TENDENCIES AND TRENDS (EL ECONOMISTA 7) GRUMA.

At the close of the first quarter of this year, the corn flour producer registered net debt of MXN 9.92 billion and an EBITDA of MXN 7.60 billion for the past 12 months, which equates to a gearing ratio of 1.3.

SHARES IN OHL PLUMMET.(EXCÉLSIOR 1-12)

Out of all the companies included in the IPC Index of the Mexican Stock Exchange, OHL Mexico reported the heaviest losses during the month of May. Shares in the company plummeted by 32.87% from MXN 30.91 at the end of April to MXN 20.75 on Friday past... The big winner in the month just ended wasGruma, whose shares soared by 9.92% to MXN 203.34 after the company’s investment-grade rating was recently restored.

REGIO INDEX SHOWS MODERATE IMPROVEMENT. (EL ECONOMISTA 2-4)

During the first five months of 2015, the Regio Index of Monterrey’s leading companies on the Mexican Stock Exchange registered an increase of 3.13%, compared to the 3.61% rise in the IPC Index. Grupo Financiero Monex’s monthly analysis of this indicator indicates that the issuers that recorded the highest growth were Axtel, with a 38.5% increase, followed by Gruma at 29.3%, and Lamosa at 16.4%... Over the same period, the companies reporting the highest returns were Vitro, Gruma and Axtel, while the poorest performing companies were GFamsa, OMA and Minera Autlán.

TLC OPENS MANUFACTURING PLANT IN GUATEMALA WITH THE SUPPORT OF MEXICO. (EL ECONOMISTA 25)

Mexico is set for a U-turn in its trade relationship with Guatemala, as it plans to increase its participation in the manufacturing supply chain in Guatemala and to export to the rest of Central America in a move that would open the door to investment from small and medium sized enterprises alongside transnational companies, said Mabel Gómez Oliver, the Mexican Ambassador to Guatemala. By the close of 2014, Mexican investment in Guatemala stood at 2.7 billion dollars, thanks to injections from large companies including América Móvil, Elektra, Mexichem, Bimbo, Cinépolis and Maseca...

MEXICANS AROUND THE WORLD. (EXPANSIÓN 28-29)

Gruma entrenches itself in Europe. After announcing its plans to set up a new plant in Moscow, Russia, and following its purchase of Azteca Foods in Spain, the Mexican firm “is focused on its core business”, says Rubén López, Analyst at BX+. “Gruma’s Spanish acquisition reinforces and strengthens its operations in Europe, where it is growing through the acquisition of medium-sized companies”, explains Gaspar Quijano, Analyst at Vector Casa de Bolsa...

MEXICAN CULTURE REACHES RUSSIA WITH “MEXICAN DAYS”. (EL INFORMADOR 0)

In collaboration with the Sverdlovsk regional government, the Mexican embassy in Russia has launched “Mexican Days” in the city of Yekaterinburg in a move aimed at promoting the cultural, trade, political and academic ties between both countries. Speaking before the media, Rodolfo Maldonado, CEO of Gruma Europe, and Mario Alanis, General Director for International Affairs at COFEPRIS, spoke about their experiences in Russia. Maldonado encouraged Mexican companies to invest in Russia, where Gruma is currently building a production plant in the Moscow region.

120 FAMILY BUSINESSES THAT ARE TRANSFORMING MEXICO.(MUNDO EJECUTIVO 2-34-43)

In the current postmodern era, family businesses would appear to form something of an archaic model, and yet Mexico is the Latin American leader in firms of this kind. This would appear to be founded on Mexican traditions of family “solidarity” when it comes to doing business. Family businesses play a powerful role in the Mexican economic structure, with official data suggesting that they account for between 70% and 90% of all businesses in the country. The companies appearing in this ranking tend to be in their second, or even in their third and fourth, generation, and in some respect their owners are in control of what happens in Mexico. The decisions they take can boost - or indeed restrict - efficiency and productivity; they have waited in line to take the reigns, and to make their companies and the national economy prosper, as they prepare the way for the arrival of a new generation of decision makers. In the list published,Gruma- founded in 1949 - is ranked at number 44.Juan Antonio González Moreno, CEO and Chairman of the Board of Directors. In 86th position isGrupo Industrial Maseca, founded in 1981.Juan Antonio González Moreno, CEO and Chairman of the Board of Directors.

THE UNSTOPPABLE FORCES OF THE STOCK EXCHANGE. (EL ECONOMISTA 1-8-9)

Financial groups have begun profiling the issuers they believe will perform most strongly on the Mexican Stock Exchange during the second half of this year. The companies expected to achieve the best results include Banorte, BanRegio, Bimbo, Cemex, Volaris, Pinfra, Gruma and Rassini, for which the recommended course of action is: Buy. So far this year, shares in Volaris have rocketed by 43.20%, Gruma’s shares are up 28.57%, and Rassini is up 25.67%. A few months ago, Grupo Financiero Interacciones agreed that Cemex, Banorte, Gruma, Pinfra and Rassini were the ones to watch.

GENOMMA LAB, ELEKTRA AND OHL, THE FASTEST FALLING SHARES IN 2015 (EL UNIVERSAL 1-3)

From January 1 to June 8, 2015, shares in Genomma Lab, Elektra and OHL were the biggest fallers on the Mexican Stock Exchange, and they are shaping up to be the big losers in the IPC Index during the first half of this year, analysts expect... By contrast, just a few weeks before the first half of 2015 draws to a close, the big winners are Gruma, Walmart and Grupo Aeroportuario del Pacífico (GAP), with a combined share price increase of 28.9% and a positive outlook for the rest of the year.

MEXICAN STOCK EXCHANGE UP BY 0.29% IN THE WEEK. (EL NORTE 0)

Despite the highs and lows of the financial markets throughout the week due to concerns over Greece, the IPC Index closed at 44,692.50 points on Friday. Trading was mixed, with 18 companies recording profits and 17 posting losses. The best performers were OHL México (OHLMEX*), Grupo Aeroportuario del Sureste (ASURB) and Gruma (GRUMAB), with increases of 1.97%, 1.78% and 1.10% respectively, to 19.15, 221.13 and 204.61 pesos per share.

WALL STREET LOOKS FAVORABLY ON MEXICAN FIRMS (EL ECONOMISTA pp-1-8-9)

 U.S. investors are optimistic about the performance of Mexican firms, and are increasing their shareholdings in some companies. They are attracted by ultra-low cost airline Volaris, for example, as well as corn flour producer Gruma and airport operator GAP, whose American Depositary Receipts (ADRs) on the New York Stock Exchange have rocketed by 37.4%, 26.3% and 15.5% respectively so far in 2015. According to The Washington Times, the corn-based Latin American food market could reach U.S. sales figures of US$11 billion in the 2017. Against this backdrop, U.S. investors see enormous growth potential in Gruma, which according to Brian Flores, Analyst at Grupo Financiero Interacciones, is compounded by the firm’s capacity to generate cash flow, its low gearing ratio, and its attractive profit margins. Fifty-nine percent of Gruma’s total revenues come from the U.S. market where tortilla consumption is rising steadily, which Flores says has allowed the firm to establish agreements with fast food restaurants such as Chipotle Mexican Grill.

“THE 500”: NOT MANY GIANTS. (EXPANSIÓN 18-60-61)

It is a tough decision for business leaders. What should be their company’s key strategic objective: Growth or making a profit? It all depends on their long-term outlook. If their aim is to increase the value and longevity of their business, then sustained growth must be their goal. It can be hard to resist the temptation of reveling in high returns, and yet the “500 Leading Mexican companies” from Expansión provides a clear example of what a company can achieve through this strategy. The classic example commonly used in business literature to back up this strategy is Amazon. The global online retail giant has never made significant profits, nor has it paid out dividends. Neither greater productivity nor job creation. The study reveals that growth of business has no direct correlation to job creation or increased productivity. Both Cemex and Gruma have increased their workforce by over 1,200% over the past 35 years. However, this does not necessarily mean they have created new sources of employment. Cemex achieved this increase by purchasing other companies that had an established workforce. There are some companies, however, such as Gruma, that have created new jobs, since their growth has been organic. Nevertheless, these cases are few and far between.

MARKET SUCCESSES. (EXPANSIÓN 104-164-166)

Grupo Peñafiel currently produces and sells Clamato, the most popular brand of the beverage of the same name, in Mexico, United States and Canada. As Enrique Ortiz, the firm’s Marketing Manager, explains, Grupo Peñafiel’s portfolio consists of three kinds of brands... According to the estimates of IBTS World, a global business intelligence company that specializes in market research, the purchasing power of U.S. firms will grow by 27.5% to US$14.7 trillion. Meanwhile, the purchasing power of the country’s Hispanic population will reach 48.1%, or 1.4 trillion dollars. “Peñafiel is set to follow the example of other Mexican firms such as Gruma and Herdez, who also serve the U.S. Hispanic market”, said Verónica Uribe, Analyst at brokerage firm Monex.

BEYOND MEXICO. (EXPANSIÓN 264)

The 25 biggest global companies on the “500” list experienced international market growth of 8.3%, while in Mexico this growth was 6.6%. “It is caused by weakening domestic consumption, which has been unable to recover as quickly as hoped”, said Verónica Uribe, Analyst at Monex. The Mexican economy grew by just 2.1%, and the country’s global giants are preferring to cast their eyes abroad. Some firms have expanded their operations as they look to diversify, as Mexican markets become saturated by competition and reforms in the sectors where they operate... Mexican company Gruma has purchased the operations of Spanish firms Fat Taco and Azteca Foods for the production and marketing of tortillas, wraps, totopos, salsas and ready-made meals. The deal was worth 45 million euros, and is in line with the company’s strategy of focusing on its key business.

500 / 1975-2015 / THE MOTHER OF ALL RANKINGS. (EXPANSIÓN 216-227) (EXPANSIÓN 228-241)

The ranking of the “500 Leading Mexican Companies” published by Expansión includes organizations that we can classify as enterprises; or rather, entities that offer a good or a service, and register revenue or sales, regardless of who they are owned by and their type of business. The list aims to provide an overview of the leading Mexican companies across several economic sectors. The list is by no means a company census, but rather a snapshot of Mexican business management in a given year. Gruma in 54th position, Grupo Industrial Maseca 156th.

ROLL OF HONOR. (EXPANSIÓN 242-246)

The companies with notable key financial indicators. Return on the Mexican Stock Exchange: Gruma.

GRUMA’S PROFITS LEAD THE STOCK EXCHANGE FOR THE THIRD CONSECUTIVE YEAR. (EL FINANCIERO 20) (LA JORNADA 29)

Gruma has found the recipe to the top-performing share price on the Mexican Stock Exchange: leverage demand, reduce debt, add a pinch of expansion abroad and garnish with a weak Mexican peso. Shares in Gruma, a company that sells tortillas in the United States under the Mission, Guerrero and Calidad brands, has yielded a return of 29% this year, and they are well on their way to becoming the top performer in the IPC Index of the Mexican Stock Exchange for the third consecutive year. The company’s share price has increased by more than 400% since it implemented a restructuring plan in late 2012. Gruma is increasing its profits this year as it continues to reduce expenditure and maintain a healthy debt level, according to the company’s Director of Finance, Raúl Cavazos. In the first quarter of 2015, Gruma’s total debt fell by 3.8% compared to the previous year, to US$758 million.

ALFREDO HUERTA / FINANCE 24. (24 HORAS 15).

Gruma figures among the top-performing companies in 2015, with a return on its share price of 27.8%. In other words, if you had invested 100,000 pesos in the NAFTRAC ETF program at the beginning of the year you would have earned MXN 4,000, whereas if you had invested the same amount in Gruma you would now have your hands on MXN 27,800 in cash after just six months. With 72% of its sales coming from abroad, the depreciation of the Mexican peso caused by the fall in oil prices has handed the firm the opportunity to increase its profit margins further.

“THE ABILITY TO REACT WILL MARK THE DIFFERENCE BETWEEN THE REGION’S ECONOMIES”.(EL FINANCIERO 16)

Looking beyond the interest rate fluctuations in the United States, the investment flowing into Latin America can be attributed to the region’s economic growth potential with a growing middle class and positive long-term expectations, and it is against this background that Mexico finds itself in a strong position, said Juan Pablo Cuevas, Regional Managing Director and Head of Global Transaction Services at Bank of America Merrill Lynch. He indicated that these volumes are increasing with the expansion of multinationals, whereas “multi-Latin” companies also now exist and include Bimbo, Cemex andGruma, which the bank could also assist as they expand worldwide.

WINNERS / LOSERS (FORBES MÉXICO 22)

Juan Antonio González Moreno.Gruma’s market value +7.34: MXN 85.9 billion. The company continues to earn high grades from rating agencies thanks to its strong financial position.

TRUSTS ARE THE MOST DILIGENT (EXCÉLSIOR 12)

The National Banking and Securities Commission (CNBV) was tasked to rate the performance of companies in relation to their disclosure of information. It concluded that 14 of the 131 companies trading on the Mexican Stock Exchange failed the evaluation, with five firms scraping through and all the rest passing by meeting 80% to 100% of requirements. The failing companies, namely Agro Industrial Exportadora, Homex, Edoardo, Grupo Casa Saba, Grupo Comercial Gomo, Industria Automotriz, S.A., Ingeal (previously MacMa), Q.B. Industrias, Savia, Tekchem, Urbi, Qumma and GEO, failed to deliver the information requested. On the other hand, 83 companies achieved a score of 100 percent in the areas assessed by the CNBV, including FEMSA, Cemex, Alsea, Agua, Chedraui, Bimbo, Walmex, Grupo México, El Palacio de Hierro, Vitro, Comerci and Gruma.

MULTIMEDIOS LAGUNA TO DEDICATE PROGRAMMING TO CANCERATHON (MILENIO DIARIO DE MONTERREY 0)

Ángel Carrillo Romero, Director of Operations at Multimedios Laguna, announced that regular programming of “The channel everyone watches” will be suspended between 10:30 p.m. on Friday June 26, and midnight on Saturday June 28, to join Cancerathon 2015. Multimedios Televisión, Multimedios Radio and Milenio will be joined by other nationwide sponsors including Farmacias del Ahorro, BanRegio, Cemex, Cablevisión, Fud, Gruma, Lala, Aeroméxico, Yoplait, La Villita, Famsa, Norteñita, ArcaContinetal, Hospitaria, the Autonomous University of Nuevo León and Un Minuto Contra el Cáncer.

NEWS IN BRIEF / MEXICO. (NEO 7)

Gruma has purchased Fat Taco and Azteca Foods, two Spanish firms that produce and market tortillas, wraps, totopos, salsas and ready-made meals.

GRUMA ANNOUNCES IMPENDING EXIT FROM THE NYSE (EL ECONOMISTA 12)

Speaking through the Mexican Stock Exchange, the corn flour producer announced its intention to terminate its Deposit Agreement with Citibank regarding its American Depositary Receipts (ADRs), to delist its ADRs from the New York Stock Exchange, and to terminate its reporting obligations under the Securities Exchange Act of 1934. “Gruma has decided to delist and deregister the ADRs because it wishes to concentrate the trading of its shares on the Mexican Stock Exchange”, the issuer explained in a press release. The termination of the ADR program will bring benefits to Gruma by reducing costs associated with it, including listing, legal and auditing fees, among others. The expected termination date of the Agreement is September 7, 2015, when GRUMA expects the NYSE to suspend trading in the ADRs.

“DANCE OF THE MILLIONS” ON BOTH SIDES OF THE ATLANTIC. (MILENIO DIARIO 2)

Trade relations between Mexico and Spain have held strong despite the economic transformations in both countries. Below are the companies that have invested in one or both countries over the past 12 months.Gruma US$50m.

CORPORATE (LA CRÓNICA DE HOY 26)

Gruma will not be negatively affected by the delisting and deregistration of its American Depositary Receipts (ADRs’) from the New York Stock Exchange, as security holders will have the option of whether to cash out their securities or turn them into shares, said Hermosillo Bernal, Analyst at Actinver.