Ladies and gentlemen, thank you for standing by. I'd like to welcome you to Alicorp's First Quarter 2025 Results call on the 30th of April, 2025. At this time, all participants are on listen-only mode. The format of the call today will be a presentation by the management and IR team, followed by a question-and-answer session. Without further ado, I'd like to pass the floor to Mr. Roberto Dongo-Soria, Investor Relations at Alicorp. Please go ahead, sir.
Thank you very much. Good afternoon, everyone. This is Roberto Dongo-Soria, Alicorp's Investor Relations Officer. We are very pleased to have you with us in our First Quarter of 2025 Earnings Call. Presenting today will be Mr. Álvaro Correa, Chief Executive Officer, and Mr.Juan Moreyra , Chief Financial Officer. Other members of the management team will join us during the Q&A session. We will discuss the first quarter of 2025 results after the financial results and earnings release were issued yesterday. If you have not received a copy of the earnings release, please visit us at www.alicorp.com.pe, where you will also find the webcast presentations accompanying our discussion during this call. Please be advised that today's call is for investor and analyst only. Therefore, questions from the media will not be taken.
If you are a member of the media and wish to direct any question to the company, please contact our team directly after the call. Before we begin, I would like to remind you that forward-moving statements may be made during this conference call. These statements are based on several assumptions and factors that could change, causing the actual results to differ materially from the current expectations. We ask you refer to the disclaimer included in the earnings release prior to making any investment decisions. It is now my pleasure to turn the call over to Mr. Álvaro Correa, Chief Executive Officer of Alicorp, who will begin the presentation. Álvaro, please go ahead.
Thank you, Roberto, and good afternoon, everyone. I would like to begin today's call by highlighting the key decisions made during our annual mandatory shareholders' meeting held on March 27. A new board of directors was elected for the 2025-2028 term. Notable additions include Manuel Romero, former CFO and Deputy CEO of our company; Alfredo Pérez , our former CEO; Fernando Romero; and Walter Susini, who joins us as Independent Director. This new board brings a strong combination of experience and strategic vision. It is fully committed to upholding the strategic discipline we have demonstrated recently, with a clear focus on driving long-term growth and delivering tangible value to our shareholders. Among other key decisions, shareholders also approved a dividend distribution of PEN 0.3769 per share, which will be paid on May 14. This decision underscores our ongoing commitment to returning value to our investors.
Additionally, our authorization was granted to seek financing through the capital markets for a liability restructuring of up to $500 million. This move will strengthen our financial position, enabling us to continue executing on our strategic priorities and enhancing our capacity for sustainable growth. Now, I will turn the floor over to Juan Moreyra , who will provide a more detailed discussion on the operating results and on our expectations for 2025. Please, Juan go ahead.
Thank you, Álvaro. As mentioned in previous calls, the figures we're presenting today are on a pro forma basis. These adjusted figures exclude non-recurring impacts from the respective periods. For further details on these non-recurring items, please refer to our earnings release and the footnotes in this presentation. Please let's review our consolidated results for the first quarter of 2025 on slide 5. Consolidated gross profit amounted to PEN 784 million for the quarter, representing a 32% increase compared to the same period in 2024. This growth was primarily driven by the performance of our Aquafeed business units, which contributed PEN 111 million to the year-over-year increase. These results reflect the successful execution of strategic initiatives supported by the consolidation of the expansion of our production capabilities in Ecuador, which enabled a significant rise in sales volume, amid a more favorable market environment, particularly in the shrimp segment.
Now, if we move to slide 6, we can see how this growth in adjusted gross profit is reflected through our adjusted EBITDA. Consolidated adjusted EBITDA reached PEN 459 million, representing a 50% year-over-year increase for the quarter. Again, this growth was primarily attributed to the growth in our Aquafeed business unit with PEN 115 million, while B2B and international businesses also contributed with PEN 30 million and PEN 12 million, respectively, partially offset by lower adjusted EBITDA in consumer goods Peru. Adjusted EBITDA margin improved by 2.5 percentage points, reaching 15.8%. Please let's turn to our operating results by business unit, starting with consumer goods Peru and international businesses, as shown on slide 8. In the first quarter of 2025, in consumer goods Peru, we remained strategically disciplined, prioritizing profitable growth through our emblematic brands and consistent execution across all distribution channels.
This approach drove continued market share gains in five of our seven emblematic brands. Alacena stood out, increasing its share by 2.8 percentage points compared to previous two-month periods. Notably, Alacena, Casino, and Amarás achieved their highest market shares in the past seven bi-monthly periods. However, we're currently facing competitive pricing dynamics in the luxury segment. In response, we have implemented a targeted plan aimed at enhancing economic accessibility, particularly in the value detergent category, to protect our market position. As a result, adjusted EBITDA for the quarter decreased by 4% compared to the same period in 2024, primarily due to the strategic actions taken to address the headwinds in the luxury segment. Early results are encouraging. Detergent volume sales grew 7% this quarter versus the same period last year.
It is worth highlighting that categories such as sauces, edible oils, and pasta performed strongly during the quarter, partially offsetting the impact from the luxury segment. In this regard, when excluding detergents from the total business, EBITDA increased by 6% year-over-year. In our international businesses, Bolivia continues to face a challenging macroeconomic environment, further influenced by the upcoming general election scheduled for August this year. Nonetheless, in Ecuador, Daniel Noboa was elected as president for the 2025-2029 term and expected that he could continue with the current economic policies in the country. Despite this external context, we remained strategically focused, which continues to enable significant improvements on key and prioritized categories. Adjusted EBITDA for the quarter reached S/ 31 million, reflecting a 67% year-over-year increase.
This performance was mainly driven by Bolivia, where broad-based price adjustments across the economy helped mitigate the impact of higher financial costs resulting from exchange rate fluctuations. Additionally, in Ecuador, adjusted EBITDA also improved by S/ 7 million. In other geographies, we exceeded our expectations for our Tari brand, placing the product in nearly 1,000 stores across strategic areas in the U.S. and outperforming the category's average velocity in each of them. Looking ahead to 2025, international businesses will maintain operational discipline and focus on growth across prioritized categories and geographies. Specifically, for the Tari brand in the U.S., we will continue to drive expansion while supporting business as usual in other geographies through a defined export portfolio centered on profitable categories and cost efficiency. Now, let's move on to the performance of our B2B and aqua suite unit on slide 9, please.
For our B2B business, we continued to experience the same volume growth during the quarter, with a 35% increase compared to 2024. This growth was primarily driven by the incorporation of Rafinería des Espino's operations, as well as an increase in out-of-home consumption and tourism, which positively impacted the performance of categories such as flour and edible oils. However, we are seeing increased competitiveness in our core categories such as oils, sauces, and detergents, driven by the growing presence of new competitors. As a result, adjusted EBITDA for the quarter amounted to S/ 98 million, reflecting a 45% increase compared to last year. In this context, our focus will be on reinforcing commercial leadership and implementing strategies to protect our market positions. We expect sustained growth in demand for our products by the end of the year.
Moving on to aqua suites, in the first quarter of 2025, global shrimp and salmon markets remained relatively stable. Shrimp prices held steady while salmon prices saw a slight decline. In Ecuador, shrimp export volumes grew at a double-digit rate compared to the same period in 2024, though this growth partially reflects the low baseline from last year. Within this context, we remain focused on optimizing feed formulations, strengthening relationships with key clients in Ecuador, and reinforcing our leadership position in Central America. Additionally, we're actively pursuing new feed contract opportunities in Chile, reaffirming our commitment to the regional growth. EBITDA for the first quarter reached $37 million, representing a six-fold increase year-over-year. This significant growth was primarily driven by the strong increase in sales volume, which contributed to a notable improvement in gross profit.
Additionally, favorable raw material costs and the continued share in aqua portfolio further supported this positive performance. We remain confident in Ecuador's competitive advantages over the other shrimp-producing countries, positioning Vitapro to capture value and lead as the market continues to recover. With that, let's move on to slide 11 to comment on our leverage, debt, and liquidity metrics, please. We continue to deliver strong cash flow generation, primarily driven by the operating performance during the quarter, which positively contributed to a reduction in our leverage from 2.5 times as of March 2024 to 1.8 times as of March 2025. Notably, these achievements were accomplished despite the execution of our share buyback program in March 2025, totaling PEN 391 million. Excluding this impact, our leverage ratio would have been approximately 1.6 times.
In terms of liquidity, our available cash position stood at PEN 2.5 billion, an increase of around PEN 982 million compared to March 2024. This variation is primarily driven by positive and stable cash flow generation and funding increases to support intercompany liability management. This cash position covers 1.2 times our debt maturities over the next 12 months, and when considering our committed facilities, this ratio increases to 1.4 times. Looking ahead, our focus on increasing our profitable revenue and improving our channel mix, along with actively managing working capital, should continue to support stable cash flow generation and help maintain healthy leverage levels, providing us with both financial and strategic flexibility. Now, let's wrap up today's presentation with a glimpse of what we expect for 2025 results on slide 13, please.
As mentioned during the call, first-quarter results remain positive, primarily driven by the recovery of our aqua suite business despite facing significant challenges in the consumer segment, particularly in the detergent category, as previously discussed. These results and the current market context are in line with our expectations for 2025. Key growth drivers, such as continued improvements of our emblematic brands and the performance of our aqua suite business, remain critical to achieve our target. However, the primary risks we're closely monitoring include competitive dynamics in our most relevant categories, as well as other key factors impacting our operations. In this regard, we maintain the expectations communicated last quarter, anticipating sales growth of 10%-12% and mid to high single-digit growth in adjusted EBITDA for 2025.
The stable cash flow generation, improvements in profitability, and initiatives such as the current share buyback program, dividend distribution, and the acquisition of Refinería del Espino will lead us to believe the leverage ratio will remain within the range of 2-2.5 times net debt to adjusted EBITDA. As of our investments, we continue to expect our CapEx to reach $70 million. Now, I would like to stop and open the session to any questions you may have.
Thank you. We'll now move to the question and answer section. If you'd like to ask a question, please press star from your phone and wait for the prompt. If you're dialed in by the web, you can type your question in the box provided or request to ask a voice question. We'll give it a moment or two for questions to come in. Okay.
Our first question comes from Felipe Ucros from Scotiabank. Your line is now open. Please go ahead.
Thanks, operator. Good afternoon. Alvaro, Roberto. Can you guys hear me okay?
Yes. Yes.
Okay. Perfect. A couple of questions on my side. The first one on consumer goods, first wondering if you can expand a little bit on the difficulties that you're having in the value segment of the laundry category with new entrants and what your defense strategy is here. Just wondering any color you can give us on that would be great. Then on aqua suite, very nice recovery here.
Wondering if you can give us some color on what drove that recovery, whether it was a new strategy behind it, the new capacity, or simply down-to-market forces, and what you expect here for the rest of the year, specifically whether you think this new volume level is a sustainable one for us to model, or whether you think there were one-offs here that made it this much better than last year. Thank you. Okay.
Thank you, Felipe. Thank you for your question. As for the laundry category, you asked about the challenges. Basically, what we're facing is strong competition from imported products that attack mainly the value segments. In response to that, we have implemented a strategy to protect that area of the category.
That's a combination of understanding what the clients need, what the consumer wants, and what the product that we have, how the product that we have fits that need. It's a combination of deeper and more intensive, I would say, go-to-market strategy as well as pricing, but basically is defending our traditional position in that segment as well. That's basically what we're doing. I don't know, Álvaro, if you want to complement on that.
Very quickly, Álvaro, and thank you, Felipe, for the question. We invest heavily in understanding consumer needs, and that applies not only for the core segment but also for the value segment. We have deployed different initiatives from revisiting our portfolio, from launching new brands and new product lines, and we're confident that we're going to be able to continue with growth in that segment and defend the laundry detergent category.
As for your second question regarding aqua suite, yes, we had a very good start in the year. That's a result, I would say, of several factors. One is consistency of the strategy, how we get closer and understand better the needs of our clients, the level of sophistication in the shrimp industry is growing, so the needs are there. We have worked a lot on the feed performance. The quality of our product is fundamental in winning the market. That has enabled us to, and competitive also in our cost structure. That has enabled us to maintain and even grow our market share there. Yes, this quarter is also a positive one in terms of demand. The production of shrimps in this quarter has been very good, good weather, good weather conditions, and that has helped. Some positive trends also on raw materials that also have helped.
It's a combination of factors. If that will continue, I would say that the more permanent ones, the competitive advantages that we have, yes, will be there. The volumes, we know that this is a business that is volatile and it's seasonal as well, so that will depend on the weather and the demand for it.
Got it. Very clear. Thanks a lot. Maybe if I can do a follow-up question on B2B. Just wondering if you could give us some detail on what it would have looked like on an organic basis. Seems like whatever you got from Refineria del Espino has done pretty well, but it seems like some of the other categories are having some difficulty. Just wondering ex-M&A what it looks like.
I will allow Juan Morerya, who is in charge of that business, to answer that question, Felipe.
Thank you, Alvaro. Thank you, Felipe. Yes. If we compare the gross profit, Felipe, without Refinería del Espino, we would have, instead of the S/ 114 million that you see in adjusted gross profit, would be close to S/ 123 million. There is a slight, I would say, reasonable growth if you take into consideration the growth of the market and the consumption at home. If we convert that and look at the EBITDA numbers, the numbers look more flat, but that's basically because in this current year, B2B has a higher allocation of admin expenses. If we look at the gross profit, that basically is a more direct reflection of the business, and I would say that we still have growth versus last year.
In terms of the main categories, volumes are growing according to market growth, and in some cases, we are focusing on increasing our market share, considering that market share in most of the categories that we have, that we're managing, are in leading position. Keep increasing the market share in flour, in sauces, in oils. It's quite challenging because we have a higher market share with it. Nevertheless, the volume is growing, and the gross margin per metric ton is also growing slightly higher than the previous year. I don't know if that answered your question.
That totally answers the question. Thanks a lot, guys. Thanks.
Thank you. Our next question comes from Alejandro Aramburú from BTG. Your line is now open. Please go ahead.
Hi. Good afternoon. Thank you for the call. I wanted to follow up on your comments on consumer goods Peru.
If you maybe can give us some color as to how should we think about gross margins. You had some pressure this quarter, likely due to the competitive environment you mentioned. Given that this is, I assume, likely to continue, and given also what you've seen in terms of raw material prices, maybe product mix, how should we think about gross margins for the rest of the year? Thank you.
Thank you, Alonso. We have deployed this strategy and put a lot of focus on the laundry segment. There, we will probably, even though we have very healthy margins, and we are planning to keep them relatively stable, there will probably be some reduction there. I would say that for the rest of the categories, margins will continue to be healthier than before.
I think we're reaching a level in which we feel comfortable with the margins. There is always the need to protect competition there. Consumer needs are there, and we have to protect that. Basically, we don't see margins being affected that much for, I mean, going forward.
Okay. If that is the case, then when we look at your consolidated EBITDA margins, should we think that this closer to 15%-16% level, that's sort of the level you think EBITDA margins should be at the consolidated level?
Yes. Yes. In consumer goods, you were asking about consumer goods Peru, right?
Yes. I'm referring to, I think consumer goods Peru is higher, right? It's closer to.
It's around 20%.
Right. I'm referring to consolidated margins, right? You've got margins close to 16% the last couple of quarters.
I'm just wondering if you think that's a sustainable level.
Yes, it is. It is also that, as you can imagine, affected by mix. If we see, for instance, aquafeed growing faster, that's a business with lower gross margins and EBITDA margins. That affects the result. Basically, at this level, I would say that the margins that you're mentioning will be able to maintain going forward.
Great. Thank you, Álvaro.
Thank you very much. Just a reminder, if you'd like to ask a question, please press star on your phone. If you're dialed in by the web, you can type your question in the box provided or request to ask a voice question. We'll just give a few more moments to see if any new questions will come in. Okay. It looks like we have no further questions.
We'd like to thank everyone for the participation. I'll now hand it back to the Alicorp team for the closing remarks.
Okay. Thank you. Thank you, everyone. Thank you for the questions. I would just like to close this call by reaffirming our strong confidence in the solid foundations of our business and the effectiveness of our long-term strategy. We are backed by the strength of our brand, the resilience of our team, and the competitive advantages we have built. These fundamentals position us not only to navigate short-term challenges but to capture future opportunities and continue generating sustainable long-term value for all our shareholders. We remain fully committed to disciplined execution and to delivering results that support our strategic priorities and long-term growth. Thank you once again for your time. In case you have any further questions, please do not hesitate to contact us. Goodbye, everyone.
That concludes the call for today. Thank you and have a nice day.