Coltejer Sees 2023 Profit Rebound in Clothing Imports, Property Revaluations
Medellin-based Coltejer – for more than 100 years a historic giant in Colombian textile production, but not anymore – on November 14 reported a third quarter (3Q) 2023 net profit of COP$52 billion (US$12.7 million) — a huge improvement over the COP$20.7 billion (US$5.06 million) net loss in 3Q 2022.
As for nine-months (January through September) 2023, net income rose to COP$77.8 billion (US$19 million), a huge improvement over the COP$58 billion (US$14 million) net loss for nine-months 2022.
The improvements were credited to a “decrease in the [Colombian peso-U.S. dollar] exchange rate during the year to date [hence reducing import costs], plus recognition of the fair value of some investment properties,” which “momentarily compensated for maintaining suspension of the operational activities for production of flat and nonwoven fabrics” here in Colombia, according to Coltejer.
However — on the down side — in both 2022 and 2023 Coltejer “sold some imported products, whose purchase prices have been affected by the variability in the exchange rate — variations that had not been fully absorbed by the sales price — in addition to the fixed costs” for maintaining the company’s shuttered textile plants here.
On the other hand, “an increase in operating profit for the latest quarter is observed basically due to the 40% increase in income — and also because at the end of 2022, the contracts of workers who had been linked for much of 2022 were terminated,” meaning former salaries and social-benefit costs have disappeared this year.
As for nine-months 2023 results, Coltejer cited a big drop in inventories of imported fabrics “that the company continues to carry with the intention of generating cash flows that allow us to cover our operating expenses.”
As for operating income, “a considerable increase is observed [in 2023], basically due to the recognition of the increase in the fair value of some investment properties, a situation that did not occur in 2022,” the company noted.
As for the increase in before-tax profits this year, this improvement came “basically due to the positive exchange rate differential and the aforementioned increase in [real estate] fair value,” Coltejer added.
