GRUMA SHARES ARE UP 57.17% THIS YEAR (EL ECONOMISTA 1-5)

Gruma, the global leader in corn flour production, has maintained its rising share prices as the company continues to prove its capacity as one of the best-yielding issuers on the Mexican Stock Exchange since 2013. The company directed by Juan González Moreno explained in a press release that its shares have reached record highs in nearly every period. So far, shares have risen 57.17% in 2014, boosted by the strong income and profit outlooks for 2014. According to the company, the recent upward trend in its shares is related to strong growth expectations for this year, with profits forecast to increase by 34% compared to 2013 to stand at 2.78 billion pesos... Most tortillas made in Mexico, 65%, continue to be produced using lime-treated (nixtamalized) corn dough compared to the 35% produced using corn flour. Production of these is broken down as follows: 25% is made by Maseca; 8% is made by Minsa; 1% is made by Harimasa; 0.50% is made by Cargill; 0.40% is made by Macsa and 0.20% is made by Blancas…

WINNERS AND LOSERS ON THE MEXICAN STOCK EXCHANGE DURING THE FIRST HALF OF THE YEAR (EL FINANCIERO p-30)

Despite the slow start experienced by the Mexican Stock Exchange this year caused by poor economic indicators, there were some outstanding issuers on the Stock Price Index (IPC, acronym in Spanish), such as Gruma, IEnova, Grupo Aeroportuario del Pacífico, OHL México and Alsea, all of which reported double digits at the end of June... Gruma, the biggest winner on the IPC, has performed well in the market with its actions aimed at achieving sustainable growth in profitability, as well as having acquired companies abroad and selling assets with low operating cash flows, explained Alberto Carrillo, a food analyst at Signum Research...

GRUMA HAS OUTSTANDING POSITIVE MARKET PERFORMANCE (OVACIONES 2)

Gruma, the global leader in corn flour production, continues to take center stage at the Mexican Stock Exchange as the best-yielding company during the first half of the year. So far in 2014 its shares have risen 57.17% to reach record highs, boosted by strong income and profit outlooks for the current year, thus making it clear that the market rewards efficient management...

MEXICANS WORLDWIDE (EXPANSIÓN 22-23) 

European-style Totopos. Gruma is broadening its horizons to Europe and Asia, having signed an agreement in May to purchase Spanish company Mexifoods, the country’s leading producer of tortillas, totopos and other corn-based products. As part of its growth strategy Juan Antonio González Moreno, Chairman of the Board of Gruma, says the company will use its new tortilla division in Madrid to distribute to five more countries. It is investing US $170 million in its global expansion. In addition to its commitment to growth, the company is also steadfastly reducing its debt, says José María Flores, an analyst at brokerage firm Ve por Más.

SPAIN ATTRACTS MEXICAN INVESTORS (EL FINANCIERO PP-4)

Direct investment in Spain by Mexican companies is on the rise. In 2013, levels of investment rose to US $743 million: an upturn of 284% over the previous year. Mexican ADO’s purchase of Avanza, Spain’s leading bus company; Sigma’s acquisition of Campofrío sausages; Gruma’s purchase of Mexifoods, and the acquisition of Spanish shipyards by Pemex are just some of the most recent investments...

SLOW GROWTH AFFECTS CONSUMER COMPANIES (EL ECONOMISTA 1-8-9)

The analysts we consulted have profiled companies listed on the Mexican Stock Exchange that recorded the highest yields during the April-June 2014 period, which included Gruma, Bimbo, Walmex and Liverpool...

AGREEMENT AGAINST TAX EVASION SIGNED (CAPITAL DE MÉXICO 5) (EL NORTE 0)

A group of Spanish and Mexican companies have submitted a series of proposals in Madrid, Spain to renew the bilateral agreement to avoid double taxation, and prevent fraud and tax evasion, which was signed into effect in 1994... The companies backing the agreement’s renewal are Telefónica, ACS, Grupo Alfa, Cemex, Grupo Santander, Iberdrola, Grupo Bimbo, Repsol, BBVA, ADO, Gas Natural Fenosa, OHL and Gruma...

CARLOS HANK GONZÁLEZ/GUEST COLUMN/FOUNDATIONS FOR A DEVELOPED MEXICO (MUNDO EJECUTIVO 48)

Carlos Hank González, CEO of Grupo Financiero Interacciones and Grupo Hermes, and Vice President of Gruma, writes: “The developed Mexico we want and that we are all working towards will not come overnight. With the reforms proposed by the Federal Executive Branch, some of which have been approved and others which are currently under discussion in Congress, we will be setting solid foundations to achieve our goal sooner rather than later...

LOW CORN PRICES HAS NOT REDUCED TORTILLAS PRICES (LA JORNADA 25)

One metric ton of corn is now quoted in the international grain market at a price 40% lower than it was two years ago, when it reached its highest price in three decades. The reduction in the cost of the main ingredient used to make tortillas has not been felt by end consumers in a market dominated by companies that produce the food using traditional methods of grain nixtamalization (treatment with lime), as shown by official data and information from international organizations. Tortillas, one of the basic staples of the Mexican population, are essentially produced using two methods. The traditional way, using nixtamal dough —obtained by cooking the grain— which accounts for two thirds of domestic consumption, with the remaining one third made with corn flour. Last month in Monterrey Juan González Moreno, President and CEO of Gruma, the leading corn flour producer in Mexico, said the price of corn flour has decreased by up to 30% in recent months, and yet this price reduction has not reached the end consumer.

THE 300 MOST INFLUENTIAL LEADERS IN MEXICO/101-124 (LÍDERES MEXICANOS 172-184)

Líderes Mexicanos magazine publishes its ranking of the most influential leaders in Mexico. Juan González Moreno, Chairman of the Board of Gruma and GIMSA, is ranked in the 122^nd position…

DESPITE THE CRISIS, 31 LEADING COMPANIES INCREASE THEIR REVENUE BY 46% (LA JORNADA 22)

Amidst a slow economic recovery with high levels of unemployment and low public spending rates, the 31 leading companies in Mexico have increased their revenue by 6% during Q2 2014, a figure three times higher than the 2.14% growth expected for the economy between April and June of this year. Analysts agreed that after excluding the revenues of the leading financial groups, the 31 largest companies in Mexico, such as Bimbo, Gruma, Lala, Walmart, Liverpool, Sanborns, Alfa, ICA, Cemex, Peñoles, Grupo México and América Móvil, made net profits of approximately MXN 59.2 billion, a figure 46% higher than the MXN 40.5 billion achieved at the end of June 2013.

SLIM OWNS FOUR OF THE HIGHEST-VALUED BRANDS IN MEXICO (EL UNIVERSAL 5) (LA JORNADA 24), (EL ECONOMISTA pp-21), (EL NORTE 0)

Business magnate Carlos Slim Helú owns four of the most valuable brands in Mexico: Telcel, Telmex, Inbursa and Sanborns, for a total value calculated at US $10.22 billion. However, experts claim that the outlook for the sector indicates that this dominance will decline over the next five years due to the impact of telecommunications reform. According to Interbrand’s 2014 Best Mexican Brands study, the most valuable brands were Telcel, Corona, Telmex, Oxxo, Bimbo, Modelo Especial, Banorte, Banamex, Televisa, Bodega Aurrerá, Inbursa, Mexichem, Liverpool, Compartamos Banco, TV Azteca, Aeroméxico, Fud, Elektra, Jimador, Superama, Interjet, Suburbia, Cementos Moctezuma, Sanborns and Maseca. 

MASECA SELLS 4% OF ITS CAPITAL STOCK (LA JORNADA 25) (EL NORTE 0)

Grupo Industrial Maseca (GIMSA) reported this Wednesday that it has sold 37,068,962 shares, which account for approximately 4% of the company’s total shares, for the sole purpose of providing those who performed the operation with greater liquidity. Yesterday the company informed the Mexican Stock Exchange that an extraordinary amount of shares were sold during the day of operations...

JESÚS RANGEL/TUG-OF-WAR (MILENIO DIARIO 26)

Grupo Industrial Maseca yesterday reported through the Mexican Stock Exchange that a group of investors has sold more than 37 million shares at the market price (approximately four percent of the company’s total shares). This was done to ensure liquidity and does not affect the company...

IN THE NORTH (EL NORTE 0)

The Ambassador of Spain in Mexico, Luis Fernández Cid, is visiting Monterrey for the first time. Six months after taking office, the diplomat met yesterday with Mexican and Spanish business leaders, and representatives from universities. He spoke in a meeting with business leaders including Soriana Chairman Ricardo Martín Bringas, and Alfa and Gruma CEOs Paulino Rodríguez and Juan González Moreno at the Founders Meeting Hall of the Cervecería Cuauhtémoc facilities.

BACK TO TORTILLAS (EXPANSIÓN 6-40-46) Roberto González Barrera, the founder of Grupo Maseca (Gruma)

was a strong-willed individual who was not easily persuaded, recalls a former employee of the world’s largest tortilla corporation. Formal and well-disciplined in his approach, he would start his day at six in the morning and was so meticulous that the first thing he would do when he arrived in the morning was check the cleanliness of the offices. Up until two years ago, Gruma was led as a family business where everyone at all levels knew who was boss. Nevertheless, González Barrera had the respect of the more than 20,000 employees, who affectionately called him “Don Maseco”. However, the Gruma story changed forever on August 25^th, 2012 with the death of its founder and his “Don Maseco” business leadership style. His heirs, led by Juan Antonio González Moreno, decided to take the company back to its roots and make it more profitable. Consequently, the company’s profitability and operating margins increased from 5.2% to 8.9% last year with share prices rising almost 300% from MXN 39.17 to 155.030 between December 31^st, 2012 and July 1^st, 2014... Juan Antonio González Moreno was able to persuade Eduardo Livas Cantú and Javier Vélez Bautista out of retirement. These are two key figures that not only know the company inside out, but can also bring their experience of the past to bear with a fresh outlook on the future...

GRUMA PAYS DIVIDENDS FOR THE FIRST TIME IN SEVEN YEARS (EL FINANCIERO 29) (EL NORTE)

Gruma announced it would pay its first cash dividend since 2007 for an amount equal to MXN 649 million, at 1.50 pesos per share. “It’s surprising as we weren’t expecting this to happen until 2015 once the company had reduced its leverage. We believe this is a positive move that stimulates rising share trends in the short term,” said analysts at Barclays...

GRUMA SHARES ARE UP 57.17% THIS YEAR (EL ECONOMISTA 1-5)

Gruma, the global leader in corn flour production, has maintained its rising share prices as the company continues to prove its capacity as one of the best-yielding issuers on the Mexican Stock Exchange since 2013. The company directed by Juan González Moreno explained in a press release that its shares have reached record highs in nearly every period. So far, shares have risen 57.17% in 2014, boosted by the strong income and profit outlooks for 2014. According to the company, the recent upward trend in its shares is related to strong growth expectations for this year, with profits forecast to increase by 34% compared to 2013 to stand at 2.78 billion pesos... Most tortillas made in Mexico, 65%, continue to be produced using lime-treated (nixtamalized) corn dough compared to the 35% produced using corn flour. Production of these is broken down as follows: 25% is made by Maseca; 8% is made by Minsa; 1% is made by Harimasa; 0.50% is made by Cargill; 0.40% is made by Macsa and 0.20% is made by Blancas…

THE 500 LEADING COMPANIES IN LATIN AMERICA/1-250 (AMÉRICA ECONOMÍA 86-95)

AméricaEconomía magazine has published the list of 500 leading companies in Latin America, with Gruma ranked 138 (2013) … In the table of companies showing most growth by EBITDA, Gruma is ranked 16^th (2013) with Grupo Industrial Maseca in the 23^rd position (2013)… In the table showing greatest decapitalization, Grupo Industrial Maseca is ranked 16^th (2013)… In the table showing Return on Equity, Grupo Industrial Maseca is ranked 47^th (2013)…In the table showing Return on Assets, Grupo Industrial Maseca is ranked 18^th (2013).

THE 500: THE 50 LEADING COMPANIES IN MEXICO (AMÉRICAECONOMÍA 130)

AméricaEconomía magazine has published its list of 500 leading companies in Latin America, in which Gruma is ranked 42^nd (2013) among the top 50 leading companies in Mexico.

GRUMA’S NET INCOME UP 403% (EL ECONOMISTA 1) (EL ECONOMISTA 8) (REFORMA 8) (EL NORTE 0)

Gruma, the global leader in corn flour and tortilla production, has reported its continued upward results in Q2 2014 as it posted a 403% increase in net income, to stand at MXN 1.14 billion, as well as a 30% increase in operating profits to stand at MXN 1.36 billion... The remarkable results in the company’s net income were due primarily to the improved better operating performance, exchange rate fluctuation, lower interest rates and lower taxes...

EFFICIENCY BOOSTS GRUMA’S CASH FLOW (EL FINANCIERO 36)

Yet again, the efficiency achieved in terms of costs and spending, in addition to a reduction of debt and tax, allowedGrumato post positive results in Q2 2014 with 13% growth in operating cash flow, 30% growth in operating profits and a 403% increase in net income. Its sales volume and revenue were similar to the same period in 2013...

IRASEMA ANDRÉS DAGNINI/GOOD BOOKS (LA RAZÓN 18)

Gruma surprises once again with financial results showing a three-digit percentage increase in revenue. In the second quarter of the year, the company produced net profits of MXN 1.2 billion, up from MXN 922 million the previous year for an extraordinary increase of over 328%; and this isn’t the first quarter in which it has shown such increases... The Gruma business model should serve as an example of continuity, commitment and perseverance for all companies. With 65 years in the corn flour production market and with a worldwide presence, Gruma’s effective long-term management and planning allows the company to leverage business opportunities...

GRUMA’S NET PROFITS SHOT UP BY OVER 400% IN THE SECOND QUARTER (MILENIO NOTICIAS (12 to p.m.)

Reporter:Gruma’snet profits shot up by over 400% in annual terms during the second quarter. The tortilla producer reported a net income of MXN 1.14 billion between April and June, compared to MXN 226 million for the same period in 2013...

ÉDGAR GONZÁLEZ MARTÍNEZ/THE CAPITALS (EL SOL DE MÉXICO 5) 

Who’s who of business. GRUMA announced its operating results at the close of the second quarter of 2014 (2Q14), showing significant improvements.

GIRA GRUMA ESTRATEGIA Y GANA RENTABILIDAD(REFORMA 1) (EL NORTE 0)

Menor deuda, mayor rentabilidad y un incremento del 127.7 por ciento en el precio de su acción en el último año, son el resultado de un cambio en la estrategia de Grupo Maseca (Gruma). Raúl Cavazos Morales, director corporativo de Finanzas y Planeación Estratégica, dijo en entrevista que la empresa adelantará para fines de este año el pago de su deuda por las acciones que compró a Archer-Daniels-Midland Company (ADM), la cual tenía programada para 2015. Al detallar el cambio, el directivo señaló que en el pasado la empresa estaba enfocada en el crecimiento por volúmenes y en expandir su presencia global. Con la llegada del nuevo presidente y director general, Juan Antonio González Moreno, el enfoque fue hacia consolidar las operaciones y hacia un crecimiento rentable. Cavazos Morales aseguró que ahora están listos para reducir el nivel de deuda. “A raíz de la venta por parte de nuestro socio ADM en su paquete accionario que tenía en Gruma y algunas de sus subsidiarias, la compañía incrementó su apalancamiento en 450 millones de dólares a nivel consolidado. “Puedo confirmar que este proceso de desapalancamiento terminará en este 2014”, anotó…

INTERNATIONAL OPERATION WILL ‘NURTURE’ GRUMA’S GROWTH THROUGH 2016 (EL FINANCIERO 32)

Gruma wants to conquer the world once again after a year and a half of ‘belt-tightening’ achieved through an aggressive plan of cuts to costs and spending. Over the next two years, the growth strategy of the global leader in tortilla and corn flour production will focus on international expansion and profitability in its operations, particularly in the United States, Europe and Asia. “By 2016 our international operations will contribute about 73% of our consolidated sales and 68% of operating cash flow (EBITDA), compared to the 69% and 60% they currently contribute,” saidCFO Raúl Cavazosin an interview.Grumawill therefore aim to expand abroad by way of organic growth and acquisitions, particularly in Europe and Asia...

ALBERTO BARRANCO/ENTERPRISE (EL UNIVERSAL 4)

Gruma shakes off debt. With debts of US $450 million following its purchase of the share package in the company held by U.S. firm Archer Daniels Midland, Grupo Maseca set out on a long deleveraging process that is about to come to an end. The company got rid of one of its subsidiaries during this process: Molinos de México (sic!). With this operation the company plans to wrap up by year-end, it is eyeing new investment opportunities in the European Union and Asia. In the meantime, it is building four new plants, two in Mexico, and one in Malaysia and another in Russia. The firm is directed by Juan Antonio González Moreno, son of the company’s founder, now deceased, Roberto González Maseca (sic)…

INVESTMENTS (MILENIO DIARIO 28)

Piling on the kilos. In case you didn’t know, let us be the first to tell you that over the next two years Gruma, the global leader in corn flour production, is planning to implement a growth strategy in the international market with the further aim of making its operations in the United States, Europe and Asia more profitable, forecasting a 73% growth in sales compared to the 69% posted during the second quarter of this year, as well as growth in its operating cash flow from 60% to 68%.