Fomento Economico Mexicano SAB de CV

Latest Results (30.08.2026):

Fomento Economico Mexicano SAB de CV — second quarter of 2026: FEMSA reported solid 2Q26 results with total consolidated revenues up 9.3% year-over-year and income from operations up 7.2%. Net consolidated income rose to Ps. 9,221 million (+64.9% y/y), supported by lower non-cash FX losses and improved associate results; net majority income was Ps. 1.62 per FEMSA Unit (+107.7%). Management flagged strong OXXO Mexico performance, continued momentum in growth platforms, and a cautiously optimistic outlook for the second half of 2026.

Top-line and margins

Total revenues increased 9.3% in 2Q26 (10.1% on a comparable basis excluding OXXO Brazil consolidation and FX effects). Gross profit rose 7.8% while gross margin contracted 60 bps to 40.1%; operating income increased 7.2% with consolidated operating margin at 8.3% (down 10 bps).

OXXO Mexico

OXXO Mexico delivered double-digit results: total revenues +11.8% and income from operations +12.3% vs. 2Q25. Company noted a return to positive customer traffic, improved execution and category initiatives supporting performance.

Coca‑Cola FEMSA

Coca‑Cola FEMSA contributed to consolidated growth with total revenues +4.7% and income from operations +9.1%. Management said weak demand and tax increases in Mexico were offset by robust South America results.

Spin and loyalty metrics

Digital ecosystem growth: Spin by OXXO had 11.5 million active users (+22.1% y/y); Spin Premia reached 29.1 million active loyalty users (+9.4%). Average tender at OXXO Mexico rose to 50.4% from 45.8% in 2Q25.

Net income drivers

Net consolidated income of Ps. 9,221 million (+64.9%) benefited from a much smaller non‑cash FX loss (Ps.655m vs. Ps.4,102m in 2Q25) and a positive swing in associates’ results. These were partially offset by higher net interest expense and a higher income tax provision (effective tax rate 34.8% in 2Q26, explained by non-deductible items and tax loss effects).

Balance sheet and leverage

As of June 30, 2026, cash & investments were Ps. 73,591 million and total debt Ps. 163,539 million, yielding net debt of Ps. 90,020 million. Net Debt / Adjusted EBITDA ex‑KOF was 1.15x (up from 0.93x in 2Q25), reflecting capital return to shareholders and lower cash balances.

Capital allocation and capex

Capital expenditures in 2Q26 were Ps. 8,872 million (3.8% of sales), down 3.6% y/y. Recent capital actions: completion of an accelerated share repurchase totaling ~US$300 million and continued dividends/share repurchases (Ps.45,498m dividends and Ps.10,354m buybacks in the last 12 months).

Reporting changes and strategic moves

FEMSA updated its reporting segments (OXXO Mexico; Americas & Mobility; Europe; Health; Coca‑Cola FEMSA) to improve transparency. It also announced a strategic equity investment by QED Investors into its lending business while retaining majority ownership and consolidation of results.

Outlook

Management described momentum across most business units but expects a more subdued H2 (no World Cup tailwind, soft consumer in Mexico). They remain cautiously optimistic given geographic diversification and ongoing strategic initiatives.