Tuesday, September 28, 2021

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Antioquia Acting Governor Luis Fernando Suarez announced just after noon today (Monday, May 3) that current travel and shopping restrictions will continue tomorrow (Tuesday, May 4) through at least Tuesday, May 11 because of continuing excessive Covid-19 infections.

Under the latest control scheme, “pico y cedula” shopping limits are reimposed on Tuesday, May 4, enabling trips for people with cedulas ending in 0 and 1, while those with cedulas ending in 2 and 3 can shop on Wednesday, May 5. On Thursday, May 6, people with cedulas ending in 4 and 5 can shop.

“Urgent basic food-supply shopping” is allowed on Friday, May 7 for those with cedulas ending in 6 and 7, while “urgent” shopping is also allowed for cedulas ending in 8 and 9 on Saturday, May 8.

Those with cedulas ending in 0 and 1 can do “urgent” shopping on Sunday, May 9, while those with cedulas ending in 2 and 3 can shop on Monday, May 10.

In addition to “pico y cedula” restrictions, curfews and liquor-sales bans are imposed daily from 8pm to 5am May 4 to May 6, then continually from 8pm  Friday, May 7 to 5 am Tuesday, May 11, according to the Governor.

As in recent Covid-19 restrictions, home deliveries of food and medicines are allowed, along with emergency and authorized trips.

Toronto-based PharmaCielo – owner of a medical-marijuana production and processing facility in the eastern Medellin suburb of Rionegro – on May 3 posted a full-year 2020 net loss of Cdn$43.7 million (US$35.6 million), worse than the Cdn$34.7 million (US$28 million) loss in 2019.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at a net loss of Cdn$23.5 million (US$19 million), worse than the Cdn$18 million (US$14.6 million) EBITDA net loss in 2019.

Revenues were the only bright spot in 2020, rising to Cdn$2.6 million (US$2.1 million), up from Cdn$787,000 (US$641,000) in 2019.

The company also reported a decline in cash and cash equivalents, to a total ofCdn$8.9 million (US$7.2 million) at December 31, 2020 compared to Cdn$13.7 million (US$11 million) at December 31, 2019. However, “subsequent to the quarter ended December 31, 2020, on April 7, 2021, the company closed an overnight marketed equity offering for gross proceeds of Cdn$13.5 million [US$11 million],” according to the company.

Commenting on the 2020 results, PharmaCielo CEO Henning von Koss stated that the year 2020 “was challenging for the world as a whole and PharmaCielo was not exempted. Despite these challenges, we accomplished several key operational milestones, particularly during the second half of 2020, which have positioned the company for growth through 2021.

“Since joining as CEO in December 2020, I have focused our team on streamlining operations, finishing the Processing and Extraction Centre (PEC) [in Rionegro] and aligning and strengthening our organizational structure, particularly on the sales side.

“The PEC is complete and operating with a unique combination of advanced upstream and downstream technologies that drive a broad portfolio including several value-add CBD, THC-free as well as high-THC content formulations. We are operating at a lower cost structure, and the organization is focused on execution, with recent entries into the UK, Swiss and Brazilian markets highlighting the success of our revised end market focus.

“The global cannabinoid supply chain continues to grow and mature. With our operational foundation complete and awareness growing, evidenced by growth in the number of potential customers requesting appointments to confirm GMP compliance, it is time to build-out a dedicated sales organization to secure PharmaCielo’s position as a preferred B2B supplier of cannabinoid inputs,” he concluded.

Medellin-based multinational foods manufacturing and retailing giant Grupo Nutresa reported April 30 that its first quarter (1Q) 2021 net profit rose 20.6% year-on-year, to COP$233 billion (US$62 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) also rose by 5.7%, to COP$397.5 billion (US$106 million), while sales rose 6.6%, to COP$2.8 trillion (US$746 million, according to the company.

Sales in Colombia rose 7.3%, to COP$1.7 trillion (US$453 million), while international sales rose 5%, to US$306 million, according to the company.

Gross profit rose 4.9% year-on-year, to COP$1.2 trillion (US$320 million), “the result of Grupo Nutresa’s increasing revenues and the higher costs of commodities associated to international prices, as well as the depreciation of several currencies in Latin America against the dollar,” according to the company.

Financial revenues declined 21.8% year-on-year, “due to lower interest rates on our cash investments during the period,” but financial expenses dropped 24.1% “mainly due to the lower cost of debt,” the company added.


Colombia-based Cemex LatAm Holdings reported a US$3.8 million net profit for first quarter (1Q) 2021, up sharply from a US$30.4 million net loss in 1Q 2020.

“Consolidated net sales during the first quarter of 2021 increased 7% on a like-for-like basis adjusted for currency fluctuations, compared to the first quarter of 2020,” according to the company. “Net sales improved in all countries except Panama.”

Cost of sales as a percentage of net sales increased 1.6pp during the quarter, from 59.4% in 1Q20 to 61.0% in 1Q21. The increase was mainly due to higher maintenance costs and higher variable costs in Nicaragua.

Operating expenses as a percentage of net sales decreased 2.7 percentage points during the latest quarter, from 28.3% in 1Q 2020 to 25.6% in 1Q 2021, “driven by our cost savings program,” according to Cemex LatAm.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for 1Q 2021 rose 12% in like-for-like terms, compared to 1Q 2020. EBITDA margin during 1Q 2021 also increased 0.8 percentage points versus 1Q 2020.

“The EBITDA margin expansion was mainly driven by higher volumes and lower selling, general and administrative expenses, despite higher maintenance expenses of US$5.7 million during 1Q 2021,” according to the company.

Net debt declined by US$35 million during 1Q 2021, to US$619 million. Free cash flow reached US$26 million in 1Q 2021 versus US$2 million in 1Q 2020.

“The improvement was mainly driven by a positive working capital effect and higher EBITDA,” according to Cemex. “Our average working capital days were negative during 19 days in 1Q 2021 versus seven negative days during 1Q 2020. Our financial expense decreased by US$2.4 million, or 18%, compared to the same period last year.

Net debt to EBITDA ratio improved to 3.4-times in March 2021, from 3.7-x in December 2020.

As for the rest-of-2021 outlook, “we are giving a strategic CAPEX estimate of US$40 million,” of which “US$35 million is related to the general development of our Maceo [Antioquia] cement plant project in Colombia,” according to Cemex.

Colombia Results

In Colombia, the cement/concrete industry “is experiencing robust growth, with the self-construction and infrastructure sectors as the main drivers of demand,” according to Cemex.

“Our cement volumes in Colombia grew 4% [during 1Q 2021], less than the industry in the quarter, mainly due to our pricing strategy and competitive dynamics.

“Our cement prices during the quarter improved by 4%, compared to the same period last year, and by 1% sequentially, in local currency terms.

“Despite the imposition of new [Covid-19 quarantine] containment measures in April, we believe the outlook remains favorable, supported by record home sales, the execution of existing 4G [fourth-generation] highway projects and the roll-out of new infrastructure programs,” the company added.

Central America Results

In Panama, 1Q 2021 cement volumes decreased 11% compared to the same period last year and improved 19% sequentially. “The industry's cement volumes remained weak during the first two months of the year, but showed signs of recovery in March,” according to the company.

In Costa Rica, “our cement volumes during the first quarter increased 7% due to better activity in the infrastructure and self-construction sectors. Our quarterly cement prices improved 2% compared to the same period last year, and 1% sequentially.

In Guatemala, El Salvador Nicaragua, “our cement volumes during the quarter improved by 16%, reaching the highest levels since 2016. Cement volumes increased in these three countries,” according to Cemex.

“In Guatemala, our cement volumes were driven by strong activity in the self-construction sector, a segment where we have a greater relative presence, as well as a gradual recovery in the formal sector. Our cement prices improved 1% compared to the same period last year and sequentially, in local currency terms.

“In Nicaragua, our cement volumes improved by 17% driven by the self-build sector, as well as government sponsored projects. Cement consumption during the quarter was also supported by the increase in remittances. Looking ahead, socio-political risks in the country could increase due to the presidential elections scheduled for November this year,” the company added.

EPM 1Q 2021 Net Income Rises 31% Year-on-Year

Wednesday, 28 April 2021 08:11 Written by

Medellin-based multinational electric power and utilties giant EPM announced April 27 that its first quarter (1Q) 2021 net income jumped 31% year-on-year, to COP$856 billion (US$230 million).

Revenues rose 18% year-on-year, to COP$5.6 trillion (US$1.5 billion), while earnings before interest, taxes, depreciation and amortization (EBITDA) rose 12%, to COP$1.7 trillion (US$457 million).

The company will hand-over COP$1.4 trillion (US$377 million) to the city of Medellin (its sole shareholder) this year thanks to continuing profits, according to EPM. To date, Medellin has already received COP$300 billion (US$81 million) of the 2021 projected profits, the company added.

EPM attributed its positive results to “a better result of commercial operations,” mainly because of “an increase in power generation, given the high water inputs and the reserves in the reservoirs” for its mainly hydroelectric power operations.

So far this year, EPM infrastructure investments total COP$511 billion (US$137 million), of which COP$257 billion (US$69 million) corresponds to the 2.4-gigawatt, US$5 billion "Hidroituango" hydroelectric project in Antioquia, according to the company.

Grupo EPM’s total assets during 1Q 2021 grew 1% year-on-year, to COP$64.7 trillion (US$17.4 billion), while liabilities rose 5%, to COP$$38.4 trillion (US$10.2 billion), resulting in COP$26.3 trillion (US$7.07 billion) in net equity, down 3%.

Financial indebtedness stands at 42%, while the debt/EBITDA ratio closed at 4.4 as of March 31, 2021, up from 3.80 at end-March 2020, according to the company.

Antioquia Governor Luis Fernando Suárez announced last night (April 24) that metro Medellin, the “oriente” region and the rest of Antioquia will continue restrictions on movements to Monday, May 3 because of overwhelming cases of Covid-19.

Curfews and bans on liquor sales will continue from 8 pm to 5 am daily to April 29.

Simultaneously, starting Monday, April 26, “pico y cedula” shopping restrictions only enable people with cedulas ending in 0 and 1 to make shopping trips.

On Tuesday, April 27, people with cedulas ending in 2, 3 and 4 can go shopping, while on Wednesday, April 28, shopping is permitted for those with cedulas ending in 5, 6 or 7.

On Thursday, April 29, shopping is permitted only for cedulas ending in 8 and 9.

As for Friday April 30, Saturday May 1 and Sunday May 2, a total quarantine is declared-- except for essential workers -- although home-delivery of food and medicines is allowed, along with emergency trips and authorized trips.

On the morning of May 1, Governor Suarez further announced a new order that abolishes a previous order that had allowed "essential food item" trips on Friday, April 30 and Sunday, May 2 for people with cedulas ending in even-numbers. The new order likewise abolishes shopping-trip rights for those with cedulas ending in odd numbers on Saturday, May 1. Only home deliveries and emergency trips are permitted on those days.

Hospitals jammed with Covid patients meanwhile report a critical shortage of oxygen tanks, partly because some now-recovered patients previously receiving home care have failed to return tanks to oxygen suppliers, Suarez warned.

As a result, even more extreme quarantine measures are being considered for all Colombia, while Antioquia might extend the current, existing restrictions to May 10, he cautioned.

The Antioquia departmental government’s Institute for the Development of Antioquia (IDEA) announced April 22 that it just signed an alliance deal with Medellin-based “green” project consultant Animal Bank.

Animal Bank is an initiative created by Medellin’s Portafolio Verde organization (see Medellin Herald 08/26/2019), which helps various commercial or industrial project developers to find novel ways to offset, avoid or minimize environmental impacts.

“IDEA will be a founding ally of Animal Bank, becoming the first public entity to support this initiative,” according to the agency. “The alliance will support the design, structuring and development of projects focused on the conservation of biodiversity.”

Animal Bank allies also include Renting Colombia (subsidiary of Bancolombia), Continental Gold, the Humboldt Institute of Colombia, Vanderbilt University and B Lab. Its board of directors includes environmental sustainability expert Brigitte Baptiste, rector of EAN University.

According to Portafolio Verde executive director Alejandro Zapata Arango, “through the management of partner organizations, the Animal Bank establishes sources of operation and financing that allow it to advance in the fulfillment of its purpose. Along this route, we have identified the importance of having the support of a public-sector company such as IDEA, an entity that shares the principles and meaning of [environmentally conscious] banking and that acts from a commitment to the development of society.”

The alliance between IDEA and Animal Bank “will contribute to the future of the territories and the next generations by creating social awareness with actions aimed at the efficient use of natural resources and carrying out collective work for the conservation of biodiversity,” according to the organization.

Sweden-based multinational personal-hygiene-products giant Essity announced last night (April 22) that it just paid US$1.54 billion to boost its shareholding in Medellin-based counterpart Grupo Familia to “at least 94%,” up from 50% previously.

According to company CEO Magnus Groth, “Essity has been a [partial] owner in Familia since 1985.With this acquisition we are building a stronger platform in Latin America to increase growth, profitability and efficiency as well as accelerate digital transformation.”

Grupo Familia has commercial operations in 13 Latin American and Caribbean countries and exports from Colombia to seven nations, selling personal-hygiene and paper products under the “Nosotras,” “Pequeñín” and “Familia” brands. The company just reported 2020 net income of COP$317 billion (US$87 million), up from COP$247 billion (US$68 million) in 2019.

Essity meanwhile has commercial operations in 150 countries, selling personal-hygiene and paper products under the “Tena” and “Tork” brands.

Essity’s net sales in 2020 amounted to SEK122 billion (US$14.5 billion), while full-year 2020 net profits came in at SEK11.7 billion (US$1.4 billion), up from SEK10.2 billion (US$1.2 billion) in 2019, according to the company.

“Essity's decision to acquire the majority shareholding of Productos Familia S.A. will help accelerate Grupo Familia's long-term growth strategy, ensuring its access to more markets in the region,” according to Familia.

“We are happy with this announcement and to start this new chapter in the success story of Grupo Familia,” added company president Andrés Felipe Gómez. “We know that by working more closely with Essity we can leverage innovation, build stronger and more sustainable brands, accelerate digital transformation and foster a culture more agile and enterprising,” he concluded.

Colombia President Ivan Duque announced April 21 that while 4 million Colombians have already received at least one shot of Covid-19 vaccine, that number will have topped 5 million by May 4, thanks to accelerating vaccination rates.

Meanwhile, Antioquia Acting Governor Luis Fernando Suarez revealed April 21 that 600,000 people in Antioquia (including metro Medellin) – 10% of its total population – have already gotten at least one shot, as 74% of the 703,000 doses provided to Antioquia through the national government’s “MiVacuna” program have been applied into arms.

Nationally, Colombia now has more than 40,000 trained and certified Covid vaccinators, with another 20,000 undergoing final training, President Duque added.

As a result, Colombia is on-track to boost vaccination capacity to 200,000 people daily, hence enabling the nation to meet its target of getting 35 million of the most-vulnerable Colombians (70% of the total population) vaccinated before year-end 2021, he said.

On the supply front, Pfizer just delivered another 550,000 doses of its vaccine to Colombia, while Sinovac will have delivered another 2 million of its vaccines by early May, he said.

In total, Colombia already has bought 67 million doses of Covid-19 vaccines, including 20 million through the “Covax” multinational consortium.

By pharmaceutical provider, Pfizer is providing 10 million doses (covering 5 million Colombians); AstraZeneca is providing 10 million doses (for 5 million people); Janssen (Johnson & Johnson) will deliver 9 million doses (covering 9 million people); Sinovac is providing 7.5 million doses (for 3.7 million people) and Moderna is providing 10 million doses for 5 million people, according to Colombia’s Health Ministry.

According to the Health Ministry, as of April 20, 896,839 Colombians 80 years and older had gotten at least one Covid shot (80% of that cohort), while 75% of front-line health workers (totaling 708,350 persons) likewise had gotten a shot.

One-third of Colombians 70 to 79 years old meanwhile have gotten at least one shot, while 89,360 persons 65 to 69 years old have gotten a shot to date, according to the Ministry.

In May, the national vaccination campaign extends to persons 18 to 59 years old -- if they suffer medical co-morbidities, including those with cardiovascular and pulmonary diseases, as well as those with cancer, AIDs and other diseases, according to the Ministry.

EPM’s problem-plagued, US$5 billion “Hidroituango” hydroelectric project is facing yet another threat from a new assets-embargo order brought by Colombia’s Comptroller-General against one or possibly all of the Hidroituango construction contractors.

In an April 21 press conference, EPM general manager Jorge Andrés Carrillo Cardoso cautioned that the full, immediate impact of the Comptroller’s surprise embargoes – aiming to grab COP$4 trillion (US$1.1 billion) from the Hidroituango contractors -- has yet to be analyzed completely, via continuing discussions with the involved contractors.

The contractors meanwhile retain rights to appeal the Comptroller embargoes -- possibly enabling continuation of their Hidroituango project work, while some future appeals process proceeds.

While EPM continues to hold the required financing for the project, the Comptroller embargoes potentially could savage the finances of the contracting companies, causing them to stop work – resulting in enormously costly delays that could have consequences for EPM’s finances, even though EPM has a “contingency plan” for replacing contractors.

One such rumored "contingency plan" is to hand the Hidroituango project to China Three Gorges company, a Chinese state-owned construction contractor. In furtherance of this aim, the Chinese government last year published a fawning report in the state-owned People's Daily newspaper on Medellin Mayor Daniel Quintero, sparking rumors that Quintero is cultivating a strategic "friendship" for his future political career.

However, EPM isn't yet saying what the future plan is for Hidroituango if the current contractors are ruined by the Comptroller. “The information we have at this time is still very preliminary and is being analyzed by each of the parties and related companies,” EPM GM Carrillo stated at the press conference.

Just prior to the press conference, EPM issued a bulletin stating that “it has been reported that Integral SA and possibly the other EPM contractors in the Hidroituango project had their accounts seized by the Comptroller General of the Republic within the framework of the fiscal responsibility process” -- a process first unveiled by the Comptroller last December (see Medellin Herald 12/03/2020, “Colombia’s Comptroller-General Blames Hidroituango Contractors, Former Officials, Politicians for US$1.18-Billion in Losses at Hidroituango Project”).

“EPM is not a party to such processes and has not received notification, nor have its accounts been seized. In accordance with the foregoing, EPM at this time is not in the capacity to report if such measures have any effect for the company or for the project,” the EPM bulletin concluded.

EPM’s Carrillo added at the press conference that once the company completes its analysis of the immediate impact of latest Comptroller actions, it will issue a public statement explaining its plans for completing the Hidroituango project.

As of this moment (1 pm Tuesday, April 21), the only publicly available document from the Comptroller specifies the seizure of certain bank accounts and real-estate properties held by Hidroituango construction consultant Integral SA.

However, this same document also states that “responsible companies” involved in the Comptroller's COP$4 trillion demand include all the Hidroituango consortia members including Camargo Correa, Conconcreto, Coninsa Ramon H, Ferrovial Agroman Chile, Sainc Ingenieros Constructores, Ingetec, Sedic, and third-party project insurors including Mapfe, Seguros Generales Suramericana, Axa Colpatria and SBS Seguros Colombia.

“Affected parties” named in the demand include the Hidroituango S.A. corporate entity, EPM, the Antioquia government’s Instituto para el Desarrollo de Antioquia (IDEA), EPM subsidiary Central Hidroeléctrica de Caldas (CHEC), Colombia’s national energy finance agency FEN as well as the Colombian national government.

Also named in the complaint as "responsible parties" are a host of former Medellin and Antioquian mayors and governors as well as former EPM and Hidroituango project officials, according to the Comptroller document.

Late Wednesday, April 21, the Hidroituango construction consortium issued a press bulletin stating the following: "The CCC Ituango Consortium and the companies that make it up have not received any communication by the Office of the Comptroller General of the Republic nor from our financial providers, on the imposition of embargoes on their accounts.

"During the  fiscal responsibility process we have provided all the information necessary to clarify the allegations raised by the Comptroller and demonstrate that in the execution of civil works under our charge, we have always acted in good faith, diligently and in accordance with the good practices of the engineering, complying with the designs and instructions provided by EPM."


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About Medellin Herald

Medellin Herald is a locally produced, English-language news and advisory service uniquely focused upon a more-mature audience of visitors, investors, conference and trade-show attendees, property buyers, expats, retirees, volunteers and nature lovers.

U.S. native Roberto Peckham, who founded Medellin Herald in 2015, has been residing in metro Medellin since 2005 and has traveled regularly and extensively throughout Colombia since 1981.

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