Valores Industriales Full-Year 2023 Net Income Plummets 92% Year-on-Year
Medellin-based investment conglomerate Valores Industriales announced March 27 a full-year 2023 net income of COP$1.86 billion (US$481,000), down 92% from a restated 2022 net income of COP$24.5 billion (US$6.2 million).
Despite the plunge in profits, 2023 gross revenues improved slightly, to COP$1.15 trillion (US$297 million), versus CO$1.02 trillion (US$264 million) in 2022.
Operating income also improved in 2023, at COP$165 billion (US$42.7 million), versus COP$101 billion (US$26 million) in 2022, according to the company.
Explaining the profits drop, Valores Industriales cited a switch to a new “patrimony-participation” accounting method, which drastically reduced profit recognition in five subsidiary or minority-owned companies, including Reforestadora y Manufacturera Los Retiros, Valores Inmobiliarios Cinco, Valores Cinco, Azulgrana and Sodium Group Costa Rica.
Valores Industriales — created in 1997 as a spin-off from Medellin-based paper-products giant Productos Familia (the latter now owned by global forest-products giant Essity) — this year announced plans to complete acquisition of all outstanding publicly-traded shares, and subsequently delist itself from public trading during first-half 2024.
Valores Industrialess four main subsidiaries include:
- Reforestadora y Manufacturera Los Retiros, dedicated to forest planting and harvesting for paper products.
- Valores Inmobiliarios Cinco, dedicated to real-estate developments.
- Inversiones en Valores Cinco, dedicated to consulting and management services for third-party companies.
- Sodium Group Costa Rica, in which it now holds a (recently restated) 40% share. This newly combined company — incorporating Medellin-based Brinsa SA — has holdings in chemicals, livestock, agriculture, tourism and real-estate services.
Despite the drop in accounting profits during 2023, the Valores Industriales real-estate division saw “a slow process of companies returning to offices, which generated a significant impact on the marketing of [office-building properties] and leasing of the remaining spaces.
“Despite having had fewer [lease] placements compared to the 2023 budget, income did not have a significant decrease due to the early closing of 284 square meters of [Medellin-based property] Groupe Seb on the 7th floor, higher rent indexations due to inflation and higher income from the casino and from the parking area that was not budgeted.
“The office market in Medellín closed the year 2023 with a positive but moderate transactional dynamic due to the interest of some companies in improving their corporate spaces and expanding their operations. Most class-A+ projects managed to reduce their availability, especially on entire floors. On the other hand, during the second half of the year, Rivana (Tigo) and One Plaza (Globant) freed-up areas as the hybrid work [telecommunting] trend reduced their occupied area,” the company added.
