Grupo IMSA 2Q 2024 Net Profit Plunges 81%, But 1H Profits Up 50%

Medellin-based multinational diversified manufacturer-marketer Grupo IMSA announced August 16 an 81% year-on-year decline in second quarter (2Q) 2024 net income, to COP$8.7 billion (US$2.16 million), from COP$47.3 billion (US$11.7 million) in 2Q 2023.

However, gross revenues for 2Q 2024 rose 8% year-on-year, to COP$93 billion (US$23 million), from COP$87 billion (US$21.6 million) in 2Q 2024.

As for first half (1H) 2024, net income is up 50% year-on-year, to COP$98.7 billion (US$24.5 million), while revenues are up 6.7%, to COP$190 billion (US$47 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) for 1H 2024 are up 65% year-on-year, to COP$10.8 billion (US$2.68 milllion), according to the company.

Among the revenues for 1H 2024, “56% corresponds to the composite materials and polyester business unit in Brazil, 35% to [Colombia consumer-products marketer] MCM, 5% to [food additives producer] Addimentum,” and the remainder mainly to passive investments.

Up until April 2024, “sales of COP$35 billion [US$8.7 million] were consolidated for the operation of O-tek Argentina, a company that was divested in May 2024,” the company noted.

As a result of that divestiture, “the results of this business unit are recorded under discontinued operations,” the company added.

Despite the O-tek Argentina sale, revenues for 1H 2024 nevertheless rose 7% compared to 1H 2023, according to IMSA.

“This growth is consistent with the established business plan, which complies with the guidelines of profitable growth, development of its businesses, geographic expansion to new markets, diversification of its business lines, investments that leverage growth and profitability, and the use of competitive advantages in the market, to maintain an attractive value proposition for all its stakeholders,” according to the company.

“However, it is important to recognize that macroeconomic situations, availability of inputs, variations in freight or contractions of some business segments or categories have led to the adoption of alternative action plans to mitigate these impacts and recognize new opportunities along the way.

“Regarding the liquidity and leverage position, Grupo IMSA has a solid capital structure that allows it to support the growth of its businesses and actively make portfolio investments.

“At the end of June, the Group maintains its negative net financial debt, that is, with higher levels of cash and temporary investments than financial debt, totaling COP$187 billion [US$46 million], with total liabilities representing 20% of its total assets, compared to 25% in [1H] 2023,” the company concluded.