Friday, February 21, 2020

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Uber-Colombia announced February 20 that it’s relaunching computerized application-based alternative taxi services, which had been terminated February 1 because the Colombian government ruled that Uber had failed to comply with all legal requirements for such services.

According to the announcement (in Spanish, see: https://www.uber.com/es-SV/blog/uber-se-reinventa-por-colombia/) the newly revised service, “which is temporary, allows [customers] to reach [their] destination by renting a car with a driver. How? By accepting a contract through our application on each occasion and each product, with one additional click.

“In addition, you can customize the conditions of your experience with the [vehicle operator], such as deciding the route you want to follow or the music you want to listen to.

“We want to build an inclusive, flexible, friendly and accessible community for all ... It is our commitment to Colombia. #UberSeReinventaPorColombiaUber reinvents itself to operate again in Colombia and is already providing services.

“Starting at 8 a.m. today February 20, Uber restarted its operation in Colombia . . . We will also offer various services that include traditional and new media such as taxis, so that everyone has the opportunity to take advantage of technology to provide a better service.

“The new platform will offer five services to Colombians: By hours [PorHoras], which will allow people to rent a vehicle with a driver and pay for the time they use it; ‘UberYa,’ with which people can rent a vehicle with driver to move around the city in an agile and reliable way.

“Another of the services will be ‘Economy,’ by which you can rent vehicles with a driver that will include vehicles with not-so-recent models, which can be accessed at a lower price, and will not be available in all cities of Colombia.

“’Comfort’ will be the premium alternative with which you can rent more modern vehicles with driver; ‘Uber XL’ will be aimed at large groups and advise dividing the rental price among all to save,” according to the company.


Medellin-based multinational retail grocery and dry-goods marketer Grupo Exito announced February 19 that its full-year 2019 net profits came-in at COP$57.6 billion (US$16.9 million), down sharply from the COP$253 billion (US74$ million) in 2018 when the company still included Brazil operations (since sold).

“The result was impacted by variations in the tax [regimes], the contribution of international operations and performance of the units registered as discontinued,” according to Exito.

While profits (as measured in total pesos) dipped, operating income rose 6.3% year-on-year, to COP$15.3 trillion (US$4.5 billion) in 2019, versus COP$14.8 trillion (US$4.3 billion) in 2018, with electronic commerce, large-format sales and home-delivery sales representing 75% of the sales growth.

Recurring earnings before interest, taxes, depreciation and amortization (EBITDA) rose slightly year-on-year, at COP$1.28 trillion (US$376 million).

Colombia sales were the best in three years, up 4.8% year-on-year, according to the company, to COP$11.75 trillion (US3.4$ billion), according to the company.

“The results of Colombia are due to the cost-effective implementation of innovative value formats (Exito Wow, Carulla Freshmarket and Surtimayorista) and the execution of the omnichannel strategy (electronic commerce and domiciles),” according to Exito.

“E-commerce sales channels grew 37% in 2019 and represent 4.5% of sales in Colombia, compared to 3.4% in 2018,” the company added.

“The positive results of the Grupo Éxito operation in Colombia show the assertiveness in the development of strategies leveraged in innovation and transformation:

“1. Expansion of value formats: Éxito Wow closed 2019 with nine stores under this format, growing 13.4% of its sales and representing 17.5% of the total sales of the Éxito brand.

“2. Carulla FreshMarket, the concept of the group's premium brand that offers customers multiple experiences, fresh, healthy products and superior service, ended 2019 with 13 points of sale in the country, which grew sales by 12. 7% compared to the previous year and represented 17% of Carulla's total sales.

“3. Carulla SmartMarket, the smart commerce laboratory that opened its doors last December, offers its customers new experiences that reduce their shopping time, also integrating the concept of Carulla FreshMarket and important sustainability initiatives such as plastic use reduction. This proposal had an investment of COP$4 billion (US$1.17 million) and has about 20 technological formats.

“4. Surtimayorista, the format designed for professional customers and final consumers, completed 30 stores and consolidated in the central area of he country. Sales of the cash and carry format brand grew 17.8% in 2019 compared to the previous year.

“The e-commerce platforms exito.com and carulla.com had more than 86 million visits, 40.4% more than in 2018. Orders for these channels achieved 441,000 shipments in 2019.

“The ‘market place’ (virtual platform at the service of other companies) increased its sales by 29.4% in 2019 compared to the previous year.

“The ‘last- mile’ [home delivery] service had double-digit growth in the number of shipments in the year, and digital catalogs of 42%. For its part, the ‘Click & Collect’ service (purchase and pick up) increased the number of its orders by 25%,” the company added.


Medellin-based multinational electric power giant EPM announced February 19 that its board of directors gave formal approval for the company to bid on the “CaribeMar” power company in Bolívar, Cesar, Córdoba and Sucre departments in Colombia.

If EPM were to win the auction, then its national share of the Colombia power market would jump to 35% (19 million customers), up from 23% today.

“After an exhaustive and comprehensive analysis process, the EPM board of directors in its session on Wednesday, February 19 approved that the company present the documentation for its participation in the auction process of the shares of ‘CaribeMar,’ one of the two companies that will arise from the separation of markets of Electricaribe,” according to EPM.

Following the financial collapse of Electricaribe and a subsequent national government takeover, the government decided to split the auction of its assets into two parts: CaribeMar (Bolívar, Cesar, Córdoba and Sucre) and CaribeSol (Atlántico, Magdalena and La Guajira).

“Entering CaribeMar means for EPM a unique growth opportunity to reach the Atlantic coast market and provide its service to 1.5 million customers. CaribeMar represents approximately 12% of the share of the national energy market,” according to EPM

As noted in a separate report last month by Colombian business newspaper Portafolio, the “CaribeMar” portion of the former Electricaribe company includes 65% of the hotel sector of the tourist-popular Caribbean coast as well as many large industrial and commercial customers.

While Electricaribe has historically suffered from widespread theft of electric power through illegal connections, the “CaribeMar” area suffers less than the “CaribeSol” area, according to that report.

Not mentioned in the Portafolio report -- but widely known here in Antioquia and admired by power-experts internationally -- is that EPM pioneered the development of low-cost, pay-as-you-go metering systems that avoid power theft, especially in low-income neighborhoods.

This novel system enables people to buy “power cards” (similar to credit cards) in ubiquitous neighborhood stores. These cards provide a certain number of kilowatt-hours at subsidized power prices. Hence people on limited budgets buy only the power they actually want -- at affordable prices -- rather than stealing power through illegal connections and subsequently wasting “free” power by profligate usage, irrespective of actual need.

Colombia’s Energy Ministry announced last year that following years of debate over how to resolve chronic financial losses and massive power thefts at Electricaribe – with a resulting lack of investment in required infrastructure -- the government decided to assume COP$1.2 trillion (US$353 million) in Electricaribe’s pension liabilities, and then sell-off the assets to other power companies with better track records and greater financial muscle.

Electricaribe divisions will require about COP$8 trillion (US$2.35 billion) in infrastructure investments over the next 10 years, according to the Energy Ministry.

Meanwhile, upper-middle-class and wealthier residential power customers (“estratos 4,5 and 6”) throughout Colombia have been paying a special COP$4 (US$0.001) per-kilowatt surcharge to help Electricaribe limp along until new owners are found, the Energy Ministry noted.


Medellin-based multinational cement/concrete giant Cementos Argos on February 14 announced the debut of a US$78 million “green cement” processing facility at its 2.3 million tonnes/year Rioclaro, Antioquia cement plant.

The new technology cuts carbon dioxide (CO2) emissions by up-to-38% while cutting energy consumption by 30%, according to Argos.

“For the first time in Colombia is this type of cement produced, in which a porrtion of the traditional ‘clinker’ raw material is replaced by thermally activated clays (artificial pozzolana),” according to Argos.

The new facility thermally activates 450,000 tonnes/year of certain clays used in Portland cement production.

“With this project we are leading the industry and sowing the seeds of the Argos of the future, which starts today a new production line in Rioclaro, but which has a gigantic growth potential in all geographies,” added Cementos Argos President Juan Esteban Calle.

The new facility also “allows Argos greater flexibility and positions it as the first cement producer in Colombia to offer its customers a broad portfolio of products,” according to Argos.

“The entry into operation of this new [production] line, added to the modern Cartagena [Colombia] plant and other facilities in the national geography, gives Argos the largest installed capacity in the country for the production of cement and concrete,” the company added.


Colombia-based aviation giant Avianca announced February 13 the launch of its new “Avianca Express” division for new routes including flights from Medellin’s downtown Olaya Herrera airport (EOH).

Absent from EOH for 20 years, “Avianca Express” soon will launch flights utilizing ATR-72 propeller aircraft to and from downtown Medellin -- initially serving Quibdó, Montería and Bucaramanga, starting March 30.

“Given the importance of Medellín as a development hub in the Colombian territory, the Olaya Herrera airport will be one of the most robust foci of operations that Avianca Express will have to connect the regions of the country,” according to the company.

Avianca Express also announced new flights to-and-from Bogota to cities including Corozal, Florencia, Ibagué, Manizales and Villavicencio, according to the company.

Medellin is the only city in Colombia with two airports: Downtown EOH for domestic flights mainly to smaller cities, and Jose Maria Cordova (JMC) international airport in the eastern Medellin suburb of Rionegro.


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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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