In This Article:
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Consolidated Revenue: Increased 10% to MXN62.6 billion.
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Consolidated EBITDA: Rose 10.2% to MXN12.7 billion, marking the highest third-quarter margin in eight years.
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Net Income: Increased 13.1% to MXN5.1 billion.
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Mexico Net Sales: Grew 4.8% to MXN29.3 billion.
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Mexico EBITDA: Increased 6.6% to MXN7.4 billion, with a margin of 25.3%.
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South America Revenue: Rose 8.7% to MXN10.6 billion.
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South America EBITDA: Increased 1% to MXN1.7 billion, with a margin of 15.7%.
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United States Revenue: Increased 5.1% to $1.1 billion.
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United States EBITDA: Grew 10.5% to $182 million, with a margin of 16.2%.
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Cash and Equivalents: Reached MXN28.1 billion.
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Total Debt: Stood at MXN48 billion, with a leverage ratio of 0.45 times.
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Operating Cash Flow: Totaled MXN29.7 billion.
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CapEx: MXN10.6 billion, representing 6% of consolidated revenues.
Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Arca Continental SAB de CV (EMBVF) reported a 10% increase in consolidated revenues, reaching MXN62.6 billion, driven by effective pricing and exchange rate gains.
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The company achieved a 10.2% increase in consolidated EBITDA, marking the highest third-quarter EBITDA margin in eight years.
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In Mexico, Arca Continental SAB de CV (EMBVF) gained value share in non-alcoholic ready-to-drink beverages, outpacing the industry.
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The launch of TUALI, a next-generation B2B digital platform, is expected to revolutionize operations for nearly 1 million customers in Latin America.
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Sustainability efforts have led to a 74% PET bottle collection and recycling rate in Mexico, moving closer to the goal of 100% by 2030.
Negative Points
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Total consolidated volume decreased by 4.6% in the quarter, attributed to unfavorable weather conditions and tough comparisons from previous years.
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South America faced challenges due to a volatile macroeconomic environment and weakening consumer demand, with total volume down 8.6%.
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Ecuador experienced a severe energy crisis, leading to an 8.1% volume decline due to widespread power outages.
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In Argentina, volume declined by 13.1%, although there are signs of economic contraction easing.
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The company faced a challenging quarter in terms of volume performance in Mexico, with a 2.6% decline in unit case volume due to heavy rains and below-average temperatures.
Q & A Highlights
Q: In the US, what is driving the better margin performance, and are there benefits from the efficiency program in distribution? A: The improved margins are due to effective pricing, volume mix, and efficiency projects. The company has been focusing on digital transformation and optimizing production logistics, which has resulted in better cost management. Additionally, investments in production facilities in Fort Worth, Texas, are expected to enhance supply chain efficiencies and support future growth. - Arturo Hernandez, CEO