The following is a summary of the Coca-Cola FEMSA, S.A.B. De C.V. (KOF) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Despite volume declines in several territories including Mexico, Colombia, and Uruguay, Coca-Cola FEMSA reported a revenue growth of 10.7%, reaching MXN69.6 billion for Q3.

• Gross profit increased 11.3% to MXN32.1 billion with a corresponding growth in margin by 20 basis points, reaching 46.1%.

• Operating income rose by 13.9% to MXN9.6 billion, leading to a margin expansion of 30 basis points to 13.8%.

• Net income for the majority increased by 8.9%, amounting to MXN5.9 billion, predominantly driven by operating income growth, with some offsets from financial results and taxes.

Business Progress:

• Focusing on digital transformation, Juntos+ now has 1.2 million active users. 56% of Coca-Cola FEMSA's customer base are digital buyers, a significant leap from the previous quarter.

• Expansion of manufacturing and warehouse capacities, particularly in Mexico, with new bottling lines and distribution centers slated to accommodate growing demand.

• Growth in Guatemala by 7.5% was supported by market-specific initiatives catering to local consumption trends and demographics.

Opportunities:

• Juntos+ and Juntos+ Advisor are rapidly being adopted across territories, enhancing the digital experience and optimizing sales processes through advanced AI modeling and analytics.

• Strategic investments in infrastructure to support long-term growth, particularly in Mexico and Guatemala, aim at improving production capabilities and route-to-market efficiencies.

Risks:

• Unfavorable weather conditions and economic slowdowns, especially in Mexico, led to volume declines and impacted consumption patterns.

• The instability of local currencies such as the Argentine peso and the Brazilian real posed challenges in terms of currency translation impact on revenues and costs.

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