Walmart de Mexico (Walmex), the retail giant in Mexico, posted remarkable Q3 results with a 12.2% year-on-year surge in net profit, primarily attributed to robust sales performance.
In the third quarter, Walmex achieved a net profit of 13.63 billion pesos ($782 million). Quarterly revenue increased by 7.7% compared to the previous year, reaching 213.07 billion pesos, only slightly below the LSEG estimate of 213.34 billion pesos.
In a statement filed with Mexico’s primary stock exchange, Walmex acknowledged that the appreciation of the Mexican peso had a negative impact on revenues. They further highlighted that without the foreign exchange effects on their Central America operations, sales growth would have been even higher.
Sales in Mexico saw an impressive 9.5% increase, while Central America experienced a 9% growth. Notably, Walmex opened 24 new stores in Mexico and three in Central America, contributing significantly to their total revenues.
The earnings before interest, tax, depreciation, and amortization (EBITDA) for the quarter also showed a robust rise of 8.5%, reaching 23 billion pesos.
Walmex’s earnings per share exceeded expectations at 0.78 pesos, surpassing the LSEG estimate of 0.74 pesos.
These results come on the heels of Walmex’s announcement on October 6 that it would be facing an antitrust panel investigation for alleged monopolistic practices, following a three-year investigation by Mexico’s antitrust regulator, Cofece.
Walmex CEO Guilherme Loureiro expressed confidence in the company’s compliance with the law and stated, «This is the first opportunity for Walmex to defend itself against the allegations, and we will exercise all rights and remedies available to us under the law.»
Should the regulator find Walmex in violation of competition law, Cofece could impose fines of up to 8% of the company’s annual income in Mexico.
