MONTERREY, MEXICO — Positive performance from the retail tortilla industry helped drive solid operating income and sales gains at Gruma USA in fiscal 2023.

In the year ended Dec. 31, 2023, Gruma USA had operating income of $565.2 million, up 28% from $440.9 million in fiscal 2022. For the fourth quarter ended Dec. 31, operating income increased 11% to $156 million from $140.7 million.

Net sales at Gruma USA increased 14% in fiscal 2023 to $3.65 billion, up from $3.2 billion a year ago. Net sales in the fourth quarter were virtually unchanged at $890.4 million, which compared with $890.7 million a year ago.

Gruma said sales volume decreased 6% in the fourth quarter to 395,000 tonnes, but without the effects of an extra week of operations in the fourth quarter of fiscal 2022 volumes would have increased by 2%, led mainly by a positive performance in the corn flour and retail tortilla business.

“The tortilla business contracted 8% in volume in 4Q23 as a result of the extra week of operations in 4Q22 in this subsidiary,” Gruma said. “Excluding this effect, tortilla volumes declined 1% when compared to 4Q ‘22. The positive performance from the retail tortilla channel spearheaded by the better-for-you product line was offset by a significant contraction at Gruma’s foodservice channel as a result of higher price sensitivity coupled with a client selectivity process taking place in this segment of the business.

“In the corn flour business, excluding the effect from the extra week of operations, volume sold expanded by 4% on the back of a recovery from past price sensitivity effects on some clients, in addition to a continuous positive performance at the retail channel of this business.”

Gruma said operating margin improved 170 basis points to 17.5% during the fourth quarter.

Cost of sales as a percentage of net sales remained flat relative to the fourth quarter of fiscal 2022, reflecting revenue and cost dynamics, Gruma said.

Gruma said it spent $56 million on capital expenditures during the fourth quarter and $211 million for the full year. During the fourth quarter, the company allocated expenditures to equipment replacement and capacity expansion in the United States, general upgrades and maintenance across the company, particularly at GIMSA, and production expansion in Australia, China and Malaysia.

Overall, majority net income at Gruma SAB de CV in fiscal 2023 was $429.5 million, up 35% from $319.2 million in fiscal 2022. Net sales increased 18% to $6.58 billion from $5.6 billion a year ago.