Bimbo U.S. operating income tumbles

by Staff
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MEXICO CITY — U.S. operating income fell in the first quarter for Grupo Bimbo S.A.B., pressured by rising raw materials costs.

U.S. operating income of NP17 million ($1.6 million) for the quarter ended March 31, was down 80% from NP83 million ($7.9 million) in the previous year’s first quarter. U.S. first-quarter sales reached NP4,283 million, up more than 3% from NP4,142 million in the previous year’s first quarter. New product launches and a better overall sales mix contributed to the sales increase.

Gross margin in the United States declined by 1.7 percentage points from the same quarter last year due to "the escalation of raw materials costs that has outpaced pricing actions," Bimbo said. The company’s operation margin in the United States narrowed by a more modest 0.4 points, benefiting from lower operating expenses.

Pricing was moderately higher in the quarter following two price hikes over the past year — one in September 2007 and another early March of this year.

Companywide, Mexico City-based Grupo Bimbo S.A.B. de C.V. had first-quarter operating profit of NP1,281 million, up from NP1,230 million, and first-quarter sales of NP19,027 million, up from NP17,516 million.

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