Fomento Económico Mexicano (FEMSAUBD) Q2 2025 earnings summary

Executive summary

• Total revenue grew 6.3% year-over-year, with strong trends outside Mexico and the consolidation of OXXO U.S.A. offsetting a challenging Mexican environment and adverse weather.

• Net consolidated income dropped 64.3% to MXN 5.6 billion, mainly due to a non-cash FX loss and lower interest income.

• Operating income increased 0.2%–1.2% year-over-year, but profitability was pressured by higher costs and a weaker consumer environment in Mexico.

• Management remains focused on reversing negative traffic and volume trends, managing costs, and leveraging resilience and strategic initiatives for the second half of the year.

Financial highlights

• Total revenues: Ps. 211,364 million (+6.3% YoY); gross profit: Ps. 85,922 million (+4.2% YoY); income from operations: Ps. 17,832 million (+1.2% YoY).

• Gross margin contracted 80 bps to 40.7%; operating margin contracted 50 bps to 8.4%.

• Proximity Americas revenue grew 6.9% (2% organic/currency-neutral), driven by network expansion and OXXO U.S.A. consolidation.

• Valora Europe revenues up 31.4% in MXN (5.9% currency-neutral); operating income up 54.4% (24% currency-neutral).

• Health division revenues rose 15.6% in MXN, with 13.1% same-store sales growth; operating margin at 3.8%.

Outlook and guidance

• Confident in stable full-year operating margins for Proximity Americas; cautious optimism for H2 amid macro volatility.

• Ongoing focus on operational discipline, strategic investments, and rigorous capital allocation to support sustainable growth.

• Store expansion plans unchanged, with 1,000–1,100 net OXXO additions expected in Mexico.

• Management expects to focus on cost control, assortment, and price strategies to address weak traffic and volume trends, especially in Mexico.