UPDATE 3-Mexican breadmaker Grupo Bimbo's profit plummets nearly 90%

(Adds analyst comment, stock detail in paragraphs 13-14)

By Sarah Morland and Aida Pelaez-Fernandez

MEXICO CITY, Feb 19 (Reuters) - Mexican breadmaker Grupo Bimbo's fourth-quarter net profit plummeted 89% compared to the same period in 2022, the company said in a filing on Monday, citing foreign exchange, higher costs and restructurings notably in North America.

Bimbo's net profit landed at 3.3 billion pesos ($192.1 million), compared to over 30 billion pesos a year earlier.

Revenues for the company, which sells buns, cakes, cookies, bagels and tortillas across more than 30 countries, shrunk 6.5% to total 101.9 billion pesos. Both metrics fell below forecasts by analysts polled by LSEG, who had estimated a quarterly profit of 4.4 billion pesos and revenues of 103.2 billion.

In a call with analysts, finance chief Diego Gaxiola said the company had suffered from negative foreign exchange effects due to the appreciation of the Mexican peso, and though margins should contract slightly in the first half of this year they should recover in the second half.

This year, Gaxiola added, the company plans between $1.8 billion and $2 billion in capital expenditures, below levels in 2023, when the company made a number of acquisitions.

Besides foreign exchange, Grupo Bimbo said it had been hit by higher North American labor costs, as well as restructurings including the closure of a bakery in Albuquerque.

Despite the costs, Gaxiola said 2023 marked an "excellent year" with record levels of sales and core earnings, excluding the impact of the peso.

Stripping this out, the company's annual sales remained stable, growing 0.3%, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) edged up 2.8%.

The company in July cut its annual sales forecast to low-to-mid single-digit growth, citing the stronger Mexican peso, which appreciated some 13% to the dollar over the year, weighing on revenues earned abroad.

The United States and Canada accounted for over 48% of Bimbo's 2023 revenues, while its home market brought in 33%.

The company said cookies and salty snacks performed particularly well in North America, while strong performance in Brazil helped partially offset "social disruptions and a challenging competitive environment" elsewhere in Latin America.

For 2024, the company forecasts low-to-mid single-digit adjusted EBITDA growth and plans to focus on restructurings in countries such as the United States, Gaxiola said.

Analysts at J.P. Morgan predicted a negative reaction when trading opens on Tuesday, pointing to the poorer-than-expected results and slow growth forecasts.

They said late 2023's "more challenging tone" and this year's guidance implies risks to current estimates, which "should likely put some pressure on the stock tomorrow." Bimbo's stock is trading down nearly 8% since the start of January.

($1 = 16.9666 Mexican pesos at end-December) (Reporting by Sarah Morland; Writing by Natalia Siniawski; Editing by Brendan O'Boyle, Chris Reese and Michael Perry)