Business
FEMSA (FMX) Q2 Earnings Top Estimates on Solid Revenue Growth
FEMSA (FMX) Q2 Earnings Top Estimates on Solid Revenue Growth
About this update from Coca-cola Femsa Sab De Cv Units Cons Of 5 Shs -l- + 3 Shs Series -b-
Fomento Economico Mexicano S.A.B. de C.V. FMX, alias FEMSA, reported second-quarter 2023 net majority earnings per ADS of $1.00 (Ps. 1.72 per FEMSA unit). The company reported adjusted net majority earnings per ADS of $1.64, surpassing the Zacks Consensus Estimate of $1.21.Net consolidated income was Ps. 8,926 million (US$522.9 million), reflecting a 16.8% increase from Ps. 7,640 million (US$382.4 million) in the year-ago quarter.Total revenues were $11,562 million (Ps. 198,220 million), which improved 18.3% year over year in the local currency. Revenues, in U.S. dollar, surpassed the Zacks Consensus Estimate of $11,115 million. Revenue growth was driven by gains across its business units. On an organic basis, total revenues rose 9.5%.Shares of this Zacks Rank #1 (Strong Buy) company have rallied 15% in the past three months compared with the industry’s growth of 3%.FEMSA’s gross profit rose 20.1% year over year to Ps. 74,570 million (US$4,349.7 million). The consolidated gross margin expanded 50 basis points (bps) to 37.6%, owing to the gross margin expansion at Coca-Cola FEMSA, Envoy Solutions and FEMSA Health, as well as the consolidation of Proximity Europe. Growth was partly negated by margin declines in the Fuel and Proximity Americas units.The gross margin expanded 170 bps each at the Health and Envoy Solutions segments, and 30 bps at Coca-Cola FEMSA S.A.B. de C.V. KOF. Meanwhile, Proximity Europe delivered a gross margin of 42.1%. However, the company reported gross margin declines of 20 bps at Proximity Americas and 30 bps at the Fuel division.FEMSA’s operating income (income from operations) was up 8% year over year to Ps. 16,581 million (US$967.2 million). On an organic basis, operating income improved 4.5%. The consolidated operating margin contracted 80 bps to 8.4%, driven by margin contractions at Proximity Americas, Health, Fuel and Envoy Solutions divisions, as well as the inclusion of Proximity Europe. The gains were partly offset by margin expansions at the Coca-Cola FEMSA Division.Fomento Economico Mexicano S.A.B. de C.V. Price, Consensus and EPS SurpriseFomento Economico Mexicano S.A.B. de C.V. price-consensus-eps-surprise-chart | Fomento Economico Mexicano S.A.B. de C.V. QuoteSegmental DiscussionProximity Americas: Total revenues for the segment rose 19.9% year over year to Ps. 72,099 million (US$4,205.5 million). The increase can pri...