La Comer (LACOMER UBC) Q3 2023 earnings summary

Executive summary

• Q3 net sales rose 15.0% YoY to MXN 9,612m; same-store sales grew 8.9%.

• Q3 operating profit increased 39.0% to MXN 676m, EBITDA rose 28.4% to MXN 1,021m, and net income grew 23.8% to MXN 535m.

• Sales growth exceeded market benchmarks, with market-share gains; all formats, regions, and categories posted positive results.

• Strategy focuses on medium- and high-income shoppers through differentiated formats, product quality, service, and shopping experience.

Financial highlights

• Q3 gross profit increased 17.9% to MXN 2,762m; selling expenses net rose 12.3% to MXN 2,085m.

• 9M net sales grew 14.7% to MXN 28,069m; net income rose 21.8% to MXN 1,705m.

• 9M gross profit grew 17.2% to MXN 7,996m; operating profit rose 30.5% to MXN 2,079m and EBITDA increased 21.8% to MXN 3,081m.

• 9M taxes were MXN 431m, up 137.4% YoY.

Outlook and guidance

• Two store openings were expected in Q4 2023; a Querétaro La Comer store was undergoing a complete remodel.

• 2024 plans called for 6–8 openings: 3 La Comer, 3 City Market, and 2 Fresko projects; permitting or real-estate issues could delay some openings.

• Expansion targets more than 100 stores by year-end 2026, from 54 locations in 2016.

• Management was moderately optimistic on 2024 consumption, while noting election-year uncertainty and potential long-term moderation in same-store sales.