REPORTS FOURTH QUARTER 2004 RESULTS

Transcription

1 Ticker BMV OTC GCARSOA1 GCARSO GPOVY REPORTS FOURTH QUARTER 2004 RESULTS HIGHLIGHTS Stock Price (December 04) Outstandig Shares (000 s) 797,436 Mexico City, February Grupo Carso (GCarso) reported today results for the fourth quarter ended December 31, Grupo Carso reported annual revenues of $69,721 MM Ps, 17% higher than those of Grupo Carso posted operating income and increases of 19% and 16% respectively. Net income reached $6,709 MM Ps, it increased 224% when compared to the previous year. The restructuring of industrial assets continued during. Grupo Condumex was formed as a result of the merger of Condumex into Empresas Frisco. The new Grupo Condumex includes the main manufacturing companies within Carso s industrial portfolio, with the exception of Porcelanite that remained as a direct Grupo Carso subsidiary. CONSOLIDATED RESULTS MM Ps vs vs , , % 69, , % Operating Income 2, , % 9, , % Operating Margin 13.6% 14.1% -3.8% 13.0% 12.7% 1.8% 3, , % 11, , % Net Income 3, % 6, , % The regrouping of Grupo Carso s companies has no material effect at the holding level. The objective is to achieve a efficiencies and synergies. Three main divisions are identified within Carso s portfolio: Grupo Condumex and Porcelanite leading the manufacturing related companies; Swecomex and Grupo PC Constructores attending the Group s interests in infrastructure related projects; and Grupo Sanborns and Cigatam maintaining its position in the retail and consumption markets. Yearly net income of 6,709 MM Ps, increased 224% versus last year; explained by: i) Income from the divestiture of a 40% stake in Primex, S.A. de C.V., ii) a positive effect in deferred income tax due to the reduction of rates in effect as of 2005, and iii) a favorable fiscal resolution awarded to Grupo Carso that resulted in a decrease on taxable income and deferred taxes coming from loses caused by sale of stocks during the years 2002 to This press release contains forward-looking statements that involve inherent risk and uncertainties. We have identified certain important factors that may cause actual results to differ materially from those contained in such forward-looking statements. 1

2 REVENUES & OPERATING INCOME Revenue Breakdown Operating Income Breakdown Cigatam 17% Porcela 5% CICSA 4% GSanbor 35% Others 2% GCondumex 37% Cigatam 8% Porcela 7% GSanbor 43% Others 6% GCondumex 33% CICSA 3% DEBT By Currency DEBT $19,189.5 MM Ps By Term Pesos 38% Long term 60% 2

3 CASH FLOW () AND INTEREST BEARING DEBT of $3,308.9 MM Ps was 11.5% higher than that of, with an margin of 16.7%. Total debt for 2004 was $19,189.5 MM Ps, 3.2% higher than that of Net debt of $15,684.9 MM Ps, decreased by $637 MM Ps in comparison with previous year and $1,382.6 MM Ps versus 3Q04 (MM Ps) NET DEBT (MM Ps) 3,309 15,685 2,968 16,321 to interest expenses ratio was 4.93 times in 2004, 25% higher than that of * / INTEREST EXPENSES* *12 months FINANCIAL RESULTS vs vs 2003 Interest Expenses % 2, , % Interest Income % % Interest (net) % 1, , % Forex Results (47.9) N.A. (28.5) % REPOMO (302.7) (279.7) 8.2% (847.2) (771.6) 9.8% UDI's Results % % IFC % , % Other Financial Op. (78.3) (153.5) N.A. (58.6) % Earnings From non consolidated companies % % Minority Interest % 1, % IFC + Other Financial Op. (40.6) % , % 3

4 SUBSIDIARIES Contribution to Consolidated Results 37% 33% 37% Op. Income Grupo Condumex posted quarterly consolidated sales of $7,411 MM, 23.3% higher when compared to. Higher metal prices, together with higher volumes, mainly in instalations, fiber optic and copper cables, and mining; contributed to revenue growth. Operating and margins were stable in comparison with. Grupo Condumex * 4th Quarter MM Ps % 2003 % CHG 7, % 6, % 23.3% Op. Income % % 20.8% 1, % 1, % 18.7% Net Income % % N.A. During December, Grupo Condumex, completed the divestiture of its 40% stake in Grupo Primex. It was sold to Grupo Industrial Camesa. Telecommunications division volumes showed strong growth, especially in fiber optic cable and installations, due to strong demand observed from this division s main clients. The construction and energy division showed stable volumes in Energy cable and Metals divisions, while transformers and turnkey projects volume declined when compared to the previous year. Autoparts volumes increased 23.5%, while automotive cable volumes remained stable, and harnesses volumes declined 5.3% versus. Nacobre posted quarterly sales 13.3% higher when compared to, however, operating margin declined 89 bps, while margin increased by 17 bps. Copper and PVC divisions showed volume increases of 4.1% and 8.1% during 2004, whereas, aluminum division showed a 26.9% volume decrease, with improved operating results. Ferrosur posted revenues of $607.7 MM Ps, 9.6% higher than those of. growth is explained by volume increases in petrochemical, intermodal and industrial sectors. Operating income rose 3.7% versus last year, reaching $132.3 MM Ps with an operating margin of 21.8%. At the mining division, Milling volumes increased 59.6% against Minera Tayahua continued performing well, with increased production volumes and better ore grades. for this division increased 62.4% during the quarter, while operating margin increased from 5.1% in, to 30.1% in. Improved revenues and operating margins resulted form increased milling volumes combined with higher metal prices. MINING NACOBRE CONSTRUCTION AUTOMOTIVE TELECOM Volume Growth VAR % 2004 VS 2003 Copper cable 21.9% Fiber Optics 69.6% Installation 61.2% Harnesses -5.3% Autoparts 23.5% Copper cable 0.1% Energy Cable 0.3% Transformers & Turnkey Projects -11.6% Metals 3.9% Copper Division 4.1% Aluminum Division -26.9% Plastic Division 8.1% Gold 63.5% Silver 37.7% Lead 48.8% Zinc 16.4% Copper 42.4% * Individual figures for Grupo Condumex subsidiaries are presented for comparison purposes in the Financial Summary. Ferrosur (Tons/Km) 9.1% 4

5 SUBSIDIARIES Contribution to Consolidated Results 5% 7% 8% Op. Income Revenues for the fourth quarter reached $976 MM Ps, a 3.6% increase relative to. Operating income of $181 MM Ps represented an operating margin of 18.5% while Ebitda margin registered 26.9%. Volumes continued growing, however pricing pressure continued due to competitive market conditions. The new plant in Sonora started operations as planned during the quarter, but it has not yet reached full utilization levels. Production from this plant is mainly devoted to attend the export market. 4th Quarter MM Ps % 2003 % CHG % % 3.5% Op. Income % % -19.4% % % -13.9% Net Income % % 195.6% Quarterly Results (MM Ps) % 18.5% 1Q04 2Q04 3Q04 Op. Margin 5

6 SUBSIDIARIES Carso Infraestructura y Construcción Contribution to Consolidated Results 4% 3% 2% Op. Income 4th Quarter MM Ps % 2003 % CHG % % 241.1% Op. Income % % 260.6% % % 251.2% Net Income % % 436.6% Grupo PC Constructores reported an important construction backlog as of December Some of the projects the company has been developing include a turnkey project that consists of a 90,000 square meter building located at downtown Mexico, with an estimated cost of approximately $1,200 MM Ps to be delivered by the 4Q05. Swecomex continued working on its existing projects. The first oil platform has been completed and is awaiting for transportation by Pemex. Other two platforms are programmed to be delivered on 2Q05, while the completion of the two largest projects is expected by mid Additional oil platform biddings are expected for this year. 6

7 SUBSIDIARIES Contribution to Consolidated Results 17% 8% 7% Op. Income Cigatam, a subsidiary of which Grupo Carso owns 50.01%, is the cigarette manufacturer company that sells all its production to Philip Morris Mexico, an affiliate of which Grupo Carso owns 49.99%, for further commercialization. Cigatam s revenues reached $3,377.4 MM Ps., which represented a 3.4% growth relative to. Operating income of $213.6 MM Ps., representing an 6.3% operating margin, was 18.6% lower than. CIGATAM & SUBSIDIARY 4th. Quarter MM Ps % 2003 % CHG 3, % 3, % 3.4% Op. Income % % -18.6% % % -18.4% Net Income % % 61.3% Market volume decreased by 5.3% in compared to, while Cigatam s volume decreased 6.8% in the same period. Total year market volume for 2004 decreased by 1.6% vs. 2003, while Cigatam s volume decreased only 0.4%. 7

8 Ticker BMV GSANBORB1 GSANBOR Stock Price (December 04) Outstandig Shares (000 s) 970,146 GRUPO SANBORNS HIGHLIGHTS Revenues for 2004 reached $22,224.1 MM Ps, a 10.7% increase relative to last year s revenues. Total debt of $4,021 MM Ps, decreased by $861 MM Ps during the last twelve months. Sanborns and Sears posted SSS yearly increases of 4.3% and 5.3%, while total annual revenues grew 7.0% and 9.7%, respectively. Consumption recovery, and promotional strategies implemented in the different retail formats, were the main drivers for sales growth. On December 17, 2004, Grupo Sanborns announced it had reached an agreement to acquire 100% of the outstanding shares of Dorinan s Tijuana S.A. de C.V. (Dorian s). Dorian s is a well diversified retail chain with strong influence in the north western part of Mexico. With a total of 71 points of presence, Dorian s attends different formats and market niches: 11 department stores for the middle-high end market under the name of Dorian s; 13 retail stores targeting the middle-low end market named Mas; 24 personal care products stores named Dax; and 23 all for one dollar concept stores named Solo un Precio. Acquisition price of $873 MM Ps. This aqcuisition will add around 167 thousand square meters to GSanborns selling space area. As of February 1 st 2005, JC Penney stores in Mexico were renamed using the Dorian s name. No material changes are expected in the stores format, while providing Grupo Sanborns has a new, well positioned brand to attend the retail subsidiaries expansion plan. CONSOLIDATED RESULTS MM Ps vs vs , , % 22, , % Operating Income 1, , % 3, , % Operating Margin 16.8% 18.0% -6.9% 14.8% 15.6% -5.4% 1, , % 3, , % Net income 1, % 2, , % DEBT By Currency Pesos 69.5% DEBT $4,021.0 MM Ps By Term Long term 25.9% 8

9 REVENUES & OPERATING INCOME Revenue Breakdown Operating Income Breakdown Sanborns 43.2% Sears 54.4% Others 2.4% Shopping Centers 1.5% El Globo 3.7% Sears 49.2% Sanborns 33.6% Others 5.1% Shopping Centers 4.5% El Globo 2.5% CASH FLOW () AND INTEREST BEARING DEBT of $1,308 MM Ps was 6.6% higher than that of. margin was 19.1%, with a 136 bps decrease versus. Total debt decreased by $861 MM Ps during the year, reaching $4,021 MM Ps. Net debt for 2004 was $3,294.7 MM Ps, it reduced by $1,134 MM Ps during 2004, representing a 25.6% decrease versus (MM Ps) NET DEBT (MM Ps) 1,308 3,295 1,227 4,429 * / INTEREST EXPENSES* to interest expenses ratio was 6.26 in 2004, 18.8% higher than that of *12 months 9

10 FINANCIAL RESULTS vs 2004 vs MM Ps Interest Expenses % % Interes Income % % Net Income % % Forex Results (15.2) % % REPOMO (139.3) (141.8) -2% (401.3) (397.5) 1% UDI's Results % % IFC % % Other Financial Op. (52.1) % (181.6) % IFC + Other Financial Op. (34.5) % % Earnings from non consolidated companies % % Minority Interest % % 10

11 SUBSIDIARIES Contribution to Consolidated Results 18% 25% 22% Op. Income Sears revenues for the were $3,475 MM Ps, a 15.4% increase versus. Same store sales increased 10.4% during the period. Operating result of $676 MM Ps, resulted 8.5% higher while the operating margin decreased 123 bps against. Consumption recovery, together with a intensive promotional activity, fueled Sears total and SS sales, however, promotions and strong competition affected operating and margins. 4th. Quarter MM Ps 2004 % 2003 % CHG 3, % 3, % 15.4% Op. Income % % 8.5% % % 8.9% Net Income % % 87.3% Others 12.0% REVENUE BREAKDOWN Others 12.6% Shopping Centers 3.2% Hardline 44.1% Shopping Centers 3.5% Hardline 41.6% Softline 40.7% Softline 42.3% During this quarter, Sears open 2 new stores reaching 50 stores for the end of the year. Active Accounts managed by Sears showed an increase of 25.5%, versus 2003, reaching 1,104 thousand active accounts by the end of the year. SEARS Credit Portfolio & PDL 4,716 5, % 1.3% 1Q04 2Q04 3Q04 Portfolio PDL 11

12 SUBSIDIARIES Contribution to Consolidated Results 15% 14% 14% Op. Income Retail, Restaurant and Music MM Ps 4th. Quarter 2004 % 2003 % CHG 2, % 2, % 7.6% Op. Income % % 3.1% % % 3.2% Net Income % % 37.8% Combined revenues for the quarter reached $2,955.8 MM Ps, a 7.6% increase in comparison with. Combined quarterly SSS grew 5.1% versus. Operating income reached $385.5 MM Ps, an increase of 3.1% in comparison with. Operating and margins of 13.0% and 15.6%, slightly decreased versus, respectively. Sanborns and Sanborns Café quarterly sales reached $2,436.9 MM Ps, growing 7.2% in comparison with the. Operating and margins of 12.1% and 14.6%, decreased in comparison with. SSS for Sanborns and Saborns Café grew 4.3% and 2.3% respectively. Music stores sales of $534.3 MM Ps, were 13.6% higher than those of. Operating margin of 12% increased 99 bps while margin grew 57 bps, reaching 14.3%. There were no additional music stores openings maintaining 65 stores by the end of the year, while Sanborns ended up with 130 stores and 31 Cafés. Revenue Breakdown Sanborns Caf é 3% Others 0.0% Mucic Stores 18% Sanborns stores 79% 12

13 SUBSIDIARIES Contribution to Consolidated Results 1% 1% 1% Op. Income MM Ps. 4th. Quarter 2004 % 2003 % CHG % % 1.3% Op. Income % % -14.7% % % -7.8% Net Income % % -40.3% El Globo reported quarterly revenues of $251 MM Ps, growing 1.3% in comparison with the. Operating income decreased 14.7%, with a margin of 11.5%. decreased 7.8% versus. Eight new stores were opened this quarter, reaching 191 locations by the end of Revenue Contribution Bread 44% Cakes 38% Other products 11% Specialties 7% 13

14 FINANCIAL SUMMARY 2004 vs MM USD MM Ps CHG CHG CARSO Revenues 19, % 16, % 17.0% 69, % 59, % 16.9% 1, , % Op. Income 2, % 2, % 12.5% 9, % 7, % 19.1% % 3, % 2, % 11.5% 11, % 9, % 15.7% % Financial results % % % % 2, % -77.2% % Net income 3, % % 441.1% 6, % 2, % 223.8% % Cash & equivalents 3, , % % Total Assets 76, , % 6, , % Total Debt 19, , % 1, , % % Ps. Denominated 38% 37% 1.8% 38% 37% 1.8% % Long Term 60% 60% -0.2% 60% 60% -0.2% Net debt 15, , % 1, , % Stockholders equity 36, , % 3, , % Shares Outstanding (000) 797, , % GRUPO CONDUMEX 7, % 6, % 23.3% 27, % 21, % 25.1% % Op. Income % % 20.8% 3, % 2, % 38.1% % 1, % 1, % 18.7% 4, % 3, % 31.5% % Net Income % % % 2, % % N.A N.A. Condumex 5, % 4, % 24.2% 18, % 14, % 25.0% % Op. Income % % 1.9% 1, % 1, % 17.1% % % % 3.9% 2, % 2, % 15.7% % Net Income % % 588.6% 1, % % 221.7% % Nacobre 1, % 1, % 13.3% 6, % 5, % 22.9% % Op. Income % % 0.0% % % 67.7% % % % 14.9% % % 52.7% % Net Income % % N.A % % N.A % Mining % % 62.4% 1, % % 99.0% % Op. Income % % 852.8% % % N.A % % % 275.8% % % % % Net Income % % N.A % % -71.4% N.A. Ferrosur % % 9.6% 2, % 2, % 8.3% % Op. Income % % 3.7% % % 11.0% % % % 4.6% % % 12.4% % Net Income % % 106.8% % % 110.0% % PORCELA % % 3.5% 3, % 3, % 3.5% % Op. Income % % -19.4% % % -13.3% % % % -13.9% % 1, % -10.0% % Net Income % % 195.6% % % -46.5% % CARSO INFRAESTRUCTURA Y CONSTRUCCIÓN % % 241.1% 2, % % 287.3% % Op. Income % % 260.6% % % 576.5% % % % 251.2% % % 511.7% % Net Income % % 436.6% % % % % CIGATAM 3, % 3, % 3.4% 12, % 11, % 7.5% % Op. Income % % -18.6% % % 3.9% % % % -18.4% % % 3.1% % Net Income % % 61.3% % % 20.1% % 14

15 FINANCIAL SUMMARY 2004 vs MM USD MM Ps CHG CHG GRUPO SANBORNS Revenues 6, % 5, % 14.2% 22, % 20, % 10.7% % Op. Income 1, % 1, % 6.3% 3, % 3, % 4.7% % 1, % 1, % 6.6% 3, % 3, % 4.3% % Financial results % % % % % -91.8% % Net income 1, % % 87.8% 2, % 1, % 47.9% % Cash & equivalents % Total Assets 26, , , , % Total Debt 4, , % % Long Term 26% 60% 26% 60% -56.6% Stockholders equity 12, , , % Shares Outstanding (000) 970, ,773.0 SANBORNS, SANBORNS CAFÉ & MUSIC STORES 2, % 2, % 7.6% 9, % 9, % 7.0% % Op. Income % % 3.1% 1, % 1, % 10.6% % % % 3.2% 1, % 1, % 8.9% % Net Income % % 37.8% % % 44.1% % SEARS 3, % 3, % 15.4% 10, % 9, % 9.6% % Op. Income % % 8.5% 1, % 1, % 7.3% % % % 8.9% 2, % 2, % 5.2% % Net Income % % 87.3% 1, % % 41.2% % CONTROLADORA Y ADMINISTRADORA DE PASTELERÍAS % % 1.3% % % 11.5% % Op. Income % % -14.7% % % -14.4% % % % -7.8% % % -7.1% % Net Income % % -40.3% % % -37.4% % Jorge Serrano Mexico City Tel. (5255) ext Fax (5255) jserranoe@inbursa.com INVESTOR RELATIONS Jesús Granillo Mexico City Tel. (5255) ext Fax (5255) jgranill@inbursa.com.mx 15