Fomento Económico Mexicano, S.A.B. de C.V. (FMX) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

May 2, 2022 9:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning. And welcome everyone to FEMSA's First Quarter 2022 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise [Operator Instructions]. During this conference call, management may discuss certain forward-looking statements concerning FEMSA’s future performance and should be considered as good faith estimates made by the company. These forward-looking statements reflect management’s expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, which can materially impact the company's actual performance.

At this time, I will now turn the conference over to Francisco Camacho Beltran, Chief Corporate Officer. Please go ahead, sir.

Francisco Camacho Beltran

Thank you, operator. Good morning, everyone. I hope you and your families are okay. Welcome to FEMSA's first quarter 2022 results conference call. Today, we are joined by Eugenio Garza, our CFO; and Juan Fonseca, whom you know well. As always, we also have Jorge Collazo on the line, who leads Coke FEMSA's Investor Relations team. Without further delay, let's just start with our call. We are very encouraged by the results achieved by all our business units during the first quarter. As you may remember, we closed 2021 with a positive momentum and things have continued to improve at the start of this year. I believe there are three things happening here. First, everyone -- every one of our business units has been working hard to develop successful growth strategies to fit their momentum and situation, always leveraging the superior execution skills that our operators are known for. Second, the teams also worked through the last couple of years to adapt to the COVID challenges, and these often included streaming the cost structure and becoming more efficient. And finally, we are continuing to see positive trends in consumer activity and mobility as the world continues to reopen, with these effects particularly visible in the month of March.

At OXXO, the business accelerated sequentially during the quarter, and these favorable revenue trends resulted in positive operating leverage. As a result, the team was able to deliver record margins at the gross, operating and EBITDA level for the first quarter. At [Indiscernible] international, we closed acquisition of OK Market and organic growth continued at a great space, including our joint venture in Brazil, where we opened the 100 OXXO store during the quarter.