ALICORP S.A.A.: Alicorp Third Quarter 2019 Consolidated Financial Statements
ACCESS Newswire
LIMA, PERU / ACCESSWIRE / November 4, 2019 / Alicorp S.A.A. ("the Company" or "Alicorp") (BVL: ALICORC1 and ALICORI1) announced today its unaudited financial results corresponding to the Third Quarter 2019 (Q3 19´). Financial figures are reported on a consolidated basis and are in accordance with International Financial Reporting Standards ("IFRS") in nominal Peruvian Soles, based on the following statements, which should be read in conjunction with the Financial Statements and Notes to the Financial Statements published at the Peruvian Securities and Exchange Commission (Superintendencia del Mercado de Valores - SMV). Consolidated statements include i) financial results of the Bolivian companies acquired during Q2 18´ and Q3 18´("Industrias de Aceite S.A." or "Fino" and "Sociedad Aceitera del Oriente S.R.L" or "Sao"), and ii) financial results of Intradevco Industrial S.A. or "Intradevco" in Q1 ‘19. Financial figures also include i) the effect of the adoption of the International Accounting Standard 29 & 21 (or IAS 29 & 21, Financial Reporting in Hyperinflationary Economies) in Argentina and ii) the adoption of IFRS 16 (Leases standard). Hereafter, references to IAS 29, include the IAS 21 application.
FINANCIAL HIGHLIGHTS
Results for Q3 19' include two accounting effects that were not considered during Q3 ‘18: i) the adoption of the International Accounting Standard 29 (IAS 29) in Argentina as this is now considered a hyperinflationary economy, and ii) the adoption of International Financial Reporting Standard 16 (IFRS 16) with regards to Leases. The Company restated Q3 18´ financial data to comply with IFRS 16. Hence, when necessary, the effect of IAS 29 is excluded in the Q3 19´ when necessary, in order to compare variation and performance. Additionally, it is essential to note that Q3 18' consolidated figures included the financial results of Fino and Sao but not Intradevco's, which was acquired in January 2019.
1. Consolidated Revenue amounted to S/ 2,593 million (+17.4% YoY), while Volume reached 860 thousand tons (+28.7% YoY). Excluding the impact of Intradevco acquisition, Crushing business and IAS 29, Organic Revenue reached S/ 2,097 million, a 3.2% increase compared to Q3 18´. Total Consolidated Revenue reflects growth across all the businesses: i) Consumer Goods Peru (+22.1% or +S/ 160 million) mainly due to the acquisition of Intradevco, ii) Crushing (+82.2% or S/ 146 million) explained by higher volume of the winter sunflower and the soybean campaigns, iii) Consumer Goods International (+11.0% or S/ 40 million), also explained by the acquisition of Intradevco, as well as the recovery of revenue in Bolivia and Ecuador, iv) Aquafeed (+4.9% or S/ 25 million) due to volume increase in the Shrimp Feed business in Ecuador, in addition to a recovery of volume in the Fish Feed business in Chile and, v) B2B (+3.8% or S/ 16 million) due to revenue growth in all its segments (Bakery, Industrial clients and Food service).
2. During Q3 19´, Revenue from the Consumer Goods Peru business reached S/ 885 million
(+22.1% YoY) while Volume reached 190 thousand tons (+28.5% YoY). Excluding Intradevco's financial figures, Revenue and Volume both grew 1.2% YoY and 1.4% YoY, respectively. Organic growth was supported by a Revenue increase in Margarines (+22.1% YoY), Panettone (+18.1% YoY), Canned Tuna (+17.6% YoY), Cookies and Crackers (+4.6% YoY), Pasta (+4.0% YoY), and Laundry Detergents (+1.2% YoY). These results were remarkable when we consider the current Peruvian market slowdown and how Alicorp has managed to grow in the aforementioned categories despite a stalled consumer market, which was impacted by lower employment levels on a year-to-date basis. Despite this scenario, the Company succeeded in growing/maintaining market share in the most relevant categories, such as Canned Tuna (+6.4 p.p. YoY), Stain Removers (+3.5 p.p. YoY), Tomato Sauce (+2.3 p.p. YoY), Margarines (+1.9 p.p. YoY), Pasta (+1.8 p.p. YoY), Dishwashing Soap (+1.6 p.p.), Bleach (+1.1 p.p.) and All-Purpose Cleaners (+0.9 p.p.).
3. Regarding product innovation, during Q3 19´ the Company either launched or revamped 32 products/lines (14 in Consumer Goods Peru, 9 in Consumer Goods International, 7 in B2B, and 2 in Aquafeed). Most significantly, these included: the new "Bolivar Sensations" softener, strenghtening the brand's recognition and differentiation within the category, and "Opal Quitamanchas", a new stain remover for colored clothing that seeks to penetrate the market with a specialized variety of products for colored clothes. In the Consumer Goods International division, there were 3 launches in Brazil, 2 in Ecuador, 2 in Argentina, 1 in Colombia and 1 in Panama. In Brazil, these launches included new products in the Achocalatados, Cheese and Panettone categories under the "Geneo" and "Santa Amália" brands. In Ecuador, we launched cream-filled cookies in a variety of flavors, vanilla cookies, crackers and, we initiated imports of hot chili sauce. In Argentina, we revamped the "Bríos" cookies brand and launched a new flavor. In Colombia, two brands were launched in the Cookies & Crackers category. In Panama, the "Plusbelle" brand launched beauty soaps in a variety of scents. Finally, in B2B we added 4 new products to our Bakery platform, and incorporated soy sauce under the "Kikko" brand and coffee under the "Cafetal" brand to our Food Service platform, through business partner agreements.
4. Gross Profit reached S/ 658 million (+18.5% YoY) while the Gross Margin remained relatively flat compared to Q3 18'. Excluding the impact of Intradevco acquisition, Crushing business and IAS 29, Gross Margin was 27.5%, an increase of 1.5 p.p. YoY, mainly explained by i) lower raw materials prices which benefited the Consumer Goods Peru, B2B and Aquafeed units, ii) design-to-value initiatives in the Consumer Goods Peru unit and iii) pricing and revenue management strategies, in addition to a positive impact of the efficiency program implemented in the B2B business.
5. EBITDA amounted to S/ 383 million (+32.0% YoY) while EBITDA Margin reached 14.8%, an increase of 1.6 p.p. compared to Q3 ‘18. Excluding the impact of Intradevco acquisition, Crushing business, IAS 29 and non-recurring expenses, EBITDA amounted to S/ 323 million (+3.1% YoY) while EBITDA Margin remained flat compared to Q3 19' at 15.4%. The Organic EBITDA increase was mainly explained by i) higher Gross Profit in the B2B and the Aquafeed businesses, in line with a decline in commodity costs, ii) the positive results of the implementation of Argentina's restructuring program and iii) non-recurring expenses in Q3 '18 related to the Fino and Sao acquisitions.
6. Consequently, Net Income totaled S/ 159 million during Q3 19´, (+19.6% YoY), while Net Margin reached 6.1%, relatively flat compared to Q3 ‘18. Earnings per Share (EPS) increased from S/ 0.155 in Q3 18´ to S/ 0.185 in Q3 19´. Excluding the impact of Intradevco acquisition, Crushing business, IAS 29 and non-recurring expenses, Net Income amounted to S/ 164 million (+4.1% YoY), while Net Margin reached 7.8% (+0.1 p.p.). Hence, the organic Earnings per Share (EPS) reached S/ 0.191 in Q3 19´.
7. Cash flow from Operations as of September 2019 was S/ 802 million, S/ 178 million higher than the figure generated in the same period of 2018. The higher Operative Cash Flow was mainly explained by an increase of sales of +S/ 1,086 million, but partially offset by higher payments to suppliers and employees for S/ 761 million and S/ 138 million YoY, respectively. Cash Flow used in Investing Operations as of September 2019 was S/ 1,383 million, compared to S/ 1,119 million obtained during the same period of 2018. Higher Cash Flow invested was explained due to the acquisition of Intradevco which amounted to S/ 1,581 million, and CAPEX investments (PP&E) amounted to S/ 125 million as of September 2019. This increase was partially offset by the sale of Credicorp Ltd. shares, which amounted to S/ 343 million.
8. As of September 2019, Net Debt increased by S/ 1,161 million compared to December 2018, reaching S/ 3,495 million, mainly reflecting debt incurred undertaken due to Intradevco's acquisition. Net Debt-to-EBITDA ratio increased from 2.3x as of December 2018 to 3.0x as of September 2019.
For a full version of ALICORP's Third Quarter 2019 Earnings Release, please visit:
Alicorp is a leading Consumer Goods company headquartered in Peru, with operations in other Latin American countries, such as Argentina, Brazil, Bolivia, Chile, Ecuador, and exports to other countries. The Company focuses on four core businesses: (1) Consumer Products (food, personal and home care products), in Peru, Brazil, Bolivia, Argentina, Ecuador, Colombia and Chile, among other countries, (2) B2B Products (industrial flour, industrial lard, pre-mix and food service products), (3) Aquaculture (fish and shrimp feeding) and (4) Oilseeds crushing (soybean and sunflower) which is part of the vertically-integrated consumer business in Bolivia. Alicorp has over 7,600 employees in its operations in Peru and international subsidiaries. The Company´s common and investment shares are listed on the Lima Stock Exchange under the ticker symbols ALICORC1 and ALICORI1, respectively.
