mexico city...title mexico city author mrroman created date 3/13/2020 10:33:28 am

December 31, 2019

Company Overview(MSE: Walmex)

2

This presentation is property of Wal-Mart de México S.A.B. de C.V. and is

intended for the use of the company’s shareholders and the investment

community. It should not be reproduced in any way.

This presentation may contain certain references concerning Wal-Mart de

Mexico S.A.B. de C.V.’s future performance that should be considered as

good faith estimates made by the Company.

These references only reflect management expectations and are based

upon currently available data. Actual results are always subject to future

events, risks and uncertainties, which could materially impact the

Company’s actual performance.

3

Table of contents

History of Walmex 4

Walmex Today 11

Financial Information 29

Competitors 35

Walmex Resources 42

4

History of Walmex

5

History: founded in 1958

1958

1970

1964

1959

Vips Restaurantsstarts operations

Bodega Aurrerá& Suburbia

start operations

Aurrerástart operations

Superamastarts operations

1977

Cifra starts trading on the Mexican Stock Exchange

6

History: Walmart’s first international business

1991

1999

1997

1993

Wal-Mart Stores, Inc.acquires majority

position in Cifra - Tender offer

on the MSE

Introduction of Every Day Low

Prices

Joint venture between Cifra and

Wal-Mart Stores, Inc.

Walmart Supercenterstart operations

2003

Walmart de México Foundation created

&

Stores, Inc.

7

History: “Bodegas” expansion & incorporation of Central America

2004

2008

2007

2005

License issued to operate

a bank in Mexico

Bodega AurreráExpress expansion

Mi Bodegastart operations

Superama.com.mxOnline grocery sales pilot

Wal-Mart Stores, Inc. acquires 33% of the shares of CARHCO

(Central American Retail Holding Company)

2010

Walmart de México acquires

100% of Walmart Centroamérica

8

History: Sells its Restaurant Division, the Bank and Suburbia

2011

2015

2014

2013

Walmart de México y Centroamérica

sells its restaurant division to Alsea

Walmart de México y Centroamérica

sells its bank to Inbursa

First Walmart Supercenter

in Central America(Honduras)

Walmart.com.mx launches

2017

Walmart de México y Centroaméricasells Suburbia to Liverpool

9

Continuous profitable growth

EBITDA(Mx$ billion)

Sales(Mx$ billion)

Walmex fiscal year: January-December

26.9

71.0

2009 2019

269.4

641.8

2009 2019

10

13.2

39.6

71.3

132.2

96.0

287.9

Growth across multiple formats

Walmex fiscal year: January - December

2009 2019

CAGR 11.6%

2009 2019

CAGR 6.4% CAGR 11.6%

2009 2019

2009 2019

Total Sales(Mx$ billion)

74.9

178.2CAGR 9.1%

11

Walmex Today

12

Walmex: Listed on the Mexican Stock Exchange

• Market Cap: Mx$ 946 bn1

• Weight on the MSE index: 7.9%2

• 3rd most traded stock on the MSE3

1 As of December 31, 2019 / 2 Internal estimation as of December 31, 2019 / 3 From January to December 2019

Wal-Mart Stores, Inc.

Mexican Stock ExchangeSustainable Index

ADR: WMMVY OTCQX

70% 30%

13

Company description

As of December 31, 2019

Revenues (Mx$ billion) 647

Units 3,407

Countries 6

Cities 675

Business formats 4

eCommerce sites 3

Distribution centers 28

Associates (thousand) 239

Contributionto

2019 sales

17.7%

Central America

82.3%

Mexico

*

* Last 12 months as of December 2019

14

Value Driver: Price

Basic general merchandise, food and household

items at the best prices.

% of 2019 Walmex sales 45.1

Customer target C, D, E

Cities* 665

Operating units*

– Mexico 2,035

– Central America 704

SQ. FT. (average) SKUs (average) Units Approach

43,379 32,000 541 Weekly shopping

12,271 11,200 550 Small towns

3,660 4,400 1,648 Fill-in trip

1

*As of December 31, 2019

1: Includes seasonal merchandise

15

Mama Lucha

She is Mexico’s favorite

luchadora, who fights against

high prices together with Bodega

Aurrerá. She brings the lowest

prices to all families.

She is the average Mexican

housewife: she wants the best for

her family, but faces a constant

struggle (lucha in Spanish) to

make ends meet.

16

Value Drivers: Price and assortment

Widest assortment of goods at Every Day Low Prices.


SQ. FT. (average) 78,685

SKUs 90,000

Customer target A/B, C, D+

Cities* 96

Prototypes 4

Operating units*

– Mexico 280


*As of December 31, 2019

1: Includes seasonal merchandise

1

17

Carrito

Qualities: Friendly, curious, helpful, observer,

good listener, fun, responsible, practical,

intelligent, ally, accomplice.

Only Carrito can join, advise and listen to our

customer in order to help her find everything she

needs when she comes to Walmart.

Carrito is the perfect shopping partner.

He knows our customer better than anyone and

he understands what motivates her to shop.

18

Neighborhood supermarkets with outstanding fresh

and food departments at reasonable prices.



SKUs 20,000

Customer target A, B, C

Cities* 47

Prototypes 2

Operating units*

– Mexico 93


Value Drivers: Quality, convenience and service

* As of December 31, 2019

19

Local format branding

Costa Rica Nicaragua

El Salvador Guatemala & Honduras

Mexico

20

Membership warehouse clubs focused on businesses

and high income households.



SKUs 5,500

Customer target A, B, C, D, Business

Cities* 86

Prototypes 4

Operating units*

– Mexico 163

Value Drivers: Price leader, volume, new and unique merchandise


21

Business Member

Advantage Member

22

0Omnichannel Improvements

GMV = Gross Merchandise Value

% of total

sales

Contribution

to total sales

growth

2019 - eCommerce (Mexico)

Net Sales

GrowthGrocery General

Merchandise

GMV Growth

Total

23

Superama.com.mx: online grocery sales leader

Call Center

Mobile Apps

Web page

Delivery

24

Walmart.com.mx: online general merchandise

•Audio •Cameras

•Auto & tires •Home

•Baby & toddler •Musical Instruments

•Books •Jewelry & accessories

•Cell Phones •Toys

•Computers & tablets •Books

•TV’s & video •Pets

•Sports •Health & Beauty

•Consumer Appliances •Video Games

•Electronics •Patio & Garden

•Furniture

CategoriesDifferentiated catalogue Delivery

25

Walmart.com.mx: groceries and perishables

•Meal Solution, grains & pasta, snacks

•Pharmacy, Health & Beauty

•Beverages, Wine & liquor

•Cleaning Supplies & Pets

•Frozen Food

•Produce

•Dairy, Eggs & Cheese

•Meat, Seafood & Poultry

•Baby & toddler

•Deli

•Bakery & Bread

Categories

27

Flexible multiformat operation

0 20,000 40,000 60,000 80,000 100,000 120,000 140,000Sales Area (Sq. Ft.)

Flexible PrototypesIncome Level

C, D, E

A/ B, C, D+

A, B, C, D+

A, B, C

28

Regional store presence

675 Cities withWalmex presence

Honduras33

Nicaragua27

Costa Rica24

Guatemala 49

El Salvador 22

Mexico 520


29

Efficient distribution network

28 DistributionCenters

Monterrey

Guadalajara

Mexico City

Villahermosa

Culiacán

Guatemala

El Salvador

Honduras

Nicaragua

Costa Rica

2

6

3

3

2

3 3

3

1

2


30

Financial Information

31

Walmex: 4Q19 Results

(MX$ Millions)

4Q194Q18

IFRS 16 Pro-formaVar.

4Q18 Reported

Var.

$ % $ % % $ % %

Total revenue 185,744 100.0 177,422 100.0 4.7 177,422 100.0 4.7

Gross margin 42,117 22.7 40,570 22.9 3.8 40,570 22.9 3.8

General expenses 25,989 14.0 24,320 13.7 6.9 25,059 14.1 3.7

Earnings before other income, net 16,128 8.7 16,250 9.2 (0.8) 15,511 8.7 4.0

Other income, net 72 0.0 107 0.1 (32.9) 107 0.1 (32.9)

Operating income 16,200 8.7 16,357 9.2 (1.0) 15,618 8.8 3.7

EBITDA 20,591 11.1 20,470 11.5 0.6 18,964 10.7 8.6

Net Income 11,232 6.0 11,490 6.5 (2.3) 11,762 6.6 (4.5)

Note: Pro-forma 2018 figures are not audited, but are based on the 2018 audited reported results and adjusted with our best estimates to show the effects

related to the adoption of the IFRS 16.

X=Times

32

Mexico: 4Q19 Results

(MX$ Millions)

4Q194Q18


4Q18 Reported

Var.

$ % $ % % $ % %

Total revenue 153,658 100.0 145,886 100.0 5.3 145,886 100.0 5.3

Gross margin 34,333 22.3 32,952 22.6 4.2 32,952 22.6 4.2

General expenses 19,243 12.5 19,157 13.1 0.5 19,731 13.5 (2.5)

Earnings before other income, net 15,090 9.8 13,795 9.5 9.4 13,221 9.1 14.1

Other income, net (7) 0.0 153 0.1 (1.0x) 153 0.1 (1.0x)

Operating income 15,083 9.8 13,948 9.6 8.1 13,374 9.2 12.8

EBITDA 18,491 12.0 17,159 11.8 7.8 15,984 11.0 15.7



X=Times

33

Central America: 4Q19 Results

(MX$ Millions)

4Q194Q18

IFRS 16 Pro-formaVar. (%)

4Q18Reported

Var. (%)

$ % $ %Peso

terms

On a

constant

currency

basis

$ %Peso

terms

On a

constant

currency

basis

Total revenue 32,086 100.0 31,536 100.0 1.7 3.9 31,536 100.0 1.7 3.9

Gross margin 7,784 24.3 7,618 24.2 2.2 4.4 7,618 24.2 2.2 4.4

General expenses 6,746 21.0 5,163 16.4 30.7 33.5 5,328 16.9 26.6 29.3

Earnings before other

income, net1,038 3.2 2,455 7.8 (57.7) (56.8) 2,290 7.3 (54.6) (53.7)

Other income, net 79 0.2 (46) (0.1) 2.7x 2.7x (46) (0.1) 2.7x 2.7x

Operating income 1,117 3.5 2,409 7.6 (53.6) (52.6) 2,244 7.1 (50.2) (49.2)

EBITDA 2,100 6.5 3,311 10.5 (36.6) (35.2) 2,980 9.4 (29.5) (28.0)



X= Times

34

Walmex: 2019 Results

(MX$ Millions)

20192018


2018 Reported

Var.

$ % $ % % $ % %

Total revenue 646,846 100.0 616,910 100.0 4.9 616,910 100.0 4.9

Gross margin 148,051 22.9 141,647 23.0 4.5 141,647 23.0 4.5



Other income, net 379 0.1 201 0.0 88.2 201 0.0 88.2


EBITDA 71,005 11.0 67,148 10.9 5.7 61,747 10.0 15.0

Net Income 37,898 5.9 35,606 5.8 6.4 36,753 6.0 3.1



35

Mexico: 2019 Results

(MX$ Millions)

20192018


2018 Reported

Var.

$ % $ % % $ % %

Total revenue 532,241 100.0 503,692 100.0 5.7 503,692 100.0 5.7

Gross margin 120,336 22.6 114,235 22.7 5.3 114,235 22.7 5.3



Other income, net 220 0.0 211 0.0 4.0 211 0.0 4.0


EBITDA 60,581 11.4 55,790 11.1 8.6 51,662 10.3 17.3



36

Central America: 2019 Results

(MX$ Millions)

20192018

IFRS 16 Pro-

forma

Var. (%)2018

ReportedVar. (%)

$ % $ %Peso

terms

On a

constant

currency

basis

$ %Peso

terms

On a

constant

currency

basis

Total revenue 114,605 100.0 113,218 100.0 1.2 3.4 113,218 100.0 1.2 3.4

Gross margin 27,715 24.2 27,412 24.2 1.1 3.2 27,412 24.2 1.1 3.2

General expenses 21,274 18.6 19,611 17.3 8.5 10.8 20,193 17.8 5.4 7.6

Earnings before other

income, net6,441 5.6 7,801 6.9 (17.4) (15.7) 7,219 6.4 (10.8) (8.9)

Other income, net 159 0.1 (10) 0.0 16.8x 17.2 x (10) 0.0 16.8x 17.2x

Operating income 6,600 5.8 7,791 6.9 (15.3) (13.6) 7,209 6.4 (8.4) (6.6)

EBITDA 10,424 9.1 11,358 10.0 (8.2) (6.3) 10,085 8.9 3.4 5.5



X= Times

37

Financial strength

Cash

Inventories

Fixed assetsand other

Suppliers

Shareholders’equity

and other

Assets Liabilities &shareholders' equity

Balance sheet statement

(December 31, 2019 – MX$ Million)

38

Growth Program 2019

12.514.3

17.4 17.920.6

2015 2016 2017 2018 2019

(Mx$ billion)CAPEX (% Total)

Existing Stores

(Remodels &

maintenance)Technology

&

eCommerce

40%

28%

20%

11%

1%

Logistics

Fresh Upstreaming

Total CapEx:

$20.6 B MXN

New Stores

39

Competitors

40

Revenues*(Mx$ billion)

155.7

129.4

21.6

Selected self-service competitors

* Last 12 months as of December 2019

Listed on the MSE Private

41

Informal market remains a large competitor

42

Associates

MX$43.6 million invested in training

26,381 promoted associates

37% of management positions are

filled by women

2019 highlights:

02

01

03

43

Community support

2019 highlights:

9,500 small producers

developed

Donations for over 34,800 food tons

benefiting +1M people per month

02

01

03

+1,500 million pesos were channeled

through social impact programs

103,300 volunteer participations04

44

Environmental commitment and success

01

05

03

02

04

2019 highlights:MX$ 519 million investment in

sustainability initiatives

1,174 water treatment plants

The zero waste objective:74% progress in Mexico & 50% in Central America

2,274 products with less

environmental impact

90% of our units are supplied

by renewable energy

45

Walmex resources

Investor Relations:

www.walmex.mx

Corporate:

www.walmartmexico.com.mx

Online & sales:

www.superama.com.mx

www.walmart.com.mx

www.sams.com.mx

http://www.walmex.mx/

http://www.walmartmexicoycam.com.mx/

http://www.superama.com.mx/

http://www.walmart.com.mx/

http://www.sams.com.mx/

mexico city...title mexico city author mrroman created date 3/13/2020 10:33:28 am

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