Bimbo shares collapse in the BMV

Grupo Bimbo's shares in the Mexican Stock Exchange (BMV) had a fall of 6.11% half-day on Tuesday, its steepest fall since August 2011, a day after releasing the general corporate results for the second quarter of 2019, in which it also showed figures below the estimate as well as a reduction in its performance in the sector.

Bimbo reported revenues of 72,324 billion pesos in the second quarter of 2019, below the 72,900 billion estimated by Bloomberg analysts. According to its financial report sent to the Mexican Stock Exchange (BMV), sales of the company recorded a decline of 0.6 percent in these three months, reaching 72,324 billion pesos.

Between April and June, net sales in Mexico fell 0.4 percent, as a result of a weaker consumer environment mainly in the traditional channel and in the categories of sweet bread and snacks, as well as the intercompany strategy implemented between the subsidiaries of Mexico and the United States.

While they fell 1.9 percent, reflecting the pressure of the exchange rate and a decline in sales in dollars of less than 1.0 percent, Latin America fell 3.0 percent due to economic conditions in Argentina and the competitive environment in Brazil.

In Europe, Asia, and Africa, sales in the second quarter increased 5.3 percent, driven mainly by the acquisition of the Chinese bakery Mankattan, the performance of the Bimbo QSR business and the bagel category in the United Kingdom, as well as the best trends in the sweet bread category in Iberia.

Grupo Bimbo decided to operationally separate its Barcel snack business from its Ricolino candy line, as part of the measures put in place to circumvent the economic slowdown affecting the Mexican market during the second half of the year.

Each of the divisions will have its management team focused on their respective lines, although the two businesses will continue to benefit from their synergies, the company said in a conference with analysts and investors.