• Total Sales (4Q 2024): MXN21.7 billion, an 11.1% year-over-year increase.
• Same-Store Sales Growth (4Q 2024): 7.2%.
• EBITDA (4Q 2024): MXN3.6 billion, a 13% increase with a margin of 16.4%.
• Digital Orders (4Q 2024): 34 million, amounting to MXN7.3 billion, 33.5% of total sales.
• Starbucks Alsea Same-Store Sales (4Q 2024): Increased by 5.2%.
• Domino's Pizza Alsea Same-Store Sales (4Q 2024): Increased by 4.8%.
• Burger King Alsea Same-Store Sales (4Q 2024): Decreased by 1.1% excluding Argentina.
• Full-Service Restaurant Segment Same-Store Sales Growth (4Q 2024): 3.9%.
• New Store Openings (4Q 2024): 107 new stores, including 74 corporate units and 33 franchisees.
• Net Income (4Q 2024): Decreased 45.3% year-over-year to MXN575 million.
• CapEx (Full Year 2024): MXN6.5 billion.
• Pre-IFRS 16 Gross Debt (End of 2024): MXN33 billion.
• Cash Position (End of 2024): MXN6.5 billion.
• Total Debt-to-Pre-IFRS 16 EBITDA Ratio (End of 2024): 2.8 times.
• Net Debt-to-EBITDA Ratio (End of 2024): 2.3 times.

• Warning! GuruFocus has detected 5 Warning Signs with ALSSF.

Release Date: February 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Alsea SAB de CV (ALSSF) reported an 11.1% year-over-year increase in total sales for the fourth quarter, reaching MXN21.7 billion.
• Same-store sales grew by 7.2% in the fourth quarter, showcasing strong brand performance.
• Digital sales accounted for 33.5% of total sales, highlighting the success of Alsea's digital strategy.
• The company opened 107 new stores in the fourth quarter, focusing on high-traffic areas and remodeling existing locations.
• Alsea's loyalty programs saw a 33.1% growth in sales, contributing significantly to total sales.

Negative Points

• Starbucks Europe experienced a 7.4% decline in same-store sales, impacted by reduced consumer traffic and recent flooding in Valencia.
• Burger King Alsea's same-store sales decreased by 1.1% in Mexico, with flat sales in Chile.
• Adjusted EBITDA in Europe decreased by 2.1% for the quarter, primarily due to macroeconomic pressures and brand boycott impacts.
• Net income for the fourth quarter decreased by 45.3% year-over-year, affected by currency exchange translation costs.
• Pre-IFRS 16 gross debt increased by MXN6.9 billion year-over-year, reaching MXN33 billion, due to debt incurred for acquisitions and currency impacts.

Q & A Highlights

Q: In Europe, Starbucks' same-store sales seem to be improving. Can you provide monthly results and expectations for the start of the year? A: (Armando Torrado Martinez, CEO) We are seeing a gradual recovery in France, with improvements in traffic. We expect full recovery by the end of 2026. The first nine weeks of the year show a low single-digit decline, indicating better numbers by year-end. (Federico Rodriguez, CFO) We are implementing efficiency programs across Europe, including portfolio management and cash flow generation strategies. (Gerardo Lozoya Latapi, Director-Investor Relations) December was strong, and the trend continues into 2025 with robust same-store sales.

Q: Can you provide more details on the growth outlook for next year, particularly for Mexico, South America, and Europe? A: (Federico Rodriguez, CFO) We expect mid-single-digit growth across regions, with sequential improvement in France. Mexico and other regions should see mid to high single-digit growth. The FX depreciation will impact the top line, but we are focusing on profitable growth. (Armando Torrado Martinez, CEO) We are rationalizing capital allocation and focusing on profitable store openings, especially in high-potential areas.

Q: Could you elaborate on the store openings and the focus on Domino's brand performance? A: (Federico Rodriguez, CFO) 80% of new openings will be Starbucks and Domino's, mainly in Mexico and Europe. Casual dining will also see growth in Spain and Mexico. (Armando Torrado Martinez, CEO) Domino's had a strong year with product innovations and digital strategies. We are focusing on carry-out promotions and digital transformation to maintain growth.

Q: What trends are you seeing in Mexico, and is the guidance based on a better second half of the year? A: (Federico Rodriguez, CFO) We saw strong consumer resilience in the last months of the year, with positive traffic trends across most brands. The guidance assumes a 2% GDP growth, with similar behavior expected in both halves of the year.

Q: Can you provide insights into the Starbucks strategy in Mexico, particularly regarding standalone stores? A: (Armando Torrado Martinez, CEO) Out of the 180 to 220 new stores, about half will be Starbucks, with 90% being corporate stores. We are focusing on drive-through and standalone stores, which offer good returns. The unit economics and rent negotiations are favorable, supporting our expansion strategy.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.