GRUPO HERDEZ, S.A.B. DE C.V. GRUPO HERDEZ
FOURTH QUARTER AND FULL-YEAR 2022
EARNINGS RELEASE
CONSOLIDATED HIGHLIGHTS FOR THE QUARTER
- Net sales were MXN 8.9 billion, 18.5% higher than in 2021.
- EBIT and EBITDA increased 16.9% and 16.1%, respectively, to MXN 1.4 billion and MXN 1.6 billion.
- Consolidated Net Income was MXN 938 million, 35.9% higher than the previous year, with a margin expansion of 1.3 percentage points to 10.5%.
1
Mexico City, Mexico, February 22, 2023 - Grupo Herdez, S.A.B. de C.V. ("Grupo Herdez" or the "Company") (MSE: HERDEZ) today announced results for the fourth quarter and full year ended December 31, 2022.
"The year 2022 was full of challenges and lessons, which allowed us to continue strengthening our operation and, obtaining outstanding results throughout the different business segments. We are optimistic about 2023 and expect a solid performance," said Héctor Hernández-Pons Torres, Chairman and Chief Executive Officer of Grupo Herdez.
The information contained in this document is prepared in accordance with International Financial Reporting Standards ("IFRS") and is expressed in Mexican pesos unless stated otherwise.
Grupo Herdez consolidates 100 percent of its Impulse division, Barilla Mexico, Herdez Del Fuerte - Mexico, and McCormick de Mexico in its financial statements. The proportional stake of Herdez Del Fuerte in MegaMex is registered in Equity Investments in Associated Companies.
NET SALES
Consolidated net sales increased 18.5% in the last quarter of the year to record figures of MXN 8.9 billion, while full-year sales were 21.0% higher than in 2021, climbing to MXN 31.6 billion. In comparable terms - without the acquisition of Mediterranean* - net sales grew 16.0% in the quarter and 20.3% for the full year.
During the quarter, growth benefited mainly from price increases over the last twelve months, while on a cumulative basis, the improvement was due to the combination of higher prices, and to a lesser extent, volume increases.
Net sales for the quarter in the Preserves segment were MXN 7.4 billion, 20.1% higher than in the same quarter of 2021. Full-year sales grew 20.8%, to MXN 25.3 billion. During the year, mayonnaise, pasta, tomato purée, and vegetables were the outstanding categories. By channel, we saw a general double-digit growth rate, with institutional, club stores, and wholesalers exceeding the average.
Impulse sales in the quarter grew 6.6% over last year to MXN 884 million. Accumulated sales registered growth of 19.7%, climbing to MXN 3.9 billion. These results reflect low-single digit increase in the average ticket, which offset lower store traffic for the quarter; nevertheless, sales for the full year reflect normalized post-covid operations, as well as price increases implemented over the last twelve months. The
aforementioned translated into a high single-digit increase on the average ticket in the quarter. For Helados 2 Nestlé, the traditional channel continued its recovery trend.
Net sales in the Export segment during the quarter were MXN 624 million, 19.0% higher than in the previous year, mainly driven by higher volumes of homemade sauces and mole. Full-year net sales were MXN 2.4 billion, 25.3% higher than in 2021, due to price increases in the last twelve months and to a lesser extent higher volumes.
NET SALES | 4Q22 | 4Q21 | % change | 2022 | 2021 | % change | ||||||||||||||
Consolidated | 8,910 | 7,518 | 18.5 | 31,646 | 26,153 | 21.0 | ||||||||||||||
Preserves | 7,401 | 6,163 | 20.1 | 25,343 | 20,977 | 20.8 | ||||||||||||||
Impulse | 884 | 830 | 6.6 | 3,917 | 3,273 | 19.7 | ||||||||||||||
Exports | 624 | 525 | 19.0 | 2,386 | 1,904 | 25.3 | ||||||||||||||
Figures in millions of MXN.
- Mediterranean refers to Interdeli and Deli, Dips & Sancks, businesses that were acquired by Herdez Del Fuerte on October 2022, owners of brands like LIBANIUS®, FLAVEUR®, and LIGURIA®, among others.
NET SALES PERFORMANCE | ||||
7,518 | 7,667 | 7,961 | 8,910 | |
7,108 | ||||
4Q21 | 1Q22 | 2Q22 | 3Q22 | 4Q22 |
GROSS PROFIT
Consolidated gross margin in the quarter was 36.5%, a decline of 1.1 percentage points compared to the previous year, while on a sequential basis - quarter to quarter - there was a recovery of 2.6 percentage points. In the Preserves and Export segments, gross margin decreased 0.9 and 3.5 percentage points, respectively, due to high prices for key raw materials and packaging, and to a lesser extent, due to an unfavorable sales mix in Exports. In the Impulse segment, the margin increased 0.5 percentage points to 57.2%, compared to the same quarter of last year, as a result of operating leverage.
Full-year consolidated gross margin fell 1.5 percentage points to 35.4%. Preserves saw a 1.9 percentage
points decrease. In the Impulse segment, the margin increased 1.5 percentage points, due to higher sales in Helados Nestlé's traditional channel.
3
GROSS MARGIN
Consolidated
Preserves
Impulse
Exports
4Q22 | 4Q21 | ||
3,249 | 2,830 | ||
2,681 | 2,290 | ||
506 470
6270
% change
14.8
17.1
7.5
(12.4)
2022 | 2021 | |||
11,206 | 9,652 | |||
8,671 | 7,567 | |||
2,246 | 1,825 | |||
289 | 260 | |||
% change
16.1
14.6
23.1
11.2
Figures in millions of MXN.
GROSS MARGIN | 4Q22 | 4Q21 | pp change | 2022 | 2021 | pp change | ||||||||
Consolidated | 36.5 | 37.6 | (1.1) | 35.4 | 36.9 | (1.5) | |
Preserves | 36.2 | (0.9) | 34.2 | 36.1 | (1.9) | ||
37.1 | |||||||
Impulse | 57.2 | 0.5 | 57.3 | 55.8 | 1.5 | ||
56.7 | |||||||
Exports | 9.9 | 13.4 | (3.5) | 13.7 | (1.6) | ||
12.1 | |||||||
Figures in percentages.
GROSS PROFIT PERFORMANCE
2,830 | 3,249 | |||||
2,569 | 2,685 | 2,702 | ||||
37.6 | 36.2 | 36.5 | ||||
35.0 | 33.9 | |||||
4Q21 | 1Q22 | 2Q22 | 3Q22 | 4Q22 | ||
SALES, GENERAL, AND ADMINISTRATIVE EXPENSES (SG&A)
During the quarter, consolidated SG&A were 21.4% of net sales, 1.3 percentage points below the previous year. In Preserves, the proportion of SG&A over net sales decreased 1.4 percentage points to 17.0%, mainly due to higher sales.
Accumulated SG&A were 23.7% of net sales, 1.4 percentage points lower than in 2021. This is mainly due to the price increases implemented during the year, which offset the higher freight rates.
EARNINGS BEFORE INTEREST AND TAXES BEFORE OTHER INCOME
EBIT before other income and expenses in the quarter was MXN 1.3 billion, 19.7% higher than that reported in the fourth quarter of 2021, due to 23.2% growth in Preserves. Consolidated margin remained mostly flat compared to the previous year at 15.1% propelled by price increases and operating leverage.
4
Accumulated consolidated EBIT before other income and expenses was MXN 3.7 billion, 20.3% higher than the previous year, with a margin of 11.7%, in line with 2021.
OTHER EXPENSES (INCOME)
During the quarter, other income of MXN 20 million was recorded, while for the full year other income was MXN 119 million, which compares favorably to expenses of MXN 78 million in the previous year.
EARNINGS BEFORE INTEREST AND TAXES (EBIT)
EBIT in the quarter was MXN 1.4 billion, 16.9% higher than in 2021, with a 15.3% margin, in line with the fourth quarter of 2021. The aforementioned is explained by: i) the price increases implemented over the last twelve months, and ii) the absorption of operating expenses. Accumulated EBIT grew 27.4% to MXN
3.8 billion, which represented a margin of 12.1%, an increase of 0.6 percentage points compared to the previous year. In comparable terms - without the acquisition of Mediterranean - EBIT was 28.3% with a margin of 12.3%.
EBIT
Consolidated
Preserves
Impulse
Exports
Figures in millions of MXN.
4Q22
1,364
1,434
(97)
27
4Q21
1,166
1,188
(55)
33
-
change
16.9
20.7
(77.4)
(17.6)
2022
3,831
4,044
(359)
146
2021
3,007
3,392
(513)
127
-
change
27.4
19.2
30.1
14.2
EBIT MARGIN (%)
4Q22
4Q21
pp change
2022
2021
pp change
Consolidated
Preserves
Impulse
Exports
Figures in percentages.
15.3
19.4
(11.0)
4.3
15.5
19.3
(6.6)
6.2
(0.2)
0.1
(4.4)
(1.9)
12.1
16.0
(9.2)
6.1
11.5
16.2
(15.7)
6.7
0.6
(0.2)
6.5
(0.6)
EBIT PERFORMANCE
1,166 | 1,364 | ||||||||
15.5 | 835 | 778 | 854 | 15.3 | |||||
5 | |||||||||
11.7 | 10.2 | 10.7 | |||||||
4Q21 | 1Q22 | 2Q22 | 3Q22 | 4Q22 | |||||
ALL-IN RESULT OF FINANCING
In the fourth quarter, the all-in cost of financing was MXN 190 million, 14.5% lower than in the same period in 2021, due to lower levels of debt after the refinancing in June 2022. The accumulated all-in cost of financing was MXN 767 million, 9.0% higher than in 2021, due mainly to: i) higher debt in the first nine months of the year, and ii) increased interest rates.
EQUITY INVESTMENTS IN ASSOCIATED COMPANIES
Equity investments in associated companies totaled MXN 221 million in the quarter, and MXN 466 million for the full year, 1.5% and 42.0% lower than in the previous year, respectively. These results were due to increased avocado prices and logistics expenses that affected MegaMex's performance during the year. Nevertheless, equity investments in associated companies had a sequential recovery, climbing to MXN 221 million from MXN 92 million registered in the third quarter of 2022.
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
Grupo Herdez SAB de CV published this content on 23 February 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 February 2023 01:12:01 UTC.
