Grupo Bimbo posts strong Q2 results, sells AI-focused subsidiary to Mekitec
MEXICO – Mexican multinational baking company Grupo Bimbo has reported strong Q2 results where net sales grew 6.6% driven volume growth in multiple categories, mainly snacks, confectionery, buns and rolls, and pastries.
During the quarter ending June 30th, Grupo Bimbo generated record profits while boosting return on equity by 280 basis points.
Regionally, the company’s North American business remained resilient amid a pandemic and managed to deliver sales growth of 0.9% buoyed by a strong delivery of the group’s branded business led by sweet baked goods, buns and rolls, and snacks.
In Mexico, sales rose 14.7%, attributable to volume growth driven mainly by the bonds, sweet baked goods, bread bars, and snack categories, as well as in the traditional channels.
Sales in the Latin America division also increased almost 13% (excluding FX effects) driven by growth in almost every country, especially double-digit sales growth in Chile, Peru, and Paraguay.
“I am more than proud that our team’s reached record profits for the second quarter and net sales growth of 6.6%, excluding FX effects,” said Mr. Daniel Servitje. Chairman and Chief Executive Officer of Grupo Bimbo.
“As we move forward, we will continue investing in our associates, our brands, in the entire value-chain in our sustainability strategy and in our digital transformation projects to achieve our vision.”
Following an impressive quarterly run, Grupo Bimbo now is determined to protect profit margin improvements from the runaway inflation in the US and Europe that is currently impacting the cost of production for many consumer goods companies.
To this end, Group CEO Servitje said that the company is taking a number of steps, including raising prices in North America during the current quarter.
Grupo Bimbo sells AI-focused subsidiary
Meanwhile, Grupo Bimbo has offloaded its baking x-ray technology subsidiary Kanan Smart Solution to food quality control system manufacturer Mekitec Group in a share transaction.
Kanan Smart Solution focuses on the development of artificial intelligence and x-ray inspection technology to detect foreign objects and ensure the safety of bakery products.
The inspection software company has a revenue of $1.8 million and 13 employees in Mexico, with a presence also in the US, Ecuador, and France.
As part of the deal, Kanan’s software development team and local sales and service operations in Mexico will now become part of Mekitec.
This is expected to strengthen Mekitec’s x-ray inspection capabilities for baking companies and boost its market position throughout Latin America.
Following the share transaction, Grupo Bimbo’s venture arm Bimbo Ventures will become a significant shareholder of Mekitec and will support the Finnish company in accelerating its growth.
Earlier, Grupo Bimbo acquired Emmy’s Organics, a producer of ultra-premium organic cookies in an effort to gain entry into the quickly growing better-for-you cookie and sweet baked goods market.
Established in 2009, Emmy’s has an impressive portfolio of better-for-you snacks that include six cookie varieties, three cookie bite varieties, and chocolate-covered snacks that are vegan and gluten-free.
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