After cost-cutting, m. Dias comes unglued from fall of food sector

After facing problems during the crisis – suffering from the devaluation of the Brazilian real and the retraction of consumption in the Northeast, your biggest market – the largest manufacturer of biscuits and masses of the country, the cearense M white, has been featured in reports of positive investment banks. In times of lean results, she became a favorite of analysts in the food and beverage sector.
Based in Fortaleza and owner of brands such as Adria and Isabela, the M managed to take off the performance of the sector. Last year, the segment of cookies and pastas registered 2.8% drop in the volume of sales in the same period, the M White advanced 6.1 percent.
With a portfolio of pasta and cookies simpler and without stuffing – precisely the most advanced in a time of little money available in the consumer''s pocket –, the company ended up taking advantage over rivals.
Owns 30% of the national market of crackers, m. Dias has 65% stake in the Northeast. To continue advancing, the company has focused on the Southeast, where it will invest in a new plant in Minas Gerais.
Among the measures adopted in the last year, the analyst at Bradesco BBI, Gabriel Vaz de Lima, highlights the changes in prices of products. At first, the company elevated values to maintain their margins, but as soon as the price of wheat fell, offered discounts. "She responded quickly to variations (of demand)."
The sector as a whole had to resort to promotions, says the ceo of Brazilian Association of industries of cookies, pasta and Processed breads and cakes (Abimapi), Claudio Zanão. After the losses of 2.8% from last year, projecting that the Zanão food manufacturers close 2017 with an increase in turnover of up to 2%.
Cost cuts. Despite being in a better situation than the competition, that doesn''t mean the M White didn''t feel the impact of the crisis. The group from Ceará had agonized in 2015 – with 0.77% in the high profit in a year in which inflation was 10.67%.
In this scenario, the order was to produce a lean budget for 2016. "We realized that we''d have to do a great job of reducing costs," says the Vice President of the company''s investments, Jeanie Mattos junior. The company renegotiated contracts and 1000 employees fired – today, are 16000.
The result of this work appeared more clearly at the beginning of 2017. The net profits of the company reached R $189,400,000 from January to March, twice the result from the first three months of 2016.
"They prepared for a very difficult scenario, and things have improved", highlights Bradesco BBI analyst, referring mainly to the exchange rate. The devaluation of the real has forced the company to arrange for an unfavorable exchange rate, because 40 percent of its costs are in dollars. The Exchange, after overcoming the R $4, eventually returning home to R $3.20, giving breath to the M white.
Although most banks see M optimistically, one analyst says that the company''s papers are at a very high level – on Wednesday, the action was in R $49.45 – and the year can be challenging because of the macroeconomic environment.