Release Date: February 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Grupo Bimbo SAB de CV (BMBOY, Financial) achieved record top-line growth in 2024, driven by strong performance in Mexico and the EAA regions.
- The company completed five strategic acquisitions in profitable and growing markets like Eastern Europe and North Africa, enhancing its global profile.
- Grupo Bimbo SAB de CV (BMBOY) reached 97% renewable electricity globally, with 100% renewable electricity in 28 out of 35 operating countries.
- The company was recognized for its commitment to global nutrition and health, ranking 4th among food companies evaluated by the Access to Nutrition Initiative.
- Sales in Latin America increased by 13.8%, with strong growth in countries like Argentina, Paraguay, El Salvador, and Panama.
Negative Points
- In North America, the topline declined by 5.7% due to a weak consumption environment and strategic exit from certain non-branded businesses.
- The adjusted margin in North America contracted by 390 basis points, primarily due to strategic investments and one-time charges related to bakery closures.
- Grupo Bimbo SAB de CV (BMBOY) faced a challenging consumer environment in North America, with prolonged inflationary pressures affecting consumption.
- The company is still awaiting regulatory approvals for acquisitions in Brazil and the Balkans, which could delay expansion plans.
- Grupo Bimbo SAB de CV (BMBOY) anticipates a challenging first half of 2025 due to ongoing investments in North America and a strained consumer environment.
Q & A Highlights
Q: Can you elaborate on the expected benefits from your investments in North America, particularly in the second half of 2025?
A: (Diego Aciola, CFO) We anticipate seeing benefits from our investments in North America starting in the second half of 2025. The first half will be challenging due to tough comparisons and ongoing investments. However, we expect to see improvements as the benefits from these investments begin to materialize, alongside a more favorable comparison base.
Q: How much of your Mexican operations are exposed to potential tariffs on exports to the US?
A: (Rafael Sameer, CEO) Less than 10% of our US revenues come from Mexican exports, so the impact of potential tariffs would be minimal. We have contingency plans to mitigate any impact, including maximizing local production in the US.
Q: What are the main drivers behind the 2% year-over-year growth in Mexico's top line?
A: (Rafael Sameer, CEO) The growth is primarily driven by volume increases, supported by innovation and a strong market presence. We have been prudent with pricing strategies, focusing on volume growth through new product introductions and market expansion.
Q: Can you provide more details on the competitive environment in North America and any changes in consumer trends?
A: (Mark Bendix, Executive Vice President) We are seeing a bifurcation in consumer behavior, with economically stressed consumers opting for value offerings and more affluent consumers choosing premium products. Our focus is on expanding our value segment offerings and premium products to capture these trends.
Q: What is your strategy for driving growth in North America in 2025, and are there any plans for M&A activities?
A: (Mark Bendix, Executive Vice President) Our strategy includes focusing on health-conscious consumers, expanding capacity and distribution, and optimizing our asset base. We are also exploring M&A opportunities that align with our strategic goals, although no specific plans can be disclosed at this time.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
