US integration costs hit Bimbo profits

US integration costs hit Bimbo profits

A drop in profits from its US operations has hit half-year profits at Mexican bakery giant Grupo Bimbo.

The company said yesterday (25 July) its net income fell 26.7% to MXN1.49bn (US$111.1m) in the first six months of the year.

Bimbo reported a 43.7% decline in operating profit from its US division, which incurred costs from the integration of businesses acquired from Sara Lee last year. Overall operating income fell 7.9% to MXN3.79bn.

An increase in debt pushed up interest costs, which also hit the bottom line.

However, the addition of the Sara Lee business in the US pushed up sales. Bimbo said its net sales increased 41.2% to MXN84.26bn.