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Home / argentina / In just three months, Arcor is already gaining nearly $ 1,000 million in losses

In just three months, Arcor is already gaining nearly $ 1,000 million in losses



The multinational Cordoban registered red at $ 874 million in the first quarter due to devaluation and recession. Equal, add shares to Mastellone.

The crisis experienced by Arkor does not stop. Considered the world's largest maker of hard candies, Argentina's leading food company and leader in sweets from Argentina and Brazil, is strongly influenced by the unstable scenario of the local economy.

In fact, last year it recorded a negative balance of $ 1,011 million, which testifies to an eloquent symptom of the moment the country passes, because in all its 67 years of life, it has lost only money in 2002, but economic and financial context. politically much more volatile and unstable than the current one after the failure of the Peso's convertibility regime.

However, there is nothing to predict that this year the scenario will change. Moreover, taking into account that in the first three months of 2019, the food multinational company in Cordoba continues to accumulate red in balance.

According to Arcor's own report on the Buenos Aires Stock Exchange, between January and March, it suffered a total loss of $ 874 million against a profit of $ 382 million in the same period in 2018.

The company says the worrying change in performance reports is closely related to the depreciation of the peso against the dollar, which began exactly in April last year, as well as the recession of the economy, which is reflected in the constant withdrawal of consumption.

In fact, the negative performance of Pagani's family forced him to re-arm his business plans. The last example is the closure of the La Campagnola plant in Mendoza to move the production of this brand to San Luis.

Its situation does not avoid that of other major local food companies like Molinos Rio de la Plata, Quickfood and Mastellone, who also closed the first quarter with big losses.

In the same scenario, the largest hamburger producer in the country and owner of the Paty brand, which closed the first quarter of this year with a red of 191 million dollars, while the owner of La Serenísima reported a negative balance of 465 million dollars. during the same period.

In the case of the company owned by Perez Companc's family, its balance sheet shows a profit of $ 657 million, but this is the result of external factors that contributed $ 973 million and were not triggered by the recovery of their domestic operations.

But despite the negative scenario, Arcor continues its control plan over Mastellone, where it already controls a little over 42.99% of the capital. Now she will seek to increase this position to 47.48%. Arcor is about to pay $ 12 million for 29 million Mastellone shares.

Once the deal is over, it has to be approved by the Brazilian regulators because Mastellone has a plant in the neighboring country, food from Cordoba will be almost on the verge of completing the purchase process of 49% of La Serenisima's owner, 2015 and this is progressively gradual from this year.

Meanwhile, it is still looking for ways to reduce its deficit and to face plans that allow it to redirect the supply of its products as well as other companies in the food sector.

Everyone, driven by the consequences of the economic recession, the volatility of the exchange rate and the new habits of consumers who, in order to adapt to the crisis and survive, are looking for cheaper products and second and even third brands.

Arcor is one of the largest players in the food industry: it employs 21,000 people and is among the largest exporters in the country. Last year, however, he warned of "the behavior of some macroeconomic variables," including the impact of the strong devaluation of the peso, with a rise of more than 100% between April and October 2018, in addition to a deepening decline in domestic consumption, which negatively affected the volume of sales.

In the same year, its president, Louis Pagani, had to come out publicly to deny the risk of default by a letter in which he dismissed the possibility of bankruptcy.

"In the face of unwarranted and malicious statements spreading at the date of the financial statement of our company, we want to inform you that Arcor is not in the process of restructuring its obligations as it has a sound financial position," he assured the manager.

A very different scenario from 2017, when the economy registered an increase of 2.9% and the balance sheet of the main Argentine multinational company, showed a positive result of $ 1,118 million, sales of $ 48,420 million, as Ebitda of $ 4,783 million and investments for $ 100 million.

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