Milling & Baking News Corporate Profiles - November 2013 - (Page 78)

Company Overview Grupo Bimbo S.A.B. de C.V. Margin improvement, integration preoccupy B.B.U. in 2013 W hile many other baking companies spent 2013 repositioning themselves in the wake of the Hostess Brands, Inc. bankruptcy, Bimbo Bakeries USA appeared more inward looking in its activities and perspectives. The company was focused on improving profitability and effecting a change at the top level of management. In his first conference call as president of B.B.U., Fred Penny's message was about progress the company was making toward achieving a 10% to 11% EBITDA margin goal established by its parent company Grupo Bimbo S.A.B. de C.V. "We continue to work hard on achieving the synergies on our asset restructuring and the key projects that are going to drive the improvement that we're looking for," Mr. Penny said during the July conference call. In the company's most recent quarter, the objectives increasingly appeared to be within reach. EBITDA margin for Grupo Bimbo in the company's U.S. business widened to 8.1%, from 6.4% the year before. Company-wide, the Grupo Bimbo EBITDA margin eclipsed 10%, rising to 10.8% from 8.6% in the third quarter of 2012. Margins were widest in Mexico, at 16.4%, and worst in Iberia, at a -2.0%. Even in the latter market, though, the figure represented a significant improvement from -6.8% the previous year. Even as the company focused on integrating the Sara Lee baking business acquired in 2011, B.B.U. has not ignored changes in the marketplace. Taking advantage of a void lasting several months with the Hostess bankruptcy, B.B.U. introduced a line of snack cakes. The new Sara Lee snack cakes offered by B.B.U. include Chocolate Crème Cupcakes, Golden Crème Cakes, Devil's Food Crème Cakes, Buttery Sunshine Cakes, Crumb Cakes and Golden Fudge Cakes. "We are going to support that launch with marketing and promotional activities as we feel the need to do, and we will just continue to be focused on our strategies by category in every part of the market," Mr. Penny said at the time. By introducing snack cakes under Chief executive officer - Top brands - 2012 sales - Daniel Servitje 78 \ November 2013 the Sara Lee brand, B.B.U. chose a path Sara Lee Corp. avoided during the 10 years it was a major player in the fresh baked foods business. Instead, Sara Lee focused on building a bread business under the Sara Lee brand during the 10 years following its 2001 acquisition of The Earthgrains Co. Mr. Penny has experience in the cake business, having headed the Entenmann's operation of Weston Foods. Mr. Penny holds a bachelor's degree in business administration from Long Island University and a master's degree in finance from N.Y.U. He launched his baking career in a finance position with the bakery group of Kraft Foods Inc. and advanced through a number of positions of growing responsibility through the 1980s. He was promoted to executive vicepresident of George Weston Bakeries, Inc. in 2007. Several months into his new job, Mr. Penny said integration of Sara Lee into B.B.U. will be part of a larger, overdue process needed at a company that came together over a period of decades $6.3 billion Sara Lee Oroweat Arnold Entenmann's Mrs Bairds Thomas' Milling & Baking News * Food Business News * Baking & Snack * Meat & Poultry Corporate Profiles

Table of Contents for the Digital Edition of Milling & Baking News Corporate Profiles - November 2013

Milling & Baking News Corporate Profiles - November 2013