“Notably, the multinational company reported year-to-year improvements during the quarter driven primarily by its operations in the United States, Europe, and Mexico.”.

• The company reported MXN 20.053 billion in net sales and MXN 2.474 billion operating profit in Q319.
  
  
• EBITDA was MXN 3.299 billion, while the EBITDA margin stood at 16.5%.
  
  
• Net sales and EBITDA of operations outside of Mexico represented 74% and 75% of its consolidated figures, respectively.
  
  
• In Q319, the company invested USD 17 million (MXN 333 million) primarily in its plants in Dallas, Tijuana, and Malaysia.
  
  

Mexico City, October 23, 2019.- Today, Gruma reported its third quarter 2019 (Q319) results. Notably, the multinational company reported year-to-year improvements during the quarter driven primarily by its operations in the United States, Europe, and Mexico.

At the close of Q319, the company’s Sales Volume stood at 1.056 million metric tons. Compared to Q318, the consolidated sales volume was up 3%, led by Gruma Europe and Gruma USA.

Net sales were up 8% compared to Q318 to stand at MXN 20.053 billion. This increase was driven by improved sales volume and higher average prices in the United States, an increase in prices in Mexico (GIMSA), and growth in sales volume in Europe.

Sales from Gruma operations outside of Mexico accounted for 74% of total sales in Q319.

The Cost of Sales as a percentage of the company’s net sales increased from 62.2% to 62.9%. This was driven primarily by less activity by the Technology Division in alignment with the company’s program to reduce capital expenditures. In absolute terms, the cost of sales was up 10% to stand at MXN $12.607 billion, due to rising costs of supplies, particularly in Mexico and the United States, in addition to the growth of sales volume in Europe.

Meanwhile, Operating Profit stood at MXN 2.474 billion, up 2% compared to Q318, while profit margins stood at 12.3%.

EBITDA, for the Mexican multinational known as the worldwide leader in the production of corn flour, tortillas, and wraps, was up 9% year-over-year to stand at MXN 3.299 billion in Q319. The EBITDA margin improved from 16.4% to 16.5%.

Gruma’s reported Net Profit for the period was MXN 1.304 billion, a 2% year-to-year increase compared to MXN 1.275 billion reported in Q318.

The company’s Majority Net Profit stood at of MXN 1.304 billion, a 2% year-over-year increase due to a drop in taxes.

Gruma’s capital investments in Q319 stood at USD 17 million in (MXN 333 million), to purchase company-wide technology updates, maintenance, and expand the capacity of the following plants:

Expansión de capacidad en las plantas de:

1. Flour tortillas and corn chips in Dallas, Texas.
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2. Corn tostadas in Tijuana, Mexico.
   
   
3. Flour tortillas and pizza discs in Malaysia.
   
   

Key events during Q319:

Secretariat of Agriculture and Gruma Join Efforts to Support Mexico’s Native Corn Producers

The purpose of the program is help increase farmers increases their revenues. Farmers in the States of Guerrero, Oaxaca, and Puebla will benefit by receiving higher payments for their crops. This support affirms Gruma’s commitment to permanently assist Mexican farmers and agricultural workers while working in coordination with the Mexican government to improve their living conditions and ensure domestic food self-sufficiency.

The Secretariat of Agriculture and Gruma Support Mexican Farmers to Reduce Corn Imports

Gruma has pledged to work with the Secretariat of Agriculture and Rural Development (SADER) on the Comprehensive Program for Managing White Corn in Northern Tamaulipas. The purpose of the program is to reduce corn imports in the medium term and purchase close to 400,000 tons from producers in Tamaulipas, Mexico, to replace the amounts presently purchased from the United States.

The company currently imports 600,000 tons of corn per year, which represents 24% of the 2.5 million tons of corn it processes in Mexico. With this program, corn imports would be reduced by 8% and benefit corn producers in the State of Tamaulipas.

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