MEXICO CITY (Reuters) -Walmart's Mexico unit on Tuesday reported a 10% increase in first-quarter revenue, even as it acknowledged sales growth fell behind the retail sector for the first time in eight years.
Walmart (NYSE:WMT) de Mexico, the country's biggest retailer, brought in 187.8 billion pesos ($9.4 billion) in revenue for the quarter, in line with analysts' estimates, according to Refinitiv, while net profit rose more than 10% to 11.1 billion pesos.
Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 6.4% to 20.7 billion pesos, slightly below expectations.
Although same-store sales increased 9% in Mexico, the retailer noted that it did not keep up with the industry as a whole.
"The market grew faster than we did," Walmart de Mexico, or Walmex, said in a statement accompanying the results.
Executives said the company would keep investing to spur growth while aiming to boost productivity and control costs.
Expenses in the core Mexico market increased more than revenue in the first quarter, largely due to higher salaries that Walmex said have helped reduce turnover. In Central America, the gross margin shrank as the company spent more to keep prices low.
Inflation has hit both regions, and Walmex said it was working with suppliers and using other strategies to drive prices down.
"This may affect growth versus the market in the very short term, but over time it will strengthen the trust customers have with us," Chief Executive Guilherme Loureiro said in a webcast to discuss results.
($1 = 19.8911 pesos at end-March)