Grupo Herdez tax resolutions

Mexico City, Mexico, February 27, 2020 – Grupo Herdez, S.A.B. de C.V. (“Grupo Herdez” or the “Company”) (BMV: HERDEZ) announces that it’s currently challenging through an appeal, the resolutions issued by the tax authorities through which they denied the refund claims of favorable balances of the value added tax (VAT), derived from using the 0% VAT rate upon the sales of yogurt ice-cream and popsicles. Up to this date, the appeals are pending resolution of the controversy (denial of refund claims), of which the result does not imply an assessment upon tax obligations, contingencies or omitted taxes. The amount to recover is MXN 278 million at 2019-year end.

In addition, the Company is currently being audited by the tax authorities regarding the VAT for the fiscal years 2014 to 2016. Up to this date, the tax authorities have not issued any assessment.

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