GRUMA - Company Profile, SWOT & Financial Analysis

Gruma, S.A.B. de C.V.
www.canadean-winesandspirits.com

TABLE OF CONTENTS
Gruma, S.A.B. de C.V. ..................................................................................................................................6
Gruma, S.A.B. de C.V. - Key Employees ....................................................................................................7
Gruma, S.A.B. de C.V. - Key Employees Biographies ...............................................................................8
Gruma, S.A.B. de C.V. - Major Products and Services ..............................................................................9
Gruma, S.A.B. de C.V. - History ................................................................................................................10
Gruma, S.A.B. de C.V. - Company Statement ..........................................................................................12
Gruma, S.A.B. de C.V. - Locations and Subsidiaries ...............................................................................14
7.1
Gruma, S.A.B. de C.V. - Head Office ....................................................................................................................... 14
7.2
Gruma, S.A.B. de C.V. - Other Locations and Subsidiaries ..................................................................................... 14
Gruma, S.A.B. de C.V. - Business Analysis .............................................................................................16

8.1
Gruma, S.A.B. de C.V. - Company Overview ........................................................................................................... 16
8.2
Gruma, S.A.B. de C.V. - Business Description......................................................................................................... 16
Gruma, S.A.B. de C.V. - SWOT Analysis ..................................................................................................18

9.1
Gruma, S.A.B. de C.V. - SWOT Analysis - Overview ............................................................................................... 18
9.2
Gruma, S.A.B. de C.V. - Strengths ........................................................................................................................... 18
9.2.1
Strength - Strong Research and Development Focus ...................................................................................... 18
9.2.2
Strength - Wide Geographic Presence ............................................................................................................. 18
9.3
9.3.1
Weakness - Involvement in Lawsuits ............................................................................................................... 18
9.3.2
Weakness - High Dependence on a Specific Business Segment .................................................................... 19
9.4
Gruma, S.A.B. de C.V. - Opportunities ..................................................................................................................... 19
9.4.1
Opportunity - Increase in Consumer Spending in the US ................................................................................ 19
9.4.2
Opportunity - Recovering US Restaurant Industry ........................................................................................... 19
9.4.3
Opportunity - Strategic Initiatives ...................................................................................................................... 19
9.5
10
Gruma, S.A.B. de C.V. - Weaknesses...................................................................................................................... 18
Gruma, S.A.B. de C.V. - Threats .............................................................................................................................. 19
9.5.1
Threat - Economic Instability of EU Nations ..................................................................................................... 19
9.5.2
Threat - Rising Labor Costs in the US .............................................................................................................. 20
9.5.3
Threat - Declining Economy of Latin America .................................................................................................. 20
Gruma, S.A.B. de C.V. - Company Financial Analysis .............................................................................21

10.1
Gruma, S.A.B. de C.V. - Five Year Snapshot: Overview of Financial and Operational Performance Indicators ..... 21
10.2
Gruma, S.A.B. de C.V. - Interim ratios ..................................................................................................................... 23
10.2.1
10.3
Gruma, S.A.B. de C.V. - Financial ratios: Capital Market Ratios ..................................................................... 23
Gruma, S.A.B. de C.V. - Financial Performance and Ratio Charts .......................................................................... 24
10.3.1
Gruma, S.A.B. de C.V. - Revenue and Operating margin ................................................................................ 24
10.3.2
Gruma, S.A.B. de C.V. - Asset and Liabilities .................................................................................................. 25
10.3.3
Gruma, S.A.B. de C.V. - Net Debt vs. Gearing Ratio ....................................................................................... 26
10.3.4
Gruma, S.A.B. de C.V. - Operational Efficiency ............................................................................................... 27
10.3.5
Gruma, S.A.B. de C.V. - Solvency .................................................................................................................... 28
10.3.6
Gruma, S.A.B. de C.V. - Valuation ................................................................................................................... 29
10.4
Gruma, S.A.B. de C.V. - Competitive Benchmarking ............................................................................................... 30
10.4.1
Gruma, S.A.B. de C.V. - Market Capitalization................................................................................................. 31
10.4.2
Gruma, S.A.B. de C.V. - Efficiency ................................................................................................................... 32
10.4.3
Gruma, S.A.B. de C.V. - Valuation ................................................................................................................... 33
10.4.4
Gruma, S.A.B. de C.V. - Turnover: Inventory and Asset .................................................................................. 34
2
Canadean. This product is licensed and is not to be photocopied.

10.4.5
11
Gruma, S.A.B. de C.V. - Liquidity ..................................................................................................................... 35
Gruma, S.A.B. de C.V. - Mergers & Acquisitions and Partnerships .......................................................36

11.1
Gruma, S.A.B. de C.V. - M&A and Partnerships Strategy........................................................................................ 36
12
Gruma, S.A.B. de C.V. - Recent Developments ........................................................................................39
13
Appendix ....................................................................................................................................................43
13.1
Methodology ............................................................................................................................................................. 43
13.2
Gruma, S.A.B. de C.V. - Ratio Definitions ................................................................................................................ 43
13.3
Disclaimer ................................................................................................................................................................. 48
3
List of Tables
Table 1: Gruma, S.A.B. de C.V. - Key Employees .................................................................................................................... 7
Table 2: Gruma, S.A.B. de C.V. - Key Employees Biographies ................................................................................................ 8
Table 3: Gruma, S.A.B. de C.V. - Major Products and Services .............................................................................................. 9
Table 4: Gruma, S.A.B. de C.V. - History ................................................................................................................................ 10
Table 5: Gruma, S.A.B. de C.V. - Subsidiaries ....................................................................................................................... 14
Table 6: Gruma, S.A.B. de C.V. - Annual ratios ...................................................................................................................... 21
Table 7: Gruma, S.A.B. de C.V. - Interim ratios ...................................................................................................................... 23
Table 8: Gruma, S.A.B. de C.V. - Capital Market Ratios......................................................................................................... 23
4

List of Figures
Figure 1: Gruma, S.A.B. de C.V. - Revenue and Operating Profit .......................................................................................... 24
Figure 2: Gruma, S.A.B. de C.V. - Asset and Liabilities .......................................................................................................... 25
Figure 3: Gruma, S.A.B. de C.V. - Net Debt vs. Gearing Ratio ............................................................................................... 26
Figure 4: Gruma, S.A.B. de C.V. - Operational Efficiency ....................................................................................................... 27
Figure 5: Gruma, S.A.B. de C.V. - Solvency ........................................................................................................................... 28
Figure 6: Gruma, S.A.B. de C.V. - Valuation ........................................................................................................................... 29
Figure 7: Gruma, S.A.B. de C.V. - Market Capitalization ........................................................................................................ 31
Figure 8: Gruma, S.A.B. de C.V. - Efficiency .......................................................................................................................... 32
Figure 9: Gruma, S.A.B. de C.V. - Valuation ........................................................................................................................... 33
Figure 10: Gruma, S.A.B. de C.V. - Turnover: Inventory and Asset ....................................................................................... 34
Figure 11: Gruma, S.A.B. de C.V. - Liquidity ........................................................................................................................... 35
5
1 Gruma, S.A.B. de C.V.
Financial Snapshot
Operating Performance
Fast Facts
Headquarters Address
Rio de la Plata 407 Ote. Col. del Valle,San

Pedro Garza Garcia,Nuevo
Leon,66220,Mexico
Telephone
+52 81 83993300
Fax
+N/A
Website
www.gruma.com
Ticker Symbol , Exchange Name
GRUMAB,Mexico Stock Exchange
Number of Employees
18,818
Fiscal Year End
December
Revenue (US$ million)
4,567
The company reported revenue of US$4,567 million

during the fiscal year 2015 (2015). The company's
revenue grew at a CAGR of 4.00% during 20112015,
with an annual growth of 16.75% over 2014. In 2015,
the company recorded an operating margin of 12.64%,
as against 12.06% in 2014.
Revenue and Margins
SWOT Analysis
Strengths
Weaknesses
Strong Research and Development

Focus
High Dependence on a Specific

Business Segment
Wide Geographic Presence
Involvement in Lawsuits
Opportunities
Threats
Increase in Consumer Spending in the

Declining Economy of Latin America
US
Recovering US Restaurant Industry
Economic Instability of EU Nations
Strategic Initiatives
Rising Labor Costs in the US
Return on Equity
The company recorded a return on equity (ROE) of
4.47% for 2015, as compared to its peers, General
Mills, Inc. (Ticker: GIS), Flowers Foods, Inc. (Ticker:
FLO) and Archer Daniels Midland Company (Ticker:
ADM), which recorded ROEs of 24.44%, 15.22% and
10.33% respectively. The company reported an
operating margin of 12.64% in 2015.
Return on Equity
Share Data
Share price (US$) as on 19 Apr 2016
19.78
EPS (US$)
0.92
Market Capitalization (US$ million)
8,560
Enterprise Value (US$ million)
9,485
Shares outstanding (million)
433
Liquidity Position
The company reported a current ratio of 1.59 in 2015,
as compared to its peers, General Mills, Inc., Flowers
Foods, Inc. and Archer Daniels Midland Company,
which recorded current ratios of 0.77, 1.33 and 1.62
respectively. As of December 2015, the company
recorded cash and short-term investments of worth
US$229 million, against US$208 million current debt.
The company reported a debt to equity ratio of 0.77 in
2015 as compared to its peers, General Mills, Inc.,
Flowers Foods, Inc. and Archer...
6
2 Gruma, S.A.B. de C.V. - Key Employees

Table 1: Gruma, S.A.B. de C.V. - Key Employees
Name
Job Title
Board Level
Homero Huerta Moreno
Chief Administrative Officer, Director
Executive Board
Javier Velez Bautista
Chief Executive Officer - Mission Foods

USA, Director
Executive Board
Juan Antonio Gonzalez

Moreno
Chairman, Chief Executive Officer
Executive Board
Felipe Antonio Rubio Lamas Chief Technology Officer
Senior Management
Fernando Solis Camara y

Jimenez Canet
Senior Management
Chief Communications Officer
Jose Antonio Jaikel Aguilar Chief Executive Officer - Central America
Senior Management
Leonel Garza Ramirez
Chief Procurement Officer
Senior Management
Raul Cavazos Morales
Chief Financial Officer
Senior Management
Rodolfo Maldonado
Chief Executive Officer - Gruma Europe,

Middle East and Africa
Senior Management
Salvador Vargas Guajardo
General Counsel
Senior Management
Adrian Sada Gonzalez
Director
Non Executive Board
Alberto Santos Boesch
Director
Non Executive Board
Carlos Hank Gonzalez
Director
Non Executive Board
Eduardo Livas Cantu
Director
Non Executive Board
Everardo Elizondo
Almaguer
Director
Non Executive Board
Gabriel A. Carrillo Medina
Director
Non Executive Board
Juan Manuel Ley Lopez
Director
Non Executive Board
Thomas S. Heather
Rodriguez
Director
Non Executive Board
Since
2013
2009
Source: Canadean
7
3 Gruma, S.A.B. de C.V. - Key Employees Biographies

Table 2: Gruma, S.A.B. de C.V. - Key Employees Biographies
Employee Details
Biography
Felipe Antonio Rubio Lamas

Job Title : Chief Technology Officer
Felipe Antonio Rubio Lamas serves as the Chief Technology Officer of

the company. Prio to this he held various positions within the company
including Senior Vice President of manufacturing processes,
engineering, design, and construction of production facilities for Gruma
Corporation among others.
Homero Huerta Moreno

Job Title : Chief Administrative Officer, Director
Homero Huerta Moreno serves as the Chief Administrative Officer, and

an Executive director of the company. He has occupied diverse posts in
Gruma, including the Vice President of Finance and Administration for
Venezuela.
Juan Antonio Gonzalez Moreno

Job Title : Chairman, Chief Executive Officer
Juan Antonio Gonzalez Moreno serves as the Chairman and the Chief
Executive Officer of the company. He also serves as the Chairman of
Car Amigo USA and GIMSA and a member of board of directors of
Groupo Financiero Banorte. Previously, Mr. Moreno held various
leadership positions including the Chief Executive Officer of Special
Projects at Gruma Corporation, the Chief Executive Officer at Gimsa
and Gruma for Asia & Oceania regions, the President at Azteca Milling,
and the President and the Vice President of Sales at Azteca Milling.
Leonel Garza Ramirez

Job Title : Chief Procurement Officer
Leonel Garza Ramirez is the Chief Procurement Officer of the

company. Previously, he has held various leadership positions in the
company including Vice President of Corn Procurement, Chief
Procurement Officer at Gamesas Quality Control and Research
divisions, and Manager of Quality and Corn Procurement among others.
Raul Cavazos Morales

Job Title : Chief Financial Officer
Raul Cavazos Morales serves as the Chief Financial Officer of the

company. He held several positions within the finance department at
Gruma including Chief Treasury Officer and Vice President of Corporate
Treasury.
Source: Canadean
8
4 Gruma, S.A.B. de C.V. - Major Products and Services

Gruma, S.A.B. de C.V. is involved in the production and distribution of Corn and Tortilla based products. The key
products offered by the company include the following:
Table 3: Gruma, S.A.B. de C.V. - Major Products and Services
Products:
Corn Flour
Corn Tortilla
Wheat Flour
Grits Snacks
Tortilla Chips
Taco Shells
Tostadas
Wraps
Pita Bread
Naan
Pizza Doughs
Polenta
Sauces and Dips
Marinades
Pasta
Rice
Oats
Wheat Flour
Machinery Accessories
Tortilla Machinery
Other Products
Brands:
Maseca
Mision
Juana
Guerrero
Diluvio
Reposada
Selecta
Monterrey
Robin Hood
Batitec
Rodotec
La Cima
Lassie
Luisiana
Mnica
Source: Canadean
9
5 Gruma, S.A.B. de C.V. - History

Table 4: Gruma, S.A.B. de C.V. - History
Year
Event type
Description
2015
Acquisitions/Mergers/Takeovers
The company announced the acquisition of Azteca Foods Europe.
2014
The company announced the acquisition of Mexifoods, a manufacturer of various products

from tortillas to Mexican sauces in Spain.
2014
Regulatory Approval
The company received an authorization from the Federal Anti-trust Commission (COFECE) to
sell its wheat operations in Mexico to Grupo Trimex.
2014
Divestiture
The company entered into an agreement with Grupo Trimex, S.A. de C.V. to sell its subsidiary
Molinera de Mexico S.A. de C.V.
2014
Plans/Strategy
The company announced its plans to invest open a new facility in Russia.
2012
2012
New Products/Services
The company owned Molinera de Mexico expanded its production capacity in two of its plants
in Guanajuato and Celaya.
2012
The company introduced three new products under the Mission brand.
2012
The company introduced Mission brand in China and also introduced new products in
Malaysia and Singapore.
2012
The companys 100th plant was inaugurated in Florida, the US.
2011
The company acquired the tortilla plant of Casa de Oro Foods, LLC (Casa de Oro), located in
the US, for US$20 million.
2011
The company acquired Solntse Mexico, a leading tortilla manufacturer in Russia, for US$7
million.
2011
The company acquired the tortilla-production assets of the Albuquerque Tortilla Company
(ATC) in the US for US$9 million.
2011
The company has acquired Semolina A.S.
2006
The company owned Mission foods acquired Corny Bakers plant in the Netherlands.
Gruma, S.A. de C.V. acquired Pride Valley Foods in England.
10
Table 4: Gruma, S.A.B. de C.V. - History

Year
Event type
Description
2006
The company acquired Rositas Investments, a company based in Australia.
2006
Corporate Changes/Expansions
The company established its first Asian plant in Shanghai, China.
2006
Divestiture
The company sold 40.00% stake in MONACA.
2006
Gruma, S.A. de C.V. acquired Oz-Mex Foods.
2000
The company opened its first European plant in Coventry, the UK.
1998
The company established a baking plant at Escobedo.
1994
Stock Listings/IPO
Gruma, S.A. de C.V. launched its initial public offering.
1987
The company established its plant in Honduras.
1982
The company acquired a flour mill in Edinburg, Texas.
1977
Gruma, S.A. de C.V. acquired a plant in Canoga Park, California.
1973
Gruma, S.A. de C.V. started operations in the Costa Rica corn market.
1957
The company established its second plant in Acaponeta.
1949
Incorporation/Establishment
Gruma, S.A. de C.V. was established.
Source: Canadean
11
6 Gruma, S.A.B. de C.V. - Company Statement

A statement by Juan A. Gonzalez Moreno, the Chairman and the Chief Executive Officer of Gruma, S.A.B. de C.V. is given
below. The statement has been taken from the companys annual report 2013.
In 2012, we began a process of transforming our philosophy and our financial, administrative and operating structures,
focusing the companys activities on new growth strategies and enhancing profitability. As a result, we are pleased to inform
you that, despite a complex and volatile business environment, we took important steps on our way to become a more agile
and competitive company, positioning it to better serve the changing needs o f the market.
The decisions we made at the end of 2012 and beginning of 2013 allowed us to strengthen GRUMAs business strategy,
leverage our capabilities developed during years of expansion and optimize investments, producing outstanding results
across all the regions where we operate.
In order to grow the companys profitability, we implemented a series of strategies focused on value creation, enhancing
efficiency and optimizing our commercial efforts, within a framework of sustainability and social responsibility.
To accelerate the implementation of these strategies, we improved our operating structure by making our organization
flatter. This enabled more efficient interactions between top management and the operating teams of our different business
units.
We also implemented initiatives to grow the value of our shareholders investment and to strengthen our financial structure.
Today, we are pleased to report that, as a result of these decisions, Gruma closed the year as the highest yielding company
on the Mexican Stock Exchange, with a 152% growth in share price compared to year end 2012.
The financial markets trust in GRUMA reflects the positive results the company began to post in the first months of 2013
and which ultimately led to operating income of Ps. 4,831 million for 2013, 72% above that of the previous year.
It is important to note that net income attributable to shareholders totaled Ps. 3,163 million in 2013, 184% more than in 2012,
largely reflecting the improved operating performance and strengthened financial structure.
The strength of the companys finances can be seen in the 18%, or US$ 278 million, decline in debt compared to 2012,
reflecting enhanced cash flow and cost reductions.
Grumas value creation strategy focuses on leveraging recent years growth through a transformation that enhances the
effectiveness and optimization of its product portfolio, distribution routes, marketing expenses and administrative costs,
among others.
The companys investment in marketing and advertising underpinned its market presence during 2013 by refocusing
expenses toward the point of sale, consumer studies and category support initiatives. In particular, advertising was
concentrated on distribution channels and our most profitable product presentations, in line with our portfolio consolidation
efforts.
The specific focus on our most profitable and high volume products combined with the greater effectiveness of our
promotions and marketing programs allowed the company to significantly reduce its operational complexity and enhance
efficiency.
Additionally, by reducing capital expenditures, we made better use of installed capacity, improving our return on equity.
All of this was made possible because we leveraged two of the companys significant strengths: installed capacity because
of the past years of expansion and the significant presence of our brands in the territories where we operate, allowing us t o
strategically align our long -term vision.
In 2013 GRUMA made capital expenditures of US$114 million which, combined with diverse efficiency-enhancement
initiatives, allowed us to grow the wheat and corn tortilla production capacity of our U.S. operations and increase the corn
flour production capacity of the plant in Chiapas, Mexico in order to satisfy regional demand.
In 2014, we will continue with a market strategy designed to strengthen our point-of-sale presence, especially focusing on
the solid relationship we have built with the approximately 30,000 small tortilla producers that we serve in Mexico,
underscoring our position as a value partner who drives their profitability, with more effective communication systems that
help us promote this category.
In all the regions where we operate, we will strengthen our business relationship with customers in food service and retail
channels, in order to improve communication and the launch of mutually beneficial projects that drive consumption and
protect each category.
12

The outstanding results of 2013, the right implementation of the strategies we have discussed here, and the talent and
professionalism of our employees have placed GRUMA at an excellent position to accelerate its growth, since it is now a
stronger and more competitive company.
The development of new operating and commercial capabilities combines with our financial flexibility and the trust of the
financial markets to paint a positive picture for 2014 and the years to come. We go forward with renewed optimism, the
determination to achieve new, higher goals and a continued focus on creating value for our shareholders, employees,
customers, consumers, suppliers and the community in general.
We appreciate the guidance, vision and leadership of our Board of Directors, who has given us their total support throughout
this transformation process. Our thanks also go to the Executive Committee for its help in strengthening the process of
institutionalizing the company and assuring that its strategic direction is an integral part of our daily operations.
Finally, we would like to thank our people, whose tenacity and talent enabled the implementation of important improvement
initiatives during the year; our customers and consumers for their renewed loyalty and trust in our products and services;
and you, our shareholders, to whom we reiterate our commitment to continue building a better, more efficient, more valuable
company that continues forward with its characteristic profitable growth, producing results to enhance your investment.
13
7 Gruma, S.A.B. de C.V. - Locations and Subsidiaries

7.1
Gruma, S.A.B. de C.V. - Head Office

Rio de la Plata 407 Ote. Col. del Valle
San Pedro Garza Garcia
Nuevo Leon
Zip: 66220
Mexico
Tel: + 52 81 83993300
7.2
Gruma, S.A.B. de C.V. - Other Locations and Subsidiaries
Table 5: Gruma, S.A.B. de C.V. - Subsidiaries

Gruma Corporation
Suite 200
1159 Cotton Wood Lane
Irving
Mission Foods (Malaysia) Sdn. Bhd.
United States of America
Malaysia
Tel: + 1 972 2325000

Zip: 75038
Investigacion de Tecnologia Avanzada, S.A. de C.V.

Azteca Milling L.P.
Mexico
United States of America
Molinera de Mexico, S.A. de C.V.

Torre Martel Avenue
Enrique Herrera 2307
Col. Valle Oriente
Productos y Distribuidora Azteca, S.A. de C.V.
Mexico
Mexico
Tel: + 52 8 399 3800

Zip: 66290
Molinos Nacionales, C.A.

Avenue Principal de los Ruices
Centro Monaca Torre Sur, Piso 4
Mission Foods (Shanghai) Co. Ltd.
Los Ruices Caracas
China
Venezuela
14

Table 5: Gruma, S.A.B. de C.V. - Subsidiaries
Gruma Centroamerica, L.L.C.
Pavas, Del Hospital Psiquiatrico
Derivados de Maiz Seleccionado, C.A.
800 metros al Oeste
Venezuela
San Jose
Venezuela
Gruma International Foods, S.L.
Spain
Source: Canadean
15
8 Gruma, S.A.B. de C.V. - Business Analysis

8.1
Gruma, S.A.B. de C.V. - Company Overview
Gruma, S.A.B. de C.V. (Gruma) is a leading producer and distributor of corn flour and tortilla. The company is principally
involved in the production and distribution of corn flour, wheat flour, packaged tortillas, flatbreads, corn chips and other
related products including rice, and oatmeal, among others. Its major brands include Mission, Guerrero, Maseca and
Tortiricas among others. Gruma is also involved in the sale of machinery and associated accessories related to corn flour
and tortilla products manufacturing. Its operations span across North America, Europe, South and Central America, Asia,
and Oceania. The companys wholly owned subsidiaries manage its businesses in different geographic regions. Gruma is
headquartered in Nuevo Leon, Mexico.
In June 2014, the company acquired Mexifoods Spain, a producer of fries, sauces, and corn and wheat tortillas in Spain to
expand its operations to Iberian Peninsula, southern France, Italy, Portugal and Malta.
8.2
Gruma, S.A.B. de C.V. - Business Description
Gruma is a producer and distributor of corn and tortilla products. The company, through its subsidiaries, specializes in the
sales of corn flour, wheat flour, tortilla and corn chips, packaged tortilla et al. It is also involved in the sale of related products
such as heart of palm, rice, oatmeal, flatbreads, technological equipments, accessories and others.
The company classifies its business operations into three reportable segments: Corn flour and packaged tortilla in the US
and Europe; Corn flour in Mexico; and Others.
Grumas Corn Flour and Packaged Tortilla in the US and Europe is controlled and managed by its subsidiary Gruma
Corporation. Gruma Corporation along with its US and Europe based subsidiaries, manufactures and distributes corn flour
and tortilla products. The firm operates primarily through Mission Foods division, which produces tortillas and related
products, and Azteca Milling, LP, a limited partnership between Gruma Corporation (80.00% stake) and Archer Daniels
Midland Company (20.00% stake). The company offers more than 20 varieties of corn flours for use in the manufacture and
distribution of tortillas and tortilla chip products in the US. The companys key brands in the US and European markets are
Mission, Maseca and Guerrero. Mission Foods operates packaged tortillas and other related products at 26 manufacturing
plants worldwide, of which 22 are in the US, two in the UK, one in the Netherlands, and one in Russia. Azteca Milling
produces corn flour at 6 plants in Texas, Indiana, Kentucky and California. Gruma Corporation also produces corn flour at its
plants in Italy, Ukraine and Turkey. Distribution of the products is carried out through using multiple models, including directstore-delivery system, retail sales, and via the companys foodservice distribution network. In FY2013, the Corn Flour and
Packaged Tortilla in the US and Europe segment reported revenues of MXN27,761 million, accounting for 51.4% of the
companys total revenue.
The Corn Flour in Mexico segment of the company, through Grupo Industrial Maseca, S.A.B. de C.V. (GIMSA), is involved in
the production, distribution and sale of corn flour in Mexico under the Maseca brand. Corn flour produced by this division is
used mainly in the preparation of tortillas and other related products. Gruma in association with Archer-Daniels-Midland has
entered the wheat milling market of Mexico through Molinera de Mxico (Molinera). Molinera produces and sells wheat flour,
wheat bran and other byproducts. Its wheat flour brands are Reposada , Poderosa and Selecta , among others. Other
subsidiaries of the company involve in the manufacture and distribution of packaged tortillas and other related products in
northern Mexico. The subsidiaries also conduct research and development on corn flour and tortilla manufacturing
equipment, produce machinery for corn flour and tortilla production, and construct our corn flour manufacturing facilities.
Gimsa offers more than 50 varieties of corn and wheat flours for use in manufacturing of various tortilla based products.
These products are offered mainly to tortilla and tortilla chip manufacturers and retailers. Gimsa currently owns 17 corn flour
mills located across Mexico. It also owns two more plants, one of which produces wheat flour and the other, corn grits and
several types of corn based products. Molinera owns and operates nine wheat flour plants. In FY2013, the Corn Flour in
Mexico segment reported revenues of MXN15,790.1 million, accounting for 29.2% of the companys total revenue.
16
Under the Other business segment the company provides Corn flour, hearts of palm, rice, and other products (Central
America); Wheat flour (Mexico); Packaged tortillas (Mexico); Wheat flour tortillas and snacks (Asia and Oceania); and
Technology and equipment. The Corn flour, hearts of palm, rice, and other products (Central America) business of the
company is managed by Gruma Centroamrica, which produces corn flour, tortillas and snacks. It also cultivates and sells
hearts of palm, and processes and sells rice. The firm sells corn flour under the Maseca, Tortimasa, Masarica and Minsa
brands. In Costa Rica, it sells packaged tortillas under the Torti Rica and Misin brands. Gruma Venezuela operates a Costa
Rican snack operation which manufactures tortilla chips, potato chips and similar products under the Tosty, Rumba, and La
Tica brand. The firm exports hearts of palm to Europe, the US, Canada, Chile and Mexico. Gruma Venezuela operates one
corn flour plant in each of Costa Rica, Honduras, El Salvador, and Guatemala In Costa Rica, it also has one plant for
producing tortillas, one plant for producing snacks, one plant to process hearts of palm and one plant for processing rice.
The firm also has small tortilla plants in Nicaragua and Honduras. Gruma Venezuela has a small plant that produces snacks
in Guatemala, and a small facility which processes hearts of palm in Ecuador. The Packaged tortillas (Mexico) is managed
by Productos y Distribuidora Azteca, SA de CV (Prodisa), which produces packaged tortillas and other related products in
Mexico. The Wheat flour tortillas and snacks (Asia and Oceania) business is managed by Gruma Asia and Oceania, which
in turn comprises Mission Foods (Shanghai) Co. Ltd., Gruma Oceania Pty. Ltd., and Mission Foods (Malaysia) Sdn. Bhd.
The Technology and equipment business of the company is managed by Investigacin de Tecnologa Avanzada, SA de CV
(Intasa), which is involved in construction, technology and equipment operations. It also provides technical support to other
facilities of Gruma. Intasa has two subsidiaries: Tecnomaz, SA de CV, or Tecnomaz, and Constructora Industrial
Agropecuaria, SA de CV (CIASA). These subsidiaries primarily provide research and development, equipment, and
construction services to Gruma and small equipment to third parties. Through Tecnomaz, the company also involves in the
design, manufacture and sale of machines for the production of tortillas and tortilla chips. The equipment is sold under the
Tortec and Batitec brands in Mexico. Tecnomaz also manufactures high volume energy efficient corn tortilla, wheat tortilla
and tortilla chip systems. In FY2013, the Other business segment reported revenues of MXN10,482.3 million, accounting for
19.4% of the companys total revenue.
Gruma carries out technological research and development for corn milling, tortilla production, engineering, plant design and
construction through Intasa and Ciasa. These subsidiaries administer and supervise the design and construction of the
companys new plants. In FY2013, the company invested MXN144.6 million.
The company classifies its geographical operations into four regions, the US and Europe, Mexico, Central America, and Asia
and Oceania. In FY2013, the company generated 51.3% of the total revenue from the US and Europe, followed by Mexico
(39.1%), Central America (6.3%), and Asia and Oceania (3.3%).
17
9 Gruma, S.A.B. de C.V. - SWOT Analysis

9.1
Gruma, S.A.B. de C.V. - SWOT Analysis - Overview
Gruma, S.A.B. de C.V. (Gruma) is a corn flour, tortilla producer and distributor. Strong research and development focus and
wide geographic presence are the companys major strengths, whereas high dependence on a specific business segment
and involvement in lawsuits remain matters of major concern. In the future, economic instability of EU nations, rising labor
costs in the US and declining economy of Latin America could impact its business operations. However, increase in
consumer spending in the US, recovering US restaurant industry and strategic Initiatives may offer growth opportunities to
the company.
9.2
9.2.1
Gruma, S.A.B. de C.V. - Strengths

Strength - Strong Research and Development Focus
Gruma continuously involves in research and development activities that focus mainly on increasing the efficiency of its
proprietary corn flour and corn/wheat tortilla production technology; maintaining high product quality; developing new and
improved products and manufacturing equipment; improving the shelf life of certain corn and wheat products; improving and
expanding its information technology system; engineering, plant design and construction; and compliance with
environmental regulations. The company currently holds 132 patents, 3 industrial designs in Mexico and one in 15 countries.
The company conducts research and development through its subsidiaries Intasa, Tecnomaz and Ciasa. Through
Tecnomaz, it involves in the design, manufacture and sale of machines for the production of corn/wheat tortillas and tortilla
chips. It carries out proprietary technological research and development for corn milling and tortilla production and also all
engineering, plant design and construction through Intasa and Ciasa. These companies administer and supervise the design
and construction of Grumas new plants. In FY2013, the company invested MXN144.6 million. Strong R&D focus helps the
company stay ahead of its peers.
9.2.2
Strength - Wide Geographic Presence
Geographically diverse operations helps the company mitigate the various risks associated with the overdependence on a
particular market. Gruma is one of the largest producer and distributor of corn and tortilla products on global scale. It is also
one of the leading producers of corn flour and wheat flour in Mexico, and one of the leading producers of corn flour and
wheat flour in Venezuela. Furthermore, It is one of the largest producers of corn flour and tortillas in Central America, and
one of the largest producers of tortilla and other flatbreads, including pita, naan, chapatti, pizza bases and piadina in Europe,
Asia and Oceania. The company had presence in 113 countries and operates 101 manufacturing plants. Geographically the
companys core operations are carried out across North America, South America, Europe, Central America, Asia, and
Australia. Grumas operations are classified into four geographies including the US and Europe, Mexico, Central America,
and Asia and Ocenia. Its businesses are carried out by its subsidiaries in these countries. During the fiscal year 2013, the
company generated 51.3% of the total revenue from the US and the Europe, followed by Mexico (39.1%), Central America
(6.3%), Asia and Oceania (3.3%). A wide geographical presence helps the company mitigate risk arising from specific
geographies and to generate brand equity as well as provides new avenues for growth to the company.
9.3
9.3.1
Gruma, S.A.B. de C.V. - Weaknesses

Weakness - Involvement in Lawsuits
Gruma has been involved in various legal proceedings. In 2009, the Surveillance Office of the Mexican National Banking
and Securities Commission (CNBV) began an investigation regarding timely disclosure of material events reported through
the Mexican Stock Exchange in connection with the companys foreign exchange derivative losses and conversion of the
realized losses into debt. In October 2013, in this case, a fine of MXN4.1 million was imposed on Gruma. Furthermore, in
August 2013, a consumer filed a petition in the US against Gruma Corporation, stating that Mission tortilla chips contained
non-natural ingredients, however they were labeled All Natural and claimed restitution and other actual damages. The
proceeding has not yet been resolved and the case is pending in the US court of law. Additionally, in June 2013, a former
employee of Gruma filed a petition against the company seeking damages for certain wage and hour claims under the
California labor law. Such lawsuits adversely impact the companys business, both in terms of brand image and financial
position.
18
9.3.2
Weakness - High Dependence on a Specific Business Segment
Gruma has multiple segments in its corn flour and tortilla business. However, the company is highly dependent on its Corn
Flour and Packaged Tortilla in the US and Europe segment, which is controlled and managed by its subsidiary Gruma
Corporation, which along with its US and Europe based subsidiaries, manufactures and distributes corn flour and tortilla
products. The firm operates primarily through Mission Foods division, a wholly-owned subsidiary, and Azteca Milling, LP, a
limited partnership between Gruma Corporation (80% stake) and Archer Daniels Midland Company(20% stake). It has
operations spread across the US and Europe. In FY2013, the company generated a majority portion of its revenues from the
Corn Flour and Packaged Tortilla in the US and Europe. The segment contributed 51.4% towards the total revenue of the
company. The contribution of this segment has been consistently more than any other business segments of Gruma. The
companys operational performance may be affected if the demand for the products offered by this division falls, which may
have a material impact on the overall financial performance of the company.
9.4
9.4.1
Gruma, S.A.B. de C.V. - Opportunities

Opportunity - Increase in Consumer Spending in the US
Increase in the consumer spending is a positive factor for the companys operating in the US. According to a recent report
by the US Bureau of Economic Analysis (BEA), in June 2014, the personal income (PI) in the US increased by 0.4%, and
disposable personal income (DPI) increased by 0.4% as compared to May 2014. Additionally, personal consumption
expenditures (PCE) increased by 0.4% for the same period. PI, DPI and PCE have been consistently increasing every
month in the US since February 2014. For the entire 2013 period, personal income (PI) in the US increased by 2.8% and
disposable personal income (DPI) increased by 1.9% as compared to 2012. In addition, personal consumption expenditure
(PCE) increased by 3.1% during the same period. Growing personal income, disposable personal income and personal
consumption expenditures indicates improved consumer spending in the US, which may positively affect the purchases of
corn and tortilla products and performance of companies such as Gruma.
9.4.2
Opportunity - Recovering US Restaurant Industry
The company stands to benefit from the growing US restaurant industry and expects to augment its revenue growth.
According to the National Restaurant Association, restaurants account for 4% of the US GDP. The association projects the
restaurant-industry sales to be approximately US$683.4 billion for 2014, a 3.6% increase from 2013. The restaurant industry
growth during 2000-2011 has outpaced the national economic growth during the same period. Gruma is involved in the
production and distribution of corn and tortilla products. The company is also involved in sale of related products such as
heart of palm, rice, oatmeal, flatbreads, technological equipments, accessories and others may benefit from the above
trends. Thus the company may consider expanding its commercial food portfolio and benefit from the growing US
foodservice industry.
9.4.3
Opportunity - Strategic Initiatives
Grumas strategy is to achieve growth through acquisitions, and taking advantage of the resulting opportunities and
synergies worldwide. In this line, the company pursued several expansion initiatives in the past. In June 2014, Gruma
acquired Mexifoods Spain, a manufacturer of various products including corn and wheat tortillas, Chips, tortilla chips, fries
and sauces. The acquisition enables the company to enhance its presence in Europe, with the expansion to Portugal, Italy,
southern France, Iberian Peninsula, and Malta. Such initiatives may help the company explore new markets and strengthen
its position in its present markets.
9.5
9.5.1
Gruma, S.A.B. de C.V. - Threats

Threat - Economic Instability of EU Nations
The unstable economic condition in EU region is posing challenges for companies dependent on these regions. In 2010, the
16-member euro region was struck by debt crisis. As a repercussion of which, the euro fell by 16% against the US dollar and
the governments from Spain to Germany slashed budget costs to decrease deficits. The IMF and the member nations of the
EU announced a EUR750 billion (US$1,042 billion) rescue package to bailout the debt struck countries such as Greece,
Italy and Ireland. Euro Zone, which grew at a rate of 1.5% during 2011, has contracted by 0.7% in 2012 and by 0.4% in
2013. Furthermore, as per IMFs latest release in January 2014, though IMF projects growth for euro zone by 1% in 2014
and 1.4% for 2015, it remains to be uneven. The company has considerable operations in a number of European countries.
In FY2013, the company generated 51.3% of the total revenue from the United States and Europe. Thus economic instability
of the EU nations may have an adverse impact on the companys operations.
19
9.5.2
Threat - Rising Labor Costs in the US
Labor costs in the US have been rising consistently. The tight labor markets, government mandated increases in minimum
wages and a higher proportion of full-time employees resulting in an increase in the labor costs. The federal minimum wage
provisions are contained in the Fair Labor Standards Act (FLSA). The minimum wage rate in the US remained at US$5 per
hour since 1997 and reached US$9.32 per hour in January 2014. For instance, the minimum wage rates have crossed or
are nearer to US$9 per hour in several states such as Washington D. C., California, Oregon, Massachusetts, Colorado, and
Connecticut among others. Furthermore, according to a Congressional Budget Office report published in February 2014, the
US President, Mr. Barack Obama, proposed to increase the minimum wage by 0.3% to US$10.10 per hour. The company
operates 30 plants across the US. Therefore, rising labor costs may increase the operational costs of the company and
lower its profits.
9.5.3
Threat - Declining Economy of Latin America
The economic slowdown in Latin America and the Caribbean (LAC) are likely to create challenges for the company over the
next few years. According to International Monetary Fund (IMF), the real GDP growth in LAC in 2013 was 2.7% as
compared to a real GDP growth of 3% in 2012 and 4.5% in 2011. Furthermore, the LAC economy is expected to have a
sluggish growth of 1.3% in 2014. The decline in growth adversely impacted consumer spending and labor markets in the
region. Since, the company has operations in Latin America; declining economy may affect its operations and growth
opportunities.
20
10 Gruma, S.A.B. de C.V. - Company Financial Analysis

10.1 Gruma, S.A.B. de C.V. - Five Year Snapshot: Overview of Financial and Operational
Performance Indicators
The company reported revenue of US$4,567 million during the fiscal year 2015 (2015). The company's revenue grew at a
CAGR of 4.00% during 20112015, with an annual growth of 16.75% over 2014. During 2015, operating margin of the
company was 12.64% in comparison with operating margin of 12.06% in 2014. In 2015, the company recorded a net profit
margin of 1.31% compared to a net profit margin of 8.59% in 2014.
Table 6: Gruma, S.A.B. de C.V. - Annual ratios
Key Ratios
Unit/Currency
2015
2014
2013
2012
2011
EPS (Earnings per Share)
MXN
11.73
8.52
7.49
0.42
7.71
Dividend per Share
MXN
1.73
1.34
0.17
0.93
Absolute
4.91
5.57
2.46
8.29
Equity Ratios
Dividend Cover
Book Value per Share
MXN
39.36
38.28
29.98
24.71
23.83
Cash Value per Share
MXN
6.75
2.89
1.87
2.82
2.09
Gross Margin
38.33
36.77
34.2
31.91
31.18
Operating Margin
12.64
12.06
9.46
5.3
14.72
Net Profit Margin
1.31
8.59
6.45
2.26
10.87
Profit Markup
62.17
58.15
51.97
46.87
45.3
PBT Margin (Profit Before Tax)
12.09
9.85
7.45
3.51
13.43
Return on Equity
4.47
25.88
24.38
9.87
39.24
Return on Capital Employed
22.56
18.92
14.84
8.17
21.26
Return on Assets
1.72
10.55
7.42
2.26
11.83
Return on Fixed Assets
28.54
23.93
19.12
10.1
29.06
Return on Working Capital
107.61
90.4
66.42
42.84
79.22
Sales Growth
16.71
1.84
-0.48
1.61
4.88
Operating Income Growth
22.33
29.81
77.83
-63.43
248.05
EBITDA Growth
36.05
31.74
94.66
-70.2
358.07
Net Income Growth
-82.23
35.54
183.6
-78.84
1120.71
EPS Growth
34.14
12.28
1550.06
-71.56
51.39
Working Capital Growth
2.77
-4.62
14.71
-32.39
114.98
Operating Costs (% of Sales)
87.36
87.94
90.54
94.7
85.28
Administration Costs (% of Sales)
24.78
23.7
23.89
25.98
25.28
Current Ratio
Absolute
1.59
1.76
1.62
1.35
1.82
Quick Ratio
Absolute
0.92
1.01
0.94
0.58
0.85
Cash Ratio
Absolute
0.25
0.17
0.12
0.07
0.12
Absolute
0.77
0.65
1.26
1.76
0.98
Profitability Ratios
Growth Ratios
Cost Ratios
Liquidity Ratios
Leverage Ratios
Debt to Equity Ratio
21
Table 6: Gruma, S.A.B. de C.V. - Annual ratios

Key Ratios
Unit/Currency
2015
2014
2013
2012
2011
Net Debt to Equity
Absolute
0.6
0.57
1.2
1.64
0.89
Debt to Capital Ratio
Absolute
0.4
0.34
0.52
0.62
0.39
Asset Turnover
Absolute
1.31
1.23
1.15
1.09
Fixed Asset Turnover
Absolute
2.89
2.8
2.74
2.36
2.36
Inventory Turnover
Absolute
4.6
4.82
4.22
2.51
3.12
Current Asset Turnover
Absolute
3.15
3.23
2.67
2.09
2.43
Capital Employed Turnover
Absolute
3.42
3.01
3.78
4.36
3.61
Working Capital Turnover
Absolute
8.51
7.49
7.02
8.09
5.38
Revenue per Employee
MXN
3096982
Net Income per Employee
MXN
40483
4.98
3.23
2.88
4.87
3.32
Efficiency Ratios
Capex to Sales
Source: Canadean
22
10.2 Gruma, S.A.B. de C.V. - Interim ratios
Table 7: Gruma, S.A.B. de C.V. - Interim ratios

Key Ratios
Unit/Currency
Dec-2015
Sep-2015
Jun-2015
Mar-2015
Interim EPS (Earnings per Share)
MXN
3.61
3.15
2.65
2.31
MXN
39.36
45.7
42.17
40.14
Gross Margin
39.68
38.45
37.99
37.06
Operating Margin
12.69
12.99
12.88
11.94
Net Profit Margin
-17.71
9.03
7.57
7.27
Profit Markup
65.79
62.47
61.27
58.87
PBT Margin (Profit Before Tax)
12.07
12.42
12.47
11.33
Operating Costs (% of Sales)
87.31
87.01
87.12
88.06
Administration Costs (% of Sales)
24.3
24.9
25.1
24.85
Current Ratio
Absolute
1.59
1.62
1.47
1.82
Quick Ratio
Absolute
0.92
0.96
0.87
1.07
Absolute
0.77
0.64
0.62
0.66
Net Debt to Equity
Absolute
0.6
0.52
0.49
0.57
Absolute
0.4
0.36
0.35
0.35
Equity Ratios
Cost Ratios
Liquidity Ratios
Leverage Ratios
Source: Canadean
10.2.1 Gruma, S.A.B. de C.V. - Financial ratios: Capital Market Ratios

Table 8: Gruma, S.A.B. de C.V. - Capital Market Ratios
Key Ratios
Value
P/E (Price/Earnings) Ratio
21.52
EV/EBITDA (Enterprise Value/Earnings Before Interest, Taxes, Depreciation and Amortization)
17.18
Enterprise Value/Sales
2.08
Enterprise Value/Operating Profit
16.43
Enterprise Value/Total Assets
2.73
Dividend Yield
Note: Above ratios are based on share price as of 19-Apr-2016. The above ratios are absolute numbers.
Source: Canadean
23
10.3 Gruma, S.A.B. de C.V. - Financial Performance and Ratio Charts

10.3.1 Gruma, S.A.B. de C.V. - Revenue and Operating margin
The consolidated group revenue of the company for 2015 stood at US$4,567 million, which corresponds to a growth rate of
16.75% over the previous year. The operating margin of the company was 12.64% in 2015, an increase of 58.00 basis points over
the previous year.
Figure 1: Gruma, S.A.B. de C.V. - Revenue and Operating Profit
Source: Canadean
24
10.3.2 Gruma, S.A.B. de C.V. - Asset and Liabilities

The company's assets grew 9.13% over the previous year to US$3,474 million in 2015. The company's liabilities grew 13.44%
over the previous year to US$2,139 million in 2015. The company's asset to liability ratio reduced from 1.69 in 2014 to 1.62 in
2015.
Figure 2: Gruma, S.A.B. de C.V. - Asset and Liabilities
Source: Canadean
25
10.3.3 Gruma, S.A.B. de C.V. - Net Debt vs. Gearing Ratio

The company recorded higher net debt of US$802 million at the end of fiscal year 2015 when compared to the previous year's net
debt of US$745 million. The company's gearing ratio for the year 2015 was 0.62, which was higher when compared to the
previous year's gearing ratio of 0.56. The gearing ratio remained higher in 2015 due to higher debt funding activities over equity.
Figure 3: Gruma, S.A.B. de C.V. - Net Debt vs. Gearing Ratio
Source: Canadean
26
10.3.4 Gruma, S.A.B. de C.V. - Operational Efficiency

The company's working capital turnover for 2015 grew to 8.51, from the previous year's working capital turnover of 7.49. In 2015,
the company's asset turnover improved to 1.31 from the previous year's current ratio of 1.23.
Figure 4: Gruma, S.A.B. de C.V. - Operational Efficiency
Source: Canadean
27
10.3.5 Gruma, S.A.B. de C.V. - Solvency

In 2015, the company's current ratio declined to 1.59 from the previous year's current ratio of 1.76. The companys quick ratio
declined to 0.92 in 2015 from the previous year's quick ratio of 1.01. In 2015, the companys debt ratio increased to 0.30 from the
previous year's debt ratio of 0.26.
Figure 5: Gruma, S.A.B. de C.V. - Solvency
Source: Canadean
28
10.3.6 Gruma, S.A.B. de C.V. - Valuation

As of 19-Apr-2016, the company recorded an EV/EBIT of 16.43, EV/Total Assets of 2.73 and EV/Sales of 2.08.
Figure 6: Gruma, S.A.B. de C.V. - Valuation
Source: Canadean
29
10.4 Gruma, S.A.B. de C.V. - Competitive Benchmarking

The following companies are the major competitors of Gruma, S.A.B. de C.V.:
American Italian Pasta Company
Archer Daniels Midland Company (Ticker: ADM)
Bunge Milling, Inc.
Flowers Foods, Inc. (Ticker: FLO)
General Mills, Inc. (Ticker: GIS)
Grupo Mac Ma SAB de CV
Grupo Minsa, S.A.B. De C.V. (Ticker: MINSAB)
30

For competitive benchmarking, latest financial results are considered. Following are the key performance indicators against
which the companies have been benchmarked:
10.4.1 Gruma, S.A.B. de C.V. - Market Capitalization
As of 19-Apr-2016, the company recorded a market capitalization of US$8,308 million, lower than its close competitors Archer
Daniels Midland Company (Ticker: ADM) and General Mills, Inc. (Ticker: GIS) which recorded market capitalizations of US$22,705
million and US$37,079 million respectively. The company recorded earnings per share of US$0.89 in 2015, which has led to a
price/earnings ratio (P/E ratio) of 21.52. This was higher than the P/E ratios of its peers Archer Daniels Midland Company (Ticker:
ADM) and Flowers Foods, Inc. (Ticker: FLO), which recorded P/E ratio of 12.83 and 20.93 respectively.
Figure 7: Gruma, S.A.B. de C.V. - Market Capitalization
Source: Canadean
Note: Company names are represented by ticker symbols
Bubble size represents Market Capitalization US$ Million
For those data points with negative values, bubbles will not be displayed.
Where the market cap is disproportionately smaller, a bubble may not be displayed.
31
10.4.2 Gruma, S.A.B. de C.V. - Efficiency

The company recorded an operating margin of 12.64% in 2015. This was higher than the operating margins of its peers, Archer
Daniels Midland Company (Ticker: ADM), General Mills, Inc. (Ticker: GIS) and Flowers Foods, Inc. (Ticker: FLO), which recorded
the margins of 2.67%, 11.78% and 7.88% respectively. In terms of revenues, the company is 0.07 times of Archer Daniels Midland
Company (Ticker: ADM), 0.26 times of General Mills, Inc. (Ticker: GIS), and 1.21 times of Flowers Foods, Inc. (Ticker: FLO).
Figure 8: Gruma, S.A.B. de C.V. - Efficiency
Source: Canadean
32
10.4.3 Gruma, S.A.B. de C.V. - Valuation

As of 19-Apr-2016, the companys EV/EBIT was 16.43. This was higher than that of its peers, Archer Daniels Midland Company
(Ticker: ADM) and Flowers Foods, Inc. (Ticker: FLO), which reported EV/EBIT figures of 15.30 and 16.28 respectively.
Figure 9: Gruma, S.A.B. de C.V. - Valuation
Source: Canadean
33
10.4.4 Gruma, S.A.B. de C.V. - Turnover: Inventory and Asset

In 2015, the company reported an inventory turnover of 4.60, lower than that of its peers: during the same period, Archer Daniels
Midland Company (Ticker: ADM), General Mills, Inc. (Ticker: GIS) and Flowers Foods, Inc. (Ticker: FLO) recorded inventory
turnovers of 7.73, 7.47 and 11.65 respectively The companys asset turnover in 2015 was 1.31, higher than the asset turnovers of
its peers: during the same period, General Mills, Inc. (Ticker: GIS) and Flowers Foods, Inc. (Ticker: FLO) recorded asset turnovers
of 0.80 and 1.31 respectively.
Figure 10: Gruma, S.A.B. de C.V. - Turnover: Inventory and Asset
Source: Canadean
34
10.4.5 Gruma, S.A.B. de C.V. - Liquidity

The company reported a current ratio of 1.59 in 2015, higher than the current ratios of its peers: during the same period, General
Mills, Inc. (Ticker: GIS) and Flowers Foods, Inc. (Ticker: FLO) recorded current ratios of 0.77 and 1.33 respectively. In 2015, the
company's debt to equity ratio was 0.77, lower than that of its peers: during the same period, General Mills, Inc. (Ticker: GIS) and
Flowers Foods, Inc. (Ticker: FLO) recorded debt to equity ratios of 1.84 and 0.83 respectively.
Figure 11: Gruma, S.A.B. de C.V. - Liquidity
Source: Canadean
35
11 Gruma, S.A.B. de C.V. - Mergers & Acquisitions and

Partnerships
11.1 Gruma, S.A.B. de C.V. - M&A and Partnerships Strategy
Archer Daniels Midland to sell 23.16% stake in Gruma to Fernando Chico Pardo
Deal Type
Acquisition
Deal Sub Type
Minority Acquisition
Deal Status
Announced
Announced Date
2012-10-23
Deal in Brief
Agrupacion Aeroportuaria Internacional III, S.A. de C.V. (AAI) and Corporativo PAFCH, S.A. de C.V. have agreed to acquire
23.16% of the issued shares of Gruma, S.A.B. de C.V., a Mexican corn flour and tortilla producer and distributor, from Archer
Daniels Midland Company (ADM).
ADM is a US-based producer of food ingredients, animal feeds and feed ingredients for food industry.
AAI and PAFCH are companies controlled directly by Fernando Chico Pardo, the chairman of Mexican airport operator Asur.
Additionally, AAI and PAFCH have expressed their interest to acquire from ADM an indirect stake of 3% of both subsidiaries of
Grumain Venezuela, MONACA and DEMASECA, along with a 40% stake in Molinera de Mexico, a wheat flour business, and 20%
stake in Azteca Milling, corn flour business in the US.
Participant Company Information
Company Name
Corporativo PAFCH, S.A. de

Involvement Type
C.V.
Acquirer
Company Overview
Corporativo PAFCH, S.A. de C.V. is a company controlled by Fernando Chico Pardo, the chairman of Mexican airport operator
Asur.
Agrupacion
Aeroportuaria
Company Name
Involvement Type
Acquirer
Internacional III, S.A. de C.V.
Company Overview
Agrupacin Aeroportuaria Internacional III, S.A. de C.V. is a company controlled by Fernando Chico Pardo, the chairman of
Mexican airport operator Asur.
Archer
Daniels
Midland
Company Name
Involvement Type
Vendor
Company
Company Overview
Archer Daniels Midland Company (ADM) is an agricultural product processor based in the US. The company offers food and feed
ingredients, foods, animal feed and industrial chemicals. Its product portfolio includes acidulants, cocoa and chocolate products,
edible beans, fiber, flour, whole grains and mixes, oils, sweeteners, protein meal, animal nutritional products, biodiesel, ethanol,
industrial oils, polyols, propylene glycol, various chemical ingredients, and other related products. The company is also involved in
procuring, transporting, storing, processing and merchandising agricultural commodities and food products. It offers several
services including logistics, contract research and development, farmer services and financial services. Its operations are spread
across the Americas, Europe, Asia, and Africa. ADM is headquartered in Decatur, Illinois, the US.
In May 2015, the company signed an agreement to acquire complete ownership of North Star Shipping and Minmetal, which
would help in strengthening its origination and transportation network in Eastern Europe.
36
Gruma acquires Semolina

Deal Type
Acquisition
Deal Sub Type
Majority Acquisition
Deal Status
Completed
Announced Date
2011-11-24
Deal in Brief
Gruma, S.A.B. de C.V., a Mexican corn flour and tortilla producer and distributor, has acquired Semolina A.S., a Turkish savory
snacks producer, for a consideration of US$17.5 million.
Company Name
Semolina A.S.
Involvement Type
Target
Company Overview
Semolina A.S. is a savory snacks producer.
Gruma Acquires Mexifoods

Deal Type
Acquisition
Deal Sub Type
Deal Status
Completed
Announced Date
2014-06-27
Deal in Brief
Gruma SAB de CV, a Mexican producer and distributor of wheat flour, corn flour, corn tortilla, oats and rice, has acquired
Mexifoods SL, a Spanish producer of wheat tortillas and corn under the MEXIFOODS brand.
Company Name
Mexifoods SL
Involvement Type
Target
Company Overview
Mexifoods SL is a Spanish producer of wheat tortillas and corn under the MEXIFOODS brand.
Grupo Trimex to Acquire Molinera de Mexico from GRUMA

Deal Type
Acquisition
Deal Sub Type
100% Acquisition
Deal Status
Announced
Announced Date
2014-06-10
Deal in Brief
Grupo Trimex, S.A. de C.V, a provider of milling flour and related products, has entered into an agreement to acquire Molinera de
Mexico, S.A. de C.V, a producer and distributor of wheat flour, from GRUMA, S.A.B. de C.V for approximately USD200 million. All
companies involved in the transaction are based in Mexico.
The transaction is subject to the approval of the Mexican Federal Trade Commission and to certain closing conditions agreed
upon by the parties.
The closing is expected to take place by October 2014.
Company Name
Grupo Trimex, S.A. de C.V
Involvement Type
Acquirer
Company Overview
Grupo Trimex, S.A. de C.V is a provider of milling flour and related products based in Mexico.
Company Name
Molinera de Mexico, S.A. de

Involvement Type
C.V.
Target
Company Overview
Molinera de Mexico, S.A. de C.V is a producer and distributor of wheat flour.
37
GRUMA acquires Solntse Mexico

Deal Type
Acquisition
Deal Sub Type
Deal Status
Completed
Announced Date
2011-07-13
Deal in Brief
GRUMA, S.A.B. de C.V., a Mexican corn flour, tortilla producer and distributor, has acquired Solntse Mexico, a Russian
manufacturer of tortilla, for $7 million.
Company Name
Solntse Mexico
Involvement Type
Target
Company Overview
Solntse Mexico is a manufacturer of tortilla.
38
12 Gruma, S.A.B. de C.V. - Recent Developments

GRUMA:EBITDA up 25% and sales up 17% at the close of Q415, mainly driven by u.s. operations
Date : 24 Feb 2016
GRUMA S.A.B. de C.V. closed 2015 with improvements in its operating results and financial structure.
At the close of the fourth quarter of 2015 (Q415), the company's Sales Volume stood at 977,000 tons, 4% higher than that reported for the same
period in 2014.
Likewise, Net Sales were up 17% on Q414, to MXN 15.16 billion, primarily driven by the performance of Gruma Corporation. It is worth noting
that, in Q415, Net Sales from operations outside of Mexico accounted for 73% of the total sales figure.
In the United States in particular, the firm's corn flour and tortilla operations were helped by the overall growth of the tortilla industry as a whole,
particularly among non-Hispanics. Other reasons behind the substantial growth in Gruma's corn flour operations include: The greater market
share achieved by the company on account of our high quality and service; the growing popularity of Mexican restaurants; the increasing
popularity of tortillas and corn chips in non-Mexican restaurants; and the growth achieved through snack manufacturers.
Gruma's Operating Profit grew by 21% during Q415 to MXN 1.92 billion, due mainly to the improvements rolled out in most of the company's
operations. From January to December 2015, Operating Profit grew by 22% to MXN 7.37 billion.
In turn, the firm's EBITDA increased by 25% in Q415 compared to the same period in 2014, to stand at MXN 2.49 billion. Although this growth
was driven by all of the company's business operations, the performance of Gruma Corporation was particularly influential. Between January
and December of 2015, Gruma's EBITDA increased by 22%, to stand at MXN 9.14 billion.
As reported on December 16 of last year, Gruma decided during the quarter to write off its indirect net investment in Molinos Nacionales, C.A.
(MONACA) and Derivados de Maz Seleccionado, DEMASECA, C.A. (DEMASECA), as well the accounts receivable held by some its
subsidiaries with MONACA, which had a negative impact on its majority net income.
This expense goes down as a non-cash charge, meaning that Gruma's cash generation will not be affected.
Gruma also reported debt of USD 769 million in Q415, with a Gross Debt/EBITDA ratio of 1.4.
In Q415, the company made capital investments worth USD 64 million, which was spent on improving technology and expanding the installed
capacities of most of its subsidiaries, particularly in Mexico and the United States. A total of USD 221 million was invested in 2015.
Gruma posts 21% growth in Net sales, 21% in net profits and 25% in EBITDA at the close of Q315
Date : 21 Oct 2015
Gruma S.A.B. de C.V.announced it's Q315 operating results that show improvements over the same period in 2014.
The multinational posted a Net Profitof MXN 1.469 billion during this period, 21% over the MXN 1.215 billion posted in the same quarter of 2014,
and its Net Majority Profitin creased by 20% to MXN 1.383 billion.
Gruma's Operating Profit grew 27% during Q315, from MXN 1.569 billion in Q314 to MXN 1.99 billion this quarter, due to improved performance
of its U.S. subsidiary, Gruma Corporation and the positive effects of the depreciation of the Mexican peso.
The company's Sales Volume stood at 968,000 metric tons, a figure that is 5% higher than the 924,000 tons posted during the same period last
year. This growth was achieved primarily through Gruma Corporation operations.
Meanwhile, the Company's Net Sales increased by 21% to MXN 15.313 billion -- MXN 2.648 billion over the MXN 12.665 billion posted in Q314.
This growth was driven by the weak peso against the dollar, which proved advantageous to the multinational's sales in the United States, in
addition to the increase in sales volumes mentioned earlier.
The firm's net sales and EBITDA from operations outside of Mexico in Q315 accounted for 74% and 68% of consolidated results, respectively.
Whereas, the Cost of Sales as a percentage of the net sales of the world's leading tortilla and corn flour producer improved by falling from 63.0%
to 61.6% as a result of Gruma Corporation's improved performance. In absolute terms, the cost of sales increased by 18% to MXN 9.425 billion.
Gruma's EBITDA experienced double-digit growth for the 14th consecutive quarter, with a 25% increase in Q315 compared to the same period
in 2014, to stand at MXN 2.412 billion. The firm's EBITDAmargin increased from 15.2% to 15.8%.
The company also reported debt of USD 753 million in Q315, with a Gross Debt/EBITDA ratio of 1.5.
In Q315, Gruma made capital investments worth USD 58 million.Most of this amount was spent on technology improvements for Gruma
39

Corporation and GIMSA, such as expanding the installed capacity of several tortilla production plants in the United States and the corn flour
plant in Mexicali. Another portion of this amount was used to build a tortilla manufacturing plant in Malaysia and to increase its shareholding in
GIMSA by approximately 2% for around USD 25 million in July of this year.
Gruma thus continues to strengthen its financial growth and consolidate in the markets where it does business, by selling high-quality, healthy
food products.
Gruma acquires Azteca Foods Europe for EUR45m

Date : 02 Apr 2015
Mexican corn miller and tortilla producer Gruma has acquired the European unit of US-based Azteca Foods in a 45m deal.
The acquisition includes all shares and ownership interests representing the capital stock of Azteca Foods Europe.
The company's Spanish subsidiary Gruma International Foods has reached a purchase agreement to acquire the production and sales
operations of Fat Taco and Azteca Foods in Spain.
Fat Taco and Azteca Foods produce and distribute tortillas, wraps, corn chips, salsas and processed foods in Spain.
The price agreed for the transaction is subject to adjustments resulting from the final calculations for working capital and net financial debt of the
acquired company.
Last year, Gruma announced plans to invest $50m in a new plant in Russia, over the next two years.
Expected to become operational by the end of 2015, the Russian plant will be capable of producing around 31,500 tonnes of corn and wheat
products including wheat tortilla wraps, tortilla and tortilla chips annually.
The plant will employ 250 people.
Gruma produces, and sells corn flour, wheat flour, tortillas, and other related products under various brands including Maseca, Masa Rica,
Tortimasa, Juana, Selecta, Mayran, Robin Hood, Polar, Loro Rojo, Elefante, Mission, Guerrero, Tortiricas, Calidad, Delicados, Rositas, Rumba,
La Casa del Maiz, La Cima, Tosty, La Comadre, Luisiana, Monica, and Lassie.
Image: Gruma produces, and sells corn flour, wheat flour, tortillas, and other related products. Photo: courtesy of Serge Bertasius Photography /
FreeDigitalPhotos.net.
GRUMA consolidates its strong financial position at the close of 4Q14: Operating income grows 22% and the EBITDA 16%
Date : 25 Feb 2015
GRUMA S.A.B. de C.V. closed the year with improved financial results and structure.
At the close of the fourth quarter of 2014 (4Q14), Sales Volume stood at 941,000 tons, 3% higher than those reported for the same period in
2013.
Likewise, Net Sales were up 5% on 4Q13, to MXN 12.91 billion. These increases were driven by all of its subsidiaries, in particular Gruma
Corporation. In 4Q14, sales from operations outside of Mexico accounted for 70% of the total.
40
The multinational's Operating Income increased by 22% in the reporting period to MXN 1.59 billion. This growth was primarily driven by
improvements in most of its operations. From January to December 2014, Operating Income grew by 30% to MXN 6.02 billion.
In turn, its EBITD Agrew by 16% for the same period in 2013, reaching MXN 1.99 billion pesos. This increase was driven by all business
operations, but mainly by Gruma Corporation. In the period January - December 2014, its EBITDA increased by 20% to MXN 7.49 billion.
The company also posted Net Income of MXN 1.39 billion pesos at the close of 4Q14, and the cumulative January - December 2014 increase in
Net Income was 35%, reaching MXN 4.46 billion.
As to its Majority Net Income, the Mexican multinational - world leader in the production and marketing of corn flour and tortillas - posted a figure
of MXN 1.38 billion, and cumulative growth of its Majority Net Income from January to December 2014 of 36%, reaching MXN 4.29 billion. This
improvement was mainly due to the improved operating performance of the company.
GRUMA's debtduring 4Q13 declined by US$535 million compared to September 2013. This was thanks to the proceeds from the sale of its
wheat flour operations in Mexico and better improved cash generation. Its debt/ EBITDA ratio fell from 2.6 to 1.4 at the close of the year.
During 4Q14, GRUMA madecapital investmentsof US$40 million, which it used to expand its production and storage capacity, mainly in Europe
and Asia. The company's investments over the course of the year totaled US$130 million.
Significant events during the quarter:
GRUMA issued a US$400 million dollar bond, saving the company US$8.6 million a year in interest repayments.
The bond placement surpassed acceptance expectations seven times over. The unsecured bond was issued for a 10-year term under conditions
similar to those of an investment bond.
The funds obtained from the placement, underwritten by Goldman Sachs and Santander, were used for the repurchasing of US$300 million
dollars of perpetuities in circulation since 2004, generating an annual saving to the company of US$8.6 million in interest repayments and 287.5
basis points.
GRUMA invests US$50 million in Russia: Juan Gonzlez Moreno laid the first foundation stone of the company's new Moscow plant.
The new facilities will be of the highest quality and food safety standards.
The investment will be made over the next two years, with the plant due to go online in late 2015.
The plant will produce wheat tortillas, sandwich wraps, corn tortillas and corn chips. GRUMA has been operating in Russia since 2011 and its
sales in the market have been growing by more than 15% each year.
GRUMA completes the sale of its wheat flour operations in Mexico
Grupo Trimex acquired the entirety of shares in Molinera de Mexico S.A. de C.V., as well as the wheat flour production of the Grupo Industrial
Maseca (GIMSA subsidiary).
The total price was approximately US$260 million.
The funds will mainly be used for the repayment of debt.
The deal is in line with the company's strategy of focusing on its key business.
41
Gruma to invest $50m in new Russian tortilla production plant

Date : 16 Dec 2014
Mexican corn miller and tortilla producer Gruma has announced plans to invest $50m in a new plant in Russia, over the next two years.
Located in the Moscow Region, the new plant will be capable of producing around 31,500 tonnes of corn and wheat products including wheat
tortilla wraps, tortilla and tortilla chips annually.
The plant is expected to become operational by the end of 2015, and will employ 250 people.
Gruma has been operating in Russia since 2011 and has witnessed 15% annual growth in its business in the region.
The company currently has eight plants across Europe, besides operations in the US, Mexico, Central America, Asia, and Oceania.
Earlier this month, Gruma divested its wheat flour milling operations in Mexico to Grupo Trimex for $260m.
According to the company, the sale proceeds will be used mainly for debt repayment, a move that will strengthen the company's balance sheet.
Image: The new plant will produce wheat tortilla wraps , tortilla and tortilla chips. Photo: courtesy of Serge Bertasius Photography /
FreeDigitalPhotos.net.
Source: Canadean
42
13 Appendix
13.1 Methodology
Canadean company reports are based on a core set of research techniques which ensure the best possible level of quality
and accuracy of data. The key sources used include:
Company Websites
Company Annual Reports
SEC Filings
Press Releases
Proprietary Databases
Notes
Financial information of the company is taken from the most recently published annual reports or SEC filings
The financial and operational data reported for the company is as per the industry defined standards
Revenue converted to US$ at average annual conversion rate as of fiscal year end
13.2 Gruma, S.A.B. de C.V. - Ratio Definitions
Capital Market Ratios
Price/Earnings Ratio (P/E)
Capital Market Ratios measure investor response to owning a company's stock and also the cost
of issuing stock.
Price/Earnings (P/E) ratio is a measure of the price paid for a share relative to the annual income
earned per share. It is a financial ratio used for valuation: a higher P/E ratio means that investors
are paying more for each unit of income, so the stock is more expensive compared to one with
lower P/E ratio. A high P/E suggests that investors are expecting higher earnings growth in the
future compared to companies with a lower P/E. Price per share is as of previous business
close, and EPS is from latest annual report.
Formula: Price per Share / Earnings per Share
Enterprise Value/Earnings
before Interest, Tax,
Depreciation & Amortization
(EV/EBITDA)
Enterprise Value/EBITDA (EV/EBITDA) is a valuation multiple that is often used in parallel with,
or as an alternative to, the P/E ratio. The main advantage of EV/EBITDA over the PE ratio is that
it is unaffected by a company's capital structure. It compares the value of a business, free of
debt, to earnings before interest. Price per share is as of previous business close, and shares
outstanding last reported. Other items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / (Net Income +
Interest + Tax + Depreciation + Amortization)
Enterprise Value/Sales
Enterprise Value/Sales (EV/Sales) is a ratio that provides an idea of how much it costs to buy
the company's sales. EV/Sales is seen as more accurate than Price/Sales because market
capitalization does not take into account the amount of debt a company has, which needs to be
paid back at some point. Price per share is as of previous business close, and shares
outstanding last reported. Other items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / Sales
Enterprise Value/Operating
Profit
Enterprise Value/Operating Profit measures the company's enterprise value to the operating
profit. Price per share is as of previous business close, and shares outstanding last reported.
Other items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / Operating Income
43
Enterprise Value/Total
Assets
Enterprise Value/Total Assets measures the company's enterprise value to the total assets.
Price per share is as of previous business close, and shares outstanding last reported. Other
items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / Total Assets
Dividend Yield
Dividend Yield shows how much a company pays out in dividends each year relative to its share
price. In the absence of any capital gains, the dividend yield is the return on investment for a
stock.
Formula: Annual Dividend per Share / Price per Share
Equity Ratios
These ratios are based on per share value.
Earnings per Share (EPS)
Earnings per share (EPS) is the portion of a company's profit allocated to each outstanding
share of common stock. EPS serves as an indicator of a company's profitability.
Formula: Net Income / Weighted Average Shares
Dividend per Share
Dividend Cover
Dividend is the distribution of a portion of a company's earnings, decided by the board of

directors, to a class of its shareholders.
Dividend cover is the ratio of company's earnings (net income) over the dividend paid to
shareholders.
Formula: Earnings per share / Dividend per share
Book Value per Share measure used by owners of common shares in a firm to determine the
level of safety associated with each individual share after all debts are paid accordingly.
Formula: (Shareholders Equity - Preferred Equity) / Outstanding Shares
Cash Value per Share
Cash Value per Share is a measure of a company's cash (cash & equivalents on the balance
sheet) that is determined by dividing cash & equivalents by the total shares outstanding.
Formula: Cash & equivalents / Outstanding Shares
Gross Margin
Profitability Ratios are used to assess a company's ability to generate earnings, based on
revenues generated or resources used. For most of these ratios, having a higher value relative
to a competitor's ratio or the same ratio from a previous period is indicative that the company is
doing well.
Gross margin is the amount of contribution to the business enterprise, after paying for directfixed and direct variable unit costs.
Formula: {(Revenue-Cost of revenue) / Revenue}*100
Operating Margin
Operating Margin is a ratio used to measure a company's pricing strategy and operating
efficiency.
Formula: (Operating Income / Revenues) *100
Net Profit Margin
Net Profit Margin is the ratio of net profits to revenues for a company or business segment - that
shows how much of each dollar earned by the company is translated into profits.
Formula: (Net Profit / Revenues) *100
44
Profit Markup
Profit Markup measures the company's gross profitability, as compared to the cost of revenue.
Formula: Gross Income / Cost of Revenue
PBIT Margin (Profit Before

Interest & Tax)
Profit Before Interest & Tax Margin shows the profitability of the company before interest
expense & taxation.
Formula: {(Net Profit + Interest + Tax) / Revenue} *100
PBT Margin (Profit Before

Tax)
Profit Before Tax Margin measures the pre-tax income over revenues.
Formula: {Income Before Tax / Revenues} *100
Return on Equity
Return on Equity measures the rate of return on the ownership interest (shareholders' equity) of
the common stock owners.
Formula: (Net Income / Shareholders Equity)*100
Return on Capital Employed
Return on Capital Employed is a ratio that indicates the efficiency and profitability of a
company's capital investments. ROCE should always be higher than the rate at which the
company borrows; otherwise any increase in borrowing will reduce shareholders' earnings.
Formula: EBIT / (Total Assets Current Liabilities)*100
Return on Assets
Return on Assets is an indicator of how profitable a company is relative to its total assets, the
ratio measures how efficient management is at using its assets to generate earnings.
Formula: (Net Income / Total Assets)*100
Return on Fixed Assets
Return on Fixed Assets measures the company's profitability to its fixed assets (property, plant &
equipment).
Formula: (Net Income / Fixed Assets) *100
Return on Working Capital
Return on Working Capital measures the company's profitability to its working capital.
Formula: (Net Income / Working Capital) *100
Cost Ratios
Cost ratios help to understand the costs the company is incurring as a percentage of sales.
Operating costs as percentage of total revenues measures the operating costs that a company
Operating costs (% of Sales) incurs compared to the revenues.
Formula: (Operating Expenses / Revenues) *100
Administration costs (% of
Sales)
Administration costs as percentage of total revenue measures the selling, general and
administrative expenses that a company incurs compared to the revenues.
Formula: (Administrative Expenses / Revenues) *100
Interest costs (% of Sales)
Interest costs as percentage of total revenues measures the interest expense that a company
incurs compared to the revenues.
Formula: (Interest Expenses / Revenues) *100
Leverage Ratios
Leverage ratios are used to calculate the financial leverage of a company to get an idea of the
company's methods of financing or to measure its ability to meet financial obligations. There are
several different ratios, but the main factors looked at include debt, equity, assets and interest
expenses.
45
Debt to Equity Ratio is a measure of a company's financial leverage. The debt/equity ratio also
depends on the industry in which the company operates. For example, capital-intensive
industries tend to have a higher debt equity ratio.
Formula: Total Liabilities / Shareholders Equity
Debt to capital ratio gives an idea of a company's financial structure, or how it is financing its
operations, along with some insight into its financial strength. The higher the debt-to-capital ratio,
the more debt the company has compared to its equity. This indicates to investors whether a
company is more prone to using debt financing or equity financing. A company with high debt-tocapital ratios, compared to a general or industry average, may show weak financial strength
because the cost of these debts may weigh on the company and increase its default risk.
Formula: {Total Debt / (Total assets - Current Liabilities)}
Interest Coverage Ratio
Interest Coverage Ratio is used to determine how easily a company can pay interest on
outstanding debt, calculated as earnings before interest & tax by interest expense.
Formula: EBIT / Interest Expense
Liquidity Ratios
Current Ratio
Liquidity ratios are used to determine a company's ability to pay off its short-terms debts
obligations. Generally, the higher the value of the ratio, the larger the margin of safety that the
company possesses to cover short-term debts. A company's ability to turn short-term assets into
cash to cover debts is of the utmost importance when creditors are seeking payment.
Bankruptcy analysts and mortgage originators frequently use the liquidity ratios to determine
whether a company will be able to continue as a going concern.
Current Ratio measures a company's ability to pay its short-term obligations. The ratio gives an
idea of the company's ability to pay back its short-term liabilities (debt and payables) with its
short-term assets (cash, inventory, receivables). The higher the current ratio, the more capable
the company is of paying its obligations. A ratio under 1 suggests that the company would be
unable to pay off its obligations if they came due at that point.
Formula: Current Assets / Current Liabilities
Quick Ratio
Quick ratio measures a company's ability to meet its short-term obligations with its most liquid
assets.
Formula: (Current Assets - Inventories) / Current Liabilities
Cash Ratio
Cash ratio is the most stringent and conservative of the three short-term liquidity ratio. It only
looks at the most liquid short-term assets of the company, which are those that can be most
easily used to pay off current obligations. It also ignores inventory and receivables, as there are
no assurances that these two accounts can be converted to cash in a timely matter to meet
current liabilities.
Formula: {(Cash & Bank Balance + Marketable Securities) / Current Liabilities)}
Efficiency Ratios
Fixed Asset Turnover
Efficiency ratios measure a company's effectiveness in various areas of its operations,

essentially looking at maximizing its use of resources.
Fixed Asset Turnover ratio indicates how well the business is using its fixed assets to generate
sales. A higher ratio indicates the business has less money tied up in fixed assets for each
currency unit of sales revenue. A declining ratio may indicate that the business is over-invested
in plant, equipment, or other fixed assets.
Formula: Net Sales / Fixed Assets
46
Asset Turnover
Asset turnover ratio measures the efficiency of a company's use of its assets in generating sales
revenue to the company. A higher asset turnover ratio shows that the company has been more
effective in using its assets to generate revenues.
Formula: Net Sales / Total Assets
Current Asset Turnover
Current Asset Turnover indicates how efficiently the business uses its current assets to generate
sales.
Formula: Net Sales / Current Assets
Inventory Turnover
Inventory Turnover ratio shows how many times a company's inventory is sold and replaced
over a period. A low turnover implies poor sales and, therefore, excess inventory. A high ratio
implies either strong sales or ineffective buying.
Formula: Cost of Goods Sold / Inventory
Working Capital Turnover
Working Capital Turnover is a measurement to compare the depletion of working capital to the
generation of sales. This provides some useful information as to how effectively a company is
using its working capital to generate sales.
Formula: Net Sales / Working Capital
Capital Employed Turnover
Capital employed turnover ratio measures the efficiency of a company's use of its equity in
generating sales revenue to the company.
Formula: Net Sales / Shareholders Equity
Capex to sales
Capex to Sales ratio measures the company's expenditure (investments) on fixed and related
assets' effectiveness when compared to the sales generated.
Formula: (Capital Expenditure / Sales) *100
Net income per Employee
Net income per Employee looks at a company's net income in relation to the number of
employees they have. Ideally, a company wants a higher profit per employee possible, as it
denotes higher productivity.
Formula: Net Income / No. of Employees
Revenue per Employee
Revenue per Employee measures the average revenue generated per employee of a company.
This ratio is most useful when compared against other companies in the same industry.
Generally, a company seeks the highest revenue per employee.
Formula: Revenue / No. of Employees
Efficiency Ratio
Efficiency Ratio is used to calculate a bank's efficiency. An increase means the company is
losing a larger percentage of its income to expenses. If the efficiency ratio is getting lower, it is
good for the bank and its shareholders.
Formula: Non-interest expense / Total Interest Income
Source : Canadean
47
13.3 Disclaimer
All Rights Reserved
No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means,
electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, Canadean.
The data and analysis within this report is driven by Canadean from its own primary and secondary research of public and
proprietary sources and does not necessarily represent the views of the company profiled.
The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the
findings, conclusions and recommendations that Canadean delivers will be based on information gathered in good faith from
both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such Canadean can
accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.
48
Reproduced with permission of the copyright owner. Further reproduction prohibited without
permission.

GRUMA - Company Profile, SWOT &amp; Financial Analysis

Transféré par

Informations du document

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

GRUMA - Company Profile, SWOT &amp; Financial Analysis

Transféré par

Droits d'auteur :

Formats disponibles

Gruma, S.A.B. de C.V.

Gruma, S.A.B. de C.V.

Gruma, S.A.B. de C.V. ..................................................................................................................................6

Gruma, S.A.B. de C.V. - Key Employees ....................................................................................................7

Gruma, S.A.B. de C.V. - Key Employees Biographies ...............................................................................8

Gruma, S.A.B. de C.V. - Major Products and Services ..............................................................................9

Gruma, S.A.B. de C.V. - History ................................................................................................................10

Gruma, S.A.B. de C.V. - Company Statement ..........................................................................................12

Gruma, S.A.B. de C.V. - Locations and Subsidiaries ...............................................................................14

Gruma, S.A.B. de C.V. - Head Office ....................................................................................................................... 14

Gruma, S.A.B. de C.V. - Other Locations and Subsidiaries ..................................................................................... 14

Gruma, S.A.B. de C.V. - Business Analysis .............................................................................................16

Gruma, S.A.B. de C.V. - Company Overview ........................................................................................................... 16

Gruma, S.A.B. de C.V. - Business Description......................................................................................................... 16

Gruma, S.A.B. de C.V. - SWOT Analysis ..................................................................................................18

Gruma, S.A.B. de C.V. - SWOT Analysis - Overview ............................................................................................... 18

Gruma, S.A.B. de C.V. - Strengths ........................................................................................................................... 18

Strength - Strong Research and Development Focus ...................................................................................... 18

Strength - Wide Geographic Presence ............................................................................................................. 18

Weakness - Involvement in Lawsuits ............................................................................................................... 18

Weakness - High Dependence on a Specific Business Segment .................................................................... 19

Gruma, S.A.B. de C.V. - Opportunities ..................................................................................................................... 19

Opportunity - Increase in Consumer Spending in the US ................................................................................ 19

Opportunity - Recovering US Restaurant Industry ........................................................................................... 19

Opportunity - Strategic Initiatives ...................................................................................................................... 19

Gruma, S.A.B. de C.V. - Weaknesses...................................................................................................................... 18

Gruma, S.A.B. de C.V. - Threats .............................................................................................................................. 19

Threat - Economic Instability of EU Nations ..................................................................................................... 19

Threat - Rising Labor Costs in the US .............................................................................................................. 20

Threat - Declining Economy of Latin America .................................................................................................. 20

Gruma, S.A.B. de C.V. - Company Financial Analysis .............................................................................21

Gruma, S.A.B. de C.V. - Interim ratios ..................................................................................................................... 23

Gruma, S.A.B. de C.V. - Financial ratios: Capital Market Ratios ..................................................................... 23

Gruma, S.A.B. de C.V. - Financial Performance and Ratio Charts .......................................................................... 24

Gruma, S.A.B. de C.V. - Revenue and Operating margin ................................................................................ 24

Gruma, S.A.B. de C.V. - Asset and Liabilities .................................................................................................. 25

Gruma, S.A.B. de C.V. - Net Debt vs. Gearing Ratio ....................................................................................... 26

Gruma, S.A.B. de C.V. - Operational Efficiency ............................................................................................... 27

Gruma, S.A.B. de C.V. - Solvency .................................................................................................................... 28

Gruma, S.A.B. de C.V. - Valuation ................................................................................................................... 29

Gruma, S.A.B. de C.V. - Competitive Benchmarking ............................................................................................... 30

Gruma, S.A.B. de C.V. - Market Capitalization................................................................................................. 31

Gruma, S.A.B. de C.V. - Efficiency ................................................................................................................... 32

Gruma, S.A.B. de C.V. - Valuation ................................................................................................................... 33

Gruma, S.A.B. de C.V. - Turnover: Inventory and Asset .................................................................................. 34

Gruma, S.A.B. de C.V.

Gruma, S.A.B. de C.V. - Liquidity ..................................................................................................................... 35

Gruma, S.A.B. de C.V. - Mergers & Acquisitions and Partnerships .......................................................36

Gruma, S.A.B. de C.V. - M&A and Partnerships Strategy........................................................................................ 36

Gruma, S.A.B. de C.V. - Recent Developments ........................................................................................39

Gruma, S.A.B. de C.V. - Ratio Definitions ................................................................................................................ 43

Gruma, S.A.B. de C.V.

Gruma, S.A.B. de C.V.

Gruma, S.A.B. de C.V.

1 Gruma, S.A.B. de C.V.

Rio de la Plata 407 Ote. Col. del Valle,San

Ticker Symbol , Exchange Name

GRUMAB,Mexico Stock Exchange

Fiscal Year End

Revenue (US$ million)

The company reported revenue of US$4,567 million

Strong Research and Development

High Dependence on a Specific

Wide Geographic Presence

GRUMA - Company Profile, SWOT & Financial Analysis

GRUMA - Company Profile, SWOT & Financial Analysis