By Robin Emmott and Gabriela Lopez
MONTERREY, Mexico (Reuters) - Mexican conglomerate Alfa aims to make more acquisitions this year and generate record income levels next year, the company said on Wednesday.
Alfa (ALFAA.MX: Quote, Profile, Research, Stock Buzz), whose businesses range from petrochemicals to cold meats and telecoms, told the Reuters Latin American Investment Summit in Monterrey it expected record earnings before interest, taxes, depreciation and amortization, or EBITDA, of more than $1 billion a year from next year.
That compares with EBITDA of $765 million in 2006 and a previous record of $825 million in 1998, according to company data.
"This year is a watershed (for Alfa), given that in 2006 we took strategic decisions to really boost the company," Chief Financial Officer Alejandro Elizondo said in an interview, referring to Alfa's expansion in aluminum and auto parts.
So far this year, Alfa has bought 10 auto parts plants in Europe, Latin America and the United States from Italy's Teksid Aluminum and Norway's Norsk Hydro (NHY.OL: Quote, Profile, Research, Stock Buzz).
Elizondo said the company aims to buy two more auto parts plants, in Poland and China, from Teksid in the next few months as it bets on growing demand for cars in Asia and Europe.
"We estimate that once all the acquisitions are integrated and we have about 12 months of operations behind us, we will be at EBITDA levels of above $1 billion," Elizondo said, adding that he expects to complete the process in the second quarter.
Elizondo said the company would also benefit from lower international commodity prices over the next few years and a stronger cash flow that could lead it to buy companies in other business areas, such as cold meats. Continued...
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