Grupo Herdez (HERDEZ) investor relations material

Executive summary

• Net sales increased 4.4% year-over-year in Q2 to $9.7 billion MXN, led by Preserves and Exports, despite a challenging consumer environment and major clients reducing inventory.

• Market share grew in two-thirds of the portfolio, with promotional strategies driving gains in mayonnaise, spices, and vegetables.

• Quarterly results were volatile due to external factors, but long-term trends remain stable.

• Gross profit increased 2.4% to $3.85 billion MXN, with consolidated gross margin at 39.6%, down 0.8pp due to higher raw material costs.

• Net income grew 11.9% to $880 million MXN, supported by lower financing costs and higher equity investment results.

Financial highlights

• First-half 2025 net sales reached $19.4 billion MXN, up 6.8% year-over-year; gross profit up 7.5% to $7.8 billion MXN.

• Preserve segment sales rose 4.7% in Q2 and 7.5% year-to-date; export segment grew 12% in Q2 and nearly 10% year-to-date, led by volume.

• Impulse segment sales declined 0.6% in Q2 due to heavy rainfall but grew 1.7% year-to-date.

• Free cash flow for Q2 was negative $295 million MXN, mainly due to inventory build-up; cash on hand at quarter-end was $2.6 billion MXN, down 31% sequentially.

• Q2 operating income was $1.27 billion MXN (down 1.1%), with a margin of 13.1%; EBITDA was $1.58 billion MXN (margin 16.2%).

Outlook and guidance

• Management expects a more upbeat second half, with sales to grow in line with guidance.

• Preserves sales to grow high single digits; impulse segment guidance lowered due to Q2 performance.

• Exports expected to decline due to softness in major categories and FX effects; EBIT to grow high single digits.

• Impulse EBIT margin to improve as SG&A is reined in; EBITDA for impulse to increase over 40%.

• Ongoing investments in production capacity and retail infrastructure, including a new pasta line and store refurbishments.