Milling & Baking News - June 30, 2020 - 11

Business

ADM Milling announces plans to
close Los Angeles flour mill
made some difficult but important
decisions about our ability to compete with older facilities in certain
markets. After exploring a wide
variety of alternatives, we have informed colleagues of our intention
to end production at our Los Angeles
wheat mill later this year."
ADM said it will be selling the
property and warehouse and working with customers to ensure a
smooth transition.
The ADM Los Angeles mill has
daily milling capacity of 11,100 cwts
and is one of three ADM mills in the
western United States. It is the company's only flour mill in California.
ADM has owned the Los Angeles flour mill since 1981, when the
company acquired the Centennial
Mills Division of Seattle-based Univar Corp. The Centennial business
was based in Portland, Ore., and
operated mills in Portland as well
as Spokane, Wash. The acquisition
of Centennial lifted ADM to become
the largest flour milling company in
the United States, with 119,000 cwts
of daily milling capacity. ADM replaced The Pillsbury Co., which at
the time had 114,000 cwts.
Initially a 2,000-cwt flour mill, the
LA facility was built in 1934, when
two Viault brothers (Arthur and Max)
exited another family business in Los
Angeles, California Milling Corp. and
established V-O Milling Co.
The Viault brothers operated V-O
Milling until 1945, when the business
was sold to The Quaker Oats Co.
Centennial acquired the mill from
Quaker in 1972. At the time the mill

had 2,400 cwts of daily milling capacity in addition to a 600-cwt whole
wheat unit. Centennial increased capacity to 4,000 cwts in 1974 and to
9,000 cwts in 1977, with the addition
of a second milling unit. When ADM
acquired the mill in 1981, the company

ADM

Continued from Page 1

In addition to opening a new state-of-the-art flour mill in 2019 in Illinois (shown above),
ADM has closed or announced the closing of four older flour mills, including its mill in
Los Angeles.

immediately announced plans to
double capacity with the addition of
a 10,000-cwt milling unit. The expansion was not completed.
With the closing of the LA mill,
ADM will have shuttered flour
mills with a combined capacity of
40,100 cwts. The new Mendota mill
has daily milling capacity of 30,000
cwts, meaning the company's overall milling capacity will be reduced

Citing strong financial results, Bimbo
prepays $400 million in debt
MEXICO CITY - Grupo Bimbo SAB
de CV has announced the prepayment
of $400 million of its committed revolving credit facility, which matures
in October 2023.
The prepayment followed a March
announcement that the company, with
the coronavirus (COVID-19) rapidly
spreading globally, had withdrawn
$720 million of its credit facility, of
which $200 million was to be used to
pay down debt maturing this month,
and the balance was designated for
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as a result of the various moves by
10,100 cwts, or 3.5%, to 276,100 cwts,
according to data from the Grain &
Milling Annual, published by Sosland Publishing Company. ADM will
remain the second largest flour milling company in the United States,
operating 20 flour mills.
After the ADM mill in the nation's
most populous state is closed, California will slip to the nation's second

giving the company greater liquidity,
flexibility and financial strength in the
face of an "uncertain environment."
"However, due to the strong results and solid cash flow generation,
coupled with a less uncertain environment, Grupo Bimbo decided to prepay
$400 million of its outstanding debt,"
the company said.
Following the repayment, Bimbo
has $1.7 billion available in its revolving credit facility. Bimbo's debt-toEBITDA ratio was 2.8 times in the first

largest milling state as measured
by daily capacity, but just barely.
California milling capacity will be
reduced to 112,220 cwts, compared
with 112,305 cwts in Minnesota,
which will be largest, and 108,628
cwts in Kansas, which ranks third. In
terms of number of operating flour
mills, California will be in a threeway tie for first with Kansas and
Pennsylvania, all at 11 flour mills. MBN
quarter ended March 31, up from 2.6
in the first quarter of 2019.
The company's total debt as of
March 31 was 120 billion pesos ($5 billion), which was up from 87 billion pesos at the end of December 2019. The
33-billion-peso increase was attributable to the increased leverage from
the $720 million withdrawal and to
the depreciation of the Mexican peso.
Average debt maturity as of March 31
was 12 years with an average cost of
5.4%. Long-term debt accounted for
94% of the company's total debt, of
which 63% was denominated in US
dollars, 31% in Mexican pesos, 5% in
Canadian dollars and 1% in Euros. MBN
Milling & Baking News

June 30, 2020 / 11

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Milling & Baking News - June 30, 2020

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