Investor Presentaiton
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Grupo Herdez, S.A.B. de C.V. and Subsidiaries.
December 31, 2009 and 2008
(Amounts stated in thousands of Mexican pesos, except exchange rates)
NOTE 1 COMPANY ACTIVITIES AND BASES FOR PRESENTATION:
Grupo Herdez, S.A.B. de C.V. and its subsidiaries are mainly engaged in the manufacture, purchase,
distribution and commercialization of canned and bottled food products, as well as of pasta, in Mexico
and with significant presence in the United States of America (U.S.) and Canada. The Company produces
and sells products pertaining to the following brands: Herdez Del Fuerte, McCormick, Doña María,
Barilla, Yemina, Vesta, Nair, Embasa, La Victoria, Búfalo, La Gloria, Carlota, Blasón, Hormel, Sólo Doña
María, Solomate Doña María, Kikkoman and Ocean Spray, among others. For these purposes, Grupo
Herdez, S.A.B. de C.V. and subsidiaries have forged alliances with leading companies worldwide, such as:
McCormick and Company Inc., Hormel Foods Corp., Barilla GeR Fratelli S.p.A. and Grupo KUO, S.A.B. de
C.V. for the creation of Herdez del Fuerte, S.A. de C.V. (Herdez del Fuerte).
a. Creation of Megamex in 2009
Through a number of agreements entered into on October 26, 2009, Herdez del Fuerte, an associated
company, and Hormel Foods Corporation (Hormel) formalized their association in a joint venture, thus
creating Megamex Foods, L.L.C. (Megamex) to be engaged in the production, sale and distribution of
food products (prepared food and Mexican style salsa, tortillas, vegetables and canned tuna fish) in the
U.S. Said company was incorporated in the state of California in the U.S.
The transaction was conducted through the contribution of the joint venture that both groups had in
the U.S. denominated Herdez Corporation, the operation conducted by Herdez through its subsidiary,
Authentic Specialty Foods, also located in the U.S., and the contribution of the businesses of certain
commercial brands related to Mexican foods, mainly salsas, operated by Hormel.
In making the contributions of the businesses as a whole, the difference in fair value resulted in a cash
payment by Hormel, that generated a profit of Ps149,735. See Note 15.
Megamex began operations on October 26, 2009 and as from that date, results thereof are included in
the financial statements of Herdez del Fuerte by the proportional consolidation method.
b. Creation of Herdez del Fuerte in 2008
As from January 1, 2008, Grupher and KUO formalized their association in a joint venture denominated
Herdez del Fuerte, S.A. de C.V.
As a result of the contribution made by the businesses and companies to the joint venture, Grupher
recorded a net gain of Ps212,708. See Note 15.
In addition, the contributions made by KUO generated goodwill for Grupher of Ps691,792. See Note 8.
c. Basis for consolidation
The consolidated financial statements at December 31, 2009 and 2008 include those pertaining to
Grupher and the subsidiaries mentioned below. All balances and transactions among them have been
eliminated in consolidation.
The subsidiaries are consolidated at 100%, except for Herdez del Fuerte, which is consolidated in
proportion to its interest, as control is exercised jointly.
Food:
Company
Herdez del Fuerte and subsidiaries
Percentage of
shareholding
2009 2008
50%
50%
McCormick de México, S.A. de C.V. (McCormick)
50% 50%
50%
50%
50%
50%
Barilla México, S.A. de C.V. (Barilla México)
Hormel Alimentos, S.A. de C.V. (Hormel Alimentos)
Sociedad de Desarrollo Agrícola H.P., S.A. de C.V. (SDA)
Services:
Herport, S.A. de C.V. (Herport)
100% 100%
50%
50%
Herdez Europa
97% 97%
Litoplas, S.A. de C.V. (Litoplas)
100%
Seramano, S.A. de C.V. (Seramano)
100%
Activity
Gathering, manufacturing,
commercialization and
distribution of food products.
Preparation and packaging of
food products.
Purchase, importation, sale and
distribution of all types of pasta.
Purchase, sale, production,
distribution, importation and
exportation of all types of foods
products.
All types of agricultural, livestock,
agroindustrial and forestry
activities.
Shipping company engaged in
the exploitation of fishing
vessels.
Distributor.
Purchase-sale of all types of
plastic articles, sale and contract
manufacturing of lithography
products and plastic arts.
Rendering of personnel services
in the technical, administrative
and accounting areas.
Herdez Capital, S.A. de C.V. SOFOM, E.N.R.
(Herdez Capital)
75%
Loan granting, capital lease
operations.
TRUST IN OUR FUTURE
35
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