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Mexico's Alsea profit slides as rising costs, exchange rate, taxes bite

Published 02/27/2023, 06:17 PM
Updated 02/27/2023, 09:45 PM
© Reuters.
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MEXICO CITY (Reuters) -Mexican restaurant chain operator Alsea reported on Monday a 31% drop in its fourth-quarter net profit from a year earlier, hit by higher energy and raw materials costs and higher taxes, after reaping strong same-store sales growth.

The Mexico City-based company, which operates Starbucks (NASDAQ:SBUX) cafes as well as Domino's Pizza (NYSE:DPZ) and Burger King restaurants among other chains, said fourth quarter revenue grew 14% from the year-ago quarter to 19.15 billion pesos ($982 million), slightly ahead of a Refinitiv estimate of 19.09 billion pesos.

Same-store sales rose about 22% year-over-year, while its delivery segment grew 13% in the quarter.

However earnings before interest, tax, depreciation and amortization (EBITDA) slid 18% to 3.49 billion pesos and net profit fell to 579 million pesos from a year earlier.

The EBITDA slide was partly due to higher raw materials costs, soaring energy costs in Europe, and the strengthening of the Mexican peso against the euro, Monex analysts said in a report.

Alsea operates in 11 countries across Latin America and in Europe.

($1 = 19.5089 pesos at end-December)

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