CONFORMED
---------
Securities and Exchange Commission
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 Or 15d-16
Of The
Securities Exchange Act of 1934
For the month of July 25, 2007
BACHOCO INDUSTRIES
(Translation of Registrant's name into English)
Avenida Tecnologico No. #401
38010 Celaya, Guanajuato
(Address of principal office)
(Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.)
(Check One) Form 20-F |X| Form 40-F |_|
(Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing information to the Commission
pursuant to Rule 12g-3-2(b) under the Securities Exchange Act of 1934.)
(Check One) Yes |_| No |X|
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b). 82__.)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Industrias Bachoco, S.A.B. de C.V.
(Registrant)
Date: July 26, 2007 By /s/ Daniel Salazar Ferrer, CFO
------------------------------
Second Quarter 2007 Results | Page 1
Industrias Bachoco Announces Second Quarter 2007 Results
Celaya, Gto., Mexico, - July 26, 2007 - Industrias Bachoco S.A.B. de C.V.
("Bachoco" or "the Company") (NYSE: IBA; BMV: Bachoco B), Mexico's leading
producer and processor of poultry products, today announced its unaudited
results for the quarter ended June 30, 2007. All figures have been prepared in
accordance with Mexican GAAP and are stated in constant Mexican pesos as of June
30, 2007.
Highlights:
o Sales of Ps. 4,693.9 million were the highest recorded in a single
quarter in Bachoco's history, increasing 24.1% above the same period
last year.
o Gross margin for the quarter was 23.1%, compared to 21.4% in 2Q06
o EBITDA for the second quarter 2007 was Ps. 677.1 million, 53.2%
higher than 442.1 reached in the same period 2006. EBITDA margin for
the second quarter was 14.4%
o Bachoco's EPS reached Ps. 0.77 (US$0.86 per ADS) for the quarter,
compared to EPS of Ps. 0.54 (US$0.60 per ADS) in the same period
last year
CEO's Comments:
Cristobal Mondragon, CEO of Bachoco, stated, "Our record sales and strong EBITDA
margin increase for the second quarter were supported by favorable market
conditions and our operating efficiencies.
"The integration of the two acquisitions announced in the first quarter of the
year is progressing in line with our expectations, and should be completed in
the coming months.
"Our financial condition remains healthy and CAPEX continues to be financed
entirely with internal resources."
Second Quarter 2007 Results | Page 2
SECOND QUARTER 2007 RESULTS
================================================================================
Net Sales
Net sales for the quarter reached Ps. 4,693.9 million, 24.1% above the Ps.
3,780.9 million reported in 2Q06. This growth was driven by an increase of 26.8%
in chicken sales, 21.0% in table eggs sales, 22.4% in swine sales, and 6.6% in
balanced feed sales.
----------------------------------------------------------------------
Net Sales by Product Line 2Q07 2Q06
% %
----------------------------------------------------------------------
CHICKEN 79.1 77.5
----------------------------------------------------------------------
EGGS 8.3 8.5
----------------------------------------------------------------------
BALANCED FEED 8.2 9.5
----------------------------------------------------------------------
SWINE AND OTHER LINES 4.4 4.5
----------------------------------------------------------------------
TOTAL COMPANY 100.0 100.0
----------------------------------------------------------------------
Operating Results
Bachoco's second quarter gross margin reached 23.1%, compared to 21.4% in 2Q06.
This increase reflects price increases across our product lines, which helped
compensate for a 21.5% increase in cost of sales. The Company's operating margin
of 11.6% compares favorably to 8.3% for the same quarter in 2006. EBITDA for the
quarter reached Ps. 677.1 million.
Taxes
The Company recognized Ps. 130.6 million in taxes during the quarter.
Net Income
Net income for 2Q07 was Ps. 464.5 million, or Ps. 0.77 per share (US$0.86 per
ADS), compared to net income of Ps.321.0 million, or Ps.0.54 per share (US$0.60
per ADS) reported in the same period of 2006.
Second Quarter 2007 Results | Page 3
RESULTS BY BUSINESS SEGMENT
================================================================================
Chicken
Sales grew 26.8% during 2Q07 as a result of a 10.6% volume increase and a 14.7%
price increase compared to 2Q06. Prices increased primarily due to a stronger
chicken market, while volume increased as a result of the integration of the new
operations and added production capacity.
Table Eggs
Sales of table eggs increased by 21.0% with volume rising 5.6% and prices
growing 14.6% from the same quarter last year.
Balanced Feed
Sales of balanced feed increased 6.6% from second quarter 2006. The increase in
sales was primarily due to an 18.1% price increase, which was partially offset
by a 9.8% decrease in volume.
Swine and Other Lines
Sales of swine and other lines increased 22.3% in the quarter. This increase
stems from a 33.1% increase in swine volume along with the integration of turkey
and beef business lines. Sales were partially offset by an 8.0% decline in swine
prices.
Second Quarter 2007 Results | Page 4
HALF YEAR 2007
================================================================================
Net Sales
Net sales for the first six months reached Ps. 8,640.2 million, compared to Ps.
7,390.6 million reported in the same period of 2006, representing an increase of
16.9%. This was due to a 16.7% increase in chicken sales, 24.9% increase in
table eggs, 9.7% increase in balanced feed and 19.7% increase in swine and other
lines.
---------------------------------------------------------------------------
Net Sales by Product Line Six Months 2007 Six Months 2006
% %
---------------------------------------------------------------------------
CHICKEN 77.78 77.94
---------------------------------------------------------------------------
EGGS 9.35 8.75
---------------------------------------------------------------------------
BALANCED FEED 8.31 8.85
---------------------------------------------------------------------------
SWINE AND OTHER LINES 4.56 4.46
---------------------------------------------------------------------------
TOTAL COMPANY 100.00% 100.00%
---------------------------------------------------------------------------
Operating Results
Bachoco's gross margin reached 21.0% during the first half of the year, slightly
below the 21.3% gross margin reported in the same period of 2006, primarily due
to a 17.3% increase in cost of sales. Bachoco's operating margin of 8.8%
compares favorably to the 7.9% margin in the same period of 2006. EBITDA for the
period reached Ps. 1,033.8 million.
Taxes
The Company recognized Ps.209.4 million in taxes during the first six months of
the year.
Net Income
Net income for the six months ended June 30, 2007 totaled Ps. 705.7 million.
Earnings per share increased to Ps. 1.18, ($1.31 per ADS) above the Ps. 0.93
($1.03 per ADS) reported for the same period last year.
Balance Sheet
The Company maintained a healthy financial structure at the end of the period.
Liquidity remained solid with cash and cash equivalents of Ps. 3,373.4 million
as of June 30, 2007. Debt was Ps. 119.1 million as of June 30, 2007.
Capex during the six-month period of Ps. 278.0 million was entirely financed
entirely through internal cash flow generation.
Second Quarter 2007 Results | Page 5
Company Description
Industrias Bachoco S.A.B. de C.V. (also referred to in this report as Bachoco or
the Company) was founded by the Robinson Bours family in 1952, in the state of
Sonora. Since then, it has grown into the largest poultry company in Mexico,
with over 700 production and distribution facilities currently organized in
seven complexes throughout the country. Bachoco's main business lines are
chicken, eggs, and swine, and the Company is also an important player in the
balanced feed industry in Mexico. The Company's headquarters are based in
Celaya, Guanajuato, located in Mexico's central region.
Industrias Bachoco made an initial public stock offering in September 1997. Its
securities are listed and traded on the Mexican Stock Exchange (Bolsa Mexicana
de Valores or BMV) under the ticker symbol Bachoco B, and on the New York Stock
Exchange (NYSE) under the ticker symbol IBA.
The Company posted net sales of U.S. $1.39 billion for 2006, divided among the
Company's four main product lines as follows: 77.6% chicken, 9.2% table eggs,
9.0% balanced feed, and 4.2% swine and other lines.
For more information, please visit Bachoco's website at
http://www.bachoco.com.mx.
This press release contains certain forward-looking statements that are subject
to a number of uncertainties, assumptions and risk factors that may influence
its accuracy. Actual results may differ. Factors that could cause these
projections to differ, include, but are not limited to: supply and demand,
industry competition, environmental risks, economic and financial market
conditions in Mexico and operating cost estimates. For more information
regarding Bachoco and its outlook, please contact the Company's Investor
Relations Department.
Second Quarter 2007 Results | Page 6
================================================================================
INDUSTRIAS BACHOCO, S.A.B. DE C.V. AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(millions of constant pesos as of June 30, 2007, and millions of U.S.
dollars, except per share data)
----------------------------------- -------------------------------
Second Quarter SIX MONTHS ENDED
----------------------------------- -------------------------------
June 30 June 30 June 30 June 30 June 30 June 30
2007 (1) 2007 2006 2007(1) 2007 2006
------------------------------------------------------------------- -------------------------------
Net Sales US 435 Ps. 4,694 Ps. 3,781 US 801 Ps. 8,640 Ps. 7,391
Cost of Sales 334 3,608 2,970 633 6,825 5,816
----------------------------------- -------------------------------
Gross Profit 101 1,086 811 168 1,815 1,574
Selling, general and
administrative expenses 50 544 498 98 1,052 987
----------------------------------- -------------------------------
Operating Income 50 542 313 71 763 588
Comprehensive Financing Cost
(income)
Interest Expense (Income) (4) (47) (36) (10) (113) (74)
Foreign Exchange Loss (gain) 2 17 (46) 1 6 (57)
Gain from Monetary Position (1) (7) (3) 1 12 12
----------------------------------- -------------------------------
Total Comprehensive Financing
Cost (income) (3) (37) (85) (9) (96) (119)
Other Income Net 1 16 2 5 59 (12)
Income before Provisions for
Income
----------------------------------- -------------------------------
Tax, Employee Profit Sharing
and Minoritary
Interest 55 595 399 85 917 694
Provisions for:
Income Tax, Asset Tax (2) (23) (65) (7) (72) (148)
Deferred Income Taxes (10) (108) (13) (13) (138) 10
----------------------------------- -------------------------------
Income before Minority Interest 43 465 321 66 708 556
Minority Interest (0) (0) (0) (0) (2) (1)
----------------------------------- -------------------------------
Net Income 43 465 321 65 706 555
Weighted Average Shares
Outstanding (Thousand) 600,000 600,000 599,490 600,000 600,000 599,286
Net Income per Share 0.86 0.77 0.54 1.31 1.18 0.93
Dividend per Share 0.22 0.20 0.20 0.22 0.20 0.20
----------------------------------------------------------------------------------------------------------
(1) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.7901 per U.S. dollar, the
noon buying rate at June 30, 2007.
--------------------------------------------------------------------------------
Second Quarter 2007 Results | Page 7
INDUSTRIAS BACHOCO, S.A.B. DE C.V. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(millions of constant pesos as of June 30, 2007, and millions of U.S. dollars)
-----------------------------------------
June 30 June 30 Dec. 31
2007 (1) 2007 2006
--------------------------------------------------------------------------------
ASSETS
Current Assets:
Cash and Cash Equivalents US 313 Ps. 3,373 Ps. 3,479
Accounts Receivable less
Allowance for Doubtful
Accounts 54 587 524
Inventories 345 3,721 2,748
Other Current Assets 31 330 378
Total Current Assets 742 8,011 7,128
Net Property, Plant and
Equipment 883 9,528 9,585
Other Non Current Assets 34 366 330
Total Non Current Assets 917 9,894 9,915
TOTAL ASSETS 1,659 17,905 17,044
-----------------------------------------
LIABILITIES
Current Liabilities:
Notes Payable to Banks 5 59 9
Trade Accounts Payable 76 822 825
Other Accrued Liabilities 52 556 291
Total Current Liabilities 133 1,436 1,126
Long-Term Debt 6 60 34
Labor Obligations 4 43 77
Deferred Income Taxes and
Others 210 2,267 2,118
Total Long-Term Liabilities 220 2,370 2,229
TOTAL LIABILITIES 353 3,806 3,355
-----------------------------------------
STOCKHOLDERS' EQUITY
Capital stock 205 2,210 2,228
Premium in Public Offering of
Shares 59 639 722
Retained Earnings 1,407 15,186 18,323
Net Income for the Year 65 706 880
Deficit from Restatement of
Stockholders' Equity (329) (3,552) (3,644)
Reserve for Repurchase of
Shares 22 236 155
Minimum Seniority Premium
Liability Adjustment - - (1)
Effect of Deferred Income
Taxes (127) (1,372) (5,018)
Total Majority Stockholder's
Equity 1,302 14,054 13,645
Minority Interest 4 45 44
TOTAL STOCKHOLDERS' EQUITY 1,307 14,099 13,689
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY 1,659 17,905 17,044
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(1) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.7901 per U.S. dollar, the
noon buying rate at June 30, 2007.
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Second Quarter 2007 Results | Page 8
INDUSTRIAS BACHOCO, S.A.B. DE C.V. AND SUBSIDIARIES
Condensed Consolidated Statements of Changes in Financial Position
(millions of constant pesos as of June 30, 2007, and millions of U.S. dollars)
---------------------------------------
June 30 June 30 Dec. 31
2007(1) 2007 2006
--------------------------------------------------------------------------------
Operating Activities:
Net Income US$ 66 Ps. 708 Ps. 556
Adjustments to Reconcile Net
Income to Resources
Provided by Operating
Activities:
Depreciation and Others 25 269 258
Changes in Operating Assets and
Liabilities (41) (441) 150
Deferred Income Taxes 12 126 65
Resources Provided by Operating
Activities 61 662 1,029
---------------------------------------
Financing Activities:
Increase of Capital Stock (0) (0) 0
Proceeds from Long-term Debt -- -- --
Proceeds from Short-term Debt 4 40 44
Repayment of Long-term Debt
and Notes Payable (0) (5) (69)
Decrease in Long-term Debt in
Constant Pesos 0 5 (1)
Cash Dividends Paid -- -- (367)
Resources Provided by (Used in)
Financing Activities 4 40 (392)
---------------------------------------
Investing Activities:
Acquisition of Property, Plant
and Equipment (26) (278) (402)
Minority Interest 0 0 1
Others (55) (594) (38)
Resources Used in Investing
Activities (81) (872) (439)
---------------------------------------
Net (Decrease) Increase in Cash
and Cash
Equivalents (16) (170) 198
---------------------------------------
Cash and Cash Equivalents at
Beginning of Period 328 3,543 3,315
Cash and Cash Equivalents
at End of Period US$ 313 Ps. 3,373 Ps. 3,513
--------------------------------------------------------------------------------
(1) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.7901 per U.S. dollar, the
noon buying rate at June 30, 2007.
--------------------------------------------------------------------------------