Fomento Económico Mexicano (FEMSAUBD) Q3 2025 earnings summary

Executive summary

• Leadership transition underway, with Jose Antonio Fernández Garza-Lagüera appointed as the new CEO effective November 1, 2025, emphasizing strategic continuity and long-term value creation.

• FEMSA Forward strategy executed, focusing on core retail and beverage verticals, divesting $11B in assets, and setting clear capital allocation targets.

• Retail operations, especially OXXO Mexico, show signs of recovery with positive same-store sales and ongoing store expansion.

• Digital ecosystem Spin by OXXO continues to grow, with active users up 20.5% year-over-year to 9.9 million, enhancing customer engagement and financial inclusion.

• Broad-based growth across business units, supported by favorable currency effects, especially from Europe.

Financial highlights

• Total revenue grew 9.1% year-over-year to Ps. 214,638 million, driven by international operations, currency tailwinds, and OXXO USA consolidation.

• Operating income increased 4.3% year-over-year to Ps. 18,126 million, reflecting inflationary pressures partially offset by efficiency gains.

• Net consolidated income fell 36.8% to Ps. 5.8B, mainly due to a non-cash FX loss from peso appreciation, higher interest expense, and lower interest income.

• Gross margin contracted 40 bps to 39.9%; operating margin contracted 40 bps to 8.4%.

• Adjusted EBITDA rose 6.5% to Ps. 30,843 million; EBITDA margin was 14.4%.

Outlook and guidance

• Cautious optimism for the coming year, with early signs of improvement in Mexico and expected tailwinds from the FIFA World Cup and Coca-Cola's 100th anniversary in Mexico.

• Continued focus on tactical and strategic initiatives to drive performance and efficiency.

• Guidance for a mid-30% effective tax rate under current legislation.