Kuo (KUO B) Q3 2024 earnings summary

Executive summary

• 3Q24 revenue rose 12.4% YoY to MXN 13,607 million and EBITDA increased 101.6% to MXN 1,435 million, led by Pork Meat and Chemical businesses.

• Net majority loss was MXN 197 million, versus a MXN 156 million loss in 3Q23, mainly reflecting quarterly foreign-exchange losses.

• Exports represented 54% of quarterly revenue; management emphasized debt reduction and working-capital efficiencies.

Financial highlights

• 3Q24 operating profit reached MXN 803 million, up 520.9% YoY; operating margin was 5.9%, versus 1.1%.

• 3Q24 gross profit was MXN 2,772 million, or 20.4% of revenue, versus MXN 1,891 million and 15.6% in 3Q23.

• 9M24 revenue increased 2.1% to MXN 38,767 million; EBITDA rose 46.7% to MXN 3,473 million, and operating profit was MXN 1,634 million versus MXN 435 million.

• 9M24 net majority loss was MXN 189 million, compared with net income of MXN 493 million in 9M23; net financial expenses increased to MXN 2,195 million.

Segment performance

• Consumer 3Q24 revenue increased 13.2% to MXN 7,660 million; EBITDA rose 106.8% to MXN 1,016 million, with a 13.3% margin.

• Pork Meat benefited from higher prices and volume, lower corn and soy-paste costs, and operating efficiencies; Herdez Del Fuerte had higher salsa and vegetable demand but faced avocado costs and weaker mix.

• Industrial 3Q24 revenue rose 11.7% to MXN 5,871 million; EBITDA increased 96.6% to MXN 419 million, with a 7.1% margin.

• Synthetic Rubber and Polymers benefited from higher prices, application volumes, margins, and positive inventory valuation; Transmissions faced lower demand, higher expenses, and lower absorption.