Mexican bread maker Grupo Bimbo
is planning to invest between USD$800 million and USD$850 million in 2018 as part of its expansion plan to increase production capacity and improve efficiency.
"By 2018, we expect capital spending to be between USD$800 million and USD$850 million. We will invest in our digital transformation project and in improving and modernizing production capacity and our distribution network " disclosed Diego Gaxiola , Bimbo's Director of Administration and Finance .
The 2018 budget represents a 31%-38% increase compared to the 2017 budget amounted to USD$607 million .
In a conference with analysts, accompanied by Daniel Servitje , Chief Executive Officer of Grupo Bimbo , Gaxiola said that in the fourth quarter of 2017 the company received a single non-monetary charge of MXN$706 million due to the recent implementation of the tax reform in the U.S.
"It is important to bear in mind that in the future, the tax reform will generate a positive effect on the cash flow of the company," he assured.
Servitje explained that the strong demand for consumer goods anticipates stable inflation levels this year, offering a positive outlook for the brand's performance in the country.
Regarding Bimbo's arrival in the Chinese market , he said that the company will look for opportunities in that region.
It should be noted that Bimbo registered a 21.5% drop in net profits in 2017, affected by increasing costs and taxes, according to its quarterly report.
Thus, Bimbo's debt amounted to MXN$94,313 million representing a 14.3% increase compared to MXN$82,500 million last year.
sg
