2 Min Read
(Recasts; adds capital expenditure details, NAFTA fears, peso slump impact)
By Noe Torres
MEXICO CITY, Feb 27 (Reuters) - Mexican bottler and retailer Fomento Economico Mexicano (Femsa) on Monday reported a 23 percent rise in fourth-quarter profit compared to the same period a year earlier, driven by currency gains stemming from a deep slump in the Mexican peso.
Net profit at the company, which operates the Oxxo chain of convenience stores and has a stake in Heineken NV , rose to 6.673 billion pesos ($323 million).
Between October and December, the Mexican peso fell by more than 7 percent against the dollar, fueled by fears of what a Donald Trump presidency could mean for Latin America's second largest economy.
Trump has threatened to slap hefty taxes on imports from Mexico to the United States and to scuttle the North American Free Trade Agreement (NAFTA) with Mexico and Canada if it cannot be renegotiated to benefit U.S. interests.
Femsa, which said it would raise capital expenditure modestly this year to $1.3 billion, flagged uncertainty over NAFTA, foreign direct investment in Mexico, the peso, and the impact of U.S. taxes on Mexico in a conference call with analysts.
Total revenues for the company, which is based in the northern industrial city of Monterrey, also rose 23 percent year-on-year to 109.907 billion pesos, driven by growth in all divisions.
Coca-Cola Femsa, the largest Coke bottler in the world and a joint venture of Femsa, reported a 30.5 percent jump in quarterly profit last week, helped by higher volume sales in Costa Rica, Nicaragua and the Philippines.
On the earnings call, Femsa executives said some $770 million of the capital expenditure would be in Coke Femsa.
$1 = 20.64 pesos Reporting by Noe Torres and Alexandra Alper; Editing by Chizu Nomiyama and Paul Simao