Q4 2025 Grupo Aeroportuario del Sureste SA de CV Earnings Call

Speaker #2: A question and answer session will follow the formal presentation. Participating in the conference call today will be Mr. José Antonio Chedraui's CEO of Grupo Comercial Chedraui, Mr. Carlos Smith, CEO of Chedraui USA, Humberto Tafolla, CFO, and Arturo Velásquez, IRO, for the company.

Speaker #2: We will begin the call with the initial comments on Grupo Comercial Chedraui's fourth quarter financial results by the company's CEO, Mr. José Antonio Chedraui, and Chedraui's USA CEO, Carlos Smith.

Speaker #2: Thank you. You may begin. Good morning to all, and welcome to our presentation of Grupo Comercial Chedraui's fourth quarter 2025 results. I want to begin by sincerely thanking our valued customers for choosing to shop at our stores, especially during this challenging economic environment, both in Mexico and the US, your continued trust inspires us every day.

Speaker #2: I also want to proudly recognize our employees on wavering dedication to advancing our three strategic pillars throughout 2025: their commitment to delivering a unique shopping experience, providing the best assortment at the lowest prices, and consistently exceeding expectations has been crucial to strengthening our customers' loyalty.

Speaker #2: In Mexico, our same-store sales have once again outperformed and tied self-service segment by 164 basis points, making an outstanding 22nd consecutive quarter of outperformance.

Speaker #2: For the full year, our same-store sales growth exceeded and tied self-service by 140 basis points, making this the fifth consecutive year of remarkable achievement.

Speaker #2: At Chedraui USA, although sales were impacted by continued immigration enforcement and the US government shut down in October and November, EBITDA margin improved by 178 basis points, to 8.6%, and by 6 basis points to 6.9% when including additional non-cash accruals made for general liability and workers' compensation claims in the quarter.

Speaker #2: This was supported by rigorous expense management and efficiencies from our Rancho Cucamanga distribution center. Finally, I'm pleased to note that we completed the most aggressive store opening year in Chedraui's history, and we surpassed our store opening target.

Speaker #2: In Mexico, we opened 65 stores during the quarter for a total of 142 stores in 2025. As such, we ended 2025 with a total of 1,067 stores in Mexico and the US.

Speaker #2: Our organic expansion will continue throughout 2026, as we expect to open 147 stores in Mexico, of which 17 of these are larger store formats and the remaining are supercito.

Speaker #2: While in the US, we expect to open five stores, four El Super and one Fiesta. Now, to start our presentation, please turn to slide four, where I will highlight key achievements of the quarter.

Speaker #2: Chedraui Mexico's same-store sales grew 3% in the fourth quarter of 2025, and surpassed and tied 1.4% growth for the 22nd consecutive quarter. Chedraui Mexico's total sales increased 6.9% due to higher same-store sales and a 4.4% sales floor expansion.

Speaker #2: Consolidated EBITDA increased 101 basis points, to 8.6%, and 7 basis points to 7.7%, including extraordinary items in the quarter. Chedraui Mexico's EBITDA margin stood 8.7% and 8.5%, including an extraordinary payment to fiscal authorities from prior fiscal years.

Speaker #2: fourth Trust, but across the retail industry. We continue to take actions to reduce the frequency and cost of these claims. I would like to highlight our commitment to delivering solid, long-term results despite short-term challenges.

Speaker #2: Despite current trends, both our Super and Fiesta same-store sales have grown considerably over the last four years. When comparing 2025 data with 2021, the same-store sales compounded annual growth rate for Al Super is 6.2% and 6.6% for Fiesta.

Speaker #2: Also, EBITDA margins over the same period increased by nearly 41 basis points for Al Super and 310 basis points for Fiesta, even when considering the headwinds we faced in this fourth quarter.

Speaker #2: Now we will review the results of the fourth quarter. Please turn to slide 9. Chedrawi USA same-store sales declined by 2.8% in US dollar terms compared to the same quarter of last year.

Speaker #2: This is explained by a decline in transactions at Al Super.

Operator: Welcome to the Viavid Conference Center. The next available conference specialist will be with you momentarily. Welcome to the Viavid Conference Center. The next available conference specialist will be with you momentarily. ... Can I have your first and last name?

José Antonio Chedraui Eguía: David Brown from Scotiabank.

Operator: Okay, which conference call are you joining?

José Antonio Chedraui Eguía: Southeast Airport Group.

Operator: Which one?

José Antonio Chedraui Eguía: Southeast Airport Group.

Operator: Okay. What time is that call?

José Antonio Chedraui Eguía: It's in 30 minutes.

Operator: 30 minutes. 9:00. Okay, how are you spelling the name of the company, sir?

Operator: Good morning to all participants, and welcome to Grupo Comercial Chedraui's Q4 2025 Commercial Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. Participating in the conference call today will be Mr. José Antonio Chedraui, CEO of Grupo Comercial Chedraui, Mr. Carlos Smith, CEO of Chedraui USA, Humberto Tafolla, CFO, and Arturo Velázquez, IR for the company. We will begin the call with the initial comments on Grupo Comercial Chedraui's Q4 financial results by the company's CEO, Mr. José Antonio Chedraui, and Chedraui USA CEO, Carlos Smith. Thank you. You may begin.

José Antonio Chedraui Eguía: It's Grupo Aeroportuario de.

Operator: Oh, Grupo. Okay, Grupo.

José Antonio Chedraui Eguía: Yes.

Operator: Yes, yes. Okay, I got it. Okay, Grupo, I'll put you into that one. Good morning to all participants, and welcome to Grupo Comercial Chedraui's Q4 2025 Commercial Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Participating in the conference call today will be Mr. José Antonio Chedraui, CEO of Grupo Comercial Chedraui; Mr. Carlos Smith, CEO of Chedraui USA; Humberto Tafolla, CFO; and Arturo Velázquez, IR for the company. We will begin the call with the initial comments on Grupo Comercial Chedraui's Q4 financial results by the company's CEO, Mr. José Antonio Chedraui, and Chedraui USA CEO, Carlos Smith. Thank you. You may begin.

José Antonio Chedraui Eguía: Good morning to all, welcome to our presentation of Grupo Comercial Chedraui's Q4 2025 results. I want to begin by sincerely thanking our valued customers for choosing to shop at our stores, especially during this challenging economic environment, both in Mexico and the US. Your continued trust inspires us every day. I also want to proudly recognize our employees' unwavering dedication to advancing our three strategic pillars throughout 2025. Their commitment to delivering a unique shopping experience, providing the best assortment at the lowest prices, and consistently exceeding expectations, has been crucial to strengthening our customers' loyalty. In Mexico, our same-store sales have once again outperformed ANTAD's self-service segment by 164 basis points, making an outstanding 22nd consecutive quarter of outperformance.

José Antonio Chedraui: Good morning to all, welcome to our presentation of Grupo Comercial Chedraui's Q4 2025 results. I want to begin by sincerely thanking our valued customers for choosing to shop at our stores, especially during this challenging economic environment, both in Mexico and the US. Your continued trust inspires us every day. I also want to proudly recognize our employees' unwavering dedication to advancing our three strategic pillars throughout 2025. Their commitment to delivering a unique shopping experience, providing the best assortment at the lowest prices, and consistently exceeding expectations, has been crucial to strengthening our customers' loyalty. In Mexico, our same-store sales have once again outperformed ANTAD's self-service segment by 164 basis points, making an outstanding 22nd consecutive quarter of outperformance.

José Antonio Chedraui Eguía: For the full year, our same-store sales growth exceeded ANTAD's self-service by 140 basis points, making this the 5th consecutive year of remarkable achievement. At Chedraui USA, although sales were impacted by continued immigration enforcement and the US government shutdown in October and November, EBITDA margin improved by 178 basis points to 8.6%, and by 6 basis points to 6.9% when including additional non-cash accruals made for general liability and workers' compensation claims in the quarter. This was supported by rigorous expense management and efficiencies from our Rancho Cucamonga distribution center. Finally, I'm pleased to note that we completed the most aggressive store opening year in Chedraui's history, and we surpassed our store openings target. In Mexico, we opened 65 stores during the quarter, for a total of 142 stores in 2025.

José Antonio Chedraui: For the full year, our same-store sales growth exceeded ANTAD's self-service by 140 basis points, making this the 5th consecutive year of remarkable achievement. At Chedraui USA, although sales were impacted by continued immigration enforcement and the US government shutdown in October and November, EBITDA margin improved by 178 basis points to 8.6%, and by 6 basis points to 6.9% when including additional non-cash accruals made for general liability and workers' compensation claims in the quarter. This was supported by rigorous expense management and efficiencies from our Rancho Cucamonga distribution center. Finally, I'm pleased to note that we completed the most aggressive store opening year in Chedraui's history, and we surpassed our store openings target. In Mexico, we opened 65 stores during the quarter, for a total of 142 stores in 2025.

José Antonio Chedraui: As such, we ended 2025 with a total of 1,067 stores in Mexico and the US. Our organic expansion will continue throughout 2026, as we expect to open 147 stores in Mexico, of which 17 of these are larger store formats and the remaining are Supercito. While in the US, we expect to open five stores, four El Super and one Fiesta. Now, to start our presentation, please turn to slide 4, where I will highlight key achievements of the quarter. Chedraui Mexico's same-store sales grew 3% in Q4 of 2025 and surpassed ANTAD's 1.4% growth for the 22nd consecutive quarter. Chedraui Mexico's total sales increased 6.9% due to higher same-store sales and a 4.4% sales floor expansion.

José Antonio Chedraui Eguía: As such, we ended 2025 with a total of 1,067 stores in Mexico and the US. Our organic expansion will continue throughout 2026, as we expect to open 147 stores in Mexico, of which 17 of these are larger store formats and the remaining are Supercito. While in the US, we expect to open five stores, four El Super and one Fiesta. Now, to start our presentation, please turn to slide 4, where I will highlight key achievements of the quarter. Chedraui Mexico's same-store sales grew 3% in Q4 of 2025 and surpassed ANTAD's 1.4% growth for the 22nd consecutive quarter. Chedraui Mexico's total sales increased 6.9% due to higher same-store sales and a 4.4% sales floor expansion.

José Antonio Chedraui: Consolidated EBITDA increased 101 basis points to 8.6% and 7 basis points to 7.7%, including extraordinary items in the quarter. Chedraui Mexico's EBITDA margin stood 8.7% and 8.5%, including an extraordinary payment to fiscal authorities from prior fiscal years. Chedraui USA's EBITDA margin increased by 178 basis points.

José Antonio Chedraui Eguía: Consolidated EBITDA increased 101 basis points to 8.6% and 7 basis points to 7.7%, including extraordinary items in the quarter. Chedraui Mexico's EBITDA margin stood 8.7% and 8.5%, including an extraordinary payment to fiscal authorities from prior fiscal years. Chedraui USA's EBITDA margin increased by 178 basis points.

José Antonio Chedraui: ... to 8.6% and 6 basis points to 6.9%, including extraordinary non-cash accruals for claim liabilities. Net cash to EBITDA improved to -0.28x in Q4 2025, compared to the -0.18x in the Q4?

Operator: ... to 8.6% and 6 basis points to 6.9%, including extraordinary non-cash accruals for claim liabilities. Net cash to EBITDA improved to -0.28x in Q4 2025, compared to the -0.18x in the Q4?

Carlos Smith: us, but across the retail industry. We continue to take actions to reduce the frequency and cost of these claims. I would like to highlight our commitment to delivering solid long-term results despite short-term challenges. Despite current trends, both El Super and Fiesta same-store sales have grown considerably over the last four years. When comparing 2025 data with 2021, the same-store sales compounded annual growth rate for El Super is 6.2% and 6.6% for Fiesta. Also, EBITDA margins over the same period increased by nearly 41 basis points for El Super and 310 basis points for Fiesta, even when considering the headwinds we faced in this Q4. Now, we will review the results of the Q4. Please turn to slide nine.

Carlos Smith: us, but across the retail industry. We continue to take actions to reduce the frequency and cost of these claims. I would like to highlight our commitment to delivering solid long-term results despite short-term challenges. Despite current trends, both El Super and Fiesta same-store sales have grown considerably over the last four years. When comparing 2025 data with 2021, the same-store sales compounded annual growth rate for El Super is 6.2% and 6.6% for Fiesta. Also, EBITDA margins over the same period increased by nearly 41 basis points for El Super and 310 basis points for Fiesta, even when considering the headwinds we faced in this Q4. Now, we will review the results of the Q4. Please turn to slide nine.

Carlos Smith: Chedraui USA same-store sales declined by 2.8% in US dollar terms compared to the same quarter of last year. This is explained by a decline in transactions at El Super.

Carlos Smith: Chedraui USA same-store sales declined by 2.8% in US dollar terms compared to the same quarter of last year. This is explained by a decline in transactions at El Super.