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Argentina-based electronic-commerce giant Mercado Libre announced March 3 that it’s opening a new information technology (IT) center in Medellin -- and expects to hire 500 technical professionals here.

The new center is the company’s second in Colombia, having opened its first IT center in Bogota in 2020.

As a result of the Medellin expansion, “Colombia joins Argentina, Brazil, Chile, Uruguay and Mexico in the list of countries that have two centers of this type for the entire Mercado Libre operation,” according to a joint press release from Mercado Libre, Medellin’s Agencia de Cooperacion e Inversion de Medellin y el Area Metropolitana (ACI, the investment promotion agency) and Ruta N, Medellin’s local high-tech landing site and incubator.

“For the start-up of the new IT Center, job openings will be filled by local experts and talents in skills such as back-end and front-end software, mobile development, IT security, business intelligence, machine learning, data science, application infrastructure [and] user experience, among others,” according to the company.

“After a 2020 of exceptional growth, we decided to redouble this effort in Antioquia,” said Mercado Libre Andean Region Director Jaime Ramírez.

“We are sure that the ecosystem of digital entrepreneurship and the innovative approach that positions Medellín as the city of the fourth industrial revolution is the right place for this second center,” he added.

Founded in 1999, Mercado Libre offers on-line platforms for individuals and companies to buy, sell, advertise and pay for goods and services online.

The “MercadoLibre.com” web site “is among the 50 most-visited sites in the world in terms of page views and is the mass consumption platform with the highest number of unique visitors in the most important countries where it operates, according to metrics provided by ComScore Networks,” the company added.


Medellin-based construction giant Conconcreto on March 1 reported a 64% year-on-year drop in 2020 net income, to COP$23.5 billion (US$6.5 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) declined 40%, to COP$102 billion (US$28 million), while revenues likewise declined by 39%, to COP$574 billion (US$158 million).

Despite the decline in profits, 2020 nevertheless “represents a positive year-end compared to that reported in third quarter 2020, and even more so considering that it reflects the negative impact that the Covid-19 emergency had on the company’s business plan and its investments,” according to Conconcreto.

Meanwhile, Conconcreto’s relatively solid cash position at year-end 2020 enables it to “comply with the financial indicators required to tender standard bidding projects and other [opportunities],” according to the company.

Among those is the recently awarded “Doble Calzada Oriente-DCO” public-private association highway project connecting Medellin eastward to Rionegro and portions of Envigado and El Retiro. For the DCO project, Conconcreto holds a 60% stake.

The DCO project, estimated at COP$926 billion (US$255 million), boosts Conconcreto’s construction backlog by approximately COP$300 billion (US$82.6 million), according to the company.

U.S. ‘Strategic Alliance’ Developments

Meanwhile in the U.S. market, Conconcreto’s “strategic alliance” with U.S.-based Century Asset Management has resulted in development of some 35,000 houses worth about US$6.5 billion., according to the company

The “strategic alliance” is now becoming an “asset manager” that will “manage the resources of its investors through investment funds for the development of rental housing projects,” according to Conconcreto.

“’Century Real Estate Fund I’ is the first fund of this alliance. It is currently in the capital raising stage and seeks to capitalize on the opportunity to invest in an environment of low interest rates, high demand for housing in Miami-Dade County and scarcity of land with permits in strategic locations, developing the Midtown Doral Multifamily project,” according to the company.

“The first project is two towers with a total of 326 apartments, located in the city of Doral, in Miami-Dade County. The first fund will be US$150 million in which Constructora Conconcreto will carry out the designs and execute the construction.”

Backlogs Growing

Aside from the new DCO project in Antioquia, the company’s backlog at year-end 2020 stood at COP$2.21 trillion (US$609 million), while the DCO and other new projects announced so far in 2021 bring the total backlog to COP$2.59 trillion (US$713.6 million), according to the company.

In total, 86.4% of the backlog corresponds to infrastructure projects, while the remaining 13.6% corresponds to buildings, including housing projects.

Infrastructure backlog values are mainly concentrated in the “Ruta 40” highway project, the “Transmilenio” mass-transit rail project in Bogota, the DCO project and the Hidroituango hydroelectric project in Antioquia.

As for building construction backlogs, these are mainly concentrated in the “Contree” and “Las Vegas de Comfandi” housing projects, along with the Century Homestead projects in the U.S., according to the company.

Hidroituango Lawsuit

In a PWC accountant’s note to the official 2020 earnings report, PWC cites the pending COP$10.5 trillion (US$2.9 billion) lawsuit brought by Medellin-based power giant EPM against the builders and designers of the US$5 billion “Hidroituango” hydroelectric project.

That lawsuit claims that Hidroituango’s builders and designers are to blame for a diversion-tunnel collapse in 2018 that resulted in hundreds of millions of dollars in physical damages and billions of dollars in lost power sales because of resulting delays of entry-into-service for the hydroelectric project.

Conconcreto has a 35% share of the “CCC Ituango” consortium in the Hidroituango project, PWC noted.

“Based on the analyses undertaken by the consortium, Conconcreto and its legal team consider that no solid arguments exist that would put blame on the consortium and its members for the [losses caused by the tunnel collapse] and therefore they don’t consider it probable that the consortium or its members would be found guilty. As a result, to date the company has not made any [special financial-loss accounting] provision,” according to PWC.

Meanwhile, the CCC Ituango consortium has filed for arbitration to settle the claims -- to be overseen by the Medellin Chamber of Commerce, PWC noted.


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.


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.


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.


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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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