Coca-Cola FEMSA (KOF) Q1 2025 earnings summary

Executive summary

• Delivered resilient results in Q1 2025 despite a soft macroeconomic backdrop and increased uncertainty in key markets, with rapid adaptation through commercial, financial, and supply chain initiatives.

• Revenue grew 10% year-over-year, operating income rose 7.3%, and net income attributable to equity holders increased 2.7%.

• Volume declined 2.2% due to softness in Mexico and Colombia, partially offset by gains in Brazil, Argentina, Uruguay, and Guatemala.

• Strategic focus for 2025 remains on growing the core business, advancing Juntos Plus, and fostering a customer-centric culture.

• Over 1.3 million customers enrolled in the Premia Juntos loyalty program, with a 75% redemption rate.

Financial highlights

• Total revenues reached MXN 70.2 billion (+10% year-on-year); currency-neutral revenue up 5.9%.

• Gross profit increased 12% to MXN 31.8 billion, with gross margin up 80 bps to 45.4%.

• Operating income rose 7.3% to MXN 9.2 billion, but operating margin contracted 30 bps to 13.2%.

• Adjusted EBITDA increased 11% to MXN 13.3 billion, with margin up 20 bps to 18.9%.

• Net income attributable to equity holders grew 2.7% to MXN 5.1 billion; EPS: MXN 0.31.

Outlook and guidance

• Expect continued uncertainty and competitive intensity, especially in Mexico, for at least the first half of the year.

• Identified $90 million in savings for 2025, distributed across cost to make, cost to serve, and portfolio savings, with a focus on Mexico and Colombia.

• Cautiously optimistic about meeting the annual budget, with positive momentum expected in the second half.

• Anticipate a benign cost environment for sweeteners and PET for the remainder of the year.

• Continued digital transformation with rollout of Juntos v.4.0 in Costa Rica and Nicaragua, and Juntos Advisor in Brazil.