Gruma sales grow due to operations outside Mexico

At the end of the first quarter of 2024, the net sales of Gruma, a leading Mexican company in the production of corn flour and tortillas, amounted to $1,647.3 million, which represented an increase of 4.0 percent compared to the January-January period. March 2023, supported by its operations outside Mexico.

Sales from operations outside Mexico represented 71 percent of the company’s consolidated figures.

Gruma’s sales increase was due to the continued effect of price adjustments from previous quarters; to the change to a more favorable combination in the American division; and the benefit of a stronger peso exchange rate.

“In the United States, Gruma continues to outperform market growth in its tortilla operation, while corn flour shows a positive recovery. Across the rest of our global operations, we are diligently increasing our presence with distributors, while early signs of recovery in China are supporting our operations in Asia and Oceania. “The company’s versatility and adaptability to the changing environment helped keep volumes stable, despite consumer weakness, while sales increased 4.0 percent thanks to a more profitable sales mix,” the company stated in its financial report sent to the investing public.

For its part, selling and administrative expenses increased 9.0 percent to 407.4 million dollars, due to higher commissions paid, in line with higher revenues; high distribution costs; and higher marketing costs. As a percentage of net sales, selling and administrative expenses increased to 24.7 percent from 23.5 percent.

Gruma’s majority net income amounted to $111 million in the first quarter of 2024, which represented an annual increase of 46 percent.

Business

In the United States, the volumes of the corn flour business remained stable, but on a continuous path of recovery with the incorporation of more industrial clients, which in the past showed some sensitivity to prices, while the retail channel of this business continues to show solid performance.

Net sales increased 2.0 percent compared to the first quarter of 2023, increasing to $902.9 million, due to the continued effect of past inflation management strategies; and a more profitable sales mix in the first quarter of this year.

At Gimsa (operations in Mexico), sales volume decreased 2.0 percent, to 524 thousand metric tons, as a result of a larger comparative base in the first quarter of 2023, where volumes grew 8.0 percent in comparative terms.

Net sales remained stable at $491 million compared to the January-March 2023 period, due to a higher year-over-year comparative basis.

Gruma’s debt remained stable at $1,902 million in relation to lower working capital needs and debt payments in previous quarters. Approximately 73 percent of Gruma’s debt is denominated in dollars, the company revealed.