Industrias Bachoco Announces Third Quarter 2007 Results

    CELAYA, Gto., Mexico, Oct. 25 /PRNewswire-FirstCall/ -- 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 September 30,
 2007. All figures have been prepared in accordance with Mexican GAAP and
 are stated in constant Mexican pesos as of September 30, 2007.
     Highlights:
     -- Bachoco recorded sales of Ps. 4,623.1 during the quarter, 24.5% above
        the Ps. 3,711.8 million reached in the same 2006 period
     -- Operating margin for the quarter of 10.7%, compares to 6.9% in 3Q06
     -- EBITDA, of Ps. 635.6 million, was 62.3% above the Ps. 391.5 million of
        3Q06
     -- Bachoco achieved an EPS of Ps. 0.61 (US$0.67 per ADS) for the quarter
        compared to an EPS of Ps. 0.39 (US$0.43 per ADS) for the same period
        last year
     CEO's Comments:
     Cristobal Mondragon, Bachoco's CEO, stated, "Favorable market
 conditions in the quarter fueled the growth in sales and volume.
     "We will continue with our efforts to expand our presence and
 commercial distribution channels in all Mexico to serve every costumer
 looking for Bachoco products.
     "Our financials will remain strong and our CAPEX will continue to be
 entirely financed by internal resources."
     THIRD QUARTER 2007 RESULTS
     Net Sales
     Net sales for the quarter reached Ps. 4,623.1 million, 24.5% above the
 Ps. 3,711.8 million reported in 3Q06. This increase was mainly driven by
 the 29.0% increase in chicken sales, 13.5% in table eggs sales, 34.9% in
 swine sales, and a 0.3% increase in balanced feed sales.
     Net Sales by Product Line     3Q07       3Q06
                                    %          %
     CHICKEN                       79.1       76.3
     EGGS                           9.1       10.0
     BALANCED FEED                  7.7        9.6
     SWINE AND OTHER LINES          4.1        4.1
     TOTAL COMPANY                100.0      100.0
 
 
 
     Operating Results
     Bachoco's third quarter gross margin of 22.9% was higher than 20.5% in
 3Q06. The increase is mainly attributed to the 24.5% sales increase, which
 partly contributed to the 20.8% increase in the cost of sales. However, the
 Company's operating margin of 10.7% compares favorably to the 6.9% margin
 of the same 2006 quarter. EBITDA during the quarter totaled Ps. 635.6
 million.
     Taxes
     Taxes recognized by the Company during the quarter were Ps. 106.7 million.
     Net Income
     Net income for 3Q07 was Ps. 364.5 million, or Ps. 0.61 per share
 (US$0.67 per ADS), compared to net income of Ps. 235.8 million, or Ps. 0.39
 per share (US$0.41 per ADS) reported in the same period of 2006.
     RESULTS BY BUSINESS SEGMENT
     Chicken
     Chicken sales rose 29.0% during 3Q07 as a result of a 10.3% volume and
 a 16.9% price increase. The chicken market remains in good shape and had a
 positive impact in pricing; the increase in volume resulted from added
 capacity driven in part by the new operations.
     Table Eggs
     Volume sales of table eggs grew 13.5%, with volumes increasing 3.4% and
 a price increase of 9.8% when compared to same last year's quarter.
     Balanced Feed
     Sales of balanced feed increased slightly during this quarter by 0.3%
 when compared to 3Q06; however, pricing rose by 16.8% and volume decreased
 by 14.1%.
     Swine and Other Lines
     Sales of swine and other lines increased 34.9% in the quarter. This
 increase was mainly the result of a 34.1% increase in volume of swine.
     NINE MONTHS 2007
     Net Sales
     Net sales for the first nine months were 19.4% higher at Ps. 13,403.0
 million, when compared to Ps. 11,221.9 million reported in the same 2006
 period. Sales rose mainly as chicken sales grew 20.7%, table eggs increased
 20.8%, balanced feed rose 6.5% and swine and other lines increased 21.5%.
     Net Sales by Product Line    Nine Months 2007     Nine Months 2006
                                         %                    %
     CHICKEN                           78.2                 77.4
     EGGS                               9.3                  9.2
     BALANCED FEED                      8.1                  9.1
     SWINE AND OTHER LINES              4.4                  4.3
     TOTAL COMPANY                    100.0%               100.0%
     Operating Results
     Bachoco's gross margin reached 21.7% during the first nine months of
 the year, well above the 21.0% gross margin reported in the same 2006
 period. The increase was primarily due to a 19.4% increase in sales, which
 was partially offset by an 18.5% increase in the cost of sales. Bachoco's
 operating margin of 9.5% compares favorably to the 7.6% operating margin
 reached in the same 2006 period. EBITDA during this period reached Ps.
 1,686.0 million.
     Taxes
     The taxes recognized by the Company during the year were Ps. 316.1
 million.
     Net Income
     Net income for the year ended September 30, 2007, was Ps. 1,081.6
 million. Earnings per share reached Ps. 1.80, (U.S. $1.98 per ADS),
 compared to Ps. 1.33 (U.S. $1.46 per ADS) reported for the same 2006
 period.
     Balance Sheet
     The Company maintained a healthy financial structure. Liquidity
 remained solid with cash and cash equivalents at Ps. 3,446.2 million as of
 September 30, 2007. Debt was Ps. 116.7 million as of September 30, 2007.
     Capex during the nine-month period was Ps. 471.8 million.
     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.
              INDUSTRIAS BACHOCO, S.A.B. DE C.V. AND SUBSIDIARIES
                  Condensed Consolidated Statements of Income
   (millions of constant pesos as of September 30, 2007, and millions of U.S.
                        dollars, except per share data)
 
                                                   Third Quarter
                                          Sep '30     Sep '30       Sep '30
                                          2007(1)       2007          2006
 
           Net Sales                      US  423    Ps  4,623     Ps  3,712
           Cost of Sales                      326        3,563         2,950
           Gross Profit                        97        1,060           762
           Selling, general and
            administrative expenses            52          567           504
           Operating Income                    45          493           257
           Comprehensive Financing Cost
            (income)
           Interest Expense (Income)           (4)         (38)          (48)
           Foreign Exchange Loss (gain)        (0)          (5)            9
           Gain from Monetary Position          3           34            35
           Total Comprehensive Financing
            Cost (income)                      (1)         (10)           (4)
           Other Income Net                    (3)         (31)           37
           Income before Provisions for
            Income
           Tax, Employee Profit Sharing
            and Minoritary
           Interest                            43          471           298
 
           Provisions for:
             Income Tax, Asset Tax             (5)         (54)          (19)
             Deferred Income Taxes             (5)         (53)          (42)
           Income before Minority Interest     33          365           237
           Minority Interest                   (0)          (0)           (1)
           Net Income                          33          365           236
                                                -            -             -
           Weighted Average Shares
            Outstanding (Thousand)        600,000      600,000       599,704
           Net Income per Share              0.67         0.61          0.39
           Dividend per Share                   -            -             -
 
 
                                                 Nine Months Ended
                                          Sep '30     Sep '30       Sep '30
                                          2007(1)       2007          2006
 
           Net Sales                    US  1,226   Ps  13,403    Ps  11,222
           Cost of Sales                      960       10,498         8,860
           Gross Profit                       266        2,905         2,361
           Selling, general and
            administrative expenses           150        1,637         1,507
           Operating Income                   116        1,268           854
           Comprehensive Financing Cost
            (income)
           Interest Expense (Income)          (14)        (153)         (123)
           Foreign Exchange Loss (gain)         0            1           (50)
           Gain from Monetary Position          4           45            48
           Total Comprehensive Financing
            Cost (income)                     (10)        (107)         (125)
           Other Income Net                     2           25            22
           Income before Provisions for
            Income
           Tax, Employee Profit Sharing and
            Minoritary
           Interest                           128        1,400         1,001
 
           Provisions for:
             Income Tax, Asset Tax            (11)        (126)         (167)
             Deferred Income Taxes            (17)        (191)          (32)
           Income before Minority Interest     99        1,084           801
           Minority Interest                   (0)          (2)           (2)
           Net Income                          99        1,082           800
                                                -            -             -
           Weighted Average Shares
            Outstanding (Thousand)        600,000      600,000       599,427
           Net Income per Share              1.98         1.80          1.33
           Dividend per Share                0.05         0.60          0.62
     (1) Peso amounts have been translated into U.S. dollars, solely for the
 convenience of the reader, at the rate of Ps. 10.9315 per U.S. dollar, the
 noon buying rate at September 28, 2007.
              INDUSTRIAS BACHOCO, S.A.B. DE C.V. AND SUBSIDIARIES
                     Condensed Consolidated Balance Sheets
   (millions of constant pesos as of September 30, 2007, and millions of U.S.
                                    dollars)
 
                                        Sep '30       Sep '30      Dec '31
                                        2007(1)         2007         2006
 
           ASSETS
           Current Assets:
             Cash and Cash Equivalents  US  315      Ps  3,446    Ps  3,535
             Accounts Receivable less
              Allowance for Doubtful
             Accounts                        54            585          532
             Inventories                    378          4,133        2,792
             Other Current Assets            45            492          384
           Total Current Assets             792          8,656        7,244
             Net Property, Plant and
              Equipment                     891          9,745        9,740
             Other Non Current Assets        32            347          335
           Total Non Current Assets         923         10,092       10,075
           TOTAL ASSETS                   1,715         18,748       17,319
 
           LIABILITIES
           Current Liabilities:
             Notes Payable to Banks           6             64           10
             Trade Accounts Payable          93          1,019          838
             Other Accrued Liabilities       55            603          296
           Total Current Liabilities        154          1,686        1,144
           Long-Term Debt                     5             53           35
           Labor Obligations                  5             50           78
           Deferred Income Taxes and
            Others                          208          2,272        2,152
           Total Long-Term Liabilities      217          2,375        2,265
           TOTAL LIABILITIES                371          4,061        3,409
 
           STOCKHOLDERS' EQUITY
             Capital stock                  208          2,279        2,264
           Premium in Public Offering of
            Shares                           59            650          734
             Retained Earnings            1,412         15,431       18,619
             Net Income for the Year         99          1,082          894
             Deficit from Restatement of
              Stockholders' Equity         (334)        (3,647)      (3,703)
           Reserve for Repurchase of
            Shares                           22            240          157
             Minimum Seniority Premium
              Liability Adjustment            -              -           (1)
             Effect of Deferred Income
              Taxes                        (128)        (1,394)      (5,099)
           Total Majority Stockholder's
            Equity                        1,339         14,640       13,865
           Minority Interest                  4             47           45
           TOTAL STOCKHOLDERS' EQUITY     1,344         14,687       13,910
 
           TOTAL LIABILITIES AND
            STOCKHOLDERS' EQUITY          1,715         18,748       17,319
     (1) Peso amounts have been translated into U.S. dollars solely for the
 convenience of the reader, at the rate of Ps. 10.9315 per U.S. dollar, the
 noon buying rate at September 28, 2007.
              INDUSTRIAS BACHOCO, S.A.B. DE C.V. AND SUBSIDIARIES
       Condensed Consolidated Statements of Changes in Financial Position
 
   (millions of constant pesos as of September 30, 2007, and millions of U.S.
                                    dollars)
 
                                          Sep-30        Sep '30        Dec '31
                                          2007(1)         2007           2006
 
           Operating Activities:
             Net Income                   US$  99     Ps.  1,084      Ps.  801
             Adjustments to Reconcile Net
              Income to Resources
           Provided by Operating
            Activities:
           Depreciation and Others             38            416           395
           Changes in Operating Assets and
            Liabilities                       (86)          (938)           16
           Deferred Income Taxes               11            122            37
           Resources Provided by Operating
            Activities                         63            684         1,251
 
           Financing Activities:
             Increase of Capital Stock          0              0             0
             Proceeds from Long-term Debt       -              -             -
             Proceeds from Short-term Debt     12            132            44
             Repayment of Long-term Debt
              and Notes Payable                (4)           (49)          (69)
             Decrease in Long-term Debt in
              Constant Pesos                   (1)           (11)           (4)
             Cash Dividends Paid              (33)          (357)         (373)
           Resources Provided by (Used in)
            Financing Activities              (26)          (285)         (401)
 
           Investing Activities:
             Acquisition of Property, Plant
              and Equipment                   (43)          (472)         (584)
             Minority Interest                  0              2            (1)
             Others                            (1)           (13)          (28)
           Resources Used in Investing
            Activities                        (44)          (483)         (613)
 
           Net (Decrease) Increase in Cash
            and Cash Equivalents               (8)           (84)          237
 
           Cash and Cash Equivalents at
            Beginning of Period               323          3,530         3,369
 
           Cash and Cash Equivalents
            at End of Period             US$  315     Ps.  3,446    Ps.  3,606
     (1) Peso amounts have been translated into U.S. dollars, solely for the
 convenience of the reader, at the rate of Ps. 10.9315 per U.S. dollar, the
 noon buying rate at September 28, 2007.
 
 

SOURCE Industrias Bachoco S.A.B. de C.V.

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