SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of July 2021

 

FOMENTO ECONÓMICO MEXICANO, S.A.B. DE C.V.

(Exact name of Registrant as specified in its charter)

 

Mexican Economic Development, Inc.

(Translation of Registrant’s name into English)

 

United Mexican States

(Jurisdiction of incorporation or organization)

 

General Anaya No. 601 Pte.
Colonia Bella Vista
Monterrey, Nuevo León 64410
México

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports

under cover of Form 20-F or Form 40-F:

 

Form 20-F x Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as

permitted by Regulation S-T Rule 101(b)(1): ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as

permitted by Regulation S-T Rule 101(b)(7): ¨

 

Indicate by check mark whether by furnishing the information contained in this

Form, the registrant is also thereby furnishing the information to the

Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

Yes ¨ No x

 

If "Yes" is marked, indicate below the file number assigned to the registrant in

connection with Rule 12g3-2(b): 82-_____________

 

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the

registrant has duly caused this report to be signed on its behalf of the

undersigned, thereunto duly authorized.

 

  FOMENTO ECONÓMICO MEXICANO, S.A. DE C.V.
   
  By: /s/ Eugenio Garza y Garza
  Eugenio Garza y Garza
  Director of Finance and Corporate Development
Date: July 28, 2021

 

 

Exhibit 99.1

 

 

 

FEMSA Announces Second Quarter 2021 Results

 

Monterrey, Mexico, July 28, 2021 — Fomento Económico Mexicano, S.A.B. de C.V. (“FEMSA”) (NYSE: FMX; BMV: FEMSAUBD) announced today its operational and financial results for the second quarter of 2021.

 

HIGHLIGHTS

 

·Our results in 2Q20 were significantly impacted by COVID-19 and the related changes in consumer mobility and behavior across markets. As we look at our 2Q21 results, the comparison base of 2Q20 is only a partial benchmark. Therefore, to facilitate the reader’s assessment of our business units’ performance in 2Q21, we provide the following table that includes variations versus 2Q19 as well.

 

FINANCIAL SUMMARY FOR THE SECOND QUARTER AND FIRST SIX MONTHS 2021
Information includes figures in millions of Ps. and variations as change vs. respective period
    Revenues   Gross Profit   Income
from Operations
  Same-Store Sales
    2Q21 % var vs.
2Q20
% var vs.
2Q19
  2Q21 % var vs.
2Q20
% var vs.
2Q19
  2Q21 % var vs.
2Q20
% var vs.
2Q19
  % var vs.
2Q20
% var vs.
2Q19
FEMSA CONSOLIDATED   137,058 19.7% 6.9%   53,858 23.7% 12.4%   13,973 87.4% 17.1%      
FEMSA COMERCIO                              
Proximity Division   50,850 17.1% 7.8%   21,138 22.6% 12.5%   4,569 188.4% (1.4%)   15.6% (2.5%)
Health Division   18,377 17.6% 20.5%   5,434 13.8% 19.7%   1,056 109.1% 59.0%   14.9% 1.2%
Fuel Division (1)   9,974 56.3% (19.7%)   1,297 31.9% (7.6%)   356 107.0% (21.8%)   53.7% (21.8%)
LOGISTICS & DISTRIBUTION   11,266 N/A N/A   2,468 N/A N/A   586 N/A N/A      
COCA-COLA FEMSA   47,786 10.9% (0.4%)   22,560 18.3% 2.1%   7,248 41.3% 14.4%      

(1) variations vs. comparable results

 

Eduardo Padilla, FEMSA’s CEO, commented:

 

“One year ago, we were in the eye of the storm. Our focus was on keeping our people and customers safe, preserving our cash, and making sure that we made it through the crisis in the best possible shape. Today, while the health emergency is not over, there is a clear recovery trend across business units and across markets. This improvement is not linear, nor is it the same for every market, but we are in a much better place now than we were last year in every one of our operations, and in some of them we are already above 2019 levels as well.

 

At OXXO, we are seeing consumers return to the stores as soon as mobility trends improve, and they are filling their needs as they always do, including thirst, hunger, and the occasional treat. And we are seeing some categories that gained momentum during the lockdowns, such as spirits and pantry replenishment, remain strong. Our Health Division continued leveraging its platform, delivering solid results on top of good numbers last year, and OXXO Gas showed great improvement even as we continued to face the headwinds of lower vehicle mobility in Mexico. Our Logistics and Distribution operations continued to see gradual improvement in their markets, although Latin America is reopening more slowly than the United States. For its part, Coca-Cola FEMSA delivered a very strong set of numbers, reflecting solid performance across markets, and the entire organization driving efficiencies that helped profitability.

 

Despite the uncertainty of the past twelve months, we remained committed to the long-term efforts that will help us build our future, such as the digital initiatives that already begin to enable new growth avenues across our operations. Those opportunities, combined with the encouraging near-term results we are delivering, make us optimistic about the second half of the year, and beyond. And I take this opportunity to again thank our more than three hundred thousand colleagues for their resilience and unwavering effort.”

 

1

 

 

 

Results are compared to the same period of previous year

 

femsa consolidateD

 

FEMSA CONSOLIDATED   CONSOLIDATED NET DEBT
2Q21 Financial Summary  
(Millions of Ps.)   (Millions of Ps.)
                           
    2Q21 2Q20   Var.   Org.     As of June 30, 2021   Ps. US$ 3
Revenues   137,058 114,514   19.7%   15.7%     Cash   107,784 5,415
Income from Operations   13,973 7,456   87.4%   84.9%     Short-term debt   5,732 288
Income from Operations Margin (%)   10.2 6.5   370 bps         Long-term debt 4   176,716 8,878
Operative Cash Flow (EBITDA)   21,349 15,136   41.0%   38.8%     Net debt 4   74,664 3,751
Operative Cash Flow (EBITDA) Margin (%)   15.6 13.2   240 bps                
Net Income   5,255 (10,775)   148.8%                

 

Total revenues increased 19.7% in 2Q21 compared to 2Q20, reflecting a recovery in consumption during the second quarter coupled with an undemanding comparison across our business units. On an organic1 basis, total revenues increased 15.7%.

 

Gross profit increased 23.7%. Gross margin expanded 130 basis points, mainly driven by expansion at Coca-Cola FEMSA and FEMSA Comercio’s Proximity Division, partially offset by a contraction at FEMSA Comercio’s Health and Fuel Divisions.

 

Income from operations increased 87.4%. On an organic1 basis, income from operations increased 84.9%, reflecting steady recovery trends across all our business units and an undemanding comparison base in the second quarter of 2020, which reflected COVID-19 pandemic containment measures, including operating and category restrictions. Consolidated operating margin increased 370 basis points to 10.2% of total revenues, reflecting margin expansion across all our business units.

 

Income tax was Ps. 3,311 million in 2Q21.

 

Net consolidated income increased to Ps. 5,255 million, driven by: i) higher income from operations across all our business units; and ii) an increase in our participation in associates’ results, which mainly reflects the results of our investment in Heineken. This was partially offset by a non-cash foreign exchange loss related to FEMSA’s U.S. dollar-denominated cash position as impacted by the appreciation of the Mexican peso during the quarter.

 

Net majority income was Ps. 0.86 per FEMSA Unit2 and US$0.43 per FEMSA ADS.

 

Capital expenditures amounted to Ps. 5,172 million, reflecting higher investments at most of our business units.

 

 

 

1 Excludes the effects of significant mergers and acquisitions in the last twelve months.

2 FEMSA Units consist of FEMSA BD Units and FEMSA B Units. Each FEMSA BD Unit is comprised of one Series B Share, two Series D-B Shares and two Series D-L Shares. Each FEMSA B Unit is comprised of five Series B Shares. The number of FEMSA Units outstanding as of June 30, 2021 was 3,578,226,270, equivalent to the total number of FEMSA Shares outstanding as of the same date, divided by 5.

3 The exchange rate published by the Federal Reserve Bank of New York for June 30, 2021 was 19.9060 MXN per USD.

4 Includes the effect of derivative financial instruments on long-term debt. Excludes long-term leases.

 

July 28, 2021  2

 

 

FEMSA COMERCIO – Proximity DIVISION

 

FEMSA COMERCIO – PROXIMITY DIVISION
2Q21 Financial Summary
(Millions of Ps. except same-stores sales)
    2Q21 2Q20   Var.
Same-store sales (thousands of Ps.)   801 693   15.6%
Revenues   50,850 43,409   17.1%
Income from Operations   4,569 1,584   188.4%
Income from Operations Margin (%)   9.0 3.6   540 bps
Operative Cash Flow (EBITDA)   7,360 4,628   59.0%
Operative Cash Flow (EBITDA) Margin (%)   14.5 10.7   380 bps

 

 

Total revenues increased 17.1% in 2Q21 compared to 2Q20, reflecting a 15.6% average same-store sales increase, driven by a 7.6% growth in average customer ticket and an increase of 7.4% in store traffic. These figures reflect an undemanding comparison base coupled with improving customer mobility and reduced operating restrictions during the second quarter of 2021. During the quarter, OXXO’s store base expanded by 128 units to reach 276 total net new store openings for the last twelve months. As of June 30, 2021, FEMSA Comercio’s Proximity Division had a total of 19,834 OXXO stores.

 

Gross profit reached 41.6% of total revenues, reflecting more dynamic commercial income activity and promotional programs with our key supplier partners.

 

Income from operations amounted to 9.0% of total revenues, driven by higher operating leverage. Operating expenses increased 5.8% to Ps. 16,569 million, below revenues, reflecting cost efficiencies and tight expense control, partially offset by our continuing initiative to gradually shift from commission-based store teams to employee-based teams and an undemanding comparison base in 2Q20 that included extraordinary expenses in connection to the COVID-19 pandemic.

 

July 28, 2021  3

 

 

FEMSA COMERCIO – HEALTH DIVISION

 

FEMSA COMERCIO – HEALTH DIVISION    
2Q21 Financial Summary    
(Millions of Ps. except same-stores sales)    
    2Q21 2Q20   Var.   Org.
Same-store sales (thousands of Ps.)   1,359 1,183   14.9%    
Revenues   18,377 15,624   17.6%   0.0%
Income from Operations   1,056 505   109.1%   0.0%
Income from Operations Margin (%)   5.7 3.2   250 bps    
Operative Cash Flow (EBITDA)   1,917 1,418   35.2%   0.0%
Operative Cash Flow (EBITDA) Margin (%)   10.4 9.1   130 bps    

 

 

 

Total revenues increased 17.6% in 2Q21 compared to 2Q20, mainly reflecting positive trends in our Mexican, Chilean and Colombian operations, partially offset by a negative currency translation effect related to the depreciation of the Chilean and Colombian pesos relative to the Mexican peso. During the quarter, the Health Division’s store base expanded by 54 units to reach a total of 3,459 points of sale across its territories as of June 30, 2021. This figure reflects the addition of 270 net new store openings for the last twelve months. Same-store sales for drugstores increased an average of 14.9%, reflecting the revenue drivers described above. On a currency-neutral1 basis, total revenues increased 18.9% while same-store sales increased by 21.6%.

 

Gross profit represented 29.6% of total revenues, reflecting: i) increased promotional activities in our operations in South America; and ii) higher institutional sales in our operations in Chile and Colombia. These were partially offset by improved efficiency and more effective collaboration and execution with key supplier partners in Mexico.

 

Income from operations amounted to 5.7% of total revenues, reflecting higher operating leverage. Operating expenses increased 2.5% to Ps. 4,378 million, below revenue growth, reflecting tight expense control and efficiency gains across our operations.

 

 

 

1 Calculated by translating comparable period figures at the foreign currency exchange rates used in the current period.

 

July 28, 2021  4

 

 

FEMSA COMERCIO – FUEL DIVISION

 

FEMSA COMERCIO – FUEL DIVISION
2Q21 Financial Summary
(Millions of Ps. except same-stations sales)
    2Q21 Comparable
2Q20(1)
  Var.*   Reported
2Q20
Same-station sales (thousands of Ps.)   5,927 3,855   53.7%   3,855
Revenues   9,974 6,382   56.3%   6,382
Income from Operations   356 172   107.0%   51
Income from Operations Margin (%)   3.6 2.7   90 bps   0.8
Operative Cash Flow (EBITDA)   610 388   57.2%   267
Operative Cash Flow (EBITDA) Margin (%)   6.1 6.1   0 bps   4.2
           
(1) Includes wholesale and distribution operations          
*vs. Comparable Results              

 

 

Total revenues increased 56.3% in 2Q21 compared to 2Q20, reflecting a 53.7% average same-station sales increase, driven by a 24.2% growth in the average volume and a 23.8% increase in the average price per liter. This reflects an undemanding comparison base which was affected by reduced vehicle mobility in connection to the COVID-19 pandemic. During the quarter, the Fuel Division added 2 stations, to reach a total of 563 points of sale as of June 30, 2021. This figure reflects the addition of 12 total net new stations for the last twelve months.

 

Gross profit reached 13.0% of total revenues.

 

Income from operations amounted to 3.6% of total revenues. Operating expenses increased 16.0% to Ps. 941 million, below revenues, reflecting tight expense control and increased expense efficiencies.

 

July 28, 2021  5

 

 

Logistics and Distribution

 

LOGISTICS AND DISTRIBUTION
2Q21 Financial Summary
(Millions of Ps.)
     
    2Q21
Revenues   11,266
Income from Operations   586
Income from Operations Margin (%)   5.2
Operative Cash Flow (EBITDA)   1,197
Operative Cash Flow (EBITDA) Margin (%)   10.6

 

Total revenues amounted to Ps. 11,266 million, reflecting positive demand dynamics in our operations in Latin America, coupled with a gradual re-opening and recovery of most end-user segments in the United States. These were partially offset by the negative currency translation effect from the depreciation of the Brazilian Real relative to the Mexican peso.

 

Gross profit reached 21.9% of total revenues, reflecting favorable sales mix and efficiencies in our Latin American operations.

 

Income from operations represented 5.2% of total revenues. Operating expenses totaled Ps. 1,882 million, reflecting high operating leverage driven by tight expense control and efficiencies across markets.

 

July 28, 2021  6

 

 

 

Results are compared to the same period of previous year

 

femsa consolidated

 

FEMSA CONSOLIDATED
Financial Summary for the First Six Months
(Millions of Ps.)
               
    2021 2020   Var.   Org.
Revenues   261,556 236,716   10.5%   6.1%
Income from Operations   23,498 16,970   38.5%   35.9%
Income from Operations Margin (%)   9.0 7.2   180 bps    
Operative Cash Flow (EBITDA)   38,326 32,256   18.8%   16.4%
Operative Cash Flow (EBITDA) Margin (%)   14.7 13.6   110 bps    
Net Income   11,514 (1,669)   N.S.    

 

Total revenues increased 10.5%. On an organic basis,1 total revenues increased 6.1% reflecting growth across all operations.

 

Gross profit increased 12.4%. Gross margin increased 70 basis points to 38.4% of total revenues, reflecting gross margin expansion at Coca-Cola FEMSA and FEMSA Comercio’s Proximity Division, partially offset by a contraction at FEMSA Comercio’s Health and Fuel Divisions.

 

Income from operations increased 38.5%. On an organic basis,1 it increased 35.9%. Our consolidated operating margin increased 180 basis points to 9.0% of total revenues, reflecting margin expansion at Coca-Cola FEMSA and FEMSA Comercio’s Proximity and Health Division, partially offset by a contraction at FEMSA Comercio’s Fuel Division.

 

Net consolidated income increased to a Ps. 11,514 million, reflecting: i) higher income from operations at all our business units; ii) higher non-operating income; and iii) an increase in our participation in associates’ results, which mainly reflects the results of our investment in Heineken. These were partially offset by a non-cash foreign exchange loss related to FEMSA’s U.S. dollar-denominated cash position as impacted by the appreciation of the Mexican peso.

 

Net majority income per FEMSA Unit2 was Ps. 2.14 (US$1.07 per ADS).

 

Capital expenditures amounted to Ps. 8,526 million, reflecting lower investments at most of our business units.

 

 

 

1 Excludes the effects of significant mergers and acquisitions in the last twelve months.

2 FEMSA Units consist of FEMSA BD Units and FEMSA B Units. Each FEMSA BD Unit is comprised of one Series B Share, two Series D-B Shares and two Series D-L Shares. Each FEMSA B Unit is comprised of five Series B Shares. The number of FEMSA Units outstanding as of June 30, 2021 was 3,578,226,270, equivalent to the total number of FEMSA Shares outstanding as of the same date, divided by 5.

 

July 28, 2021  7

 

 

femsa comercio – PROXIMITY division

 

FEMSA COMERCIO – PROXIMITY DIVISION
Financial Summary for the First Six Months
(Millions of Ps. except same-stores sales)
             
    2021 2020   Var.  
Same-store sales (thousands of Ps.)   744 714   4.2%  
Revenues   94,268 89,030   5.9%  
Income from Operations   6,980 4,639   50.5%  
Income from Operations Margin (%)   7.4 5.2   220 bps  
Operative Cash Flow (EBITDA)   12,556 10,376   21.0%  
Operative Cash Flow (EBITDA) Margin (%)   13.3 11.7   160 bps  

 

Total revenues increased 5.9%. OXXO’s same-store sales increased an average of 4.2%, driven by a 11.6% increase in average customer ticket, partially offset by a 6.6% decrease in store traffic.

 

Gross profit reached 40.9% of total revenues.

 

Income from operations amounted to 7.4% of total revenues. Operating expenses increased 2.2% to Ps. 31,532 million.

 

femsa comercio – health division

 

FEMSA COMERCIO – HEALTH DIVISION
Financial Summary for the First Six Months
(Millions of Ps. except same-stores sales)
           
    2021 2020   Var.
Same-store sales (thousands of Ps.)   1,383 1,200   15.2%
Revenues   36,127 30,920   16.8%
Income from Operations   1,866 890   109.7%
Income from Operations Margin (%)   5.2 2.9   230 bps
Operative Cash Flow (EBITDA)   3,550 2,609   36.1%
Operative Cash Flow (EBITDA) Margin (%)   9.8 8.4   140 bps

 

Total revenues increased by 16.8%. Same-store sales for drugstores increased by an average of 15.2%, reflecting positive trends in our Mexican, Chilean and Colombian operations coupled with a positive currency translation effect related to the appreciation of the Chilean peso compared to the Mexican peso during the first six months of the year, partially offset by strict mobility restrictions across our South American operations.

 

Gross profit reached 29.1% of total revenues.

 

Income from operations amounted to 5.2% of total revenues. Operating expenses increased 5.5% to Ps. 8,637 million.

 

July 28, 2021  8

 

 

FEMSA COMERCIO – FUEL DIVISION

 

FEMSA COMERCIO – FUEL DIVISION
Financial Summary for the First Six Months
(Millions of Ps. except same-stations sales)
               
    2021 Comparable
2Q20(1)
  Var.*   Reported
2Q20
Same-station sales (thousands of Ps.)   5,516 5,214   5.8%   5,214
Revenues   18,509 17,239   7.4%   17,239
Income from Operations   564 615   (8.3%)   285
Income from Operations Margin (%)   3.0 3.6   -60 bps   1.7
Operative Cash Flow (EBITDA)   1,044 1,062   (1.7%)   732
Operative Cash Flow (EBITDA) Margin (%)   5.6 6.2   -60 bps   4.2

 

(1) Includes wholesale and distribution operations

*vs. Comparable Results

 

Total revenues increased 7.4%. Same-station sales increased an average of 5.8%, reflecting a 11.4% increase in the average price per liter, partially offset by a 5.0% decrease in the average volume.

 

Gross profit reached 12.8% of total revenues.

 

Income from operations amounted to 3.0% of total revenues. Operating expenses increased 4.3% to Ps. 1,813 million.

 

Logistics and Distribution

 

LOGISTICS AND DISTRIBUTION
Financial Summary for the First Six Months
(Millions of Ps.)
     
    2021
Revenues   22,074
Income from Operations   953
Income from Operations Margin (%)   4.3
Operative Cash Flow (EBITDA)   2,162
Operative Cash Flow (EBITDA) Margin (%)   9.8

 

Total revenues amounted to Ps. 22,074 million, reflecting positive demand dynamics in our operations in Latin America, coupled with gradual recovery trends in the United States. These were partially offset by the negative currency translation effect from the depreciation of the Brazilian Real relative to the Mexican peso.

 

Gross profit reached 21.8% of total revenues, reflecting favorable sales mix and efficiencies in our Latin American operations.

 

Income from operations represented 4.3% of total revenues. Operating expenses totaled Ps. 3,869 million, reflecting high operating leverage driven by tight expense control and efficiencies across markets.

 

July 28, 2021  9

 

 

coca-cola femsa

 

Coca-Cola FEMSA’s financial results and discussion thereof are incorporated by reference from Coca-Cola FEMSA’s press release, which is attached to this press release or may be accessed by visiting http://www.coca-colafemsa.com

 

CONFERENCE CALL INFORMATION:
Our Second Quarter 2021 Conference Call will be held on: Wednesday, July 28, 2021, 10:00 AM Eastern Time (9:00 AM Mexico City Time). To participate in the conference call, please dial: Domestic US: (866) 548 4713; International: +1 (323) 794 2093; Conference Id: 9127072. The conference call will be webcast live through streaming audio. For details please visit www.femsa.com/investor.
If you are unable to participate live, the conference call audio will be available on http://ir.FEMSA.com/results.cfm

 

FEMSA is a company that creates economic and social value through companies and institutions and strives to be the best employer and neighbor to the communities in which it operates. It participates in the retail industry through FEMSA Comercio, comprising a Proximity Division operating OXXO, a small-format store chain, a Health Division, which includes drugstores and related activities, and a Fuel Division, which operates the OXXO Gas chain of retail service stations. In the beverage industry, it participates through Coca-Cola FEMSA, the largest franchise bottler of Coca-Cola products in the world by volume; and in the beer industry, as the second largest shareholder of Heineken, one of the world’s leading brewers with operations in over 70 countries. FEMSA also participates in the logistics and distribution industry through its Strategic Business Unit, which additionally provides point-of-sale refrigeration and plastic solutions to its business units and third-party clients. Across its business units, FEMSA has more than 320,000 employees in 13 countries. FEMSA is a member of the Dow Jones Sustainability MILA Pacific Alliance, the FTSE4Good Emerging Index and the Mexican Stock Exchange Sustainability Index, among other indexes that evaluate its sustainability performance.

 

The translations of Mexican pesos into US dollars are included solely for the convenience of the reader, using the noon buying rate for Mexican pesos as published by the Federal Reserve Bank of New York on June 30, 2021, which was 19.9060 Mexican pesos per US dollar.

 

FORWARD-LOOKING STATEMENTS

 

This report may contain certain forward-looking statements concerning our future performance that should be considered as good faith estimates made by us. These forward-looking statements reflect management’s expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, which could materially impact our actual performance.

 

eight pages of tables and Coca-Cola FEMSA’s press release to follow

 

July 28, 2021  10

 

 

FEMSA
Consolidated Income Statement
Millions of Pesos
                             
    For the second quarter of:   For the six months of:
    2021 % of rev. 2020 % of rev. % Var. % Org.(A)   2021 % of rev. 2020 % of rev. % Var. % Org.(A)
Total revenues    137,058  100.0  114,514  100.0  19.7  15.7    261,556  100.0  236,716  100.0  10.5  6.1
Cost of sales    83,200  60.7  70,970  62.0  17.2      161,156  61.6  147,369  62.3  9.4  
Gross profit    53,858  39.3  43,544  38.0  23.7      100,400  38.4  89,347  37.7  12.4  
Administrative expenses    6,573  4.8  5,263  4.6  24.9      12,404  4.7  10,278  4.3  20.7  
Selling expenses    33,175  24.2  30,165  26.3  10.0      64,069  24.5  61,162  25.8  4.8  
Other operating expenses (income), net (1)    137  0.1  660  0.6  (79.2)      429  0.2  937  0.4  (54.2)  
Income from operations(2)    13,973  10.2  7,456  6.5  87.4  84.9    23,498  9.0  16,970  7.2  38.5  35.9
Other non-operating expenses (income)    (565)    7,241    (107.8)      (1,003)    7,098    (114.1)  
Interest expense    4,878    4,184    16.6      8,714    9,518    (8.4)  
Interest income    283    629    (55.0)      543    1,319    (58.8)  
Interest expense, net    4,595    3,555    29.3      8,171    8,199    (0.3)  
Foreign exchange loss (gain)    2,485    207    N.S.      961    (8,117)    (111.8)  
Other financial expenses (income), net.    (107)    (83)    28.9      (261)    (181)    44.5  
Financing expenses, net    6,973    3,679    89.5      8,871    (99)    N.S.  
Income before income tax and participation in associates results    7,565    (3,464)    N.S.      15,630    9,972    56.7  
Income tax    3,311 43.8%  5,733 -165.5%  (42.2)      5,970 38%  10,455 105%  (42.9)  
Participation in associates results(3)    1,001    (1,578)    163.4      1,854    (1,185)    N.S.  
(Loss) Consolidated net income    5,255    (10,775)    148.8      11,514    (1,669)    N.S.  
Net majority income    3,082    (11,692)    126.4      7,647    (3,911)    N.S.  
Net minority income    2,173    917    137.0      3,867    2,242    72.5  
                             
Operative Cash Flow & CAPEX   2021 % Integral 2020 % Integral % Inc. % Org.(A)   2021 % Integral 2020 % Integral % Inc. % Org.(A)
Income from operations    13,973 10.2  7,456 6.5  87.4  84.9    23,498 9.0  16,970 7.2  38.5  35.9
Depreciation    6,221 4.5  6,348 5.5  (2.0)      12,428 4.8  12,476 5.3  (0.4)  
Amortization & other non-cash charges    1,155 0.9  1,332 1.2  (13.3)      2,400 0.9  2,810 1.1  (14.6)  
Operative Cash Flow (EBITDA)    21,349 15.6  15,136 13.2  41.0  38.8    38,326 14.7  32,256 13.6  18.8  16.4
CAPEX    5,172    4,384    18.0      8,526    9,693    (12.0)  

 

(A) Organic basis (% Org.) excludes the effects of significant mergers and acquisitions in the last twelve months.

(1) Other operating expenses (income), net = other operating expenses (income) +(-) equity method from operated associates.

(2) Income from operations = gross profit - administrative and selling expenses  - other operating expenses (income), net.

(3) Mainly represents the equity method participation in Heineken´s and Raizen convenience stores results, net.

 

July 28, 2021  11

 

 

FEMSA
Consolidated Balance Sheet
Millions of Pesos
               
ASSETS     Jun-21 Dec-20 % Inc.    
Cash and cash equivalents      107,784  107,624  0.1  160  
Investments      10,107  662  N.S.    
Accounts receivable      26,886  28,249  (4.8)    
Inventories      44,386  44,034  0.8    
Other current assets      22,316  20,700  7.8   x
Total current assets      211,479  201,269  5.1    
Investments in shares      91,424  98,270  (7.0)    
Property, plant and equipment, net      111,475  113,106  (1.4)    
Right of use      54,776  54,747  0.1    
Intangible assets (1)      154,870  155,501  (0.4)    
Other assets      69,701  61,955  12.5    
TOTAL ASSETS      693,725  684,848  1.3    
               
LIABILITIES & STOCKHOLDERS´ EQUITY              
Bank loans      3,070  4,469  (31.3)    
Current maturities of long-term debt      2,662  4,332  (38.6)    
Interest payable      1,677  2,069  (18.9)    
Current maturities of long-term leases      6,854  6,772  1.2    
Operating liabilities      112,706  100,771  11.8    
Total current liabilities      126,969  118,413  7.2    
Long-term debt (2)      176,716  174,706  1.2    
Long-term leases      52,020  51,536  0.9    
Laboral obligations      7,443  7,253  2.6    
Other liabilities      24,850  25,753  (3.5)    
Total liabilities      387,998  377,661  2.7    
Total stockholders’ equity      305,727  307,187  (0.5)    
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY      693,725  684,848  1.3    
               
    June 30, 2021        
DEBT MIX (2)   % of Total Average Rate        
Denominated in:              
Mexican pesos   37.3% 7.2%        
U.S. Dollars   36.2% 3.3%        
Euros   15.6% 5.4%        
Colombian pesos   1.0% 3.8%        
Argentine pesos   0.4% 46.7%        
Brazilian reais   7.2% 6.8%        
Chilean pesos   1.6% 1.6%        
Uruguayan Pesos   0.7% 7.3%        
Guatemalan Quetzal   0.0% 6.3%        
Total debt   100.0% 5.5%        
               
Fixed rate (2)   89.5%          
Variable rate (2)   10.5%          
               
               
DEBT MATURITY PROFILE   2021 2022 2023 2024 2025 2026+
% of Total Debt   2.1% 1.6% 3.6% 3.6% 4.3% 84.8%

 

(1) Includes mainly the intangible assets generated by acquisitions.

(2) Includes the effect of derivative financial instruments on long-term debt.

 

July 28, 2021  12

 

 

FEMSA Comercio - Proximity Division
Results of Operations
Millions of Pesos

 

    For the second quarter of:   For the six months of:
    2021 % of rev. 2020 % of rev. % Var.   2021 % of rev. 2020 % of rev. % Var.
Total revenues    50,850  100.0  43,409  100.0  17.1    94,268  100.0  89,030  100.0  5.9
Cost of sales    29,712  58.4  26,167  60.3  13.5    55,756  59.1  53,548  60.1  4.1
Gross profit    21,138  41.6  17,242  39.7  22.6    38,512  40.9  35,482  39.9  8.5
Administrative expenses    1,579  3.1  1,367  3.1  15.5    2,805  3.0  2,654  3.0  5.7
Selling expenses    14,930  29.4  13,937  32.2  7.1    28,596  30.4  27,809  31.3  2.8
Other operating expenses (income), net    60  0.1  354  0.8  (83.1)    131  0.1  380  0.4  (65.5)
Income from operations    4,569  9.0  1,584  3.6  188.4    6,980  7.4  4,639  5.2  50.5
Depreciation    2,572  5.1  2,591  6.0  (0.7)    5,140  5.5  5,105  5.7  0.7
Amortization & other non-cash charges    219  0.4  453  1.1  (51.7)    436  0.4  632  0.8  (31.0)
Operative cash flow (EBITDA)    7,360  14.5  4,628  10.7  59.0    12,556  13.3  10,376  11.7  21.0
CAPEX    1,730    1,693    2.2    3,038    3,948    (23.0)
                         
Information of OXXO Stores                        
Total stores               19,834   19,558   1.4
Stores Mexico                19,566    19,308   1.3
Stores South America               268   250   7.2
                         
Net new conveniences stores:                        
vs. Last quarter   128   (40)    N.S.            
Year-to-date   268   228   17.5            
Last-twelve-months   276   950   (70.9)            
                         
Same-store data: (1)                        
Sales (thousands of pesos)    801.2    693.1    15.6    744.1    713.9    4.2
Traffic (thousands of transactions)    17.9    16.6    7.4    17.1    18.3    (6.6)
Ticket (pesos)    44.9    41.7    7.6    43.6    39.1    11.6
                         
(1) Monthly average information per store, considering same stores with more than twelve months of operations, income from services are included.

 

July 28, 2021  13

 

 

FEMSA Comercio - Health Division
Results of Operations
Millions of Pesos
                         
    For the second quarter of:   For the six months of:
    2021 % of rev. 2020 % of rev. % Var.   2021 % of rev. 2020 % of rev. % Var.
Total revenues    18,377  100.0  15,624  100.0  17.6    36,127  100.0  30,920  100.0  16.8
Cost of sales    12,943  70.4  10,849  69.4  19.3    25,624  70.9  21,847  70.7  17.3
Gross profit    5,434  29.6  4,775  30.6  13.8    10,503  29.1  9,073  29.3  15.8
Administrative expenses    819  4.5  868  5.6  (5.6)    1,554  4.3  1,666  5.4  (6.7)
Selling expenses    3,596  19.6  3,377  21.6  6.5    7,113  19.7  6,463  20.8  10.1
Other operating expenses (income), net    (37)  (0.2)  25  0.2  N.S.    (30)  (0.1)  54  0.2  (155.6)
Income from operations    1,056  5.7  505  3.2  109.1    1,866  5.2  890  2.9  109.7
Depreciation    741  4.0  782  5.0  (5.2)    1,444  4.0  1,443  4.7 0.1
Amortization & other non-cash charges    120  0.7  131  0.9  (8.4)    240  0.6  276  0.8  (13.0)
Operative cash flow (EBITDA)    1,917  10.4  1,418  9.1  35.2    3,550  9.8  2,609  8.4 36.1
CAPEX    331    363    (8.8)    585    737    (20.7)
                         
Information of Stores                        
Total Stores               3,459   3,189   8.5
Stores Mexico                1,372    1,275   7.6
Stores South America               2,087   1,914   9.0
                         
Net new stores:                        
vs. Last quarter   54   -7   N.S.            
Year-to-date   91   28    N.S.            
Last-twelve-months   270   128   110.9            
                         
Same-store data: (1)                        
   Sales (thousands of pesos)   1,359.4   1,183.1    14.9   1,382.5   1,200.3    15.2
                         
(1) Monthly average information per store, considering same stores with more than twelve months of all the operations of FEMSA Comercio - Health Division.

 

July 28, 2021  14

 

 

FEMSA Comercio - Fuel Division
Results of Operations
Millions of Pesos
                         
    For the second quarter of:  
          Comparable (A)   As Reported  
    2021 % of rev.   2020 % of rev. % Var.   2020 % of rev. % Var.  
Total revenues    9,974  100.0    6,382  100.0  56.3    6,382  100.0  56.3  
Cost of sales    8,677  87.0    5,399  84.6  60.7    5,533  86.7  56.8  
Gross profit    1,297  13.0    983  15.4  31.9    849  13.3  52.8  
Administrative expenses    84  0.8    71  1.1  18.3    71  1.1  18.3  
Selling expenses    855  8.6    735  11.5  16.3    722  11.3  18.4  
Other operating expenses (income), net    2  -    5  0.1  (60.0)    5  0.1  (60.0)  
Income from operations    356  3.6    172  2.7  107.0    51  0.8  N.S.  
Depreciation    247  2.5    206  3.2  19.9    206  3.2  19.9  
Amortization & other non-cash charges    7  -    10  0.2  (30.0)    10  0.2  (30.0)  
Operative cash flow (EBITDA)    610  6.1    388  6.1  57.2    267  4.2  128.5  
CAPEX    82      110    (25.5)    110    (25.5)  
                         
Information of OXXO GAS Service Stations                        
Total service stations    563      551    2.2          
Net new service stations                        
vs. Last quarter   2      1    100.0          
Year-to-date    5      6    (16.7)          
Last-twelve-months    12      10    20.0          
                         
Volume (million of liters) total stations    528      420    25.6          
                         
Same-stations data: (1)                        
Sales (thousands of pesos)    5,927.2      3,855.2    53.7          
Volume (thousands of liters)    316.1      254.6    24.2          
Average price per liter    18.8      15.1    23.8          
                         
(A) Unaudited consolidated financial information
(1) Monthly average information per station, considering same stations with more than twelve months of operations.  

 

FEMSA Comercio - Fuel Division
Results of Operations
Millions of Pesos
                         
    For the six months of:  
          Comparable (A)   As Reported  
    2021 % of rev.   2020 % of rev. % Var.   2020 % of rev. % Var.  
Total revenues    18,509  100.0    17,239  100.0  7.4    17,239  100.0  7.4  
Cost of sales    16,132  87.2    14,885  86.3  8.4    15,237  88.4  5.9  
Gross profit    2,377  12.8    2,354  13.7  1.0    2,002  11.6  18.7  
Administrative expenses    147  0.8    107  0.6  37.4    107  0.6  37.4  
Selling expenses    1,672  9.0    1,626  9.5  2.8    1,604  9.3  4.2  
Other operating expenses (income), net    (6)  -    6  -  N.S.    6  -  N.S.  
Income from operations    564  3.0    615  3.6  (8.3)    285  1.7  97.9  
Depreciation    476  2.6    429  2.5  11.0    429  2.5  11.0  
Amortization & other non-cash charges    4  -    18  0.1  (77.8)    18  -  (77.8)  
Operative cash flow (EBITDA)    1,044  5.6    1,062  6.2  (1.7)    732  4.2  42.6  
CAPEX    169      213    (20.8)    213    (20.8)  
                         
Information of OXXO GAS Service Stations                        
Total service stations   563     551    2.2          
Net new service stations                        
vs. Last quarter   2     1    100.0          
Year-to-date   5     6    (16.7)          
Last-twelve-months   12     10    20.0          
                         
Volume (million of liters) total stations   999     1,041    (4.1)          
                         
Same-stations data: (1)                        
Sales (thousands of pesos)    5,516.5      5,214.0    5.8          
Volume (thousands of liters)    299.9      315.8    (5.0)          
Average price per liter    18.4      16.5    11.4          
                         
(A) Unaudited consolidated financial information
(1) Monthly average information per station, considering same stations with more than twelve months of operations.  

 

July 28, 2021  15

 

 

Logistics and Distribution
Results of Operations
Millions of Pesos
             
    For the second quarter of:   For the six months of:
    2021 % of rev.   2021 % of rev.
Total revenues    11,266  100.0    22,074  100.0
Cost of sales    8,798  78.1    17,254  78.2
Gross profit    2,468  21.9    4,821  21.8
Administrative expenses    1,032  9.2    2,155  9.8
Selling expenses    856  7.6    1,706  7.7
Other operating expenses (income), net    (6)  (0.1)    8  -
Income from operations    586  5.2    953  4.3
Depreciation    434  3.9    844  3.8
Amortization & other non-cash charges    177  1.5    365  1.7
Operative cash flow (EBITDA)    1,197  10.6    2,162  9.8
CAPEX    130      324  

 

July 28, 2021  16

 

 

Coca-Cola FEMSA
Results of Operations
Millions of Pesos
                         
    For the second quarter of:   For the six months of:
    2021 % of rev. 2020 % of rev. % Var.   2021 % of rev. 2020 % of rev. % Var.
Total revenues    47,786  100.0  43,075  100.0  10.9    92,500  100.0  88,341  100.0  4.7
Cost of sales    25,226  52.8  24,000  55.7  5.1    50,009  54.1  48,592  55.0  2.9
Gross profit    22,560  47.2  19,075  44.3  18.3    42,491  45.9  39,749  45.0  6.9
Administrative expenses    2,279  4.8  1,882  4.4  21.1    4,092  4.4  3,733  4.2  9.6
Selling expenses    12,910  26.9  11,748  27.3  9.9    24,899  26.9  24,399  27.6  2.0
Other operating expenses (income), net    123  0.3  315  0.7  (61.0)    353  0.4  763  0.9  (53.7)
Income from operations    7,248  15.2  5,130  11.9  41.3    13,147  14.2  10,854  12.3  21.1
Depreciation    2,179  4.6  2,324  5.4  (6.2)    4,417  4.8  4,577  5.2  (3.5)
Amortization & other non-cash charges    580  1.1  767  1.8  (24.4)    1,252  1.3  1,864  2.1  (32.8)
Operative cash flow (EBITDA)    10,007  20.9  8,221  19.1  21.7    18,816  20.3  17,295  19.6  8.8
CAPEX    2,841    1,788    58.9    4,301    3,867    11.2
                         
Sales volumes                        
(Millions of unit cases)                        
Mexico and Central America    545.8  64.1  521.7  66.8  4.6    1,017.1  61.6  998.0  63.4  1.9
South America    106.1  12.5  85.6  11.0  23.9    226.7  13.7  196.8  12.5  15.2
Brazil    199.5  23.4  173.5  22.2  15.0    408.3  24.7  379.6  24.1  7.6
Total    851.4  100.0  780.8  100.0  9.1    1,652.0  100.0  1,574.3  100.0  4.9

 

July 28, 2021  17

 

 

FEMSA
Macroeconomic Information
                   
    Inflation   End-of-period Exchange Rates
    2Q 2021 LTM (1) Jun-21   Jun-21    Dec-20
          Per USD Per MXN   Per USD Per MXN
Mexico   1.17% 6.02%    19.80  1.0000    19.95  1.0000
Colombia   1.29% 2.89%    3,756.67  0.0053    3,432.50  0.0058
Brazil   1.39% 8.28%    5.00  3.9588    5.20  3.8387
Argentina   6.68% 47.13%    95.72  0.2069    84.15  0.2371
Chile   0.56% 3.29%    735.28  0.0269    711.24  0.0280
Euro Zone   0.16% 2.35%    0.84  23.5896    0.81  24.5213
                   
(1) LTM = Last twelve months.

 

July 28, 2021  18

 

 

 

 

Coca-Cola FEMSA Announces Results for the Second Quarter and First Six Months of 2021

 

Mexico City, July 26, 2021, Coca-Cola FEMSA, S.A.B. de C.V. (BMV: KOF UBL, NYSE: KOF) (“Coca-Cola FEMSA”, “KOF” or the “Company”), the largest Coca-Cola franchise bottler in the world by sales volume, announces results for the second quarter and the first six months of 2021.

 

SECOND QUARTER OPERATIONAL AND FINANCIAL HIGHLIGHTS

 

·Consolidated volumes increased 9.1% as compared to the second quarter of 2020 and 1.3% as compared to the same period of 2019. This increase was driven by volume growth across all of our territories as a result of solid execution, coupled with economic reopening and increased mobility across our markets.
·Total revenues increased 10.9%, comparable revenues increased 19.2%. This increase was driven mainly by volume growth, coupled with pricing initiatives and favorable price-mix effects. These effects were partially offset by unfavorable currency translation. Total revenues remained flat as compared to the same period of 2019.
·Operating income increased 41.3%, while comparable operating income increased 44.1%. This increase was driven mainly by cost and expense efficiencies, coupled with favorable price-mix effects and raw material hedging initiatives. Additionally, we recognized a positive extraordinary effect of Ps. 1,083 million, driven by the resumption of the recognition of tax credits in Brazil related to the Manaus Free Trade Zone. These effects were partially offset by the normalization of certain operating expenses and unfavorable currency hedging positions. Operating income increased 14.4% as compared to the same period of 2019.
·Majority net income increased 56.8%, driven mainly by operating income growth, coupled with a decline in other non-operating expenses related to impairments of Ps. 903 million recognized during the same period of the previous year.
·Earnings per share1 were Ps. 0.20 (Earnings per unit were Ps. 1.58 and per ADS were Ps. 15.79.).

 

FINANCIAL SUMMARY FOR THE SECOND QUARTER AND FIRST SIX MONTHS OF 2021
Change vs. same period of last year
    Total Revenues   Gross Profit   Operating Income   Majority Net Income
    2Q 2021 YTD 2021   2Q 2021 YTD 2021   2Q 2021 YTD 2021   2Q 2021 YTD 2021
As Reported Consolidated 10.9% 4.7%   18.3% 6.9%   41.3% 21.1%   56.8% 38.9%
Mexico & Central America 10.5% 6.3%   12.6% 8.9%   9.3% 16.8%      
South America 11.7% 2.3%   32.0% 3.1%   387.6% 34.2%      
                         
Comparable (2)    Consolidated 19.2% 12.2%   26.1% 13.7%   44.1% 26.9%      
Mexico & Central America 13.7% 7.9%   15.6% 10.4%   11.1% 17.9%      
South America 29.9% 19.6%   55.0% 20.7%   415.3% 58.0%      

 

John Santa Maria, Coca-Cola FEMSA’s CEO, commented:

 

“We are proud that our efforts to accelerate the recovery are reflected in solid second-quarter results and a solid cash flow generation. Our consolidated revenues increased 10.9%, driven by our portfolio and execution initiatives, coupled with recovering mobility and improving price-mix trends. Notably, our Mexico and Central America division delivered double-digit top-line growth, while our South America division’s outstanding volume performance was driven mainly by a solid growth in Brazil, coupled with recovering trends in Colombia, Argentina, and Uruguay. As a result, our consolidated volumes already exceed our 2019 baseline by 1.3%. Importantly, as part of our resilient profile and disciplined approach, our favorable raw material hedging initiatives combined with cost and expense efficiencies, are enabling us to protect our profitability, while successfully navigating still volatile environments.

 

As we enter the second half of the year, we are confident that we are taking the right strategic actions to continue building an unparalleled commercial beverage platform that is digitally integrated in order to carry on capturing opportunities to grow profitability. Moreover, we continue ensuring that our employees, clients and consumers remain at the center of every decision and action we take. By delivering on our objectives, we are confident that we will continue to deliver sustainable value for all of our stakeholders for many years to come.”

 

 

(1)Quarterly earnings / outstanding shares. Earnings per share (EPS) were calculated using 16,806.7 million shares outstanding. For the convenience of the reader, as a KOFUBL Unit is comprised of 8 shares (3 Series B shares and 5 Series L shares), earnings per unit are equal to EPS multiplied by 8. Each ADS represents 10 KOFUBL Units.
(2)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.

 

Coca-Cola FEMSA Reports 2Q21 Results
July 26, 2021
Page 19 of 34

 

 

 

 

 

 

RECENT DEVELOPMENTS

 

·After conducting a thorough analysis, Coca-Cola FEMSA has decided to reverse its temporary decision to suspend tax credits on concentrate purchased from the Manaus Free Trade Zone in Brazil as of the second quarter 2021. As a result, the Company is recognizing an extraordinary Ps. 1,083 million at the operating income level equivalent to the accumulated credit suspended since 2019 and until the first quarter of 2021. This decision was supported by recent developments and opinions from external advisors.

 

·Coca-Cola FEMSA and The Coca-Cola Company have enhanced their Cooperation Framework.

 

As part of a shared vision for the future, and to continue strengthening its relationship and alignment, Coca-Cola FEMSA and The Coca-Cola Company have agreed to enhance the Cooperation Framework previously announced in July 2016. This enhancement includes additional drivers to grow the business, strengthening our successful and longstanding partnership.

 

This update contemplates the following main objectives:

 

oGrowth Principles. As part of this milestone, the companies agree to continuously build and align ambitious business growth plans to increase our operating income via top-line growth, cost and expense efficiencies and the implementation of marketing, commercial strategies and productivity programs.
oRelationship Economics. Aimed at ensuring that the economics of our business and management incentives are fully aligned towards long-term system value creation. Potential future concentrate price adjustments for sparkling beverages and flavored water in all our territories will consider investment and profitability levels that are mutually beneficial for both parties.
oPotential new businesses and Ventures. As the System continues to evolve, leveraging Coca-Cola FEMSA’s sales and distribution network, the Company may be allowed to engage in the distribution of potential new businesses such as the distribution of beer, spirits and other consumer goods.
oDigital Strategy. Development of a joint general framework for digital initiatives as part of both companies’ industry leading digitization efforts.

 

·On May 4, 2021, Coca-Cola FEMSA paid the first installment of the 2020 dividend in the amount of Ps. 0.63 per share for a total cash distribution of more than Ps. 5,294 million pesos for the first installment.

 

·On June 30, 2021, Coca-Cola FEMSA published its first Green Bond Report, providing an update on the allocation of the use of proceeds from its first-ever green bond, issued in September 2020 for US$705 million. According to best practices, the company reported the use of proceeds for its look-back period, from 2018 to 2020, having allocated US$235.48 million, representing 33.4% of the proceeds from the green bond.

 

CONFERENCE CALL INFORMATION

 

 

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July 26, 2021
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CONSOLIDATED SECOND QUARTER RESULTS

 

 

 

CONSOLIDATED SECOND QUARTER RESULTS
             
    As Reported   Comparable (1)
Expressed in millions of Mexican pesos   2Q 2021 2Q 2020 Δ%   Δ%
Total revenues   47,786 43,075 10.9%   19.2%
Gross profit   22,560 19,075 18.3%   26.1%
Operating income   7,248 5,130 41.3%   44.1%
Operating cash flow (2)    10,007  8,221 21.7%   27.4%

 

Volume increased 9.1% to 851.4 million unit cases, driven mainly by double-digit growth in South America, coupled with solid volume recoveries in Mexico and Central America. Consolidated volume increased 1.3% versus our 2019 baseline.

 

Total revenues increased 10.9% to Ps. 47,786 million, driven mainly by volume, our pricing initiatives and favorable price-mix effects across our markets. These effects were partially offset by unfavorable currency translation effects from all of our operating currencies. On a comparable basis, total revenues would have increased 19.2%. Total revenues declined 0.4% versus the same period of 2019.

 

Gross profit increased 18.3% to Ps. 22,560 million, and gross margin expanded 290 basis points to 47.2%, driven mainly by cost efficiencies, successful raw material hedging initiatives, favorable price-mix effects, and the recognition of Ps. 1,083 million related to the resumption of tax credits on concentrate purchased from the Manaus Free Trade Zone. These effects were partially offset by an unfavorable currency hedging position and higher concentrate costs in Mexico. On a comparable basis, gross profit would have increased 26.1%. Gross profit increased 2.1% versus the second quarter of 2019.

 

Operating income increased 41.3% to Ps. 7,248 million, and operating margin expanded 330 basis points to 15.2%. This increase was driven mainly by the increase in gross profit, coupled with operating expense efficiencies. These effects were partially offset by the normalization of certain operating expenses such as marketing, labor, and maintenance related to increases in mobility across our operations. On a comparable basis, excluding currency translation effects, our operating income would have increased 44.1%. Our operating income increased 14.4% versus our 2019 baseline.

 

 

(1)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.
(2)Operating cash flow = operating income + depreciation + amortization & other operating non-cash charges.

 

Coca-Cola FEMSA Reports 2Q21 Results
July
26, 2021
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Comprehensive financing result recorded an expense of Ps. 1,323 million, compared to an expense of Ps. 1,268 million in the same period of 2020. This increase was driven mainly by a foreign exchange loss of Ps. 171 million, as our cash exposure in U.S. dollars was negatively impacted by the appreciation of the Mexican Peso, as compared to the first quarter of the year. In addition, the Company recorded a lower interest income as compared to the same period of the previous year.

 

These effects were partially offset by a decrease in interest expenses of Ps. 162 million, driven mainly by the payment of short-term financing incurred during the first quarter of 2020, which was a preventive measure to reinforce the Company’s cash position in the face of the uncertainties driven by the COVID-19 pandemic.

 

Finally, a gain of Ps. 118 million in monetary position in inflationary subsidiaries was recognized as compared to a gain of Ps. 81 million during the same period of 2020.

 

Income tax as a percentage of income before taxes was 37.9% as compared to 32.6% during the same period of the previous year. This increase was driven mainly by adjustments to deferred tax reserves, the effects of a higher inflation level, and adjustments in the tax provision.

 

Net income attributable to equity holders of the company reached Ps. 3,316 million as compared to Ps. 2,115 million during the same period of the previous year. This increase was driven mainly by operating income growth, coupled with impairments recognized in other non-operating expenses of Ps. 903 million during the same period of 2020. Earnings per share1 were Ps. 0.20 (Earnings per unit were Ps. 1.58 and per ADS were Ps. 15.79.).

 

 

(1)Quarterly earnings / outstanding shares. Earnings per share (EPS) were calculated using 16,806.7 million shares outstanding. For the convenience of the reader, as a KOFUBL Unit is comprised of 8 shares (3 Series B shares and 5 Series L shares), earnings per unit are equal to EPS multiplied by 8. Each ADS represents 10 KOFUBL Units.

 

Coca-Cola FEMSA Reports 2Q21 Results
July
26, 2021
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CONSOLIDATED FIRST SIX MONTHS RESULTS

 

 

 

CONSOLIDATED FIRST SIX MONTHS RESULTS
             
    As Reported   Comparable (1)
Expressed in millions of Mexican pesos   YTD 2021 YTD 2020 Δ%   Δ%
Total revenues   92,500 88,341 4.7%   12.2%
Gross profit   42,491 39,749 6.9%   13.7%
Operating income   13,147 10,854 21.1%   26.9%
Operating cash flow (2)    18,816  17,295 8.8%   14.8%

 

Volume increased 4.9% to 1,652.1 million unit cases in the first six months of 2021 as compared to the same period of 2020, driven mainly by gradual recoveries and increases in mobility across our markets. Consolidated volume increased 0.9% as compared with the same period of 2019.

 

Total revenues increased 4.7% to Ps. 92,500 million in the first six months of 2021 as compared to the same period of 2020, driven mainly by volume growth, coupled with our pricing initiatives and favorable price-mix effects. These factors were partially offset by unfavorable currency translation effects resulting from the depreciation of all of our operating currencies into Mexican Pesos. On a comparable basis, total revenues would have increased 12.2%. Total revenues declined 2.1% versus the same period of 2019.

 

Gross profit increased 6.9% to Ps. 42,491 million in the first six months of 2021 as compared to the same period of 2020, and gross margin expanded 90 basis points to 45.9%. Our raw material hedging initiatives, cost efficiencies, favorable price-mix effects, and the recognition of Ps. 1,083 million related to the resumption of tax credits on concentrate purchased from the Manaus Free Trade Zone were partially offset by an unfavorable currency hedging position, the depreciation in the average exchange rate of most of our operating currencies as applied to our U.S. dollar-denominated raw material costs, and higher concentrate costs in Mexico. On a comparable basis, gross profit would have increased 13.7%. Gross profit declined 1.4% versus 2019.

 

Operating income increased 21.1% to Ps. 13,147 million in the first six months of 2021 as compared to the same period of 2020, and operating margin expanded 190 basis points to 14.2%. This increase was driven mainly by operating expense efficiencies and an increase in gross profit. These effects were partially offset by the normalization of certain operating expenses such as marketing, labor, and maintenance related to increases in mobility across our operations and unfavorable currency translation effects. On a comparable basis, operating income would have increased 26.9%. Our operating income increased 8.9% versus our 2019 baseline.

 

 

(1)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.
(2)Operating cash flow = operating income + depreciation + amortization & other operating non-cash charges.

 

Coca-Cola FEMSA Reports 2Q21 Results
July
26, 2021
Page 23 of 34  

 

 

 

 

 

Comprehensive financing result recorded an expense of Ps. 2,454 million during the first six months of 2021 compared to an expense of Ps. 3,467 million in the same period of 2020.

 

Interest expense, net, recorded a decrease during the first six months of 2021, driven mainly by a one-time interest expense related to our successful debt refinancing initiatives during the first quarter of 2020, coupled with the payment of short-term financings during the first six months of 2021. These short-term financings were a preventive measure to reinforce the Company’s cash position in the face of the uncertainties driven by the COVID-19 pandemic.

 

In addition, we recognized a larger gain in monetary position in inflationary subsidiaries as compared to the same period of 2020.

 

These effects were partially offset by a foreign exchange loss of Ps. 156 million, as compared to a gain of Ps. 493 million registered during the same period of 2020, as our cash exposure to U.S. dollars was negatively impacted by the appreciation of the Mexican Peso.  

 

Income tax as a percentage of income before taxes was 36.5% as compared to 31.5% during the first six months of the previous year. This increase was driven mainly by tax impacts related to higher inflation in 2021, adjustments of deferred tax assets and effects of certain changes on tax legislation where we operate.

 

Net income attributable to equity holders of the company increased 38.9% to reach Ps. 6,472 million in the first six months of 2020 as compared to Ps. 4,658 million during the same period of the previous year. This increase was driven mainly by an increase in operating income, coupled with lower financial costs related to a one-time increase in our interest expense in 2020 and lower non-operative expenses due to impairments of Ps. 903 million recognized during the first six months of 2020. Earnings per share1 were Ps. 0.39 (Earnings per unit were Ps. 3.08 and earnings per ADS were Ps. 30.81.).

 

 

(1)Quarterly earnings / outstanding shares. Earnings per share (EPS) were calculated using 16,806.7 million shares outstanding. For the convenience of the reader, as a KOFUBL Unit is comprised of 8 shares (3 Series B shares and 5 Series L shares), earnings per unit are equal to EPS multiplied by 8. Each ADS represents 10 KOFUBL Units.

 

Coca-Cola FEMSA Reports 2Q21 Results
July
26, 2021
Page 24 of 34  

 

 

 

 

MEXICO & CENTRAL AMERICA DIVISION SECOND QUARTER RESULTS

 

(Mexico, Guatemala, Costa Rica, Panama, and Nicaragua)

 

 

MEXICO & CENTRAL AMERICA DIVISION RESULTS
             
    As Reported   Comparable (1)
Expressed in millions of Mexican pesos   2Q 2021 2Q 2020 Δ%   Δ%
Total revenues   30,262 27,380 10.5%   13.7%
Gross profit   15,175 13,480 12.6%   15.6%
Operating income   5,132 4,696 9.3%   11.1%
Operating cash flow (2)    6,821  6,482 5.2%   7.7%

 

Volume increased 4.6% to 545.8 million unit cases, driven mainly by double-digit growth in Guatemala, Panama, and Nicaragua, coupled with volume recoveries in Mexico and Costa Rica. Volume declined 1.6% versus our 2019 baseline.

 

Total revenues increased 10.5% to Ps. 30,262 million, driven by volume increases, our pricing initiatives, and favorable price-mix effects. These effects were partially offset by an unfavorable currency translation effect from all our operating currencies in Central America as translated into Mexican Pesos. On a comparable basis, total revenues would have increased 13.7%. Total revenues grew 4.3% versus the same period of 2019.

 

Gross profit increased 12.6% to Ps. 15,175 million, and gross margin increased 90 basis points, driven mainly by cost efficiencies coupled with favorable raw material hedging strategies and favorable price-mix effects. These factors were partially offset by higher concentrate costs in Mexico and an unfavorable currency hedging position. On a comparable basis, gross profit would have increased 15.6%. Gross profit increased 7.1% versus our 2019 baseline.

 

Operating income increased 9.3% to Ps. 5,132 million, and operating margin contracted 20 basis points to 17.0%, driven mainly by gross profit growth. These effects were partially offset by the normalization of certain operating expenses such as marketing, labor, and maintenance as compared to the same period in 2020. On a comparable basis, operating income would have increased 11.1%. Our operating income increased 13.4% versus our 2019 baseline.

 

 

(1)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.
(2)Operating cash flow = operating income + depreciation + amortization & other operating non-cash charges.

 

Coca-Cola FEMSA Reports 2Q21 Results 

July 26, 2021

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SOUTH AMERICA DIVISION SECOND QUARTER RESULTS

 

(Brazil, Argentina, Colombia, and Uruguay)

 

 

SOUTH AMERICA DIVISION RESULTS
             
    As Reported   Comparable (1)
Expressed in millions of Mexican pesos   2Q 2021 2Q 2020 Δ%   Δ%
Total revenues   17,524 15,695 11.7%   29.9%
Gross profit   7,385 5,595 32.0%   55.0%
Operating income   2,116 434 387.6%   415.3%
Operating cash flow (2)    3,186  1,739 83.2%   109.1%

 

Volume increased 17.9% to 305.6 million unit cases, driven mainly by double-digit growth in all of our markets, led mainly by Brazil and Colombia that grew volumes as compared to 2019. The division’s volume increased 6.8% versus our 2019 baseline.

 

Total revenues increased 11.7% to Ps. 17,524 million, driven mainly by volume growth across our territories and favorable price-mix effects, partially offset by an unfavorable currency translation effect resulting from the depreciation of all of our operating currencies in the division as compared to the Mexican Peso. On a comparable basis, excluding currency translation effects, total revenues would have increased 29.9%. Total revenues declined 7.6% versus the same period of 2019, driven mainly by unfavorable currency translation effects.

 

Gross profit increased 32.0% to Ps. 7,385 million, and gross margin expanded 650 basis points to 42.1%. This increase is a result of improving operating leverage and price-mix effects, cost efficiencies, and our favorable raw material hedging position, coupled with the recognition of Ps. 1,083 million related to the resumption of tax credits on concentrate purchased from the Manaus Free Trade Zone. These effects were partially offset by an unfavorable currency hedging position, the depreciation in the average exchange rate of the Argentine Peso as applied to our U.S. dollar-denominated raw material costs. On a comparable basis, gross profit would have increased 55.0%. Gross profit decreased 7.0% versus our 2019 baseline.

 

Operating income increased 387.6% to Ps. 2,116 million, and operating margin expanded 930 basis points, driven mainly by gross profit growth, coupled with operating expense efficiencies. These effects were partially offset by the gradual normalization of marketing, labor, and maintenance expenses and an operating foreign exchange loss. On a comparable basis, operating income would have increased 415.3%. Operating income increased 16.8% versus our 2019 baseline.

 

 

(1)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.
(2)Operating cash flow = operating income + depreciation + amortization & other operating non-cash charges.

 

Coca-Cola FEMSA Reports 2Q21 Results 

July 26, 2021

Page 26 of 34

 

 

 

 

DEFINITIONS

 

Volume is expressed in unit cases. Unit case refers to 192 ounces of finished beverage product (24 eight-ounce servings) and, when applied to soda fountains, refers to the volume of syrup, powders, and concentrate that is required to produce 192 ounces of finished beverage product.

 

Transactions refers to the number of single units (e.g., a can or a bottle) sold, regardless of their size or volume or whether they are sold individually or in multipacks, except for soda fountains, which represent multiple transactions based on a standard 12 oz. serving.

 

Operating income is a non-GAAP financial measure computed as “gross profit – operating expenses – other operating expenses, net + operative equity method (gain) loss in associates.”

 

Operating cash flow is a non-GAAP financial measure computed as “operating income + depreciation + amortization & other operating non-cash charges.”

 

Earnings per share are equal to “quarterly earnings / outstanding shares.” Earnings per share (EPS) for all periods are adjusted to give effect to the stock split resulting in 16,806,658,096 shares outstanding. For the convenience of the reader, as each KOF UBL Unit is comprised of 8 shares (3 Series B shares and 5 Series L shares), earnings per unit are equal to EPS multiplied by 8. Each ADS represents 10 KOF UBL Units.

 

COMPARABILITY

 

In an effort to provide our readers with a more useful representation of our company's underlying financial and operating performance, as of the first quarter 2020, we adjusted our methodology to calculate our comparable figures, no longer excluding hyperinflationary operations. Due to this change, our “comparable” term means, with respect to a year-over-year comparison, the change of a given measure excluding the effects of: (i) mergers, acquisitions, and divestitures; and (ii) translation effects resulting from exchange rate movements. In preparing this measure, management has used its best judgment, estimates, and assumptions in order to maintain comparability.

 

Coca-Cola FEMSA Reports 2Q21 Results 

July 26, 2021

Page 27 of 34

 

 

 

 

ABOUT THE COMPANY

 

Stock listing information: Mexican Stock Exchange, Ticker: KOFUBL | NYSE (ADS), Ticker: KOF | Ratio of KOFUBL to KOF = 10:1

 

Coca-Cola FEMSA files reports, including annual reports and other information with the U.S. Securities and Exchange Commission, or the “SEC,” and the Mexican Stock Exchange (Bolsa Mexicana de Valores, or the “BMV”) pursuant to the rules and regulations of the SEC (that apply to foreign private issuers) and of the BMV. Filings we make electronically with the SEC and the BMV are available to the public on the Internet at the SEC’s website at www.sec.gov, the BMV’s website at www.bmv.com.mx, and our website at www.coca-colafemsa.com.

 

Coca-Cola FEMSA, S.A.B. de C.V. is the largest Coca-Cola franchise bottler in the world by sales volume. The Company produces and distributes trademark beverages of The Coca-Cola Company, offering a wide portfolio of 129 brands to a population of more than 265 million. With over 80 thousand employees, the Company markets and sells approximately 3.3 billion unit cases through close to 2 million points of sale a year. Operating 49 manufacturing plants and 268 distribution centers, Coca-Cola FEMSA is committed to generating economic, social, and environmental value for all of its stakeholders across the value chain. The Company is a member of the Dow Jones Sustainability Emerging Markets Index, Dow Jones Sustainability MILA Pacific Alliance Index, FTSE4Good Emerging Index, and the Mexican Stock Exchange’s IPC and Social Responsibility and Sustainability Indices, among others. Its operations encompass franchise territories in Mexico, Brazil, Guatemala, Colombia, and Argentina, and, nationwide, in Costa Rica, Nicaragua, Panama, Uruguay, and Venezuela through its investment in KOF Venezuela. For further information, please visit www.coca-colafemsa.com.

 

 

ADDITIONAL INFORMATION

 

All of the financial information presented in this report was prepared under International Financial Reporting Standards (IFRS).

 

This news release may contain forward-looking statements concerning Coca-Cola FEMSA’s future performance, which should be considered as good faith estimates by Coca-Cola FEMSA. These forward-looking statements reflect management’s expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, many of which are outside Coca-Cola FEMSA’s control, which could materially impact the Company’s actual performance. References herein to “US$” are to United States dollars. This news release contains translations of certain Mexican peso amounts into U.S. dollars for the convenience of the reader. These translations should not be construed as representations that Mexican peso amounts actually represent such U.S. dollars amounts or could be converted into U.S. dollars at the rate indicated.

 

(6 pages of tables to follow)

 

Coca-Cola FEMSA Reports 2Q21 Results 

July 26, 2021

Page 28 of 34

 

 

 

 

COCA-COLA FEMSA

CONSOLIDATED INCOME STATEMENT

Millions of Pesos (1)
                             
    For the Second Quarter of:   For the First Six Months of:
    2021 % of Rev. 2020 % of Rev. Δ% Reported Δ% Comparable (7)   2021 % of Rev. 2020 % of Rev. Δ% Reported Δ% Comparable (7)
Transactions (million transactions)    4,660.0    3,636.9   28.1% 28.1%    9,035.0    8,288.0   9.0% 9.0%
Volume (million unit cases)    851.4    780.7   9.1% 9.1%    1,652.1    1,574.3   4.9% 4.9%
Average price per unit case    51.78    50.56   2.4%      51.34    51.18   0.3%  
Net revenues    47,639    42,944   10.9%      92,181    87,821   5.0%  
Other operating revenues    147    131   12.3%      320    520   -38.5%  
Total revenues (2)    47,786 100.0%  43,075 100.0% 10.9% 19.2%    92,500 100.0%  88,341 100.0% 4.7% 12.2%
Cost of goods sold         25,226 52.8%       24,000 55.7% 5.1%           50,009 54.1%       48,593 55.0% 2.9%  
Gross profit    22,560 47.2%  19,075 44.3% 18.3% 26.1%    42,491 45.9%  39,749 45.0% 6.9% 13.7%
Operating expenses    15,189 31.8%  13,630 31.6% 11.4%      28,991 31.3%  28,132 31.8% 3.1%  
Other operative expenses, net    152 0.3%  206 0.5% -26.2%      364 0.4%  522 0.6% -30.2%  
Operative equity method (gain) loss in associates(3)    (29) -0.1%  109 0.3% NA      (11) 0.0%  241 0.3% NA  
Operating income (5)    7,248 15.2%  5,130 11.9% 41.3% 44.1%    13,147 14.2%  10,854 12.3% 21.1% 26.9%
Other non operative expenses, net    (83) -0.2%  997 2.3% NA      (80) -0.1%  990 1.1% NA  
Non Operative equity method (gain) loss in associates (4)    72 0.2%  (25) -0.1% NA      71 0.1%  (98) -0.1% NA  
Interest expense    1,463    1,625   -9.9%      2,936    4,691   -37.4%  
Interest income    194    269   -28.0%      356    556   -35.9%  
Interest expense, net    1,270    1,356   -6.4%      2,580    4,136   -37.6%  
Foreign exchange loss (gain)    171    (8)   NA      156    (493)   NA  
Loss (gain) on monetary position in inflationary subsidiries    (118)    (81)   46.2%      (291)    (175)   66.6%  
Market value (gain) loss on financial instruments    1    1   -10.4%      9    (1)   NA  
Comprehensive financing result    1,323    1,268   4.4%      2,454    3,467   -29.2%  
Income before taxes    5,936    2,889   105.4%      10,702    6,494   64.8%  
Income taxes    2,268    969   133.9%      3,927    2,091   87.8%  
Result of discontinued operations    -       -      NA      -       -      NA  
Consolidated net income    3,668    1,920   91.1%      6,775    4,403   53.9%  
Net income attributable to equity holders of the company    3,316 6.9%  2,115 4.9% 56.8%      6,472 7.0%  4,658 5.3% 38.9%  
Non-controlling interest              352 0.7%          (195) -0.5% NA                303 0.3%          (256) -0.3% NA  
                             
Operating Cash Flow & CAPEX   2021 % of Rev. 2020 % of Rev. Δ% Reported Δ% Comparable (7)   2021 % of Rev. 2020 % of Rev. Δ% Reported Δ% Comparable (7)
Operating income (5)    7,248 15.2%  5,130 11.9% 41.3%      13,147 14.2%  10,854 12.3% 21.1%  
Depreciation    2,179    2,324   -6.2%      4,417    4,577   -3.5%  
Amortization and other operative non-cash charges    580    767   -24.4%      1,252    1,864   -32.8%  
Operating cash flow (5)(6)    10,007 20.9%  8,221 19.1% 21.7% 27.4%    18,816 20.3%  17,295 19.6% 8.8% 14.8%
CAPEX    2,841    1,788   58.9%      4,301    3,867   11.2%  

 

(1)Except volume and average price per unit case figures.

(2)Please refer to page 14 and 15 for revenue breakdown.

(3)Includes equity method in Jugos del Valle, Leão Alimentos, and Estrella Azul, among others.

(4)Includes equity method in PIASA, IEQSA, Beta San Miguel, IMER, and KSP Participacoes, among others.

(5)The operating income and operating cash flow lines are presented as non-GAAP measures for the convenience of the reader.

(6)Operating cash flow = operating income + depreciation, amortization & other operating non-cash charges.

(7)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.

 

Coca-Cola FEMSA Reports 2Q21 Results 

July 26, 2021

Page 29 of 34

 

 

 

 

 

MEXICO & CENTRAL AMERICA DIVISION
RESULTS OF OPERATIONS
Millions of Pesos (1)
                             
    For the Second Quarter of:   For the First Six Months of:
    2021 % of Rev. 2020 % of Rev. Δ%
 Reported
Δ%
 Comparable (6)
  2021 % of Rev. 2020 % of Rev. Δ%
 Reported
Δ%
Comparable (6)
Transactions (million transactions)    2,790.7    2,346.7   18.9% 18.9%    5,174.6    4,943.0   4.7% 4.7%
Volume (million unit cases)    545.8    521.6   4.6% 4.6%    1,017.1    998.0   1.9% 1.9%
Average price per unit case    55.42    52.45   5.7%      55.28    52.98   4.3%  
Net revenues    30,250    27,363          56,224    52,875      
Other operating revenues    12    17          19    29      
Total Revenues (2)    30,262 100.0%  27,380 100.0% 10.5% 13.7%    56,242 100.0%  52,904 100.0% 6.3% 7.9%
Cost of goods sold    15,087 49.9%  13,899 50.8%        27,995 49.8%  26,970 51.0%    
Gross profit    15,175 50.1%  13,480 49.2% 12.6% 15.6%    28,247 50.2%  25,933 49.0% 8.9% 10.4%
Operating expenses    10,000 33.0%  8,614 31.5%        18,572 33.0%  17,185 32.5%    
Other operative expenses, net    62 0.2%  128 0.5%        251 0.4%  515 1.0%    
Operative equity method (gain) loss in associates (3)    (19) -0.1%  42 0.2%        (70) -0.1%  103 0.2%    
Operating income (4)    5,132 17.0%  4,696 17.2% 9.3% 11.1%    9,494 16.9%  8,131 15.4% 16.8% 17.9%
Depreciation, amortization & other operating non-cash charges    1,689 5.6%  1,786 6.5%        3,490 6.2%  3,955 7.5%    
Operating cash flow (4)(5)    6,821 22.5%  6,482 23.7% 5.2% 7.7%    12,984 23.1%  12,085 22.8% 7.4% 8.8%

 

(1)Except volume and average price per unit case figures.

(2)Please refer to page 14 and 15 for revenue breakdown.

(3)Includes equity method in Jugos del Valle and Estrella Azul, among others.

(4)The operating income and operating cash flow lines are presented as non-GAAP measures for the convenience of the reader.

(5)Operating cash flow = operating income + depreciation, amortization & other operating non-cash charges.

(6)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.

 

SOUTH AMERICA DIVISION
RESULTS OF OPERATIONS
Millions of Pesos (1)
                             
    For the Second Quarter of:   For the First Six Months of:
    2021 % of Rev. 2020 % of Rev. Δ%
 Reported
Δ%
 Comparable (6)
  2021 % of Rev. 2020 % of Rev. Δ%
 Reported
Δ%
Comparable (6)
Transactions (million transactions)    1,869.3    1,290.2   44.9% 44.9%    3,860.4    3,345.1   15.4% 15.4%
Volume (million unit cases)    305.6    259.1   17.9% 17.9%    634.9    576.3   10.2% 10.2%
Average price per unit case    45.29    46.75   -3.1%      45.04    48.05   -6.3%  
Net revenues    17,389    15,581          35,957    34,946      
Other operating revenues    135    114          301    492      
Total Revenues (2)    17,524 100.0%  15,695 100.0% 11.7% 29.9%    36,258 100.0%  35,438 100.0% 2.3% 19.6%
Cost of goods sold    10,139 57.9%  10,100 64.4%        22,014 60.7%  21,622 61.0%    
Gross profit    7,385 42.1%  5,595 35.6% 32.0% 55.0%    14,244 39.3%  13,815 39.0% 3.1% 20.7%
Operating expenses    5,189 29.6%  5,016 32.0%        10,419 28.7%  10,947 30.9%    
Other operative expenses, net    90 0.5%  77 0.5%        113 0.3%  7 0.0%    
Operative equity method (gain) loss in associates (3)    (10) -0.1%  67 0.4%        59 0.2%  139 0.4%    
Operating income (4)    2,116 12.1%  434 2.8% 387.6% 415.3%    3,653 10.1%  2,723 7.7% 34.2% 58.0%
Depreciation, amortization & other operating non-cash charges    1,070 6.1%  1,305 8.3%        2,179 6.0%  2,487 7.0%    
Operating cash flow (4)(5)    3,186 18.2%  1,739 11.1% 83.2% 109.1%    5,832 16.1%  5,210 14.7% 11.9% 31.1%

 

(1)Except volume and average price per unit case figures.

(2)Please refer to page 14 and 15 for revenue breakdown.

(3)Includes equity method in Leão Alimentos and Verde Campo, among others.

(4)The operating income and operating cash flow lines are presented as non-GAAP measures for the convenience of the reader.

(5)Operating cash flow = operating income + depreciation, amortization & other operating non-cash charges.

(6)Please refer to page 9 for our definition of “comparable” and a description of the factors affecting the comparability of our financial and operating performance.

 

Coca-Cola FEMSA Reports 2Q21 Results
July
26, 2021
Page 30 of 34  

 

 

 

 

 

COCA-COLA FEMSA
CONSOLIDATED BALANCE SHEET
Millions of Pesos
                     
Assets    Jun-21  Dec-20 % Var.   Liabilities & Equity    Jun-21  Dec-20 % Var.
Current Assets           Current Liabilities        
Cash, cash equivalents and marketable securities           Short-term bank loans and notes payable    3,148  5,017 -37%
   46,786  43,497 8%   Suppliers    19,663  17,195 14%
Total accounts receivable    8,895  11,523 -23%   Short-term leasing Liabilities    554  560  
Inventories    11,580  9,727 19%   Other current liabilities    24,614  20,073 23%
Other current assets    7,785  7,693 1%   Total current liabilities    47,979  42,845 12%
Total current assets    75,046  72,440 4%   Non-Current Liabilities        
Non-Current Assets           Long-term bank loans and notes payable    81,213  82,461 -2%
Property, plant and equipment    108,334  109,551 -1%   Long Term Leasing Liabilities    891  746  
Accumulated depreciation    (49,910)  (50,091) 0%   Other long-term liabilities    15,417  14,557 6%
Total property, plant and equipment, net    58,424  59,460 -2%   Total liabilities    145,500  140,609 3%
Right of use assets    1,425  1,278 11%   Equity        
Investment in shares    7,607  7,623 0%   Non-controlling interest    6,131  5,583 10%
Intangible assets and other assets    104,248  103,971 0%   Total controlling interest    113,454  116,874 -3%
Other non-current assets    18,335  18,294 0%   Total equity    119,585  122,457 -2%
Total Assets   265,085 263,066 1%   Total Liabilities and Equity        265,085      263,066 1%