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Companies 476

Written by November 04 2021 0

Medellin-based multinational supermarket and dry-goods retailer Grupo Éxito announced November 3 that its third quarter (3Q) 2021 net income rose 144% year-on-year, to COP$126 billion (US$32.8 million).

Recurring earnings before interest, taxes, depreciation and amortization (EBITDA) rose 42%, to COP$353 billion (US$92 million), while sales rose 13.5%, to COP$3.98 trillion (US$1.04 billion), according to the company.

In Colombia, sales rose 14.3% year-on-year, to COP$3 trillion (US$782 million), “the best quarterly increase in recent years,” according to Éxito. Recurring EBITDA margin in Colombia was 8.7% over operating income -- 200 basis points more -- compared to the same period of 2020 and 8.5% so far this year.

“The higher levels compared to those reported in 2020 and 2019 reflect the operational efficiencies achieved in the midst of a recovery in consumption due to the economic reactivation” happening in Colombia, according to Éxito.

The jump in EBITDA is the result of Exito’s “strategy focused on innovation and omnichannel and optimal control of expenses in the three countries” where in operates: Colombia, Uruguay and Argentina.

In Colombia, electronic and direct commerce channel sales accounted for 12.2% of total sales, indicating that “virtual commerce is here to stay,” according to Éxito. Such sales in Colombia hit COP$344 billion (US$89 million) during 3Q 2021, the company added.

Meanwhile, “the innovative formats ‘Éxito Wow’ and ‘Carulla FreshMarket’ continue to be important levers of differentiation and competitiveness; the first represented 27.8% of Éxito's total sales and the second, 36.2% of Carulla,” according to the company.

“The diversification strategy of complementary businesses -- mainly financial and real estate -- continued to contribute to the result. The occupancy rate of shopping centers reached 92% in Colombia and 89% in Argentina in September.

“The gradual recovery of the economy in Uruguay was reflected in a higher recurring EBITDA margin of the operation in this country (10.1%), benefited by higher productivity and commercial margin and a strict control of expenses.

“In Argentina, Grupo Libertad’s sales in local currency grew 58.1%, above the high level of inflation, benefiting from the economic reactivation, better performance of the food business and the electronic and direct commerce channels that reached a participation in total sales of 2.7%,” the company added.

In Colombia, recurring EBITDA margin was 8.7% over operating income -- 200 basis points more -- compared to the same period of 2020 and 8.5% so far this year.

“The higher levels compared to those reported in 2020 and 2019 reflect the operational efficiencies achieved in the midst of a recovery in consumption due to the economic reactivation of the country,” according to Éxito.

“The economic reactivation in the three countries where Grupo Éxito operates favored an atmosphere of optimism and confidence,” resulting in a 15% jump in sales corporate-wide, the company added.

Written by November 04 2021 0

Medellin-based multinational electric-power transmission builder-operator, highways concessionaire and telecom services provider ISA – now 51% owned by Colombia’s mostly state-owned Ecopetrol oil company – on November 3 reported third quarter (3Q) 2021 net income of COP$121 billion (US$31.5 million), down 78% from 3Q 2020.

Despite the profit decline, ISA’s earnings before interest, taxes, depreciation and amortization (EBITDA) actually rose 5.8% year-on-year, to COP$1.86 trillion (US$486 million), while operating revenues likewise rose 7%, to COP$2.86 trillion (US$747 million), according to the company.

The rise in operating revenues “was mainly due to the entry-into-operation of energy transmission projects, the consolidation of Orazul Energy Group at the end of the third quarter of 2020, the Ruta Costera [Colombia highway concession] project as of the fourth quarter of 2020 and PBTE [Brazil power transmission] as of March 2021, in addition to the increase in construction activity of concessions in Brazil and Chile,” according to ISA.

“When deducting the impact of the costs associated with the reprofiling of ISA InterChile’s debt and the change in the income tax rate in Colombia, accumulated income would total COP$1.6 trillion [US$418 million], 4.8% higher with respect to the same period of the previous year,” according to the company.

“ISA’s natural hedging strategy, where each company seeks to incur debt in the same currency in which revenues are received, resulted in the effect of exchange rate variations on net income for the whole year to be -1.1%,” the company added..

Among 3Q 2021 highlights:

1. More electricity transmission projects entering into commercial operation, including the Nueva Pan de Azúcar-Polpaico Reactive Compensation in ISA InterChile; the IE Itaipura in ISA CTEEP in Brazil; the Triple A Connection in Transelca (Colombia) and “72 reinforcements to the existing network in ISA CTEEP in Brazil, which together contributed total annual revenues of US$30 million,” according to the company.

2. ISA InterChile issued its first structured green bond on July 26, totaling US$1.2 billion, at a 35-year term and a 4,5% coupon. “This allowed the re-profiling of the existing debt of the Cardones-Polpaico project, lowering the financial cost and increasing the average life of the loan, thereby achieving a better match with the life of the asset. This is a key project in Chile, under the government's program of decarbonization and mitigation of climate change impacts,” according to ISA.

3. Construction of 25 energy transmission projects and 257 reinforcements in Brazil. “These will contribute total annual revenues of US$382 million once they are in operation,” according to ISA.

4. Winning a crucial environmental license for the UPME07-2017 Sabanalarga-Bolívar 500-kV transmission project in Colombia, thereby clearing the way for construction to begin.

Written by November 03 2021 0

Medellin-based utilities giant EPM announced November 2 that its third quarter (3Q) 2021 net income hit COP$2.8 trillion (US$730 million), up sharply from COP$1.3 trillion (US$337 million) in 3Q 2020.

Earnings before interest, taxes, depreciation and amortization (EBITDA) jumped 28% year-on-year, to COP$5.5 trillion (US$1.4 billion), while EBITDA margin came-in at a healthy 30%, according to the company.

Meanwhile, 3Q 2021 revenues amounted to COP$18.2 trillion (US$4.7 billion) as the Colombian economy continues to recover from last year's Covid-19 depression.

As a result, “EPM maintains healthy and solid finances,” according to the company, 100% owned by the city of Medellin.

“The group's investments in infrastructure as of September were COP$2.7 trillion [US$704 million] of which COP$1 trillion [US$261 million] corresponds to the Hidroituango hydroelectric project.

“Through September, EPM has paid the municipality of Medellín COP$1.3 trillion [US$339 million] of the total COP$1.4 trillion [US$365 million] scheduled to be transferred during 2021."

Macroeconomic reactivation, relatively heavy rains in Colombia supporting its hydroelectric power output, lower operating costs and the lower impact of Covid-19 all boosted financial results, according to the company.

Net foreign-currency-exchange expense in 3Q 2021 was just COP$24 billion (US$6.3 million), 97% lower than the same period in 2020, “caused by the restatement of the debt in dollars associated with the accumulated devaluation of the Colombian peso of 11.72 % and a closing rate of COP$3,834.68 per US$1,” according to EPM.

On the other hand, accounts-receivable balances rose to COP$158 billion (US$41 million) and non-payment of utility bills rose to COP$159 billion (US$41.4 million), both resulting from the Covid-19 pandemic.

Despite those losses, Grupo EPM total assets rose 4% year-on-year, to COP$66.5 trillion (US$17.3 billion); liabilities rose 5%, to COP$38.5 trillion (US$10 billion), and shareholder equity rose 4%, to COP$28 trillion (US$7.3 billion), according to the company.

Financial debt for both EPM Group and its parent holding company was 41%. The Debt/EBITDA indicator for EPM Group closed at 3.74, better than the 4.41 ratio for 3Q 2020.

“Discounting the available cash reserve, the net debt/EBITDA indicator stood at 3.10 for the EPM Group and at 4.39 for the parent EPM,” the company added.

Written by November 03 2021 0

Medellin-based multinational banking giant Bancolombia announced November 2 that its third quarter (3Q) 2021 net income hit COP$943 billion (US$246 million), up 237% year-on-year.

Loan provision charges “decreased by 17.8% when compared to 2Q 2021 and by 69.4% when compared to 3Q 2020. This reduction is largely due to a better economic outlook in 2021, and to the fine-tuning in the provisioning models for the portfolio under credit reliefs,” according to the company.

As of September 30, 2021, Bancolombia's assets totaled COP$269 trillion (US$70 billion), up 1.6% year-on-year, “largely explained by the growth in the loan book,” according to the company.

“In 3Q 2021, gross loans grew 3.3% compared to 2Q 2021 and 5.8% compared to 3Q 2020. During the last 12 months, [Colombian] peso-denominated loans grew 7.5% and the dollar-denominated loans (expressed in US dollars) grew 4.2%.

“Gross loans denominated in currencies other than COP -- generated by operations in Central America, the international operation of Bancolombia Panamá, Puerto Rico and the US dollar-denominated loans in Colombia, accounted for 34.3% of the portfolio, and grew 4.2% in the quarter, when expressed in COP,” according to the company.

Meanwhile, “total reserves (provisions in the balance sheet) for loan losses decreased 0.9% during the quarter and totaled COP$16.69 trillion [US$4.3 billion] equivalent to 7.9% of the gross loans at the end of the quarter,” the company added.

At the end of 3Q 2021, Bancolombia's net investment portfolio totaled COP$26.8 trillion (US$6.98 billion), down 6.8% from the end of 2Q 2021 and 3.2% from the end of 3Q 2020.

“Bancolombia's consolidated solvency ratio under Basel III was 15.31% in 3Q 2021, while the basic capital ratio (Tier 1) was 11.76%. This leverage level is adequate considering the balance sheet risks and asset growth expectations,” the company added.

Net interest income totaled COP$2.9 trillion (US$756 million) in 3Q 2021, up 2.1% from 2Q 2021 and 4.9% above 3Q 2020.

“The total cost of funding extended its downward trend during 3Q 2021. Savings accounts and checking accounts continued to increase their share over the last 12 months. Savings accounts represented 36% in 3Q 2020, increasing to 42% of total funding by 3Q 2021.

“On the other hand, checking accounts represented 14% in 3Q 2020, rising to 16% of total funding in 3Q 2021. The annualized average weighted cost of deposits was 1.41% in 3Q 2021, falling 4 basis points compared to 2Q 2021 and 75 basis points compared to 3Q 2020,” the company added.

During 3Q 2021, net fees and income from services totaled COP$880 billion (US$229 million), up 9.1% compared to 2Q 2021, and up 15.2% compared to 3Q 2020, according to the company.

Loans overdue for more than 30 days totaled COP$9 trillion (US$2.3 billion) at the end of 3Q 2021, representing 4.4% of total gross loans, down from 4.6% in 2Q 2021

In the latest quarter, loan charge-offs totaled COP$854 billion (US$222 million). Coverage for loan losses was 167.2% at the end of 3Q 2021, down from 169.1% at the end of 2Q 2021.

“Provision charges (net of recoveries) totaled COP$514 billion [US$134 million] in 3Q 2021. The provision expense for the quarter is mostly related to the operation in Colombia.

“The gradual decrease [in bad-loan provisions] is associated with the macroeconomic impact and adjustments in the provisioning models relating to clients subject to credit reliefs, which jointly have caused a balance reduction from previous periods.

“Provisions as a percentage of the average gross loans were 1.0% annualized for 3Q 2021 and 2.2% for the last 12 months.

“Bancolombia maintains a strong balance sheet supported by an adequate level of loan loss reserves,” with allowances for loan principal totaling 7.4% of total loans at the end of 3Q 2021, “decreasing when compared to 2Q 2021,” the company added.

Written by October 30 2021 0

Medellin-based multinational foods giant Grupo Nutresa on October 29 reported a 17% year-on-year hike in third quarter (3Q) 2021 net profits, hitting COP$173 billion (US$46 million).

Operating income rose to COP$3.36 trillion (US$893 million), up from COP$2.85 trillion (US$757 million) in 3Q 2020.

Meanwhile, 3Q 2021 operating profit rose 8.4% year-on-year, to COP$867 billion (US$230 million), according to the company.

As for nine-months 2021 results (January through September), sales so far this year are up 11.7%, to COP$9.1 trillion (US$2.4 billion), while sales in Colombia are up 14.5% year-on-year, hitting COP$5.5 trillion (US$1.46 billion), according to the company.

Consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) so far this year are up 5.4%, to COP$1.2 trillion (US$319 million), with a 12.9% margin on sales.

Net profit so far this year is up 14%, to COP$535 billion (US$142 million), according to the company.

International sales, up 7.7% year-on-year, hit COP$3.6 trillion (US$964 million), accounting for 39% of total sales.

Grupo Nutresa boasts of a direct corporate presence in 14 countries with 47 production plants, 45,861 employees and product sales in 78 countries on five continents.

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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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