Grupo Lala increases 3.7% its sales in 1Q20
Grupo Lala reported that its first quarter 2020 net sales increased 3.7%, year-over-year, to reach 19,405 million pesos, which was equivalent to an increase of 5.5% in constant currency.
In general, Grupo Lala is a mexican company focused on the food industry, it has more than 65 years in the production, innovation and marketing of milk, dairy products and beverages.
The company’s result was due to volume-driven sales growth in Mexico, Brazil, and Central America.
Financial results
The adverse effect was also affected by the 12% depreciation of the Brazilian real and the 3.9% appreciation of the dollar against the Mexican peso, as well as the 21.6% increase in sales of raw milk in Mexico due to a seasonal excess of milk collected from suppliers.
Grupo Lala operates 31 production plants and 172 distribution centers in Mexico, Brazil, the United States and Central America, and has the support of more than 38,000 employees. Lala operates a fleet that exceeds 7,000 units for the distribution of its more than 600 products, which reach more than 578,000 points of sale. LALA, Nutri and Vigor stand out in its portfolio of brands.
Lala Group: sales by region
Branded sales for the first quarter of 2020 in Mexico increased 5.2% year-over-year, to 14,448 million pesos driven by an increase in sales in all segments and a particularly strong performance of UHT Milk, Cream, Yogurt, Vegetable Beverages , Cárnicos y Mantequilla, along with low-digit volume growth.
In particular, UHT Milk sales increased significantly during the second half of March due to increased demand for products related to COVID-19-driven purchases.
Grupo LALA’s operations in Brazil reported net sales for the first quarter of 2,824 million pesos; an annual increase of 4.9% in BRL and a decrease of 7.6% in MXN.
This increase was due to strong volume growth in low-priced categories such as UHT Milk and Budget Yogurt, resulting in an unfavorable price mix that was not offset by Quesos’ positive performance.
Likewise, in March the sales of the Food Service channel suffered significantly from the first effects related to COVID-19.
US market
Grupo Lala’s operations in the United States reported 851 million pesos in net sales for the first quarter of 2020, a 1.8% decrease in constant currency and a 2.3% increase in Mexican pesos.
The volume reflected a mid-digit contraction due to the price increase implemented in 2019, in line with the company’s strategy to increase the profitability of the portfolio. Maquila sales were negatively affected by the effect of COVID19 on the Food Service channel.
