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Investor Relations: 1 de 13 [email protected] +52(81) 8389-9078 www.grupofamsa.com

Fourth Quarter 2010

BMV: GFAMSA

Monterrey, Mexico. February 17, 2011 – Grupo Famsa S.A.B. de C.V. (BMV: GFAMSA) The Chief Executive Officer of Grupo Famsa S.A.B. de C.V. reports on the Company’s fourth quarter 2010 (4Q10) results as of December 31, 2010. Summary of Consolidated Financial Results (Millions of Mexican pesos)

(1) Nominal figures (2) Calculated from the consolidated financial statements Letter from the CEO

Humberto Garza Valdéz, Grupo Famsa’s Chief Executive Officer, stated: Grupo Famsa continued strengthening its position through the implementation of initiatives directed at maximizing the performance of its three business units. Famsa México’s increase in EBITDA to Ps$1,765 million, the successful consolidation of Banco Ahorro Famsa as one of Mexico’s most important banking institutions and the recovery in Famsa USA’s sales are some of the most important achievements of 2010.

Famsa México’s sales growth accelerated during fourth quarter 2010, with same store

sales rising 9.1%. We underpinned the solid results from personal loans and took concrete steps to drive demand in durable goods categories as part of our focus on maximizing the productivity of our Mexican store network. In particular, the Furniture overhaul helped to revert an extended period of declining sales in this category as of the third quarter 2010.

In addition, Banco Ahorro Famsa consolidated its position as one of Mexico’s most

important banking institutions resulting from our ambitious implementation plan. According to figures published by the Mexican National Banking and Securities Commission (December 2010), Banco Ahorro Famsa is in 9th place nationwide in number of banking branches, 10th place in the balance of its consumer loan portfolio and 15th place in the balance of its deposits. The strength of our banking institution is also reflected in its capitalization index, which grew from 11.8% to more than 13% by year-end 2010.

Lastly, for the first time since 2008, Famsa USA posted increased quarterly sales. The

growing recovery of Hispanic consumers in some of our most important markets and a significant improvement in some product categories contributed to reverting a long period of falling sales for this business unit.

Fourth Quarter(1) January – December(1) 2010 2009 % Var(2) 2010 2009 % Var(2)

Net Sales 4,471 4,175 7.1% 14,993 14,947 0.3%Cost of Sales -2,221 -2,014 10.3% -7,356 -7,355 0.0%Gross Income 2,250 2,161 4.1% 7,637 7,592 0.6%Operating Expenses -1,798 -1,847 -2.6% -6,331 -6,469 -2.1%Operating Income 451 314 43.7% 1,305 1,123 16.2%EBITDA 544 390 39.3% 1,700 1,554 9.4%Net Income 253 -214 218.0% 804 97 725.9% Gross Margin 50.3% 51.8% 50.9% 50.8% EBITDA Margin 12.2% 9.3% 11.3% 10.4% Net Margin 5.6% -5.1% 5.4% 0.7%


I. Operating Results by Business Unit Famsa México

In 2010, Famsa México consolidated its recovery with annual EBITDA growing to Ps$1,765 million. The profitability of our Mexican network of stores increased during the year, reflecting the implementation of simultaneous initiatives to drive productivity. These initiatives included leveraging the integration of Banco Ahorro Famsa and reinforcing assortment, store displays and promotions.

After a significant period of contraction, our most recent results in core product

categories reflect a recovery in demand. Furniture, Computer and Motorcycle are some of the categories that headed this positive trend. The introduction of new models, the set-up of more attractive displays and the launch of targeted promotions contributed significantly to Furniture’s 15% sales growth and the 22% rise in Computer sales during the second half of 2010. In addition, we have successfully implemented a comprehensive plan to become one of Mexico’s top Motorcycle retailers. Our proprietary motorcycle brand (KURAZAI) now ranks among the 4 top-selling brands in the nation.

During the fourth quarter, we opened 4 stores in the states of Yucatán, Campeche and

Colima. These stores are part of the expansion plan that had been postponed since the economic crisis, but that we intend to resume as consumption in Mexico gains momentum. Banco Ahorro Famsa

Banco Ahorro Famsa has successfully consolidated its position as one of Mexico’s top 10 banking institutions in terms of consumer loans and number of banking branches. During 2010, our bank’s strength was complemented by an enhanced capitalization index, stable non-performing loans indicators and a growing deposit base.

At the close of 2010, Banco Ahorro Famsa’s capitalization index exceeded 13%,

reflecting its solid operations. The consistent range of approximately 12% for the non-performing loans ratio (CNBV: Indice de Morosidad, IMOR) and the benefits resulting from a reduced cost of funding and increased operating leverage served to underpin the strength of our bank. Total bank deposits, which now represent more than 70% of Grupo Famsa’s consolidated net financing, grew consistently at an average quarterly rate of 5.5%, reaching Ps$8,907 million. Moreover, the average interest rate for bank deposits fell from 8.1% to 6.1% by year-end 2010.

Banco Ahorro Famsa has also successfully incursioned into the financing of micro,

small and medium-sized businesses (MiPYMEs for the initials in Spanish). Credit risk diversification, support for Mexico’s productive activities and the complement to our traditional consumer finance business are just some of the advantages offered by this new growth front.

Famsa USA In line with our most recent expectations, the economic pressure on Hispanic

consumers ceded during the second half of 2010. The moderate improvement in the economic environment resulted in a 3.6% rise in Famsa USA’s same-store sales (SSS) during 4Q10. This result represents a significant change, since it is the first time that quarterly SSS for our U.S. operations have grown since 2008.

Recently, consumption in some of our main markets, as well as in some of our core

categories rose significantly. For example, sales in Texas grew more than 13% during the fourth quarter, and Furniture demand was much stronger than other categories such as Electronics and Household Appliances.


II. Retail Stores and Banking Branch Network Retail Stores and Banking Branches

Retail Area (Square meters)

Openings and Closures of Retail Stores and Banking Branches (Present quarter)

Total 4Q10 Openings

4Q10 Closures 4Q10 Total

3Q10 Retail Stores 410 4 1 407

Famsa México 359 4 1 356

Famsa USA 51 0 0 51

Banking Branches (1) 284 4 1 281

(1) Most banking branches are located within Famsa Mexico stores

Total 4Q10 Total

4Q09 % Var.

Retail Stores 410 410 0.0%

Famsa México 359 357 0.6%

Famsa USA 51 53 -3.8%

Banking Branches (1) 284 276 2.9%

Total 4Q10 Total

4Q09 % Var.

Stores 541,387 544,456 -0.6%

Famsa México 418,346 416,643 0.4%

Famsa USA 123,041 127,813 -3.7%


III. Financial Results by Business Unit Net Sales (Millions of Mexican pesos)

Same-store Sales

(1) Includes sales of other non-retail businesses (2) Includes Banco Ahorro Famsa (3) Calculated from the consolidated financial statements (4) Calculated in US Dollars, excluding foreign exchange effects Net Sales

Grupo Famsa’s consolidated net sales grew 7.1% year-over-year during the fourth quarter of 2010 to Ps$4,471 million. The growth of 9.4% in Famsa México’s sales for the fourth quarter made a significant contribution to this result. However, the 1.0% decline in the fourth quarter sales of Famsa USA pressured our consolidated net sales growth. Excluding foreign exchange effects, Famsa USA’s sales for the fourth quarter grew 4.1% and its same store sales rose 3.6%. It is important to note that this is the first quarter since 2008 in which Famsa USA has posted a positive growth in same store sales. Consumption in some of our main markets in the United States recovered significantly as of the third quarter.

As of December 31, 2010, accumulated net sales totaled Ps$14,993 million, a growth of

0.3% year-over-year. The economic pressure on Hispanic consumers in the United States and the appreciation of the Mexican peso resulted in a 17.3% contraction in Famsa USA’s annual sales. In contrast, Famsa México’s sales rose 6.1% in 2010, driven by the increase in personal loans and the recent recovery in demand for certain core durable goods categories.

Cost of Sales and Gross Income

Grupo Famsa’s accumulated consolidated cost of sales was Ps$7,356 million at year-end 2010, almost the same as that of the previous year. The accumulated gross income for 2010 reached Ps$7,637 million, representing a growth of 0.6% in amount and an expansion of 14 basis points in gross margin compared to the previous year.

The 4Q10 consolidated gross income grew 4.1% year-over-year to Ps$2,250 million

driven by incremental sales. However, the gross margin declined from 51.8% in 4Q09 to 50.3% in 4Q10, as a result of the holiday promotions introduced to stimulate demand both in Mexico and the United States.

Fourth Quarter January - December 2010 2009 % Var(3) 2010 2009 % Var(3)

Grupo Famsa (1) 4,471 4,175 7.1% 14,993 14,947 0.3% Famsa México (2) 3,434 3,139 9.4% 11,494 10,832 6.1% Famsa USA 993 1,003 -1.0% 3,390 4,096 -17.3% Other 296 233 27.1% 1,009 763 32.2% Intercompany -252 -200 26.0% -901 -745 20.9%

Fourth Quarter January - December 2010 2009 2010 2009

Grupo Famsa 8.8% -0.3% 3.4% -5.4% Famsa México 9.1% 5.4% 6.6% -4.3% Famsa USA(4) 3.6% -16.1% -11.8% -9.3%


Operating Income before Depreciation and Amortization (EBITDA) (Millions of Mexican pesos)

EBITDA Margin (% EBITDA / Sales)

(1) Includes EBITDA of other non-retail businesses (2) Includes Banco Ahorro Famsa (3) Calculated from the consolidated financial statements EBITDA and Operating Expenses

The consolidated EBITDA for the twelve-month period ended December 31, 2010 was

Ps$1,700 million, 9.4% above that of 2009. Consolidated operating expenses fell more than Ps$137 million in 2010 as a result of improvements in line-items such as advertising and allowance for doubtful accounts, among others. This decline in operating expenses contributed significantly to the expansion of more than 93 basis points in the 2010 consolidated EBITDA margin.

Consolidated operating expenses (excluding depreciation and amortization) for fourth

quarter 2010 declined 3.6% to Ps$1,706 million. As a result, the EBITDA for the fourth quarter increased 39.3% to Ps$544 million. The 4Q10 EBITDA margin of Famsa México was pressured by a contraction in gross margin and the incremental operating expenses corresponding to the opening of 4 new stores, as well as the implementation of special projects, such as that of our motorcycle category. Conversely, Famsa USA benefitted from savings obtained from initiatives to optimize its cost structure as well as improvement in its allowance for doubtful accounts. Comprehensive Financing Expense, Net (Millions of Mexican pesos)

The accumulated comprehensive financing expense, net at year-end 2010 was Ps$1,079 million, 12.7% below that of the previous year. Interest expense declined 3.3% mainly as a result of the reduction achieved in Banco Ahorro Famsa’s funding rate. Moreover, a moderate foreign exchange gain was posted for 2010, compared to a foreign exchange loss of Ps$126 million in 2009, reflecting the increased stability of the foreign exchange market and, more importantly, the reduction in Grupo Famsa’s net long U.S. dollar position maintained through Famsa USA’s operating assets.


Grupo Famsa (1) 544 390 39.3% 1,700 1,554 9.4% Famsa México (2) 553 576 -3.9% 1,765 1,659 6.4% Famsa USA -35 -223 84.2% -137 -128 -7.4% Other 17 -19 188.9% 24 -89 126.9% Intercompany 9 56 -84.7% 48 111 -56.9%

Fourth Quarter January - December 2010 2009 2010 2009

Grupo Famsa (1) 12.2% 9.3% 11.3% 10.4% Famsa México (2) 16.1% 18.4% 15.4% 15.3% Famsa USA -3.6% -22.2% -4.0% -3.1%


Comp. Financing Expense, net -284 -330 -13.9% -1,079 -1,236 -12.7% Interest Expense -298 -264 13.0% -1,089 -1,125 -3.3% Interest Income 2 4 -60.0% 3 16 -79.2% Exchange gain (loss), net 13 -70 118.1% 6 -126 105.1%


Similar to the third quarter of 2010, the 4Q10 quarterly interest expense increased 13.0%, largely because of the payment of interest corresponding to indebtedness payable with proceeds from the US$200 million issued in July 2010. Net Income

Accumulated net income for the twelve month period ended December 31, 2010 grew

from Ps$97 million in 2009 to Ps$804 million, an increase of 725.9% year-over-year. Net income for the fourth quarter 2010 reached Ps$253 million, compared to a loss of Ps$214 million for the same quarter of 2009. As in previous quarters, during 4Q10, a deferred income tax benefit was generated from the transfer of accounts receivable to Banco Ahorro Famsa (from Famsa México), as well as other temporary differences.


Main Balance Sheet Accounts (Millions of Mexican pesos)

December 31, 2010 2009 % Var(1)

Trade Accounts Receivable 16,572 14,131 17.3% Banco Ahorro Famsa 13,090 9,471 38.2% Famsa 3,482 4,660 -25.3%

Inventory 2,226 2,118 5.1% Net Debt 3,764 2,385 57.8% Bank Deposits 8,907 7,377 20.7% Stockholders’ Equity 9,085 8,367 8.6%

(1) Calculated from the consolidated financial statements Trade Accounts Receivable

As of December 31, 2010, trade accounts receivable totaled Ps$16,572 million, 17.3%

above those as of December 31, 2009. The increase largely reflects the growth of Banco Ahorro Famsa’s accounts receivable, driven by the integration of Famsa Mexico’s existing credit portfolio, the issuance of personal loans and the growth of the bank’s commercial portfolio ((e.g. SME loans - MiPYME). In contrast, as a result of the successful integration of Famsa México’s accounts receivable into Banco Ahorro Famsa, the balance of Famsa’s trade accounts receivable fell 25.3% year-over-year. Inventory

The balance of inventory as of December 31, 2010 increased 5.1% compared to the

previous year, to Ps$2,226 million. Famsa México’s opening of 4 new stores during fourth quarter 2010 and the moderate sales performance in the month of December are reflected in this inventory growth. Bank Deposits and Net Debt

As of December 31, 2010, bank deposits totaled Ps$8,907 million, 20.7% above those

of the previous year. Approximately 92% of these bank deposits involve some type of term deposit products we offer. In addition, Banco Ahorro Famsa’s average cost of funding declined to 6.1% in 4Q10, significantly below the rate of 6.4% that had been initially estimated for year-end 2010. Bank deposits continue to offer an optimum source of financing for the credits extended to Grupo Famsa’s Mexican customers, mitigating Grupo Famsa’s exposure to conventional credit market volatility and contributing significantly to reducing the Company’s consolidated cost of funding.

Net debt was Ps$3,764 million at year-end 2010. The 57.8% increase in net debt

reflects a 20.0% rise in gross debt and a reduction in the cash balance in 2010 compared to that of 2009. It is important to note that on July 20, 2010 Grupo Famsa successfully concluded the issuance of senior notes amounting to US$200 million, with a fixed coupon of 11.00% and maturity in 2015. The notes received a rating of “B” from Standard & Poor’s and “B+” from Fitch Ratings. Approximately 80% of the net proceeds were used to refinance short-term indebtedness. This issuance mitigates Grupo Famsa’s exposure to financial market volatility, increasing the average life of the Company’s debt from 0.5 years to approximately 3 years. This issuance also significantly reduced Grupo Famsa’s exposure to foreign exchange rate volatility by improving the balance between its dollar-denominated assets and liabilities.

Stockholders’ Equity

The balance of stockholders’ equity as of December 31, 2010 was Ps$9,085 million,

8.6% above that of the previous year.


2011 Guidance

During 2010, Grupo Famsa consolidated the recovery of its Mexican operations and reverted an extended period of sales contraction for Famsa USA through the implementation of initiatives to maximize the performance of its three business units.

The plan for our operations in Mexico contemplates opening at least 6 new stores

throughout 2011. In addition to progressive store expansion, we will continue to focus on stimulating demand in core durable goods categories, capitalize on the strength of our personal loan offering and develop complementary products for Banco Ahorro Famsa. For Famsa USA, we maintain a more conservative perspective with regard to store expansion. Our priority is to continue stimulating demand and optimizing our cost structure in the United States, in order to return to pre-crisis profitability levels. Opening of Retail Stores and Banking Branches

(1) Installed inside the new Famsa México stores Financial Results (Millions of pesos)

2011 Est.

Retail Stores 3

Famsa México 6

Famsa USA -3

Banking Branches (1) 6

2011 Est.

Consolidated Net Sales $16,100 - $16,700

Consolidated EBITDA $1,950 - $2,100

Consolidated Net Sales Growth +7% to +12%

Same-store Sales Growth

Famsa México +7% to +12%

Famsa USA (US$) +6% to +11%


IV. Consolidated Financial Statements

Grupo Famsa, S.A.B. de C.V. and Subsidiaries Consolidated Balance Sheet as of December 31

Thousands of Mexican Pesos ASSETS 2010 2009CURRENT ASSETS:Cash and cash equivalents Ps 916,792 3.6% Ps 1,514,218 6.7%Restricted cash 187,513 0.7% 191,868 0.8%Trade accounts receivable 3,482,494 13.5% 4,660,501 20.6%Trade accounts receivable financial sector 13,089,926 50.8% 9,470,599 41.9%Taxes recoverable 1,253,048 4.9% 573,601 2.5%Other accounts receivable 583,218 2.3% 538,891 2.4%Inventories 2,226,075 8.6% 2,118,045 9.4%

Total current assets 21,739,066 84.4% 19,067,723 84.4%

PROPERTY, LEASEHOLD IMPROVEMENTSAND FURNITURE AND EQUIPMENT 2,561,666 9.9% 2,731,880 12.1%

GOODWILL 241,096 0.9% 241,096 1.1%

DEFERRED CHARGES 68,902 0.3% 102,559 0.5%

OTHER ASSETS 58,778 0.2% 97,551 0.4%

DEFERRED INCOME TAX 1,034,625 4.0% 327,517 1.4%

DEFERRED EMPLOYEES'PROFIT SHARING 48,256 0.2% 36,117 0.2%Total assets Ps 25,752,389 100.0% Ps 22,604,443 100.0%

LIABILITIES AND STOCKHOLDERS' EQUITYCURRENT LIABILITIES WITH FINANCIAL COST:Interest-bearing demand deposits and time-deposits Ps 8,907,298 34.6% Ps 7,376,769 32.6%Bank debt 522,890 2.0% 1,396,144 6.2%Commercial paper 1,671,725 6.5% 1,493,803 6.6%

11,101,913 43.1% 10,266,716 45.4%

CURRENT LIABILITIES WITHOUT FINANCIAL COST:Suppliers 2,070,515 8.0% 1,729,420 7.7%Accounts payable and accrued expenses 834,826 3.2% 897,876 4.0%Income tax payable 23,920 0.1% 182,948 0.8%

2,929,261 11.4% 2,810,244 12.4%Total current liabilities 14,031,174 54.5% 13,076,960 57.9%

LONG-TERM LIABILITIES:Bank debt 16,428 0.1% 9,640 0.0%Commercial paper 2,469,920 9.6% 1,000,000 4.4%Estimated liability for labor benefits 150,128 0.6% 150,477 0.7%Total long-term liabilities 2,636,476 10.2% 1,160,117 5.1%Total liabilities 16,667,650 64.7% 14,237,077 63.0%

STOCKHOLDERS' EQUITY:Capital stock 2,472,600 9.6% 2,472,600 10.9%Additional paid-in capital 3,068,488 11.9% 3,068,488 13.6%Retained earnings 2,479,682 9.6% 2,382,327 10.5%Stock Repurchase Reserve 110,000 0.4% 110,000 0.5%Net income 804,104 3.1% 97,355 0.4%Cumulative translation adjustment 128,337 0.5% 219,437 1.0%Total majority interest 9,063,211 35.2% 8,350,207 36.9%

Minority interest 21,528 0.1% 17,159 0.1%

Total stockholders' equity 9,084,739 35.3% 8,367,366 37.0%Total liabilities and stockholders' equity Ps 25,752,389 100.0% Ps 22,604,443 100.0%


Grupo Famsa, S.A.B. de C.V. and Subsidiaries

Consolidated Income Statement from January 1 to December 31 Thousands of Mexican Pesos

2010 2009

Net sales Ps 14,992,877 100.0% Ps 14,946,922 100.0%

Cost of sales (7,356,235) -49.1% (7,355,212) -49.2%

Gross margin 7,636,642 50.9% 7,591,710 50.8%

Operating expenses (6,331,413) -42.2% (6,468,548) -43.3%

Operating income 1,305,229 8.7% 1,123,162 7.5%

Comprehensive financing expense, net (1,079,051) -7.2% (1,235,556) -8.3%

226,178 1.5% (112,394) -0.8%

Other (expenses) income, net (85,492) -0.6% 1,926 0.0%

Income (loss) before income tax 140,686 0.9% (110,468) -0.7%

Income tax 667,262 4.5% 210,128 1.4%

Consolidated net income 807,948 5.4% 99,660 0.7%

Net income corresponding to minority interest 3,844 0.0% 2,305 0.0%

Net income corresponding to majority interest Ps 804,104 5.4% Ps 97,355 0.7%0 0



Consolidated Income Statement from October 1 to December 31 Thousands of Mexican Pesos

2010 2009

Net sales Ps 4,470,504 100.0% Ps 4,175,076 100.0%

Cost of sales (2,220,928) -49.7% (2,014,186) -48.2%

Gross margin 2,249,576 50.3% 2,160,890 51.8%

Operating expenses (1,798,429) -40.2% (1,846,846) -44.2%

Operating income 451,147 10.1% 314,044 7.5%

Comprehensive financing expense, net (284,123) -6.4% (329,838) -7.9%

167,024 3.7% (15,794) -0.4%

Other (expenses) income, net (53,781) -1.2% (23,128) -0.6%

Income (loss) before income tax 113,243 2.5% (38,922) -0.9%

Income tax 140,343 3.1% (175,227) -4.2%

Consolidated net income (loss) 253,586 5.7% (214,149) -5.1%

Net income (loss) corresponding to minority interest 1,053 0.0% (74) -0.0%

Net income (loss) corresponding to majority interest Ps 252,533 5.6% Ps (214,075) -5.1%



Consolidated Cash Flow Statement from January 1 to December 31 Thousands of Mexican Pesos

Operations 2010 2009

Income (loss) before income tax Ps 140,686 Ps (110,468)

Items relating to investing activities:Depreciation and amortization 394,796 431,267Allowance for doudtful accounts 1,076,640 1,225,817Gain on sale of property, plant and equipment (2,082) (1,735)Estimated liability for labor benefits 26,890 30,848Deferred employees profit sharing (12,139) (17,342)Interest gain (3,309) (15,935)

Items relating to financing activities:Interest expense 1,088,829 1,125,446Exchange (gain) loss (93,779) 8,911Other, net 0 0

Accounts receivable (3,517,960) (2,419,965)Inventories (167,236) 43,445Other accounts receivable, deferred charges and other assets (816,234) (448,584)Suppliers 341,856 (203,829)Other accounts payable and accrued expenses (209,888) (235,509)Income tax paid (198,869) (405,736)

Net cash flow (used in) provided by operating activities (1,951,800) (993,369)

Investment

Acquisition of property, plant and equipment (196,466) (280,742)Sale of plant and equipment 5,000 11,234Interest collected 3,309 15,935

Net cash flow used in investing activities (188,157) (253,573)

Resources to be (provided by) used in financing activities (2,139,957) (1,246,942)

FinancingInterest paid (987,575) (1,132,510)New short-term debt and bank loans 4,247,026 2,991,136Payments of short-term debt and bank loans (3,367,056) (5,999,529)Bank customers' deposits 1,530,529 4,245,098Increase in capital stock 0 1,181,140Resale (reacquisition) of own shares 0 22,393Other capital adjustments 0 0

Net cash flow from financing activities 1,422,924 1,307,728

(Decrease) increase in net cash and cash equivalent (717,033) 60,786Adjustments to cash flow as a result of changes in exchange rates 115,252 196,765Cash and cash equivalent at beginning of period 1,706,086 1,448,535

Cash and cash equivalent at end of period Ps 1,104,305 Ps 1,706,086

Cash and cash equivalent Ps 916,792 Ps 1,514,218Restricted cash 187,513 191,868

Ps 1,104,305 Ps 1,706,086


This report contains, or may be deemed to contain forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The future results of Grupo Famsa, S.A.B. de C.V. and its subsidiaries may vary from the results expressed in, or implied by, the forward-looking statements made to you, possibly to a material degree.

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