MEXICO – The North American unit of Mexican bakery giant Grupo Bimbo delivered another strong year for the bakery with sales surging 22% when compared to the year prior.
According to recently released financial results, the operating income of the North America segment of Grupo Bimbo was 16.08 billion pesos ($794 million), up from 11.2 billion pesos in 2020.
The company’s operating margin widened 280 basis points during the year to 9.1%, from 6.3% in 2020 while net sales in the region stood at 176.3 billion pesos ($8.7 billion), nearly unchanged from 176.4 billion a year earlier but still up 22% from 144 billion in 2019.
An impressive North American run in 2021 gave a boost to Grupo Bimbo’s company-wide operating income which surged 34% in 2021.
The company has also attributed the strong performance to “productivity savings across the value chain coming from past restructuring investments, distribution efficiencies and cost-cutting projects.”
Bimbo also cited a US$108 million non-cash benefit from the adjustment of the company’s MEPPs (multiple employer pension plan) reflecting current interest rate levels.
Grupo Bimbo’s net majority income in 2021 was 15.9 billion pesos ($785 million), up 75% from 9.1 billion in 2020.
Net majority margin widened to 4.6% from 2.8% in 2020 while net sales grew 5% to 348.9 billion pesos ($17.2 billion) from 291.9 billion.
Highlights of the year included the company’s strongest return on equity in 10 years — 15.2%.
During the year the company completed six strategic acquisitions, including two in the United States, two in India, one in Spain and one in Brazil.
Fourth-quarter net majority income was 4.82 billion pesos ($238 million), up 67% from 2.9 billion pesos a year earlier.
Net majority margin widened in the final quarter of the year to 5%, up from 3.4% the year before while net sales were up 15% to 97.45 billion pesos ($4.81 billion) from 84.8 billion.
On a call with analysts, Chief Financial Officer Diego Gaxiola Cuevas said Bimbo would increase prices this year to catch up with inflation, labor shortages and supply chain constraints.
Cuevas said the company will spend $1.5 billion in 2022, up from the previously estimated $900 million, on growth projects including new products, mostly in North America where sales increased 12.9% in the quarter.
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