MONTERREY, MEXICO — Operating income at Gruma USA in the second quarter ended June 30 totaled 1,569 million pesos ($84.4 million), up 4% from 1,506 million pesos in the same period a year ago. Net sales at Gruma USA increased 3% to 10,555 million pesos ($567.5 million) from 10,287 million pesos.
“At Gruma USA, sales volume rose 3%, reflecting higher corn flour and retail tortilla volumes, partially affected by reductions at the food service channel for the tortilla business, where we continue to rationalize low-margin s.k.u.s (stock-keeping units),” Raul Cavazos Morales, chief financial officer, said during a July 25 conference call with analysts. “Net sales increased 3% due to growth in sales volume. Higher average prices due to the change in the sales mix was offset by the effect of the adoption of IFRS 15. EBITDA rose 6%, allowing EBITDA margin to improve 50 basis points to 18.1%.”
Gruma said operating margin at Gruma USA improved to 14.9% from 14.6% during the second quarter. Cost of sales as a percentage of net sales improved to 57.1% from 55.9% in the second quarter, Gruma said.
Gruma said it incurred $55 million in capital expenditures during the second quarter. During the quarter, the company allocated expenditures to the United States (in connection with the new tortilla plant in Dallas and general technology upgrades at several tortilla and corn flour plants), 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 second quarter was 1,308 million pesos, down 8% from the same period a year ago. EBITDA was 3,097 million pesos, up 9% from 2,835 million pesos, while sales increased 9% to 18,942 million pesos from 17,437 million pesos.