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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 October 2006
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__.)
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UPDATED WITH TABULAR INFORMATION: BACHOCO ANNOUNCES ITS THIRD QUARTER RESULTS
CELAYA, Mexico, Oct. 23 /PRNewswire-FirstCall/ -- Industrias Bachoco S.A. 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 third quarter ended September 30, 2006. All figures have been
prepared in accordance with Mexican GAAP and are stated in constant Mexican
pesos as of September 30, 2006.
Highlights:
-- During the third quarter the Company achieved sales of Ps. 3,576.2
million;
-- Gross profit was Ps. 733.8 million for the quarter;
-- Third quarter operating margin was 6.9%;
-- EBITDA reached Ps. 377.2 million, representing an EBITDA margin of
10.5%;
-- Volume of balanced feed and table eggs sold increased by 33.4% and 4.5%,
respectively, compared to third quarter of 2005;
-- Achieved an EPS of Ps. 0.38 (US $0.41 per ADS) for the third quarter.
Comments from the CEO:
Cristobal Mondragon, CEO of Bachoco stated, "The third quarter is
historically the weakest of the year for our company, so the results we achieved
in this quarter are in line with our expectations.
"The cost of our main raw materials was stable for most of the quarter with
an increase towards the end.
"In Chicken, we have continued our efforts to better serve all of our
distribution channels and are specifically focusing on enhancing the demand of
our value-added products, which we believe have significant growth potential
within the Mexican poultry industry.
"Prices of table eggs were strong, increasing 15.6% when compared with third
quarter of 2005. These gains also reflect the Company's efforts to be innovative
in this business line, and as we launch our enrichment type egg, we expect to
quickly position this product with our customers.
"The company continues to increase its market share in Balance feed where
volume sold grew 33.4% versus the same period of last year.
"On September, 20th, we announced the impact of hurricane Lane on our
Northwest complex, located in the state of Sinaloa. As a result of our
coordination efforts, we were able to maintain a steady supply to our customers
in that region, and we are close the reestablishment of almost all of our
production facilities that were affected by the hurricane.
"The Company's financial profile remains strong, with cash and cash
equivalents of Ps. 3,474.3 million, and debt capitalization remains at
historically low levels. Our CAPEX continues to be internally financed through
our operations."
THIRD QUARTER 2006 RESULTS
Net Sales
Net sales for the quarter reached Ps. 3,576.2 million, a decrease of 6.7%
compared to the Ps. 3,834.3 million reported for the 3Q05. This decline was
mainly due to revenue decreases of 12.9% in chicken and 10.5% in swine, which
were partially offset by increases of 34.5% in balanced feed and 16.5% in eggs
sales.
3Q05 3Q06
Net Sales by Product Line % %
------------------------- -------- -------
CHICKEN 81.75 76.33
EGGS 8.00 9.99
BALANCED FEED 6.64 9.58
SWINE AND OTHER LINES 3.60 4.10
TOTAL COMPANY 100.00% 100.00%
Operating Results
Bachoco's gross margin was 20.5% in 3Q06, compared to 30.8% in 3Q05, mainly
due to 12.0% decrease in the price of chicken and 10.3% in swine price. The
Company's operating margin was 6.9%, compared to 18.4% in the same quarter of
2005. EBITDA during the quarter reached Ps. 377.2 million.
Taxes
Taxes recognized by the Company during the quarter were Ps. 57.2 million.
Net Income
Net income for 3Q06 was Ps. 277.1 million, while Earnings per share reached
Ps. 0.38 (US $0.41 per ADS) compared to Ps. 0.90 (US $0.99 per ADS) reported in
the same period of 2005.
RESULTS BY BUSINESS SEGMENT
Chicken
Chicken sales decreased by 12.9% during 3Q06 as a result of a 12.0% decrease
in prices and 1.1% decrease in volume compared with 3Q05. The decline in prices
was mainly due to more normalized market conditions, while the decrease in
volume was due primarily to a reduction in yield as the Company moves to
offering more value-added products.
Table Eggs
Sales of table eggs increased by 16.5% and volume improved by 4.5% during
the 3Q06 as a result of an 11.5% increase in prices when compared to the same
quarter in 3Q05. Prices and supply for this segment were more normalized in the
market during the quarter.
Balanced Feed
Sales of balanced feed increased 34.5% when compared to third quarter of
last year, as a result of a 33.4% increase in volume. Balanced feed prices
remained similar to the same quarter of 2005.
Swine and Other Lines
Volume sold decreased 0.3%, while sales of swine decreased 10.5%. These
declines are mainly a result of the 10.3% reduction in prices of swine compared
to 3Q05 due to larger supplies in the Mexican market.
NINE MONTHS 2006 RESULTS
Net Sales
Net sales for the first nine months of 2006 reached Ps. 10,811.9 million,
compared to Ps. 11,442.4 million reported for the same period of 2005,
representing a decrease of 5.5%. This was mainly due to sales decreases of 9.6%
in chicken and 21.8% in swine, which were partially offset by an increase of
27.2% in balanced feed and 2.8% in table eggs sales.
Nine months Nine months
2005 2006
Net Sales by Product Line % %
------------------------- ----------- -----------
CHICKEN 80.91 77.41
EGGS 8.42 9.16
BALANCED FEED 6.76 9.09
SWINE AND OTHER LINES 3.91 4.34
TOTAL COMPANY 100.00% 100.00%
Operating Results
Bachoco's gross margin reached 21.0% during the first nine months of 2006,
lower than the 30.8% gross margin reported in the same period of 2005. The
decrease was primarily due to a reduction in sales and price of sales for the
Company's main product lines, and a 7.8% increase in cost of sales. Bachoco's
operating margin was 7.6%, compared with the 18.7% operating margin reached in
the same period of 2005. EBITDA during this period reached Ps. 1,205.7 million.
Taxes
The taxes recognized by the Company during the first half of the year were
Ps. 206.0 million.
Net Income
Net income for the nine-month period ended September 30, 2006, was Ps. 770.6
million. Earnings per share reached Ps. 1.29, (U.S. $1.41 per ADS), compared to
Ps. 2.94 (U.S. $3.21 per ADS) reported for the same period of 2005.
Balance Sheet
The Company maintained a healthy financial structure at the end of the third
quarter of 2006. Liquidity remained solid with cash and cash equivalents of Ps.
3,474.3 million as of September 30, 2006. Debt was Ps. 120.7 million as of
September 30, 2006.
Capex during the nine-month period was Ps. 590.5 million, financed entirely
through resources generated by the operations.
Company Description
Industrias Bachoco S.A. 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, swine, and the Company also is an important player in the
balanced feed industry in Mexico. The Company's headquarters are based in the
city of 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 BACHOCOB, and on the New
York Stock Exchange (NYSE) under the ticker symbol IBA.
The Company posted net sales of $1.36 billion USD for 2005 divided among the
Company's four main product lines as follows: 80.1% chicken and chicken-related
products, 8.7% table eggs, 7.2% balanced feed, and 4.0% 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.
INDUSTRIAS BACHOCO, S.A. DE C.V. AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(millions of constant pesos as of September 30, 2006,
and millions of U.S. dollars, except per share data)
Third Quarter
--------------------------------------------
Sept 30 Sept 30 Sept 30
2006(1) 2006 2005
------------ ------------ ------------
Net Sales US 326 Ps 3,576 Ps 3,834
Cost of Sales 259 2,842 2,653
Gross Profit 67 734 1,181
Selling, general and
administrative expenses 44 486 475
Operating Income 23 248 706
Comprehensive Financing Cost
(Income)
Interest Expense (Income) 1 8 25
Foreign Exchange Loss (Gain) (4) (46) (35)
Gain from Monetary Position 3 34 17
Total Comprehensive Financing
Cost (Income) (0) (4) 7
Other Income Net 0 4 (8)
Income before Provisions for Income
Tax, Employee Profit Sharing
and Minority Interest 23 256 691
Provisions for:
Income Tax, Asset Tax and
Employee Profit Sharing (2) (20) (123)
Deferred Income Taxes (3) (36) (0)
Income before Minority Interest 18 199 568
Minority Interest (0) (1) (0)
Net Income 18 198 567
Effects of Bulletin E-1 3 29 (25)
Net income after Bulletin e-1 21 227 542
Weighted Average Units
Outstanding (Thousand) 599,704 599,704 599,990
Net Income per Share 0.41 0.38 0.90
Dividend per Share -- -- --
Nine Months
--------------------------------------
Sept 30 Sept 30 Sept 30
2006(1) 2006 2005
---------- ---------- ----------
Net Sales US 985 Ps 10,812 Ps 11,442
Cost of Sales 778 8,537 7,922
Gross Profit 207 2,275 3,520
Selling, general and
administrative expenses 132 1,452 1,384
Operating Income 75 823 2,137
Comprehensive Financing Cost (Income)
Interest Expense (Income) (4) (48) 87
Foreign Exchange Loss (Gain) (11) (118) (131)
Gain from Monetary Position 4 46 26
Total Comprehensive Financing
Cost (Income) (11) (120) (17)
Other Income Net 3 36 (25)
Income before Provisions for Income
Tax, Employee Profit Sharing and
Minority Interest 89 979 2,129
Provisions for:
Income Tax, Asset Tax and Employee
Profit Sharing (15) (170) (295)
Deferred Income Taxes (3) (33) (73)
Income before Minority Interest 71 776 1,762
Minority Interest (0) (2) (1)
Net Income 71 774 1,761
Effects of Bulletin E-1 (0) (4) 3
Net income after Bulletin e-1 70 771 1,763
Weighted Average Units
Outstanding (Thousand) 599,427 599,427 599,900
Net Income per Share 1.41 1.29 2.94
Dividend per Share 0.05 0.60 0.42
(1) Peso amounts have been translated in to U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.9775 per U.S. dollar, the
noon buying rate at September 29, 2006.
INDUSTRIAS BACHOCO, S.A. DE C.V. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(millions of constant pesos as of September 30, 2006,
and millions of U.S. dollars)
Sept 30 Sept 30 Dec 30
2006(1) 2006 2005
---------- ---------- ----------
ASSETS
Current Assets:
Cash and Cash Equivalents US 316 Ps 3,474 Ps 3,246
Accounts Receivable less Allowance
for Doubtful Accounts 41 455 486
Inventories 237 2,607 1,849
Other Current Assets 26 285 374
Total Current Assets 621 6,822 5,955
Net Property, Plant and Equipment 829 9,099 9,395
Other Non Current Assets 35 382 339
Total Non Current Assets 864 9,482 9,734
TOTAL ASSETS 1,485 16,304 15,689
LIABILITIES
Current Liabilities:
Notes Payable to Banks 8 86 95
Trade Accounts Payable 56 609 449
Other Accrued Liabilities 44 480 454
Total Current Liabilities 107 1,176 998
Long-Term Debt 3 34 53
Labor Obligations 6 70 86
Deferred Income Taxes and Others 161 1,772 1,736
Total Long-Term Liabilities 171 1,877 1,876
TOTAL LIABILITIES 278 3,052 2,874
STOCKHOLDERS' EQUITY
Capital stock 196 2,148 2,178
Premium in Public Offering of Shares 57 626 689
Retained Earnings 1,307 14,352 12,900
Net Income for the Year 70 771 1,811
Deficit from Restatement of
Stockholders' Equity (326) (3,577) (3,612)
Reserve for Repurchase of Shares 21 231 151
Minimum Seniority Premium
Liability Adjustment -- -- (3)
Effect of Deferred Income Taxes (122) (1,343) (1,343)
Total Majority Stockholder's Equity 1,203 13,208 12,771
Minority Interest 4 43 44
TOTAL STOCKHOLDERS' EQUITY 1,207 13,251 12,815
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY 1,485 16,304 15,689
(1) Peso amounts have been translated in to U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.9775 per U.S. dollar, the
noon buying rate at September 29, 2006.
INDUSTRIAS BACHOCO, S.A. DE C.V. AND SUBSIDIARIES
Condensed Consolidated Statements of Changes in Financial Position
(millions of constant pesos as of September 30, 2006,
and millions of U.S. dollars)
Sept 30 Sept 30 Sept 30
2006(1) 2006 2005
---------- ---------- ----------
Operating Activities:
Net Income US$ 70 Ps. 772 Ps. 1,764
Adjustments to Reconcile Net
Income to Resources
Provided by Operating Activities:
Depreciation and Others 35 381 348
Changes in Operating Assets and
Liabilities 1 16 (77)
Deferred Income Taxes 3 36 143
Resources Provided by Operating
Activities 110 1,205 2,178
Financing Activities:
Increase of Capital Stock 0 0 0
Proceeds from Long-Term Debt -- -- (0)
Proceeds from Short-Term Debt 4 43 128
Repayment of Long-Term Debt
and Notes Payable (6) (70) (195)
Decrease in Long-Term Debt in
Constant Pesos -- -- --
Cash Dividends Paid (33) (359) (250)
Resources Provided by (Used in)
Financing Activities (35) (386) (317)
Investing Activities:
Acquisition of Property, Plant
and Equipment (51) (563) (569)
Minority Interest (0) (1) (0)
Others (2) (27) (47)
Resources Used in Investing Activities (54) (590) (616)
Net (Decrease) Increase in Cash and
Cash Equivalents 21 228 1,245
Cash and Cash Equivalents at Beginning
of Period 296 3,246 2,476
Cash and Cash Equivalents at End
of Period US$ 316 Ps. 3,474 Ps. 3,721
(1) Peso amounts have been translated in to U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.9775 per U.S. dollar, the
noon buying rate at September 29, 2006.
SOURCE Industrias Bachoco, S.A. de C.V.
-0- 10/23/2006
/CONTACT: Investor Relations, Daniel Salazar F., CFO, or Claudia Cabrera,
IRO, +011-52-461-61-835-55, or inversionistas@bachoco.net, or, in New York,
Lauren Puffer, +1-646-284-9404, Fax: +1-646-284-9494, or lpuffer@hfgcg.com, all
for Industrias Bachoco, S.A. de C.V./
/Web site: http://www.bachoco.com.mx /
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. de C.V.
(Registrant)
Date: October 23, 2006 By /s/ Daniel Salazar Ferrer, CFO
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Daniel Salazar Ferrer, CFO