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Grupo Herdez fourth quarter & full year 2019 earnings release

/ Investors / By

Mexico City, Mexico, February 27, 2020 – Grupo Herdez, S.A.B. DE C.V. (“Grupo Herdez” or the “Company”) (MSE: HERDEZ) today announced results for the fourth quarter and full year ended December 31, 2019.

“Our focus on innovation and growth, in conjunction with the resilience of our brands, gives us the confidence to look towards the future with optimism. We have done this for 105 years, and will continue doing so for many more,”

Said Héctor Hernández-Pons Torres, Chairman and Chief Executive Officer of Grupo Herdez.

CONSOLIDATED HIGHLIGHTS FOR THE YEAR

  • Net sales increased by 6.9% to MXN 22.4 billion, mainly driven by price increases over the last 12 months.
  • EBIT and EBITDA margins were 13.3% and 17.0%, respectively. EBIT declined 1.0 percentage points, whereas EBITDA margin increased 0.2 percentage points due to the adoption of IFRS 16.
  • Net income totaled MXN 2.2 billion, 8.2% lower than in 2018, with a margin decrease of 1.7 percentage points, due to lower participation in non-consolidated equity investments which fell to 9.9 percent.
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Grupo Herdez 2019

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2020

  • 2020: We launched the first edition of Semillero Nutrisa. Together with Nutrisa and the Victoria147 business academy for women, we invited women entrepreneurs to participate in a training program to improve the management of their businesses and have the potential to become part of our supply chain.

We established our first technological alliance with Google, which will allow us to accelerate the digital transformation of Grupo Herdez through the use of Google Cloud Platform tools such as BigQuery ML, Looker, among others.

Through the Herdez® brand and Aires de Campo® we joined the “Sowing a New Normality” initiative, promoted by the civil society organizations Ríos Tarango and Ectágono, which aims to increase the vegetation cover of the environmentally valuable area Barranca de Tarango.

  • 2021: We developed the Group’s second proprietary e-commerce platform, with the Nutrisa® online store.

We updated the apps through which we manage the loyalty programs of our retail brands, Cielito Querido Café® and Nutrisa®, improving our customers’ in-store experience.

During the year, 15 formulas had their nutritional profile strengthened by reducing some critical added nutrients (sugars, sodium and saturated fats).

  • 2022: We expanded our capabilities into new categories through the acquisition of Interdeli and Deli, Dips & Snacks. Integrating brands such as Libanius, Flaveur, Liguria and Señor Cactus into our portfolio.

We Issued the first sustainability bond through which we
committed to a 25% reduction in our water consumption.

Together with our partner McCormick & Company, Inc. we
brought the most iconic Mexican cuisine to the tables of the United Kingdom
through meal kits, sauces and condiments under the Herdez® brand.  In less than a year, we obtained a 5.5% shelf
share in the Tesco supermarket chain.

We consolidated the integration of Chilim Balam® into retail brands, a leading brand in the snack segment