MONTERREY, MEXICO — Operating income at Gruma USA in the first quarter ended March 31 totaled 1,340 million pesos ($71.6 million), up 10% from 1,217 million pesos in the same period a year ago.
Net sales at Gruma USA increased 3% in the first quarter of fiscal 2018 to 9,434 million pesos ($504 million) from 9,162 million pesos.
“The tortilla business grew 1% driven by the retail channel, where volume benefitted primarily from growth at core products such as Super Soft flour tortillas; specialty products such as Street Taco tortillas (a small tortilla especially used for tacos); low-count corn tortillas; and healthier alternatives (Carb Balance, and gluten-free in particular),” the company said. “On the other hand, the food service channel was impacted by the company’s decision to reduce supply of some s.k.u.s (stock-keeping units) based on profitability. Corn flour sales volume rose 1% driven mostly by the retail channel in connection with expanded distribution at club formats, coupled with increased displays and promotions granted by large retailers.”
Gruma said operating margin at Gruma USA improved to 14.2% from 13.3% during the first quarter.
Cost of sales as a percentage of net sales improved to 57.5% from 57.4% in the first quarter, Gruma said.
Gruma said it incurred $33 million in capital expenditures during the first quarter. During the quarter, the company allocated expenditures to the United States (in connection with the new tortilla plant in Dallas and the expansion of a tortilla plant in Florida), to Europe (in connection with packaging automation at a plant in The Netherlands and at one of its plants in England) and to Mexico (for a tortilla plant near Puebla and technology upgrades at GIMSA).Overall, majority net income at Gruma S.A.B. de C.V. in the first quarter was 1,282 million pesos, unchanged from the same period a year ago. EBITDA was 2,692 million pesos, down from 2,697 million pesos, while sales fell 1% to 17,532 million pesos from 17,677 million pesos.