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Companies 393

Written by February 27 2021 0

Medellin-based multinational foods giant Grupo Nutresa reported February 26 that its full-year 2020 net income rose 14.3% year-on-year, to COP$575 billion (US$158 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 7.2%, to COP$1.44 trillion (US$395 million), while revenue rose 11.7%, to COP$11.1 trillion (US$3.04 billion).

Sales in Colombia grew 7.9%, to COP$6.7 trillion (US$1.8 billion). International sales increased 18.1%, hitting COP$4.4 trillion (US$1.2 billion).

Gross profit totaled COP$4.7 trillion (US$1.29 billion), up 6.1%. The gross profit increase was lower than the growth in revenues “mainly due to higher commodities prices in some countries of our strategic region,” according to Nutresa.

Operating profit reached COP$1 trillion (US$274 million), up 6.6%. “This is the result of consistent work focused on administrative, sales and production expense efficiency and productivity during a period that demanded additional efforts to protecting the people and guaranteeing the continuity of the operation,” according to the company.

“Net post-operative expenses amounted to COP$204 billion [US$56 million] 9.0% lower than last year. This is explained by a 7.8% increase in financial revenue as a result of Grupo Nutresa’s good cash position over the year and a 6.4% reduction in the financial expenses from lower financing rates,” the company added.

Grupo Nutresa has food production and distribution operations in Colombia, Chile, Costa Rica, Guatemala, México, Panamá, the U.S, Venezuela, Ecuador, El Salvador, Nicaragua, Perú, Dominican Republic and Malaysia.

Its main product-and-service lines (some of them franchised) including coffees, chocolates, ice creams, pastas, biscuits/crackers, meats and fast-food restaurants. Major brands include Noel, Starbucks, Papa John’s, El Corral, Zenu, Chocolates Corona, Jet, MontBlanc, Sello Rojo, Colcafe, Matiz, Lucchetti, Crem Helado, Doria and Monticello.

Written by February 26 2021 0

Medellin-based highway construction giant Construcciones El Condor revealed February 25 that its full-year 2020 net income dipped 14% year-on-year, to COP$31 billion (US$8.5 million).

Gross revenues also dipped 7% year-on-year, to COP$825 billion (US$226 million), according to the company.

Covid-19 shutdowns during March-to-May 2020 caused some of the revenue and profit declines.

In addition, 2020 profit differences versus 2019 are partially explained by a one-time, COP$40 billion (US$10.9 million) boost in income in 2019, via the sale of El Condor’s stake in the “Tunel de Oriente” highway project between Medellin and its eastern suburbs. No such large-scale sales benefitting El Condor occurred in 2020.

“We also emphasize that the 2020 revenues are not comparable with those of the previous year because the paralysis in the mandatory quarantine on the occasion of the Covid-19 pandemic implied the non-execution of works from the end of March to May, and the resumption of these at levels lower than normal during the months of May, June and July,” according to El Condor.

“Additionally, the effects of the ‘La Niña’ weather phenomenon generated an increase in rainfall above the average during the second half of 2020, generating impacts on the execution of works with respect to the budgeted [planning] curves.

“The company assumed during all those months of paralysis the idling costs, the stand-by costs of machinery and equipment and production facilities,” although government road-building contracts also include compensation mechanisms, which eventually would help offset those extra costs, according to El Condor.

Earnings before interest, taxes, depreciation and amortization (EBITDA) came-in at COP$100 billion (US$27.4 million), with an EBITDA margin of 12.62%, down sharply from 18.5% in 2019.

However, “we consider that the EBITDA margin is not comparable, because during 2020 the company could not carry out work at the usual rate and assumed all the costs” of the Covid-19 shutdowns and weather issues. “If this paralysis had not occurred, then the EBITDA margin would have been in a range between 17 to 18%,” according to El Condor.

Future anticipated earnings – the backlog of works contracted and to-be-executed -- stood at COP$1.1 trillion (US$27.4 million) at year-end 2020, the company added.

Written by February 26 2021 0

Medellin-based insurance, health care, pensions and investment giant Grupo Sura announced February 26 that its full-year 2020 net income fell 80% year-on-year, to COP$336 billion (US$91 million) as a result of the Covid-19 crisis.

Operating revenues dipped 2.3% year-on-year, to COP$20.8 trillion (US$5.6 billion), while operating income fell 44%, to COP$1.6 trillion (US$435 million), according to the company.

The Sura Asset Management division (pension funds, investments and asset management) net income fell 39% year-on-year, to COP$431 billion (US$117 million), although assets under management rose 8.4%, to COP$523.9 trillion (US$152.6 billion), according to the company.

The Suramericana division (insurance and risk-management) net income fell 46%, to COP$211 billion (US$57.2 million), on COP$18.7 trillion (US$5 billion) in premiums for sectors including life, property, health care, automotive and computer digital insurance.

“The generally good levels of performance throughout the region with regard to property and casualty insurance, especially in Argentina, Chile and Colombia, largely offset higher claims for the life insurance segment as well as higher health care expense incurred with the pandemic,” according to Sura.

In total, Grupo Sura allocated COP$1.4 trillion (US$379 million) during 2020 “in order to address the pandemic on all fronts,” mainly including health-care services and financial aid to stricken patients, families and businesses, according to the company.

Despite the heavy costs, Sura nevertheless cut its debt and foreign exchange exposure and “secured the liquidity required to meet its upcoming financial obligations in 2021 and improve its debt profile in the medium-term,” according to the company.

Suramericana’s “mandatory health care subsidiary in Colombia expanded its telemedicine capabilities, providing more than 19.5 million health care services during the pandemic, thereby ensuring a substantially lower death rate of just 0.63% among infected patients, which was a quarter of that recorded nationwide (2.63%) and a third of the world average (2.18%), at the end of 2020,” according to the company.

As for Sura Asset Management, “the procedure for our clients to withdraw their [annual employer bonus] severance payments was expedited and made more flexible in Colombia, the same applied to those claiming unemployment insurance in Chile and Mexico, this so as to help those who lost their jobs due to the pandemic. Various types of financing funds were also made available, thereby providing liquidity to 1,282 small and medium-size companies in Colombia, Peru and Chile,” according to the company

At year-end 2020, Sura boasted of 37.5 million clients in 10 countries in Latin America.

“Thanks to the ability of our subsidiaries to adapt, maintain their pace of business performance as well as increase client loyalty, together with the benefits of Grupo Sura’s well-diversified portfolio, we were able to partially offset the impact of the volatility prevailing on the capital markets on the subsidiaries' own investment performance as well as the drop in revenues received from [stock holdings in other companies] via the equity method, especially from Bancolombia,” explained Ricardo Jaramillo, Chief Finance Officer.

Written by February 25 2021 0

Medellin-based Grupo Argos – parent of cement/concrete giant Cementos Argos, electric power producer Celsia and highway/airport concessionaire Odinsa – on February 24 reported an 87.7% plunge in 2020 net income, to COP$154 billion (US$43 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) fell 30% year-on-year, to COP$3.35 trillion (US$935 million), while EBITDA margin dipped to 24%, from 28.5% in 2019.

Operating income also fell by 16.7% year-on-year, to COP$14 trillion (US$3.9 billion), according to the company.

Facing the impact of the Covid-19 pandemic, “a shock-and-austerity plan allowed the company to ensure liquidity of COP$3.4 trillion [US$947 million] through operational savings, rationalization of investments and expenses, liquidity credits and tax refunds,” according to the company.

As a result, the company “managed to close with the same level of consolidated net debt in a year with a high cash requirement,” according to Argos.

“During 2020 the company implemented a crash plan that allowed it to achieve efficiencies in operating expenses by COP$541 billion [US$151 million] and postpone investments totaling COP$1.4 trillion [US$390 million] that gave it greater flexibility to adequately face the situation.

“Additionally, we obtained credits totaling COP$1.4 trillion [US$390 million] to guarantee liquidity and that during the year were duly prepaid thanks to the solid cash generation of the organization,” the company added.

As for its three main business units, the fourth quarter of 2020 began to show improvements, the company noted:

Cementos Argos closed the fourth quarter with 4 million tons of cement sold, 2% higher than the volume of the same period of 2019;

Celsia closed the fourth quarter with 876 gigawatt-hours sold, “in line with what was registered in the same quarter of the previous year,” according to the company.

Odinsa reported a total of 123,000 vehicles per day going through its toll booths in December 2020, 3% lower than 2019, while the El Dorado Airport in Bogota registered 1.4 million passengers in December 2020, 54% lower compared to December 2019, “but with a marked recovery compared to the months of total closure” in 2020, the company noted.

Written by February 25 2021 0

Medellin-based multinational banking giant Bancolombia announced February 24 that its full-year 2020 net income fell 91% year-on-year, to COP$276 billion (US$77 million), down from COP$3.1 trillion (US$917 million) in 2019.

As for fourth quarter (4Q) 2020, Bancolombia posted a net loss of COP$266 billion (US$74 million), down from COP$878 billion (US$260 million) in 4Q 20219, according to the company.

As for its Colombia national operations, Bancolombia posted a 4Q 2020 net loss of COP$253 billion (US$71 million) here, a huge reversal from 4Q 2019 positive net income of COP$397 billion (US$111 million) in Colombia.

Corporate-wide, gross loans in 4Q 2020 totaled COP$191 trillion (US$53.6 billion), up 5% from 4Q 2019 but declining by 3.7% during the last quarter. Colombian peso-denominated loans in 3Q 2020 grew 5.8% when compared to 4Q 2019, according to the company.

Loan provision charges for the last quarter were COP$2 trillion (US$561 million), up 20% compared to third-quarter (3Q) 2020, while the coverage ratio for 90-day past due loans was 213.2%.

“This level of provisions was largely explained by the deterioration of the consumer portfolio, Covid-19 and the update of macroeconomic variables in our expected losses models,” according to Bancolombia.

Meanwhile, Bancolombia continued to boost its electronic banking strategy in 2020 “with a robust growth in its mobile platforms. As of December 31, 2020, the bank has 9.4 million digital accounts, 4.6 million users in ‘Bancolombia a la Mano’ and 4.8 million in ‘Nequi,’” according to the company.

“Shift of sales to digital channels continues to grow. During 2020, Bancolombia managed to distribute more than 3 million products through its web and mobile platforms, which represents 44% of the total sales completed in all channels,” the company added.

As of December 31, 2020, company operations at Banco Agricola in El Salvador, Banistmo in Panama and BAM in Guatemala represented 26% of total gross loans.

“Gross loans denominated in currencies other than COP, originated by the operations in Central America, the offshore operation of Bancolombia Panama, Puerto Rico and the U.S. dollar-denominated loans in Colombia, accounted for 32.3% and decreased by 12% during 4Q 2020 (when expressed in COP),” according to the company.

“Total reserves -- allowances in the balance sheet -- for loan losses increased by 9.9% during the latest quarter and totaled COP$16.6 trillion [US$4.65 billion], equivalent to 8.7% of gross loans at the end of the quarter,” the company added.

At year-end 2020, Bancolombia’s net investment portfolio totaled COP$29.5 trillion (US$8.3 billion), up 6.6% from 3Q 2020 and up 75.7% from 4Q 2019.

Liabilities at year-end 2020 totaled COP$227.4 trillion (US$63.8 billion), down 3.7% from the end of 3Q 2020 but up 9.7% compared to 4Q 2019, according to the bank. Deposits by customers totaled COP$180 trillion (US$50.5 billion), equal to 79.5% of liabilities, at year-end 2020 -- down 1.5% when compared to 3Q 2020 but up 15% compared to year-end 2019.

“The net loans-to-deposits ratio was 96.7% at the end of 4Q 2020, decreasing when compared to 100% at the end of 3Q 2020,” but “Bancolombia’s liquidity position continues to be adequate. During 4Q 2020, total funding cost indicates the undertaken efforts to sustain a high share of deposits over the total funding mix,” the company concluded.

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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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