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Written by February 22 2020 0

Medellin-based multinational foods manufacturer Grupo Nutresa on February 21 reported a 5.2% year-on-year net income boost for full-year 2019, to COP$513 billion (US$152 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 13.5% year-on-year, to COP$1.3 trillion (US$385 million), while sales jumped 10.5% to COP$9.9 trillion (US$2.9 billion).

For fourth-quarter (4Q) 2019, profits inched-up by 0.9% year-on-year, to COP$508 billion (US$150 million), while EBITDA rose 19.6%, to COP$1.1 trillion (US$325 million).

Full-year 2019 sales in Colombia grew 8.1% year-on-year, hitting COP$6.2 trillion (US$1.8 billion). Colombia sales were 62.3% of total global sales.

International sales increased by 14.5% in Colombian-peso terms, hitting COP$ 3.76 trillion (US$1.1 billion), or 3% higher year-on-year in U.S.-dollar terms.

“More than 80% of this [corporate-wide] growth is driven by higher volumes registered in all the business units of the group,” according to Nutresa.

“Gross profit for the period amounts to COP$4.4 trillion [US$1.3 billion], with a decrease in the gross margin of 0.8% compared to that of 2018, because of an increase in the cost of some raw materials and the [COP-to-U.S. dollar] exchange rate associated with several [operating units] during the year,” the company added.

As for non-operating revenue-and-costs impacts, Nutresa recorded a 22.2% increase in financial expenses “due to the recording of the liability obligation derived from the IFRS 16 accounting standard. The expenses corresponding to the group’s interest-on-debt decreased as a result of lower rates of financing,” the company added.

Written by February 22 2020 0

Medellin-based multinational cement/concrete producer Cementos Argos on February 21 reported US$37 million net income for full-year 2019, a 39% decline year-on year as measured in U.S. dollars.

Revenues were essentially flat at US$2.85 billion in 2019 versus US$2.84 billion in 2018, while earnings before interest, taxes, depreciation and amortization (EBITDA) rose 2.9% year-on-year, to US$535 million.

Fourth-quarter (4Q) 2019 net income fell 39% year-on-year, to US$48.8 million, but 4Q 2019 EBITDA rose 7.1% year-on-year, to US$479 million. Gross revenues rose 3.7%, to US$686 million.

“In the United States -- the company’s main market -- cement sales reached 6.3 million tons, with record growth of 9.5% or around 545,000 tons,” according to Argos. U.S. market revenues rose 7.8% year-on-year, to US$1.6 billion, while EBITDA rose 12%, to US$268 million.

Corporate-wide across all markets, Cementos Argos dispatched 16 million tons of cement (up 0.6% over 2018) and 10 million cubic meters of concrete (down 1.5%) in 2019.

“These volumes reflect a positive growth of the demand in the United States, the still-challenging market conditions in Honduras and Panama and the short-term effect of the strategy to recover prices in Colombia,” according to the company.

"In Colombia, a significant price recovery was achieved, supported by good growth in demand and growing acceptance of Argos' value proposition, both in the mass markets and industrial markets,” according to the company.

“Of the 34 countries in which the company sells, measured in U.S. dollars, Colombia has the lowest-priced cement,” which discourages imports competition, according to Argos.

Despite advantages in cement prices and value proposition, Colombia results were affected by “high inflation of fuel costs, which increased 7.14% in 2019, especially due to the increase in the internal price of coal during the first semester,” according to the company.

Argos also suffered a temporary decline in sales because of a landslide near its Rioclaro, Antioquia plant, which caused a 13-day closure of the Medellin-Bogotá highway.

As a result, Colombia cement volumes dipped 3% year-on-year and concrete sales fell 5.3%, according to the company.

Despite those setbacks, Colombia 2019 revenues nevertheless rose 3.8% year-on-year, to COP$2.3 trillion (US$677 million), while Colombia EBITDA rose 20% year-on-year, to COP$522 billion (US$153 million), according to the company.

“The Colombian market continues to show a positive growth trend,” according to Argos. “Important infrastructure, housing and commercial buildings projects continue to drive the development of the sector.”

On the other hand, in its Caribbean and Central America regional markets, Argos faced “significant challenges due to the short-term difficulties facing the economies of Honduras and Panama.” Nevertheless, Argos “managed to compensate to some extent the impact on the results with the growth of exports and the good performance of operations in the Dominican Republic and Haiti,” according to the company.

Even so, the Caribbean/Central America region “remains the most profitable for the company in terms of EBITDA margin and return on capital employed,” according to Argos.

Written by February 21 2020 0

Medellin-based electric power giant Celsia on February 20 announced that its full-year 2019 net income rose 72% year-on-year, to COP$603 billion (US$177 million),

Earnings before interest, taxes, depreciation and amortization (EBITDA) likewise rose year-on-year, to COP$1.26 trillion (US$370 million), while gross revenues increased 9%, to COP$3.7 trillion (US$1.08 billion), according to the company.

Fourth-quarter (4Q) net income also rose 77% year-on-year, to COP$191 billion (US$56 million), while EBITDA rose 20% and revenues climbed 7%.

Celsia credits the growth in revenues and profits in part to the sale of its former Free Zone thermal power plant and also the acquisition of electric power distribution and marketing operations in Tolima.

Other 2019 highlights included “creation of platforms for investment for the development of medium and large-sized solar projects,” build-out of more transmission assets, and “the beginning of the development of a thermal power project with the size appropriate to [maintaining power-output] balance,” paired with its intermittent renewable-power generation.

Colombia revenues accounted for 84% of the consolidated total, with Central America accounting for the other 16%.

“Income generation in Colombia during the [fourth] quarter totaled COP$210 billion [US$61.8 million] – up 29% -- excluding the effects of the [sale of the Free Zone power plant] in 2018,” according to Celsia.

Total power generation in the latest quarter was 1,037 gigawatt-hours (GWh), down 29% mainly because of the sale of the Free Zone power plant in 2018. “If we exclude Free Zone from that figure, the decrease is 7%, explained by lower hydropower generation,” according to Celsia.

The company closed 2019 with a debt of COP$3.8 trillion (US$1.12 billion), down COP$713 billion (US$210 million) compared to the third quarter of 2019. “We continue to reduce net debt/consolidated EBITDA,” according to Celsia. “At the end of 2019, the ratio was 2.71 times, lower than the 3.9 times recorded at the end of the first half of 2019.”

As for social-environmental initiatives, Celsia boasted that it planted 4.3 million trees around 30 municipalities of Valle del Cauca, plus two areas in Antioquia and one in Tolima, restoring more than 3,300 hectares through the “ReverdeC” program.

The company also invested in voluntary and compulsory social-impact-compensation programs including energy and water upgrades for various schools; road construction projects; and development of cultural, sports and health activities, according to the company.

Celsia is a division of Medellin-based power, cement and airport/highway concessionaire Grupo Argos.

Written by February 20 2020 0

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: 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.

Written by February 20 2020 0

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 and 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.

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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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