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Written by February 28 2022 0

Medellin-based multinational gold mining giant Mineros SA announced February 28 that its full-year 2021 net income dropped 31% year-on-year, to COP$162 billion (US$41.3 million).

However, revenues increased 4% year-on-year, to COP$1.8 trillion (US$459.6 million), versus COP$1.79 trillion (US$457 million) in 2020.

The revenue boost came from a “slight increase in gold prices and higher revenues from energy sales and hedges, which managed to offset lower gold production, given the delay of some environmental permits in Colombia and the natural depletion of the mine in Argentina,” according to Mineros.

On the other hand, gross profit fell 25% year-on-year, to COP$464 billion (US$118 million), “mainly due to higher purchase costs of artisanal [gold mining] mineral, which translates into higher production. The decline was also due to the increase in depreciation and amortization, an increase in payroll costs, higher maintenance costs and higher inventory consumption, along with an increase in administration expenses and by the increase in exploration expenses,” according to Mineros.

On the upside, Mineros President Andrés Restrepo commented that “2021 was a historic year for Mineros, as we became the first Colombia-based company to be listed on both the TSX [Toronto exchange] and the Colombian Stock Exchange.

“We continue to pay dividends consistently, with COP$66 billion [US$16.8 million) in total dividends paid in 2021.

“Our production was above 260,000 ounces of gold, according to our estimates, allowing us to continue to strengthen our overall capital position. Cash costs per ounce of gold sold were also within the expected range, while the AISC [all-in sustaining cost] was slightly higher than expected.

“We entered 2022 with a focus on maintaining strong production levels at our current operations and pursuing annual production growth through a combination of brownfield exploration at current operations, greenfield exploration (exploration in areas that are not in operation) and evaluating possible acquisitions,” Restrepo added.

In Colombia, alluvial gold production rose 5% year-on-year, to 73,129 ounces, “thanks to the nearly 10,000 ounces produced under the formalization program” of formerly irregular artisanal miners, the company noted.

“The formalization is a collaborative work scheme, through contracts with third parties, in which previously informal miners are working on the company’s mining titles, with emphasis on the reprocessing of tailings from massive extraction. Currently, the formalization process includes nine operating units and generates nearly 200 direct jobs,” the company added..

In Nicaragua, the Hemco mining operation produced 127,151 ounces of gold, up 4% year-on-year, “largely explained by higher purchases of artisanal material, an increase in milled tons and a higher grade” of mined rock, according to the company.

In Argentina, mining operations dipped 14% year-on-year, to 61,487 ounces of gold, “explained by the natural depletion of the open-pit deposit and the slow recovery process in the leach pads,” according to Mineros.

Colombian Output Seen Rising in 2022

As for its year-2022 projections, Mineros foresees consolidated production in the range of 262,000 to 285,000 ounces.

“This projection foresees an increase in production in Colombia, including the new ounces from the formalization program, the maintenance of production levels in Nicaragua and a slight decrease in production in Argentina in accordance with the depletion of the mine, while new fronts are being explored.

“For 2022, cash cost is estimated in a range between US$1,090 and US$1,180 per ounce and AISC between US$1,350 and US$1,450 per ounce,” the company added.

Written by February 26 2022 0

Medellin-based multinational insurance, pensions, health care and financial services giant Grupo Sura announced February 25 that its full-year 2021 net income jumped 353% year-on-year, to COP$1.5 trillion (US$282 million).

Operating earnings rose 16.5% year-on-year, to COP$24.8 trillion (US$6.64 billion) -- COP$4 trillion (US$1.02 billion) more than in 2020 -- “due to the performance dynamics of its subsidiaries and a record high in revenues obtained via the equity method," including its major shareholdings in Medellin-based financial/industrial giants Grupo Nutresa, Grupo Argos and Bancolombia.

Fourth-quarter (4Q) 2021 net income came-in at COP$406.7 billion (US$103 million), a reversal from the COP$61 billion (US$15.5 million) net loss in 4Q 2020.

Beyond the encouraging results in 2021, “Grupo Sura expects its full-year 2022 net income to increase between 10% and 15%” over 2021, according to the company.

Sura credited the rise in 2021 income to increases in written premiums by its Suramericana insurance division; fee and commission income obtained by pensions/financial services division Sura Asset Management, as well as “good performance of the equity method in associated companies, which had record results, freeing-up of provisions with Bancolombia due to a lower risk exposure in its loan portfolio,” according to Sura.

“The results obtained at year-end 2021 exceeded our growth expectations for all of the Sura lines of business, thereby bringing us closer to our pre-pandemic figures,” added Sura CEO Gonzalo Pérez.

Operating expense also rose 15.7% year-on-year, “mainly due to a higher claims rate at Suramericana as a result of the pandemic, which was partially mitigated by a greater control over administrative expense as well as greater efficiencies obtained by the different companies,” according to the company.

“Consequently, consolidated operating earnings rose by 59.2% to COP$2.6 trillion (US$685 million) and consolidated net income came to COP$1.5 trillion (US$407 million), 4.5-times higher than for 2020 and corresponding to 89% of that obtained in 2019,” the company added.

Consolidated shareholders' equity likewise rose by 9.5% year-on-year, to COP$31.3 trillion (US$7.85 billion), according to the company.

During 2021, the Sura Asset Management division (retirement savings, investments and asset management) grew to 21.6 million clients in six countries in Latin America, and its assets-under-management increased by 7.4%, to COP$566 trillion (US$142 billion), generating COP$3 trillion (US$810 million) in operating income, up 10.6% year-on-year, according to the company.

“This was mainly driven by its fee and commission income, which increased by 11.8% in the retirement savings business and 25.4% in the ‘voluntary savings’ segment, through Inversiones Sura (voluntary savings for private individuals) and Sura Investment Management (the regional platform for the institutional segment),” according to the company.

As a result, Sura Asset Management’s 2021 consolidated net income rose 45.3% year-on-year, to COP$ 627 billion (US$167 million), while its net debt level fell by COP$668 billion (US$155.9 million), according to the company.

As for the Suramericana insurance and risk-management division, this group posted a 16.5% hike in written premiums at year-end 2021, reaching COP$21.8 trillion (US$5.8 billion), “driven by the good levels of performance for all three of its insurance segments, namely Life (13.2%), Health Care (30.7%) and Property and Casualty (10.9%). This, together with a rigorous control over administrative expenses, partially mitigated the increase in claims due to the reopening of the economies and the pandemic,” according to the company.

In 2021, Suramericana allocated COP$1.6 trillion (US$408 million) to Covid-related claims, but “thanks to the progress made with mass vaccination programs, the claims rate has so far shown an improvement in the Life and Health Care segments,” according to the company.

Because of the heavy costs of Covid-19 claims last year, Suramericana net income fell to COP$66.35 billion (US$18 million), or 68.6% lower than for 2020.

“Finally, Suramericana ended the year with technical reserves worth COP$23.3 trillion (US$5.8 billion), having increased by 10.6%,” according to the company.

Written by February 25 2022 0

Medellin-based electric power giant Celsia – a division of Grupo Argos – on February 24 reported a 60.7% year-on-year jump in 2021 net income, to COP$544 billion (US$138.5 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 10.7%, to COP$1.2 trillion (US$305.5 million), while revenues rose 16.3%, to COP$4.1 trillion (US$1.04 billion).

Power generation accounted for COP$1.48 trillion (US$376.8 million) of total revenues, while power distribution and marketing accounted for the remaining $2.63 trillion (US$669 million), according to Celsia.

“This positive behavior is due to the good dynamism of all the company’s segments added to the economic recovery reflected in a greater demand for energy,” according to the company.

“During 2021, net non-recurring revenues were recorded for nearly COP$131 billion [US$33 million] associated with the recovery of the provision for the legal process related to the Bajo Anchicayá power plant and the structured closure of Bahía Las Minas,” the company added.

Fourth-quarter (4Q) 2021 net income soared by 172% year-on-year, to COP$235 billion (US$59.8 million), while 4Q 2021 EBITDA rose by 20%, to COP$402 billion (US$102 million).

“Platforms developed with Cubico Sustainable Investments for non-conventional renewable energy and power transmission businesses represented COP$147 billion [US$37 million] in revenue for Celsia in 2021,” according to the company.

“Other events in 2021 stand out, such as the third issuance of the ‘green bond’ program for COP$140 billion [US$35.6 million]; the first loan linked to compliance with ESG [environmental, social, responsible governance] indicators for an amount of COP$500 billion [US$127 million] with Bancolombia; the execution of the ‘Works for Taxes’ program with total investments of COP$101 billion [US$25.7 million], among others,” according to Celsia.

Celsia also invested COP$365 billion (US$93 million) last year in “substations, new circuits, and control systems to improve reliability and make them safer. Of the total invested, COP$154 billion [US$39 million] went to the operation in Tolima and COP$211 billion [US$53.7 million] to Valle del Cauca,” the company added.

On other fronts in 2021, Celsia added mor than 20 megawatts of solar power capacity, and meanwhile moved closer to completion of its 200-megawatt “El Tesorito” natural-gas-fired power plant, according to the company.

Written by February 25 2022 0

Medellin-based multinational foods giant Grupo Nutresa reported February 24 a 17.6% year-on-year hike in full-year 2021 net income, hitting COP$676 billion (US$172 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) likewise rose 6.2% year-on-year, to COP$1.37 trillion (US$349 million), from COP$1.3 trillion (US$331 million) in 2020.

Gross revenues rose 14.5%, to COP$12.74 trillion (US$3.2 billion), from COP$11.1 trillion (US$2.8 billion) in 2021.

Colombia accounted for 61% of total corporate revenue, at COP$7.8 trillion (US$1.98 billion), “16.3% higher than the previous year. This growth was driven by outstanding business dynamics across all business units,” according to Nutresa.

“International sales measured in Colombian pesos amounted to COP$4.9 trillion, 11.8% higher than the sales achieved in 2020, representing 38.9% of the total revenue. When stated in dollars, these sales amount to US$1.3 billion, which represents a growth of 10.2%,” the company added.

Gross margins dipped 1.6% year-on-year, “the result of the increase in raw materials related to the global challenges in logistics and the commodities super-cycle,” according to Nutresa.

Operating profit rose 8.4% year-on-year, to COP$1.1 trillion (US$280 million), “the result of productivity measures during the period. Because of this strategy, selling expenses decreased 260 basis points over the past two years,” according to Nutresa.

“Net post-operative expenses totaled COP$117.8 billion [US$30 million], decreasing 42.3% when compared to 2020. This is mainly explained by a notable reduction in the financial expenses due to lower interest rates throughout the year,” the company added.

Written by February 24 2022 0

Medellin-based textile giant Fabricato announced February 23 a full-year, corporate-wide 2021 net profit of COP$16.5 billion (US$4.2 million) -- a big improvement over the 2020 net loss of COP$82.4 billion (US$21 million).

“Textile revenues in 2021 increased by 52% compared to 2020,” according to the company, while textile gross margins jumped a full 10 percentage points, to 18%, from 8% in 2020.

Textile operating profits in 2021 rose by COP$51 billion (US$13 million) year-on-year, to COP$73 billion (US$18.5 million), the company added.

The textile operation by itself generated a net profit of COP$18.3 billion (US$4.6 million) in 2021, versus a net loss of COP$19.7 billion (US$5 million) in 2020.

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose to COP$51.6 billion (US$13 million), from COP$9.8 billion (US$2.5 million) in 2020.

As for Fabricato’s real-estate segment, net income was essentially flat, at COP$8.9 billion (US$2.2 million), while 2021 operating income rose 23% versus 2020.

As for financial operations, Fabricato posted a net finance profit of COP$20.3 billion (US$5.1 million) in 2021 versus a net loss of COP$16.9 billion (US$4.3 million) in 2020.

Meanwhile, Fabricato reports a continuation of positive trends in January 2022, with textile sales up 64% year-on-year and textile margins up 8 percentage points, to 21%.

What’s more, “we exceeded the textile EBITDA expectation by COP$4.99 billion [US$1.27 million], as in January 2021 it was COP$2.3 billion [US$585,000] while in January 2022 it was COP$7.3 billion [US$1.8 million],” according to the company.

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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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