MONTERREY, MEXICO — A rebound in the foodservice channel that has operations close to pre-pandemic levels coupled with solid performance in the retail channel helped lift earnings and sales at Gruma USA in fiscal 2021.
In the year ended Dec. 31, 2021, Gruma USA had operating income of 7.59 billion pesos ($369.4 million), up 3.9% from 7.3 billion pesos in 2020. For the fourth quarter ended Dec. 31, operating income increased 23% to 2.21 billion pesos ($107.4 million) from 1.79 billion pesos.
Net sales at Gruma USA increased 6% in fiscal 2021 to 53.46 billion pesos ($2.6 billion), up from 50.51 billion a year ago. Net sales in the fourth quarter increased 15% to 14.21 billion pesos ($691 million) from 12.35 billion pesos.
Gruma said operating margin improved 100 basis points to 15.5% during the fourth quarter.
Cost of sales as a percentage of net sales decreased to 58.1% from 58.4% in the fourth quarter, reflecting stronger sales relative to the fourth quarter of fiscal 2020.
“In the US, we continued seeing the trends in volume growth we have been seeing over the last few quarters of 2021,” Adolfo Fritz, investor relations officer, said during a Feb. 24 conference call with analysts. “Tortilla volumes were supported (by) double-digit recovery growth in the foodservice channel, while demand for our retail products kept volume stable even after the consumption we saw in 2020. Volumes in our corn milling business in the US were also driven by higher demand spurred with the reopening of the economy as well as by seasonal holidays. This led corn flour volumes to grow by 6% compared to last year. Overall, in the US, volumes grew 3%, and so far, we have not seen a meaningful price elasticity effect even after the price increases implemented in October.”
Mr. Fritz said Gruma in February increased prices again in its foodservice channel and is prepared to increase prices over the course of 2022, should current pricing be insufficient to offset the incremental costs.
“However, this is a measure that we would only utilize if the price hike is fully warranted relative to the context we’re living today,” he said.
Gruma said it spent $70 million on capital expenditures during the fourth quarter and $286 million for the full year. During the fourth quarter, the company allocated expenditures to construction and capacity expansions at its new tortilla plants in Indiana and Spain, production lines in existing facilities in the United Kingdom and United States, a new tortilla line and transportation equipment at its tortilla plant in Monterrey, Mexico, and maintenance and general technology upgrades across the company, particularly at Gimsa.Overall, majority net income at Gruma SAB de CV in fiscal 2021 was 6.14 billion pesos, up 14% from 5.37 billion in fiscal 2020. Net sales increased 3% to 94.25 billion pesos from 91.1 billion a year ago.