FORM 6-K
Securities and Exchange Commission
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant To Rule 13a-16 Or 15d-16
Of The
Securities Exchange Act of 1934
| For the month of April 2006 | Commission file number 1-12260 |
Guillermo González Camarena No. 600
Col. Centro de Ciudad Santa Fé
Delegación Alvaro Obregón
Mexico, D.F. 01210
(Address of
principal office)
(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
(Check One) Form 20-F x Form 40-F
(Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
(Check One) Yes No x
(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b). 82- .)
 |
| Stock Listing Information | 2006 | ||||||
| Mexican Stock Exchange | FIRST-QUARTER RESULTS | ||||||
| Ticker: KOFL | |||||||
| First quarter | First Quarter | ||||||
| NYSE (ADR) | 2005 | 2004 | D % | 2006 | 2005 | ||
| Ticker: KOF | |||||||
| Total Revenues | 12,765 | 11,828 | 7.9% | % of Tot. Rev. | |||
| Gross Profit | 6,123 | 5,696 | 7.5% | 48.0% | 48.2% | ||
| Operating Income | 1,936 | 1,794 | 7.9% | 15.2% | 15.2% | ||
| Ratio of KOF L to KOF = 10:1 | Majority Net Income | 909 | 721 | 26.1% | 7.1% | 6.1% | |
| EBITDA(1) | 2,591 | 2,404 | 7.8% | 20.3% | 20.3% | ||
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Net Debt (2) | 17,425 | 18,194 | ||||
| EBITDA (1) / Interest Expense | 4.87 | 4.20 | |||||
| Earnings per Share | 0.49 | 0.39 | |||||
 |
Average Shares Outstanding | 1,846.5 | 1,846.5 | ||||
| Expressed in million of Mexican pesos with purchasing power as of March 31, 2006, except for per share amount. | |||||||
| (1) EBITDA = Operating income + Depreciation + Amortization & Other Non-cash Charges. See reconciliation table on page 11. | |||||||
| (2) Figures for 2005 are as of December 31, 2005 | |||||||
| (3) Net Debt = Total Debt - Cash | |||||||
 Total revenues increased 7.9% to Ps. 12,765 million in the first quarter of 2006, mainly driven by growth in Mexico and Brazil. |
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For Further Information: Investor Relations Alfredo Fernández alfredo.fernandez@kof.com.mx (5255) 5081-5120 / 5121 Julieta Naranjo julieta.naranjo@kof.com.mx (5255) 5081-5148 Oscar Garcia oscar.garcia@kof.com.mx (5255) 5081-5186 Website: www.coca-colafemsa.com |
Consolidated operating income grew 7.9% to Ps. 1,936 million, remaining stable as a percentage of total revenues at 15.2% in the first quarter of 2006. |
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| Consolidated majority net income increased 26.1% to Ps. 909 million, mainly due to a one-time charge to income in 2005, resulting in earnings per share of Ps. 0.49 for the first quarter of 2006. Excluding this one-time charge, majority net income would have increased by 7.8%. |
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Mexico City (April 27, 2006), Coca-Cola FEMSA, S.A. de C.V. (BMV: KOFL, NYSE: KOF) ("Coca-Cola FEMSA" or the "Company"), the largest Coca-Cola bottler in Latin America and the second-largest Coca-Cola bottler in the world in terms of sales volume, announces results for the first quarter 2006. |
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“Our first-quarter performance reflected the overall strength of our business model. For the quarter, we achieved carbonated soft drink growth in all of our market territories thanks to our robust portfolio of products and packages,
sophisticated multi-segmentation strategy, and disciplined market execution. Importantly, we believe our positive performance is increasingly reflected in the market value of our company,” said Carlos Salazar, Chief Executive Officer of the
Company. |
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| April 27, 2006 |  |
Page 1 |
| Consolidated Results | |
CONSOLIDATED RESULTS
Our consolidated revenues increased 7.9% to Ps. 12,765 million in the first quarter of 2006 as a result of increases in all of our territories with the exception of Argentina. Over 80% of our revenues growth came from Mexico and Brazil. Consolidated average price per unit excluding beer increased slightly to Ps. 26.90 in the first quarter of 2006 as compared to Ps. 26.79 the same period of the previous year, driven by average price per unit increases in Colombia, Venezuela and Brazil
Total sales volume excluding beer grew 6.4% to 466.0 million unit cases in the first quarter of 2006 as compared to the same period of 2005, mainly driven by sales volume growth in Mexico and Brazil. Carbonated soft drinks (CSD) sales volume grew 5.4% to 394.2 million unit cases, driven by incremental volume across all our territories.
Our gross profit rose 7.5% to Ps. 6,123 million in the first quarter of 2006, as compared with the same period of 2005; Mexico and Brazil represented the majority of our growth. Gross margin declined slightly to 48.0% in the first quarter of 2006 from 48.2% in the same period of 2005, due to cost pressures in all of our territories with the exception of Mexico and Argentina.
Our consolidated operating income rose 7.9% to Ps. 1,936 million in the first quarter of 2006, driven by operating income growth in Mexico, Brazil and Colombia. Our operating margin remained stable at 15.2% in the first quarter of 2006 as compared with the same period of 2005.
During the first quarter of 2006, our integral cost of financing increased to Ps. 479 million from Ps. 304 million in the same period of 2005, mainly driven by foreign exchange loss resulting from the depreciation of the Mexican peso against the U.S. dollar as applied to our US dollar net liability position.
During the first quarter of 2006, income tax, tax on assets and employee profit sharing as a percentage of income before taxes was 36.0%, a decrease of 920 basis points compared with the same period of the previous year. The effective tax rate in 2005 was affected by a one-time payment in Mexico due to a revision made by the tax authorities of payments made during 2004 in connection with a change of criteria that required coolers to be treated as fixed assets with finite useful lives.
Our consolidated majority net income was Ps. 909 million in the first quarter of 2006, an increase of 26.1% compared to the same period of 2005, mainly due to the above mentioned one-time tax charge to income during 2005. Earnings per share (“EPS”) were Ps. 0.49 (US$ 0.45 per ADR) computed on the basis of 1,846.5 million shares outstanding (each ADR represents 10 local shares). Excluding the one-time payment in the amount of Ps. 122 million related to a change of criteria that required that coolers be treated as fixed assets with finite useful lives during 2005, net income would have increased by 7.8% .
| April 27, 2006 | |
Page 2 |
| Balance Sheet and Consolidated Statement of Changes in Financial Position | |
BALANCE SHEET
As of March 31, 2006, Coca-Cola FEMSA had a cash balance of Ps. 3,007 million (US$ 276 million), an increase of Ps. 896 million (US$ 82 million) compared with December 31, 2005, as a result of cash flow generated by operations during the quarter. Total short-term debt was Ps. 4,658 million (US$ 427 million) and long-term debt was Ps. 15,774 million (US$ 1,447 million). Gross debt remained stable during the quarter.
The weighted average cost of debt for the quarter was 8.94% . The following chart sets forth the Company’s debt profile by currency and interest rate type as of March 31, 2006:
| Currency | % Total Debt(2) |
% Interest Rate | ||
| Floating(2) | ||||
| Mexican pesos | 59% | 0% | ||
| U.S. dollars | 30% | 11% | ||
| Colombian pesos | 8% | 23% | ||
| Other (1) | 3% | 23% | ||
| (1) Includes the equivalent of US$ 39.0 million denominated in Venezuelan bolivares, and US$ 25.4 million denominated in Argentine pesos. | ||||
| (2) After giving effect to cross-currency swaps. | ||||
| Consolidated Statement of Changes in Financial Position | ||||
| Expressed in million of Mexican pesos and U.S. dollars as of March 31, 2006 | ||||
Jan - Mar. 2006 |
||||
Ps. |
USD | |||
| Net income | 945 | 87 | ||
| Non cash charges to net income | 725 | 67 | ||
| 1,670 | 154 | |||
| Change in working capital | 527 | 48 | ||
| NRGOA(1) | 2,197 | 202 | ||
| Total investments | (420) | (39) | ||
| Dividends declared | (694) | (64) | ||
| Debt | 141 | 13 | ||
| Other financial transactions | 61 | 6 | ||
| Deferred taxes and others | (389) | (36) | ||
| Increase in cash and cash equivalents | 896 | 82 | ||
| Cash and cash equivalents at begining of period | 2,111 | 194 | ||
| Cash and cash equivalents at end of period | 3,007 | 276 | ||
| (1) Net Resources Generated by Operating Activities | ||||
| April 27, 2006 | |
Page 3 |
| Mexican Operating Results | |
MEXICAN OPERATING RESULTS
Revenues
Total revenues from our Mexican territories increased 7.1% to Ps. 6,769 million in the first quarter of 2006, as compared with the same period of the previous year, driven by sales volume growth. Average price per unit case declined 1.0% to Ps. 27.34 (US$ 2.51) during the first quarter of 2006, driven by strong volume growth from jug water and Mundet and Fanta Multi-flavors, which carry a lower price per unit case. Excluding Ciel water volume in 5.0, 19.0 and 20.0 -liter packaging presentations, our average price per unit case was Ps. 31.65 (US$ 2.90), a decrease of 0.7% in the first quarter of 2006, as compared to the same period of 2005.
Total sales volume increased 8.0% to 246.0 million unit cases in the first quarter of 2006, as compared with the first quarter of 2005. The increases in carbonated soft drinks and jug water sales volume represented over 70% and nearly 20% of our incremental sales volume, respectively. Carbonated soft drinks sales volume grew 7.2% compared with the same period of the previous year, the Coca-Cola brand represented approximately 60% of this growth and Mundet and Fanta Multiflavors accounted for the majority of the balance. Excluding non-flavored bottled water, the non-carbonated beverage segment grew 58.3% in the first quarter of 2006 from a low base of comparison in 2005, mainly driven by volume growth of Ciel Aquarius our no calorie flavored water brand.
Operating Income
Our gross profit grew 9.6% to Ps. 3,591 million in the first quarter of 2006, as compared with the same period of 2005, resulting in a 120 basis-point gross margin expansion to 53.0% . This improvement was driven by lower polyethylene terephtalate (PET) resin costs in U.S. dollars, lower sweetener costs and the appreciation of the Mexican peso year over year as applied to our U.S. dollar-denominated costs.
Our operating expenses per unit case remained stable, and operating expenses as a percentage of total revenues increased 20 basis points to 34.1% in the first quarter of 2006, from 33.9% in the same period of 2005. Depreciation and amortization expenses increased to Ps. 404 million, reflecting a higher ongoing level of depreciation expenses from the introduction of coolers in the market towards the end of last year. Operating income increased 13.5% to Ps. 1,284 million in the first quarter of 2006, resulting in margin expansion of 110 basis points to 19.0% in the quarter.
| April 27, 2006 | |
Page 4 |
| Central American and Colombian Operating Results | |
CENTRAL AMERICAN OPERATING RESULTS (Guatemala, Nicaragua, Costa Rica and Panama)
Revenues
Total revenues increased 5.9% to Ps. 918 million in the first quarter of 2006, as compared to the same period of 2005, mainly driven by sales volume growth. Average price per unit case declined 1.9% to Ps. 32.55 (US$ 2.99), as a result of a more competitive environment.
Total sales volume in our Central American territories increased 6.9% to 27.9 million unit cases in the first quarter of 2006, as compared with the same period of 2005. Volume increases in carbonated soft drinks accounted for approximately 50.0% of this growth, mainly driven by strong volume growth from our flavored carbonated soft drinks in the majority of our territories.
Operating Income
In spite of higher sugar prices and higher packaging costs driven by a packaging mix shift towards non-returnable presentations, which represented 64.2% of our total sales volume in the first quarter of 2006 as compared to 54.4% in the same period of 2005, our gross profit rose 1.3% to Ps. 425 million in the first quarter of 2006, compared to the same period of the previous year. This increase was a result of operating leverage due to higher revenues.
Our operating expenses declined as a percentage of total revenues from 35.1% in the first quarter of 2005 to 33.8% in the same period of 2006, driven by higher fixed cost absorption. However, our operating income remained stable at Ps. 115 million in the first quarter of 2006, resulting in an operating margin of 12.5%
COLOMBIAN OPERATING RESULTS
Revenues
Total revenues increased 2.6% to Ps. 1,160 million in the first quarter of 2006, as compared with the first quarter of 2005, mainly as a result of average price per unit case growth. Average price per unit case increased 2.8% to Ps. 27.55 (US$ 2.53) mainly driven by price increases implemented during the second half of 2005.
Despite higher prices per unit case, our total sales volume remained stable in the first quarter of 2006 at 42.1 million unit cases, as compared with the same period of the previous year. The slight increase in carbonated soft drinks, driven by the Coca-Cola brand, partially offset sales volume decline in our non-carbonated beverage segment.
Operating Income
Gross profit increased 2.2% to Ps. 516 million in the first quarter of 2006, as compared with the same period of the previous year, resulting in a gross margin of 44.5% . Our gross margin remained relatively stable, in spite of higher sugar prices and higher packaging costs resulting from a mix shift towards non-returnable presentations, which accounted for 49.0% of our total sales volume in the first quarter of 2006, as compared to 44.1% in the same period of the previous year.
Our operating expenses remained stable-and, as a percentage of total sales, declined 100 basis points to 34.8% -in the first quarter of 2006, driven by lower freight costs and a reduction in breakage expenses. Our operating income increased 11.4% to Ps. 112 million, resulting in a margin expansion of 80 basis points from 8.9% in the first quarter of 2005 to 9.7% in the same period of 2006.
| April 27, 2006 | |
Page 5 |
| Venezuelan and Argentine Operating Results | |
VENEZUELAN OPERATING RESULTS
Revenues
Revenues from our Venezuelan operations increased 8.2% to Ps. 1,287 million in the first quarter of 2006, as compared with the same period of 2005. The average price per unit case increase represented over 75% of the revenue growth. Our average price per unit case increased 6.4% to Ps. 31.29 (US$ 2.87), mainly driven by price increases implemented during the quarter and the second half of last year and a packaging mix shift towards single-serve presentations.
Total sales volume increased 1.5% to 41.0 million unit cases during the first quarter of 2006, as compared with the same quarter of 2005, mainly driven by an increase in carbonated soft drinks, which accounted for over 60% of incremental sales volume. Growth in the non-carbonated beverage segment, excluding non-flavored bottled water represented the majority of the balance.
Operating Income
Gross profit remained stable at Ps. 495 million in the first quarter of 2006, as compared with the same period of the previous year. As a percentage of sales, our gross margin decreased to 38.4% in the first quarter of 2006 from 41.7% in the same period of 2005. This decline was a result of higher raw material prices and higher packaging costs as a result of a shift in packaging mix towards non-returnable presentations, which grew as a percentage of our total sales volume to 76.1% in the first quarter of 2006 from 72.3% in the same period of 2005.
Operating expenses increased 13.7% to Ps. 481 million in the first quarter of 2006, driven by salary increases implemented during the last twelve months combined with higher freight and maintenance expenses. Operating income was Ps. 14 million during the first quarter of 2006, resulting in an operating margin of 1.1% .
ARGENTINE OPERATING RESULTS
Revenues
In the first quarter of 2006, our total revenues declined by 3.1% to Ps. 748 million, as compared with the same period of 2005. Price increases implemented in 2005 partially offset last twelve months inflation, resulting in an average price per unit case decrease of 4.3% to Ps. 17.90 (US$ 1.64) .
Total volume increased by 4.8% to 41.2 million unit cases, mainly driven by sales volume increases from the Coca-Cola brand and our non-carbonated beverage segment. Carbonated soft drinks increased 4.2% mainly driven by the Coca-Cola brand and our core flavored carbonated soft drinks. The non-carbonated beverage segment posted strong volume growth of 30.0%, driven by the Cepita and Dasani brands.
Operating Income
Our gross profit grew slightly to Ps. 298 million, as compared with the first quarter of 2005. Gross margin improved as a percentage of total revenues from 38.3% in the first quarter of 2005 to 39.8% in the same period of 2006, mainly as a result of lower raw material costs.
Operating expenses increased 17.4% mainly due to salary and industry-wide freight costs increases, in the first quarter of 2006, as compared with the same quarter of 2005. Operating income was Ps. 103 million in the first quarter of 2006, resulting in an operating margin of 13.8% .
| April 27, 2006 | |
Page 6 |
| Brazilian Operating Results | |
BRAZILIAN OPERATING RESULTS
In January 2006, FEMSA Cerveza acquired an indirect controlling stake in Cervejarias Kaiser Brasil S.A. or Cervejarias Kaiser. As of February 2006, Coca-Cola FEMSA has subsequently agreed to continue to distribute the Kaiser beer portfolio and to assume the sales function in São Paulo, Brazil, consistent with the arrangements in place prior to 2004. Beer sales volume will not be included in our sales volume for the 2006 period, although revenues and costs will be recorded in our income statement. In 2005, we did not include beer that we distributed in Brazil in our sales volumes and net sales. Instead, the amount we received for distributing beer in Brazil is included in other revenues.
Revenues
Net revenues increased 24.8% to Ps. 1,901 million in the first quarter of 2006 as compared to the same period of 2005. Excluding beer, net revenues increased 13.2% to Ps. 1,724 million in the first quarter of 2006, as compared with the same period of 2005, with volume growth accounting for approximately 70% of this growth. Excluding beer, average price per unit case increased 3.7% to Ps. 25.42 (US$ 2.33) during the first quarter of 2006, driven by price increases in connection with our multisegmentation initiatives implemented during the fourth quarter of last year and a packaging shift mix towards single serve presentations, which carry higher average price per unit case. Total revenues from beer were Ps. 177 million.
Sales volume, excluding beer, increased 9.2% to 67.8 million unit cases in the first quarter of 2006. The increase included a 7.2% growth in carbonated soft drinks, mainly driven by the Coca-Cola brand in returnable presentations, which accounted for over 50% of our incremental volume and the premium low calorie carbonated soft drinks segment and bottled water represented the majority of the balance.
Operating Income
In the first quarter of 2006, our gross profit increased 14.8% to Ps. 827 million, as compared with the same period of the previous year, in spite of the increasing pressures on sugar prices that were offset by the appreciation of the Brazilian real year over year as applied to our U.S. dollar-denominated costs and manufacturing efficiencies. Gross margin decreased from 46.0% to 43.2%, a margin reduction of 280 basis points in the first quarter of 2006, as compared to the same period of 2005 mainly driven by higher revenues as a result of the inclusion of beer revenues in our financial statement in 2006, as mentioned above.
Our operating expenses as a percentage of total revenues decreased by 320 basis points in the first quarter of 2006 as compared to the same period of 2005 to 27.1%, despite additional expenses incurred this quarter in connection with the selling function of beer. Operating income was Ps. 309 million in the first quarter of 2006, an increase of 26.1%, resulting in a margin expansion of 50 basis points to 16.1% .
| April 27, 2006 | |
Page 7 |
| Recent Developments, Conference Call Information and Disclaimer | |
RECENT DEVELOPMENTS
-
On March 8, 2006, we held our Annual General Ordinary Shareholders Meeting at which shareholders approved the annual report presented by the Board of Directors, the consolidated financial statements for the year ended December 31, 2005, the
composition of the Board of Directors for 2006, and the declaration of the dividend for fiscal year 2005 in the amount of Ps. 694.3 million. The dividend will be paid on June 15, 2006 in the amount of Ps. 0.3760 for each ordinary share
- In addition, on the same date we held a Special Shareholders Meeting at which Series “L” shareholders approved the non- cancellation of 98,684,857 Series “L” shares issued by resolution of the General Extraordinary Meeting carried out on December 20, 2002, thereby making these shares available to our Board of Directors. These shares were not subscribed by the Series “L” holders in the exercise of their pre-emptive rights at the price set by the General Extraordinary Meeting of US$ 2.216 per share.
CONFERENCE CALL INFORMATION
Our first-quarter 2006 Conference Call will be held on: April 27, 2006, 3:30 P.M. Eastern Time (2:30 P.M. Mexico City Time). To participate in the conference call, please dial: Domestic U.S.: 866-700-7477 and International: 617-213-8840. We invite investors to listen to the live audiocast of the conference call on the Company’s website, www.coca-colafemsa.com
If you are unable to participate live, an instant replay of the conference call will be available through May 5, 2006. To listen to the replay, please dial: Domestic U.S.: 888-286-8010 or International: 617-801-6888. Pass code: 98344233.
Coca-Cola FEMSA, S.A. de C.V. produces and distributes Coca-Cola, Sprite, Fanta, Lift and other trademark beverages of The Coca-Cola Company in Mexico (a substantial part of central Mexico, including Mexico City and southeast Mexico), Guatemala (Guatemala City and surrounding areas), Nicaragua (nationwide), Costa Rica (nationwide), Panama (nationwide), Colombia (most of the country), Venezuela (nationwide), Brazil (greater São Paulo, Campiñas, Santos, the state of Mato Grosso do Sul and part of the state of Goias) and Argentina (federal capital of Buenos Aires and surrounding areas), along with bottled water, beer and other beverages in some of these territories. The Company has 30 bottling facilities in Latin America and serves over 1,500,000 retailers in the region. The Coca-Cola Company owns a 39.6% equity interest in Coca-Cola FEMSA.
Figures for the Company’s operations in Mexico and its consolidated international operations were prepared in accordance with Mexican generally accepted accounting principles (Mexican GAAP). All figures are expressed in constant Mexican pesos with purchasing power at March 31, 2006. For comparison purposes, 2005 and 2006 figures from the Company’s operations have been restated taking into account local inflation of each country with reference to the consumer price index and converted from local currency into Mexican pesos using the exchange rate at the end of the period. In addition, all comparisons in this report for the first quarter of 2006, which ended on March 31, 2006, are made against the figures for the comparable period in 2005, unless otherwise noted.
This news release may contain forward-looking statements concerning Coca-Cola FEMSA’s future performance and should be considered as good faith estimates by Coca-Cola FEMSA. These forward-looking statements reflect management’s expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, many of which are outside Coca-Cola FEMSA’s control, that could materially impact the Company’s actual performance.
References herein to “US$” are to United States dollars. This news release contains translations of certain Mexican peso amounts into U.S. dollars for the convenience of the reader. These translations should not be construed as representations that Mexican peso amounts actually represent such U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated.
U.S. dollar amounts have been translated from Mexican pesos at the noon day buying rate for pesos as published by the Federal Reserve Bank of New York at March 31, 2006, which exchange rate was Ps. 10.90 to $1.00.
(7 pages of tables to follow)
| April 27, 2006 | |
Page 8 |
| Consolidated Balance Sheet | |
| Consolidated Balance Sheet | ||||||||
| Expressed in million of Mexican pesos with purchasing power as of March 31, 2006 | ||||||||
| Assets | Mar 06 | Dec 05 | ||||||
| Current Assets | ||||||||
| Cash and cash equivalents | Ps. | 3,007 | Ps. | 2,111 | ||||
| Total accounts receivable | 1,978 | 2,637 | ||||||
| Inventories | 2,331 | 2,232 | ||||||
| Prepaid expenses and other | 943 | 819 | ||||||
| Total current assets | 8,259 | 7,799 | ||||||
| Property, plant and equipment | ||||||||
| Property, plant and equipment | 32,047 | 32,157 | ||||||
| Accumulated depreciation | -14,339 | -14,191 | ||||||
| Bottles and cases | 1,096 | 1,082 | ||||||
| Total property, plant and equipment, net | 18,804 | 19,048 | ||||||
| Investment in shares and other | 480 | 471 | ||||||
| Deferred charges, net | 1,255 | 1,352 | ||||||
| Intangibles | 40,252 | 39,855 | ||||||
| Total Assets | Ps. | 69,050 | Ps. | 68,525 | ||||
| Liabilities and Stockholders' Equity | Mar 06 | Dec 05 | ||||||
| Current Liabilities | ||||||||
| Short-term bank loans and notes | Ps. | 4,658 | Ps. | 4,492 | ||||
| Interest payable | 394 | 329 | ||||||
| Suppliers | 4,387 | 4,749 | ||||||
| Other current liabilities | 3,372 | 2,858 | ||||||
| Total Current Liabilities | 12,811 | 12,428 | ||||||
| Long-term bank loans | 15,774 | 15,814 | ||||||
| Pension plan and seniority premium | 796 | 798 | ||||||
| Other liabilities | 3,851 | 4,097 | ||||||
| Total Liabilities | 33,232 | 33,137 | ||||||
| Stockholders' Equity | ||||||||
| Minority interest | 1,111 | 1,016 | ||||||
| Majority interest: | ||||||||
| Capital stock | 2,912 | 2,912 | ||||||
| Additional paid in capital | 12,460 | 12,460 | ||||||
| Retained earnings of prior years | 21,837 | 18,536 | ||||||
| Net income for the period | 909 | 3,984 | ||||||
| Cumulative results of holding non-monetary assets | -3,411 | -3,520 | ||||||
| Total majority interest | 34,707 | 34,372 | ||||||
| Total stockholders' equity | 35,818 | 35,388 | ||||||
| Total Liabilities and Equity | Ps. | 69,050 | Ps. | 68,525 | ||||
| April 27, 2006 | |
Page 9 |
| Consolidated Income Statement | |
| Consolidated Income Statement | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
| 1Q 06 | % Rev | 1Q 05 | % Rev | D % | ||||||
| Sales Volume (million unit cases) | 466.0 | 437.8 | 6.4% | |||||||
| Average price per unit case | 26.90 | 26.79 | 0.4% | |||||||
| Net revenues | 12,714 | 11,730 | 8.4% | |||||||
| Other operating revenues | 51 | 98 | -48.3% | |||||||
| Total revenues | 12,765 | 100% | 11,828 | 100% | 7.9% | |||||
| Cost of sales | 6,642 | 52.0% | 6,132 | 51.8% | 8.3% | |||||
| Gross profit | 6,123 | 48.0% | 5,696 | 48.2% | 7.5% | |||||
| Operating expenses | 4,187 | 32.8% | 3,902 | 33.0% | 7.3% | |||||
| Operating income | 1,936 | 15.2% | 1,794 | 15.2% | 7.9% | |||||
| Interest expense | 532 | 572 | -7.0% | |||||||
| Interest income | 73 | 65 | 12.0% | |||||||
| Interest expense, net | 459 | 507 | -9.5% | |||||||
| Foreign exchange loss (gain) | 186 | (15) | N.A. | |||||||
| Loss (gain) on monetary position | (166) | (188) | -11.7% | |||||||
| Integral cost of financing | 479 | 304 | 57.5% | |||||||
| Other (income) expenses, net | (19) | 130 | N.A. | |||||||
| Income before taxes | 1,476 | 1,360 | 8.5% | |||||||
| Taxes | 531 | 615 | -13.7% | |||||||
| Consolidated net income | 945 | 745 | 26.8% | |||||||
| Majority net income | 909 | 7.1% | 721 | 6.1% | 26.1% | |||||
| Minority net income | 36 | 24 | 49.0% | |||||||
| Operating income | 1,936 | 15.2% | 1,794 | 15.2% | 7.9% | |||||
| Depreciation | 351 | 322 | 8.8% | |||||||
| Amortization and Other non-cash charges (2) | 304 | 288 | 5.9% | |||||||
| EBITDA (3) | 2,591 | 20.3% | 2,404 | 20.3% | 7.8% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes returnable bottle breakage expense. | ||||||||||
| (3) EBITDA = Operating Income + Depreciation +Amortization & Other non-cash charges. | ||||||||||
| April 27, 2006 | |
Page 10 |
| Mexican and Central American operations | |
| Mexican operations | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
| 1Q 06 | % Rev | 1Q 05 | % Rev | D % | ||||||
| Sales Volume (million unit cases) | 246.0 | 227.7 | 8.0% | |||||||
| Average price per unit case | 27.34 | 27.61 | -1.0% | |||||||
| Net revenues | 6,726 | 6,287 | 7.0% | |||||||
| Other operating revenues | 43 | 35 | 24.0% | |||||||
| Total revenues | 6,769 | 100.0% | 6,322 | 100.0% | 7.1% | |||||
| Cost of sales | 3,178 | 47.0% | 3,045 | 48.2% | 4.4% | |||||
| Gross profit | 3,591 | 53.0% | 3,277 | 51.8% | 9.6% | |||||
| Operating expenses | 2,307 | 34.1% | 2,146 | 33.9% | 7.5% | |||||
| Operating income | 1,284 | 19.0% | 1,131 | 17.9% | 13.5% | |||||
| Depreciation, Amortization & Other non-cash charges (2) | 404 | 6.0% | 345 | 5.5% | 17.0% | |||||
| EBITDA (3) | 1,688 | 24.9% | 1,476 | 23.4% | 14.3% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes returnable bottle breakage expense. | ||||||||||
| (3) EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges. | ||||||||||
| Central American operations | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
1Q 06 |
% Rev |
1Q 05 |
% Rev |
D % | ||||||
| Sales Volume (million unit cases) | 27.9 | 26.1 | 6.9% | |||||||
| Average price per unit case | 32.55 | 33.18 | -1.9% | |||||||
| Net revenues | 908 | 866 | 4.8% | |||||||
| Other operating revenues | 10 | 0 | N.A. | |||||||
| Total revenues | 918 | 100.0% | 866 | 100.0% | 5.9% | |||||
| Cost of sales | 493 | 53.7% | 447 | 51.6% | 10.2% | |||||
| Gross profit | 425 | 46.3% | 419 | 48.4% | 1.3% | |||||
| Operating expenses | 310 | 33.8% | 304 | 35.1% | 2.0% | |||||
| Operating income | 115 | 12.5% | 115 | 13.3% | -0.5% | |||||
| Depreciation, Amortization & Other non-cash charges (2) | 53 | 5.8% | 57 | 6.6% | -7.1% | |||||
| EBITDA (3) | 168 | 18.3% | 172 | 19.9% | -2.6% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes returnable bottle breakage expense. | ||||||||||
| (3) EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges. | ||||||||||
| April 27, 2006 | |
Page 11 |
| Colombian and Venezuelan operations | |
| Colombian operations | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
1Q 06 |
% Rev |
1Q 05 |
% Rev |
D % | ||||||
| Sales Volume (million unit cases) | 42.1 | 42.2 | -0.2% | |||||||
| Average price per unit case | 27.55 | 26.79 | 2.8% | |||||||
| Net revenues | 1,160 | 1,131 | 2.6% | |||||||
| Other operating revenues | - |
- |
N.A. | |||||||
| Total revenues | 1,160 | 100.0% | 1,131 | 100.0% | 2.6% | |||||
| Cost of sales | 644 | 55.6% | 626 | 55.3% | 3.0% | |||||
| Gross profit | 516 | 44.5% | 505 | 44.7% | 2.2% | |||||
| Operating expenses | 404 | 34.8% | 404 | 35.8% | -0.1% | |||||
| Operating income | 112 | 9.7% | 101 | 8.9% | 11.4% | |||||
| Depreciation, Amortization & Other non-cash charges (2) | 70 | 6.1% | 74 | 6.6% | -5.1% | |||||
| EBITDA (3) | 183 | 15.7% | 175 | 15.5% | 4.4% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes returnable bottle breakage expense. | ||||||||||
| (3) EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges. | ||||||||||
| Venezuelan operations | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
| 1Q 06 | % Rev | 1Q 05 | % Rev | D % | ||||||
| Sales Volume (million unit cases) | 41.0 | 40.4 | 1.5% | |||||||
| Average price per unit case | 31.29 | 29.42 | 6.4% | |||||||
| Net revenues | 1,283 | 1,189 | 7.9% | |||||||
| Other operating revenues | 4 | 1 | N.A. | |||||||
| Total revenues | 1,287 | 100.0% | 1,190 | 100.0% | 8.2% | |||||
| Cost of sales | 792 | 61.6% | 694 | 58.3% | 14.2% | |||||
| Gross profit | 495 | 38.4% | 496 | 41.7% | -0.3% | |||||
| Operating expenses | 481 | 37.4% | 423 | 35.5% | 13.7% | |||||
| Operating income | 14 | 1.1% | 73 | 6.2% | -81.1% | |||||
| Depreciation, Amortization & Other non-cash charges (2) | 66 | 5.2% | 60 | 5.0% | 11.4% | |||||
| EBITDA (3) | 80 | 6.2% | 133 | 11.2% | -39.6% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes returnable bottle breakage expense. | ||||||||||
| (3) EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges. | ||||||||||
| April 27, 2006 | |
Page 12 |
| Argentine and Brazilian operations | |
| Argentine operations | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
1Q 06 |
% Rev |
1Q 05 |
% Rev |
D % | ||||||
| Sales Volume (million unit cases) | 41.2 | 39.3 | 4.8% | |||||||
| Average price per unit case | 17.90 | 18.71 | -4.3% | |||||||
| Net revenues | 737 | 735 | 0.3% | |||||||
| Other operating revenues | 11 | 37 | N.A. | |||||||
| Total revenues | 748 | 100.0% | 772 | 100.0% | -3.1% | |||||
| Cost of sales | 450 | 60.2% | 477 | 61.7% | -5.5% | |||||
| Gross profit | 298 | 39.8% | 295 | 38.3% | 0.9% | |||||
| Operating expenses | 195 | 26.0% | 166 | 21.5% | 17.4% | |||||
| Operating income | 103 | 13.8% | 129 | 16.8% | -20.2% | |||||
| Depreciation, Amortization & Other non-cash charges (2) | 38 | 5.1% | 34 | 4.4% | 13.0% | |||||
| EBITDA (3) | 141 | 18.9% | 163 | 21.1% | -13.3% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes returnable bottle breakage expense. | ||||||||||
| (3) EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges. | ||||||||||
| Brazilian operations | ||||||||||
| Expressed in million of Mexican pesos(1) with purchasing power as of March 31, 2006 | ||||||||||
| 1Q 06 (2) | % Rev | 1Q 05 (3) | % Rev | D % | ||||||
| Sales Volume (million unit cases) | 67.8 | 62.1 | 9.2% | |||||||
| Average price per unit case | 25.42 | 24.52 | 3.7% | |||||||
| Net revenues | 1,901 | 1,523 | 24.8% | |||||||
| Other operating revenues | 13 | 43 | -69.8% | |||||||
| Total revenues | 1,914 | 100.0% | 1,566 | 100.0% | 22.2% | |||||
| Cost of sales | 1,087 | 56.8% | 846 | 54.0% | 28.5% | |||||
| Gross profit | 827 | 43.2% | 720 | 46.0% | 14.8% | |||||
| Operating expenses | 518 | 27.1% | 475 | 30.3% | 9.1% | |||||
| Operating income | 309 | 16.1% | 245 | 15.6% | 26.1% | |||||
| Depreciation, Amortization & Other non-cash charges (4) | 41 | 2.1% | 40 | 2.6% | 1.8% | |||||
| EBITDA (5) | 350 | 18.3% | 285 | 18.2% | 22.7% | |||||
| (1) Except volume and average price per unit case figures. | ||||||||||
| (2) Includes beer results except in sales volume and average price per unit case. | ||||||||||
| (3) Excludes beer results except in other operating revenues, where net proceeds from beer are recorded. | ||||||||||
| (4) Includes returnable bottle breakage expense. | ||||||||||
| (5) EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges. | ||||||||||
| April 27, 2006 | |
Page 13 |
| Selected Information | |
For the three months ended March 31, 2006
Expressed in million of Mexican pesos as of March 31, 2006
| 1Q 05 | 1Q 06 | |||
| Capex | 195.0 | Capex | 420.5 | |
| Depreciation | 322.4 | Depreciation | 350.7 | |
| Amortization & Other non-cash charges | 287.3 | Amortization & Other non-cash charges | 304.6 | |
VOLUME
Expressed in million unit cases
| 1Q 05 | 1Q 06 | ||||||||
| CSD | Water | Other | Total | CSD | Water | Other | Total | ||
| Mexico | 182.3 | 44.3 | 1.2 |
227.8 | 195.5 | 48.6 | 1.9 |
246.0 | |
| Central America | 24.5 | 1.2 | 0.4 |
26.1 | 25.4 | 1.3 | 1.2 |
27.9 | |
| Colombia | 36.7 | 5.4 | 0.1 |
42.2 | 36.8 | 5.3 | 0.0 |
42.1 | |
| Venezuela | 35.0 | 3.5 | 1.9 |
40.4 | 35.4 | 3.5 | 2.1 |
41.0 | |
| Argentina | 38.3 | 0.5 | 0.5 |
39.3 | 39.9 | 0.6 | 0.7 |
41.2 | |
| Brazil | 57.1 | 4.5 | 0.5 |
62.1 | 61.2 | 5.9 | 0.7 |
67.8 | |
| Total | 373.9 | 59.4 | 4.6 | 437.9 | 394.2 | 65.2 | 6.6 |
466.0 | |
PACKAGE MIX BY PRESENTATION
Expressed as a Percentage of Total Volume
| 1Q 05 | 1Q 06 | ||||||||
| Ret | Non-Ret | Fountain | Jug | Ret | Non-Ret | Fountain | Jug | ||
| Mexico | 27.9 | 56.1 |
1.3 |
14.7 |
26.2 |
57.5 |
1.2 |
15.1 |
|
| Central America | 45.6 | 51.0 |
3.4 |
- |
35.8 |
60.6 |
3.6 |
- |
|
| Colombia | 49.3 | 41.0 |
3.1 |
6.6 |
45.0 |
45.7 |
3.3 |
6.0 |
|
| Venezuela | 24.8 | 69.6 |
2.7 |
2.9 |
21.2 |
72.5 |
3.6 |
2.7 |
|
| Argentina | 26.9 | 70.1 |
3.0 |
- |
26.5 |
70.4 |
3.1 |
- |
|
| Brazil | 6.3 | 90.5 |
3.2 |
- |
10.0 |
86.6 |
3.4 |
- |
|
| April 27, 2006 | |
Page 14 |
| Macroeconomic Information | |
Inflation |
Foreign Exchange Rate (local currency) per U.S. dollar |
|||||||||
| LTM 06 | 1Q 06 | Mar-06 |
Mar-05 |
Dec 05 |
||||||
| Mexico | 3.41% | 1.59% | 10.9510 | 11.1710 | 10.7109 | |||||
| Colombia | 4.11% | 0.45% | 2,289.9800 | 2,376.4800 | 2,284.2200 | |||||
| Venezuela | 12.15% | 2.50% | 2,150.0000 | 2,150.0000 | 2,150.0000 | |||||
| Argentina | 11.68% | 3.22% | 3.0820 | 2.9200 | 3.0320 | |||||
| Brazil | 4.51% | 1.51% | 2.1724 | 2.6662 | 2.3407 | |||||
| April 27, 2006 | |
Page 15 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| COCA-COLA FEMSA, S.A. DE C.V. | |
| (Registrant) | |
| Date: April 27, 2006 | By: /s/ HÉCTOR TREVIÑO GUTIÉRREZ |
| Name: Héctor Treviño Gutiérrez | |
| Title: Chief Financial Officer |