Grupo Collado, one of the largest steel service and transformation centers in Mexico, recorded net profits of MXN 1.45 million ($83,000) in the fourth quarter of 2023, a figure that contrasted with the net loss of $1.0 million from the same quarter last year, according to the company's financial statements sent to the financial markets.
Collado reported that between June and October, the price of steel registered a downward price trend and in the last two months of 2023 “it registered a recovery trend.” Although throughout the year, a drop of 18.6 percent in the price was recorded, compared to 2022.
In this scenario, the value of the company's sales decreased only 1.9 percent to MXN 2,839 million ($162.1 million).
With the price reduction, Collado achieved an excellent reduction of 11.5 percent in the cost of sales, with which the cost of sales margin decreased from 83.1 to 75.0 percent in the analysis period. Thus, gross profit increased 45.5 percent.
Expenses (administrative and operating) increased 25.4 percent to $36.4 million. The ratio of expenses to sales went from 17.6 to 22.4 percent. At the operating level, losses of $1.0 million were reversed to an operating profit of $5.1 million.
Throughout the year, the company sold $667 million, a figure that compared in pesos represented a decrease of 9.8 percent compared to 2022. Net profits decreased 19.3 percent to the equivalent of $10.8 million.
At the end of last year, Grupo Collado increased its payroll by 10.5 percent or 345 people to reach 3,635 people. The largest increase was in workers with 310 more to reach 2,788 people. The number of employees increased by 33 to total 837 and the number of senior officials increased by two to 10 people.
Grupo Collado warned that in the middle of the current year, there will be federal elections to replace the executive and legislative powers in Mexico, which entails a level of risk due to the uncertainty that this electoral process represents.
In addition, it reported that at the end of 2023, its debt recorded a balance of MXN 1,602 million ($91.5 million), 18.8 percent more than the balance at the end of 2022.
Grupo Collado is one of the largest steel processors and transformers with 11 plants, 7 warehouses and 22 sales offices.
The company has one of its main commercial adversaries as an uncomfortable partner. Since 2010, Grupo Villacero, another steel processor and transformer, owns 29.7 percent of Grupo Collado's shares. That shareholding has pitted the two companies against each other in the Mexican courts.