sales represented 8.4% compared with 9.8% in 1H20.
In 1H21 we had other expenses of $163.6 million, compared with other expenses of $212 million reported in 1H20.
Operating income in 1H21 was $4,647.7 million, which represents an operating margin of 11.6%, an increase compared to the operating income of $686.8 million and the operating margin of 2.1% in 1H20.
5
Net financial income in 1H21 was $222.6 million, lower when compared to a net financial income of $2,304.2 million in 1H20, mainly as a result of the Mexican peso appreciation year over year.
Total taxes were $1,352.6 million as of June 30, 2021. These taxes include $1,329.3 million of income tax and $23.3 million of deferred income taxes. This figure compares to total taxes of $849.1 million in 1H20.
All the above resulted in a net income of $3,517.8 million or 8.7% of net margin in the 1H21, which represents $5.96 pesos of earnings per share; while in the 1H20 the net income totaled $2,141.9 million, 6.7% of net margin and $3.55 pesos of net income per share.
| EBITDA | ||||||||||||||||
| In millions of pesos | 1H21 | 1H20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Net controlling interest profit | 3,577.2 | 2,131.8 | 1,445.3 | 67.8 | ||||||||||||
| Income tax expense (benefit) | 1,352.6 | 849.1 | 503.5 | 59.3 | ||||||||||||
| Result in associates | (59.4 | ) | 10.1 | (69.5 | ) | (686.9 | ) | |||||||||
| Net finance (income) expense | (222.6 | ) | (2,304.2 | ) | 2,081.6 | (90.3 | ) | |||||||||
| Depreciation and amortization | 703.1 | 698.1 | 5.0 | 0.7 | ||||||||||||
| EBITDA | 5,350.8 | 1,384.9 | 3,965.9 | 286.4 | ||||||||||||
| EBITDA Margin (%) | 13.3 | % | 4.3 | % | - | - | ||||||||||
| Net revenues | 40,218.6 | 32,170.3 | 8,048.2 | 25.0 |
EBITDA in 1H21 reached $5,350.8 million, representing an EBITDA margin of 13.3%, compared to an EBITDA of $1,384.9 million in 1H20, with a margin of 4.3%.
BALANCE SHEET
| BALANCE SHEET DATA | ||||||||||||||||
| In millions of pesos | June 30, 2021 | Dec. 31st, 2020 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| TOTAL ASSETS | 61,676.1 | 58,475.0 | 3,201.1 | 5.5 | ||||||||||||
| Cash and cash equivalents | 21,461.0 | 19,242.4 | 2,218.5 | 11.5 | ||||||||||||
| Accounts receivable | 4,249.9 | 4,366.7 | (116.8 | ) | (2.7 | ) | ||||||||||
| TOTAL LIABILITIES | 14,578.9 | 14,548.2 | 30.7 | 0.2 | ||||||||||||
| Accounts payable | 5,593.5 | 5,834.0 | (240.5 | ) | (4.1 | ) | ||||||||||
| Short-term debt | 497.5 | 1,251.7 | (754.2 | ) | (60.3 | ) | ||||||||||
| Long-term debt | 1,472.8 | 1,460.4 | 12.4 | 0.8 | ||||||||||||
| TOTAL STOCKHOLDERS' EQUITY | 47,097.2 | 43,926.8 | 3,170.4 | 7.2 | ||||||||||||
| Capital stock | 1,174.2 | 1,174.3 | (0.1 | ) | (0.0 | ) |
Cash and equivalents as of June 30, 2021 totaled $21,461.0 million vs $19,242.4 million as of December 31, 2020.
Total debt as of June 30, 2021 was $1,970.3 million, compared to $2,712.1 million reported as of December 31, 2020, mainly as a result of payments made in our short-term bank debt.
Net cash as of June 30, 2021 was $19,460.6 million, compared to net cash of $16,530.3 million as of December 31, 2020.
6
| CAPITAL EXPENDITURES | ||||||||||||||||
| In millions of pesos | 1H21 | 1H20 | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Capital Expenditures | 1,307.5 | 992.4 | 315.1 | 31.7 |
Total CAPEX for the 1H21 was $1,307.5 million and $992.4 million in 1H20, mainly allocated toward organic growth and productivity projects across all of our facilities.
STOCK INFORMATION
| As of June 30, 2021 | ||||
| Total Shares | 600,000,000 | |||
| Total free float | 26.75 | % | ||
| Market cap (millions of pesos) | $ | 45,162 |
| 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 | ||||||||||||||||||
| June | 77.89 | 73.93 | 75.27 | 47.60 | 43.93 | 46.32 | ||||||||||||||||||
| May | 77.50 | 74.92 | 76.52 | 46.76 | 44.55 | 46.40 | ||||||||||||||||||
| April | 75.39 | 68.04 | 74.73 | 45.47 | 39.73 | 44.47 | ||||||||||||||||||
| March | 69.42 | 67.16 | 68.04 | 40.45 | 38.30 | 39.95 | ||||||||||||||||||
| February | 71.99 | 68.02 | 69.42 | 43.19 | 39.67 | 39.67 | ||||||||||||||||||
| January | 73.60 | 69.22 | 69.28 | 44.66 | 41.14 | 41.14 |
Source: Yahoo Finances
ANALYST COVERAGE
| Institution | Analyst name | |||
| ACTINVER | Enrique Mendoza Farias | emendoza@actinver.com.mx | ||
| BBVA BANCOMER | Pablo Abraham Peregrina | pablo.abraham@bbva.com | ||
| GBM | Luis Rodrigo Willard Alonso | lrwillard@gbm.com | ||
| INTERCAM | Richard Horbach Martinez | rhorbach@intercam.com.mx | ||
| JP MORGAN | Ulises Argote | ulises.argote@jpmorgan.com | ||
| SANTANDER | Hector Maya López | hmmaya@santander.com.mx | ||
| BANK OF AMERICA | Fernando Olvera | folvera@bofa.com |
APPENDICES
For reference, some figures have been translated into millions of U.S. dollars ('USD') using an exchange rate of $19.95 per USD $1.0, which corresponds to the rate at the close of June 30, 2021, according to Mexico's National Bank.
| · | Consolidated Statement of Financial Position |
| · | Consolidated Statement of Income |
| · | Consolidated Statement of Cash Flows |
| · | Derivatives Position Report |
7
| CONSOLIDATED STATEMENT OF INCOME | ||||||||||||
| Second Quarter Results, ended June 30th: | ||||||||||||
| -Unaudited- | ||||||||||||
| U.S. Dollar | ||||||||||||
| In millions pesos | 2021 | 2021 | 2020 | |||||||||
| Net sales | $ | 1,045.7 | 20,860.9 | 16,431.9 | ||||||||
| Cost of sales | 847.2 | 16,901.1 | 14,574.5 | |||||||||
| Gross profit | 198.5 | 3,959.8 | 1,857.4 | |||||||||
| SG&A | 86.7 | 1,729.2 | 1,567.0 | |||||||||
| Other income (expenses), net | (7.1 | ) | (141.8 | ) | (207.5 | ) | ||||||
| Operating income | 104.7 | 2,088.8 | 82.8 | |||||||||
| Net finance income | (4.9 | ) | (97.0 | ) | (122.3 | ) | ||||||
| Income tax | 27.5 | 548.7 | (11.2 | ) | ||||||||
| Net Income | $ | 72.3 | 1,443.2 | (28.2 | ) | |||||||
| Non-controlling interest | (1.69 | ) | (33.6 | ) | 6.6 | |||||||
| Net controlling interest profit | 74.02 | 1,476.8 | (34.8 | ) | ||||||||
| Basic and diluted earnings per share | 0.12 | 2.46 | (0.06 | ) | ||||||||
| Basic and diluted earnings per ADR | 1.48 | 29.55 | (0.70 | ) | ||||||||
| Weighted average Shares outstanding1 | 599,743 | 599,743 | 599,787 | |||||||||
| EBITDA Result | $ | 122.2 | 2,437.4 | 437.6 | ||||||||
| Gross margin | 19.0 | % | 19.0 | % | 11.3 | % | ||||||
| Operating margin | 10.0 | % | 10.0 | % | 0.5 | % | ||||||
| Net margin | 7.1 | % | 6.9 | % | -0.2 | % | ||||||
| EBITDA margin | 11.7 | % | 11.7 | % | 2.7 | % |
1 In thousands
8
| CONSOLIDATED STATEMENT OF INCOME | ||||||||||||
| Accumulated results, for the six months ended June 30. | ||||||||||||
| -Unaudited- | ||||||||||||
| U.S. Dollar | ||||||||||||
| In millions pesos | 2021 | 2021 | 2020 | |||||||||
| Net sales | $ | 2,016.0 | 40,218.6 | 32,170.3 | ||||||||
| Cost of sales | 1,606.0 | 32,040.7 | 28,131.8 | |||||||||
| Gross profit | 409.9 | 8,177.9 | 4,038.5 | |||||||||
| Selling, general and administrative expenses | 168.7 | 3,366.5 | 3,139.7 | |||||||||
| Other income (expenses), net | (8.2 | ) | (163.6 | ) | (212.0 | ) | ||||||
| Operating income | 233.0 | 4,647.7 | 686.8 | |||||||||
| Net finance income | 11.2 | 222.6 | 2,304.2 | |||||||||
| Income tax | 67.8 | 1,352.6 | 849.1 | |||||||||
| Net income | $ | 176.3 | 3,517.8 | 2,141.9 | ||||||||
| Non-controlling interest | (2.98 | ) | (59.4 | ) | 10.1 | |||||||
| Net controlling interest profit | 179.3 | 3,577.2 | 2,131.8 | |||||||||
| Basic and diluted earnings per share | 0.30 | 5.96 | 3.55 | |||||||||
| Basic and diluted earnings per ADR | 3.59 | 71.6 | 42.65 | |||||||||
| Weighted average Shares outstanding1 | 599,790 | 599,790 | 599,815 | |||||||||
| EBITDA Result | $ | 268.2 | 5,350.8 | 1,384.9 | ||||||||
| Gross margin | 20.3 | % | 20.3 | % | 12.6 | % | ||||||
| Operating margin | 11.6 | % | 11.6 | % | 2.1 | % | ||||||
| Net margin | 8.9 | % | 8.7 | % | 6.7 | % | ||||||
| EBITDA margin | 13.3 | % | 13.3 | % | 4.3 | % |
1 In thousands
9
| CONSOLIDATED STATEMENT OF FINANCIAL POSITION | ||||||||||||
| -Unaudited- | ||||||||||||
| In U.S. Dollar | June 30, | December 31, | ||||||||||
| In million pesos | 2021 | 2021 | 2020* | |||||||||
| TOTAL ASSETS | $ | 3,091.5 | 61,676.1 | 58,475.0 | ||||||||
| Total current assets | 1,768.6 | 35,284.5 | 32,586.0 | |||||||||
| Cash and cash equivalents | 1,075.7 | 21,461.0 | 19,242.4 | |||||||||
| Total accounts receivable | 213.0 | 4,249.9 | 4,366.7 | |||||||||
| Inventories | 399.9 | 7,977.9 | 7,701.0 | |||||||||
| Other current assets | 80.0 | 1,595.8 | 1,275.9 | |||||||||
| Total non current assets | 1,322.9 | 26,391.6 | 25,889.0 | |||||||||
| Net property, plant and equipment | 1,018.3 | 20,314.8 | 19,733.8 | |||||||||
| Other non current Assets | 304.6 | 6,076.8 | 6,155.2 | |||||||||
| TOTAL LIABILITIES | $ | 730.8 | 14,578.9 | 14,548.2 | ||||||||
| Total current liabilities | 427.7 | 8,532.2 | 8,179.8 | |||||||||
| Notes payable to banks | 24.9 | 497.5 | 1,251.7 | |||||||||
| Accounts payable | 280.4 | 5,593.5 | 5,834.0 | |||||||||
| Other taxes payable and other accruals | 122.4 | 2,441.2 | 1,094.1 | |||||||||
| Total long-term liabilities | 303.1 | 6,046.7 | 6,368.4 | |||||||||
| Long-term debt | 73.8 | 1,472.8 | 1,460.4 | |||||||||
| Other non current liabilities | 48.2 | 962.0 | 1,033.0 | |||||||||
| Deferred income taxes | 181.0 | 3,611.9 | 3,875.0 | |||||||||
| TOTAL STOCKHOLDERS' EQUITY | $ | 2,360.8 | 47,097.2 | 43,926.8 | ||||||||
| Capital stock | 58.9 | 1,174.2 | 1,174.3 | |||||||||
| Commission in shares issued | 20.7 | 413.3 | 413.4 | |||||||||
| Retained earnings | 2,206.4 | 44,018.1 | 40,874.4 | |||||||||
| Others accounts | 47.6 | 948.8 | 855.5 | |||||||||
| Non controlling interest | 27.2 | 542.8 | 609.2 | |||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 3,091.5 | 61,676.1 | 58,475.0 |
*Audited
10
| CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||||||
| In million of pesos | ||||||||||||
| -Unaudited- | ||||||||||||
| U.S. Dollar | June 30, | |||||||||||
| 2021 | 2021 | 2020 | ||||||||||
| NET MAJORITY INCOME BEFORE INCOME TAX | $ | 244.1 | 4,870.4 | 2,666.5 | ||||||||
| ITEMS RELATING TO INVESTING ACTIVITIES: | 41.2 | 821.6 | 269.4 | |||||||||
| Depreciation and others | 45.7 | 911.5 | 639.3 | |||||||||
| Income (loss) on sale of plant and equipment | 2.2 | 43.3 | (23.1 | ) | ||||||||
| Other Items | (6.7 | ) | (133.2 | ) | (346.7 | ) | ||||||
| NET CASH GENERATED FROM NET INCOME BEFORE TAXES | 285.3 | 5,691.9 | 2,935.9 | |||||||||
| CASH GENERATED OR USED IN THE OPERATION: | 14.3 | 284.7 | (1,977.9 | ) | ||||||||
| Decrease (increase) in accounts receivable | (3.5 | ) | (70.5 | ) | (1,426.1 | ) | ||||||
| Decrease (increase) in inventories | (15.5 | ) | (310.0 | ) | 395.7 | |||||||
| Increase (decrease) in accounts payable | 93.0 | 1,855.0 | (1,961.8 | ) | ||||||||
| Other Items | (59.6 | ) | (1,189.9 | ) | 1,014.3 | |||||||
| NET CASH FLOW FROM OPERATING ACTIVITIES | 299.6 | 5,976.7 | 958.0 | |||||||||
| NET CASH FLOW FROM INVESTING ACTIVITIES | (44.2 | ) | (882.8 | ) | (188.6 | ) | ||||||
| Acquisition of property, plant and equipment | (65.5 | ) | (1,306.2 | ) | (824.6 | ) | ||||||
| Proceeds from sales of property plant and equipment | 0.1 | 1.8 | 37.3 | |||||||||
| Other Items | 21.1 | 421.6 | 598.7 | |||||||||
| CASH FLOW SURPLUS (REQUIREMENTS OF) TO BE USED IN FINANCING ACTIVITIES | 255.3 | 5,093.9 | 769.4 | |||||||||
| Net cash provided by financing activities: | (144.1 | ) | (2,875.3 | ) | (706.5 | ) | ||||||
| Proceeds from loans | 62.0 | 1,237.2 | 3,478.6 | |||||||||
| Principal payments on loans | (95.9 | ) | (1,912.3 | ) | (3,424.2 | ) | ||||||
| Dividends paid | (21.3 | ) | (425.8 | ) | (420.0 | ) | ||||||
| Other items | (88.9 | ) | (1,774.4 | ) | (340.9 | ) | ||||||
| Net increase (decrease) in cash and equivalents | 111.2 | 2,218.5 | 62.9 | |||||||||
| Cash and investments at the beginning of year | $ | 964.5 | 19,242.4 | 19,164.8 | ||||||||
| CASH AND INVESTMENTS AT END OF PERIOD | $ | 1,075.7 | 21,461.0 | 19,227.7 |
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DERIVATIVES POSITION REPORT
Second Quarter 2021
Thousands of Mexican Pesos, as of June 30, 2021
| TYPE OF FINANCIAL INSTRUMENT | OBJECTIVE | NOTIONAL | VALUE OF THE RELATED COMMODITY | REASONABLE VALUE | AMOUNTS DUE BY YEAR | GUARANTIES REQUIRED | ||||
| 2Q-2021 | 1Q-2021 | 2Q-2021 | 1Q-2021 | |||||||
| Forward Vanilla, and KO Fwd | Hedge | $ 248,431 | $ 19.95 | $ 20.42 | $-237,421 | $-231,713 | 96% in 2021; 4% 2022 | The deals consider the possibility of margin calls but not another kind of guarantee | ||
| Futures for corn and soybean meal | Hedge | $ 201,788 | CORN | CORN | $ 12,244 | $ 12,899 | 86% in 2021 and 14% in 2022 | |||
| In USD per Bushel | In USD per Bushel | |||||||||
| month | price | month | price | |||||||
| May-21 | $ 5.643 | |||||||||
| Jul-21 | $ 7.200 | Jul-21 | $ 5.475 | |||||||
| Sep-21 | $ 5.993 | Sep-21 | $ 4.960 | |||||||
| Dec-21 | $ 5.885 | Dec-21 | $ 4.775 | |||||||
| SOYBEAN MEAL | SOYBEAN MEAL | |||||||||
| In USD per ton | In USD per ton | |||||||||
| month | price | month | price | |||||||
| Aug-21 | $ 377.5 | |||||||||
| Sep-21 | $ 379.0 | May-21 | $ 423.2 | |||||||
| Oct-21 | $ 378.8 | Jul-21 | $ 424.8 | |||||||
| Dec-21 | $ 381.7 | Aug-21 | $ 419.6 | |||||||
| Jan-22 | $ 380.1 | Sep-21 | $ 410.7 | |||||||
| Mar-22 | $ 374.1 | Oct-21 | $ 399.6 | |||||||
| May-22 | $ 371.8 | Dec-21 | $ 397.5 | |||||||
| Jul-22 | $ 373.7 | |||||||||
| Aug-22 | $ 369.6 | |||||||||
| Sep-22 | $ 369.6 | |||||||||
| Options of Corn | Hedge | $ 594,632 | CORN | CORN | $ 88,823 | $ 33,523 | 99% in 2021 and 1% in 2022 | |||
| In USD per Bushel | In USD per Bushel | |||||||||
| month | price | month | price | |||||||
| Jul-21 | $ 7.200 | May-21 | $ 5.643 | |||||||
| Sep-21 | $ 5.993 | Jul-21 | $ 5.475 | |||||||
| Dec-21 | $ 5.885 | Sep-21 | $ 4.960 | |||||||
| Mar-22 | $ 5.955 | Dec-21 | $ 4.775 | |||||||
| Mar-22 | $ 4.194 | |||||||||
| Options of soybean meal | Hedge | $ 484,302 | SOYBEAN MEAL | SOYBEAN MEAL | $ 3,603 | $ 36,364 | 80% in 2021 and 20% in 2022 | |||
| In USD per ton | In USD per ton | |||||||||
| month | price | month | price | |||||||
| Aug-21 | $ 377.5 | May-21 | $ 423.2 | |||||||
| Sep-21 | $ 379.0 | Jul-21 | $ 424.8 | |||||||
| Oct-21 | $ 378.8 | Aug-21 | $ 419.6 | |||||||
| Dec-21 | $ 381.7 | Sep-21 | $ 410.7 | |||||||
| Jan-22 | $ 380.1 | Oct-21 | $ 399.6 | |||||||
| Mar-22 | $ 374.1 | Dec-21 | $ 397.5 | |||||||
| May-22 | $ 371.8 | Jan-22 | $ 394.2 | |||||||
| Mar-22 | $ 383.9 |
-The total financial instruments do not exceed 5% of total assets as of June 30, 2021.
-The notional value represents the net position as of June 30, 2021 at the exchange rate of Ps.19.95 per one dollar.
-A negative value means an unfavorable effect for the Company.
12
| Second Quarter 2021 | ||||||||
| Thousands of Mexican Pesos, as of June 30, 2021 | PROBABLE SCENARIO | |||||||
| TYPE OF FINANCIAL INSTRUMENT | REASONABLE VALUE | VALUE OF THE RELATED COMMODITY | EFFECT ON THE INCOME STATEMENT | EFFECT ON THE CASH FLOW(3) | ||||
| Reference Value (1) | ||||||||
| -2.5% | 2.5% | 5.0% | -2.5% | 2.5% | 5.0% | |||
| Forward Vanilla, and KO Fwd | -$ 237,421 | $19.45 | $ 20.45 | $ 20.94 | Direct | -$361,308 | -$113,534 | -$ 478 |
| -5% | 5% | 10% | -5% | 5% | 10% | |||
| Futures of Corn: (2) | $ 12,244 | $ 6.840 | $ 7.560 | $ 7.920 | The effect will materialize as the inventory is consumed | $ 1,851 | $ 22,637 | $ 33,030 |
| Futures of Soybean Meal: (2) | $ 358.6 | $ 396.4 | $ 415.3 | |||||
| Options for Corn | $ 88,823 | $ 6.840 | $ 7.560 | $ 7.920 | $ 68,536 | $ 109,110 | $ 129,397 | |
| Options of Soybean Meal | $ 3,603 | $ 358.6 | $ 396.4 | $ 415.3 | -$ 20,613 | $ 27,818 | $ 52,033 |
(1) The reference value is the exchange rate of Ps. $19.95 per USD as of June 30, 2021.
(2) The reference values are; the future of corn for July 2021, $7.2000 USD/bushel and the future of soybeanmeal for August 2021, $377.50USD/ton.
'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.
| Second Quarter 2021 | ||||||||||
| Thousands of Mexican Pesos, as of June 30, 2021 | STRESS SCENARIO | |||||||||
| TYPE OF FINANCIAL INSTRUMENT | REASONABLE VALUE | VALUE OF THE RELATED COMMODITY |
EFFECT ON THE INCOME STATEMENT | EFFECT ON THE CASH FLOW | ||||||
| Reference Value | ||||||||||
| -50% | -25% | 25% | 50% | -50% | -25% | 25% | 50% | |||
| Forward Vanilla and KO Fwd | -$237,421 | $9.97 | $14.96 | $24.93 | $29.92 | Direct | -$2,715,148 | -$1,476,285 | $787,856 | $1,789,187 |
13
CONFERENCE CALL INFORMATION
The Company will host its second quarter 2021 earnings call on Tuesday, July 27th, 2021. 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
Toll Local Mexico: 52 55 6722 5257
Toll in the Brazil: 0800 761 0710
A current list of available local and international free phone telephone numbers:
http://web.meetme.net/r.aspx?p=12&a=UruYmiHQFTxayV
Confirmation Number: 50196779
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 80 distribution centers in Mexico, and a Business Unit in the United States of America. Currently the Company employs more than 29,000 people.
The Company is rated AAA (MEX), the highest rating awarded by Fitch Mexico, S.A. de C.V., and HR AAA which signals that the Company and the offering both have the highest 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.
IR contact information: Maria Guadalupe Jaquez maria.jaquez@bachoco.net Andrea Guerrero andrea.guerrero@bachoco.net T. +52(461)618 3555 |
14
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Industrias Bachoco SAB de CV published this content on 26 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 July 2021 21:19:07 UTC.
