MONTERREY, MEXICO — Consumer demand for healthy foods benefited operations at Gruma SAB de CV in the first quarter, particularly in the company’s US operations.
Operating income at Gruma USA in the first quarter ended March 31 totaled $145.5 million, up 17% from $124.5 million in the same period a year ago. Net sales increased 2% to $902.9 million from $887.2 million, while sales volume was unchanged at 390,000 tonnes.
“The positive results and continued momentum in the retail tortilla business, were offset by the client optimization strategy in the food service business,” Gruma said. “In the corn flour business, volumes remained flat but on a continuous path to recovery with the addition of more industrial clients, who in the past exhibited some price sensitivity, while the retail channel of this business continues to show strong performance.”
Gruma said operating margin at Gruma USA increased 210 basis points during the first quarter to 16.1% from 14%. Meanwhile, cost of sales fell 3% to $517.4 million, resulting mostly from efficiencies, Gruma said.
“In the US, Gruma continues to outpace market growth in its tortilla operation, while corn flour is showing positive recovery,” the company said. “In the rest of our global operation, we are diligently growing our presence with distributors, while early signs of a recovery in China are supporting our Asia and Oceania operations.”
Gruma said it incurred $53 million in capital expenditures during the first quarter. During the quarter, the company allocated expenditures to maintenance and general upgrades across the company, particularly at GIMSA, as well as operational equipment replacement in the United States.
Overall, majority net income at Gruma SAB de CV in the first quarter was $111 million, up 46% from $75.9 million a year ago. EBITDA was $264.4 million, up 26% from $210.6 million, while sales rose 4% to $1.65 billion from $1.59 billion.