Good morning, everyone. Thank you for joining Alsea's Fourth Quarter and Full Year 2025 Earnings Video Conference. Today, you will hear from Christian Gurría, our Chief Financial Officer, and Federico Rodríguez, our Chief Financial Officer. Cristian will walk us through our operating performance and strategic progress, while Federico will provide a detailed review of our financial results and capital allocation. Before we begin, I would like to remind you that some of our comments today contain forward-looking statements based on our current expectations. Actual results may differ materially. Today's discussion should be considered alongside the disclaimers included in our earnings release and our most recent filings with the [Foreign language] . The company undertakes no obligation to update these statements. Unless otherwise specified, all figures discussed today are presented on a pre-IFRS 16 basis.
With that, I will now turn the call over to Christian for his opening remarks.
[Foreign language], Gerardo, and thank you everyone, and good morning, and thank you very much for joining us today. I will begin with an overview of our performance for the fourth quarter and full year 2025, highlighting key operating trends across regions and brands, as well as our progress in digital transformation, expansion, and ESG initiatives. Federico will then walk you through the financial results in more detail. Before going into the quarterly figures, I would like to briefly step back and reflect on how our strategic priorities throughout 2025 are shaping our business today. Despite a challenging start of the year, we responded with targeted operational and portfolio initiatives that led to a gradual improvement in performance as the year progressed. Throughout 2025, we focused on strengthening traffic and innovation to keep our brands remaining relevant and top of mind for our consumers.
At the same time, we adopted a more selective and disciplined approach to growth, directing capital towards formats and initiatives with consistently strong returns. This included strengthening our portfolio through the incorporation of brands such as Chipotle and Raising Cane's into the Alsea family, fully aligned with our long-term objectives. The right brands in the right geographies and the right stores, prioritizing quality over quantity. In parallel, we simplify our portfolio through the divestment of non-core assets in South America and Europe. This is part of our core strategy going forward, as we will continue with this simplification, as we are aiming to have a healthier and more profitable portfolio. The aforementioned is enabling us to concentrate resources on markets and brands with a stronger growth potential, translating into meaningful improvements in efficiency and profitability.
We sharpen our approach to capital allocation and cash generation, optimizing CapEx and reinforcing our financial structure. With that context, let me now turn to our fourth quarter performance. In the fourth quarter, total sales increased by 0.5% year-over-year, reaching MXN 21.7 billion, or 12%, excluding foreign exchange effects. Same-store sales grew 3.3% during the quarter, reflecting improving trends across several markets. EBITDA increased 2.9% year-over-year to MXN 3.7 billion, with a margin of 16.8%, representing a 40 basis point expansion versus last year. Same-store sales grew 3.3% during the quarter, reflecting improving trends across several markets. The results reflected disciplined execution, improving operating leverage, and the benefits of portfolio optimization efforts.
Turning on brand performance, at Starbucks Alsea, same-store sales increased 2.9% in the quarter. In Mexico, same-store sales grew 2.6%, with prior quarters and reflecting a stable demand and consistent performance. In Europe, same-store sales declined 0.3%, primarily due to continued pressure in France, partially offset by solid performance in Spain. In South America, same-store sales increased 8.8%, driven by Argentina. Excluding Argentina, same-store sales grew 1.1%, supported by strength in Colombia and gradual recovery in Chile. Domino's Pizza Alsea delivered a 5.2% increase in same-store sales. In Mexico, same-store sales grew 6.3%, supported by innovation such as Croissant Pizza, driving value and innovation. Also, we launched an expanded delivery capabilities through a strategic aggregator in Mexico.
In Spain, same-store sales increased 3.3%, reflective effective promotional execution. In Colombia, same-store sales rose 9.6%, demonstrating a strong and consistent performance through the year. At Burger King, same-store sales, excluding Argentina, declined 3.9%. In Mexico, same-store sales decreased 4.8%, reflecting continued pressure on the brand despite gradual operational improvements during the year. The full-service restaurant segment delivered same-store sales growth of 3% in the quarter. In Mexico, same-store sales increased by 3.8%, supported by value propositions such as Menú del Día, Tres Para Mí in Chili's, and Paraíso Italiano in Italianni's. In Spain, same-store sales grew 1.9% alongside the continued portfolio optimization, including the sale of TGI Fridays.
In South America, same-store sales increased 2.8%, alongside the sale of Chili's and P.F. Chang's restaurants in Chile. Our expansion strategy continues to be guided by a clear focus on quality, returns, and capital efficiency. During the fourth quarter, we opened 55 new stores, bringing total openings in 2025 to 169 units, 127 of them being corporate and 42 franchises. Below our initial expectations, this reflects a deliberate shift toward fewer, higher quality investments, prioritizing locations and formats with a stronger return profiles. Remodeling and the renovation of our existing portfolio remain as a key priority across regions, as store refreshes continue to deliver attractive returns through improved customer experience, higher productivity, and faster payback periods. Overall, our expansion approach in 2025 reflects disciplined capital allocation and a clear focus on long-term value creation.
Our digital platforms remain a key growth driver for Alsea. By the end of the quarter, loyalty sales increased 13.4% to MXN 8.2 billion, representing 30.6% of total sales and 36.6 million orders. We surpassed 8.2 million loyalty active customers and users across our brands, confirming the strength of our digital engagement. In addition, during the quarter, Domino's implemented full service through an agreement with a known aggregator. This initiative significantly expanded delivery coverage by more than doubling the number of available drivers per store, improving service levels during peak hours without incremental costs. During the quarter, we continued advancing on our ESG agenda as a core pillar of our long-term strategy, fully aligned with capital allocation and risk management.
In Europe, we completed our first round of sustainable financing for EUR 273 million, linked to targets for emission reductions, strengthening supplier assessment based on ESG criteria, and improving food waste management. This progress enabled a second ESG-linked financing tranche up to EUR 550 million through 2029. Additionally, in Mexico, we further aligned our strategy by securing a sustainability-linked loan of MXN 10.5 billion, tied to KPIs focused on emissions intensity and waste reduction. In Mexico, during the months of October and November, Fundación Alsea, through Va por Mi Cuenta movement, raised more than MXN 50 million as part of its annual fundraising initiative. These efforts were reflected in our continued inclusion in the Dow Jones Sustainability Index in 2025, scoring ten pers.
18 percentage points above the global sector average and ranking within the top 10% of the industry. For Alsea, ESG is embedded in how we allocate capital, manage risk, and create long-term value. With that, I will now turn the call to Federico to review our financial performance. Thank you.
Thank you, Christian. Good morning, everyone. In the fourth quarter, sales increased 0.5% year-over-year, supported by a sustained consumer preference for our brands and effective commercial strategies. Excluding foreign exchange effects, sales increased 12%. In Mexico, the sales increased 7.9% to MXN 12.5 billion. In Europe, sales declined 1.2% in peso terms, while increasing 5% in euros. In South America, the sales declined largely due to currency effects. The EBITDA increased 2.9% year-over-year, with a 40 basis point margin expansion, driven by a stable food cost, disciplined execution, and improved labor efficiencies.
In Mexico, the adjusted EBITDA increased 17.1% year-over-year, primarily due to an increase in same-store sales of 3.1%, following a strong recovery in November and December, while the portfolio optimization and improved labor efficiencies helped offset higher wage costs. In Europe, adjusted EBITDA was 18.7% higher year-over-year, driven by a 1.7% increase in same-store sales, lower food cost, and disciplined labor cost management. In South America, the adjusted EBITDA declined by 22.9%, largely due to the depreciation of the Argentine peso relative to the Mexican peso. This impact was partially mitigated by robust consumer demand in Colombia and stable market conditions in Chile, although Argentina continued to experience a more challenging operating environment.
The net income for the quarter increased 32% year-over-year to MXN 812 million, reflecting a continued, though less pronounced, positive non-cash foreign exchange effect related to U.S. dollar-denominated debt. We have mentioned previous quarters, this impact is non-recurring. Following the refinancing of the obligations, we have now achieved a natural hedge, this revaluation will no longer affect the PNL going forward. CapEx for the full year total MXN 5.1 billion. Of this amount, 75% was allocated to a store development, including the opening of 127 new corporate units, remodelings and equipment replacement, while 25% was directed to strategic projects, including the Guadalajara Distribution Center, technology upgrades, and process improvements. As of 31 December 2025, the pre-IFRS 16 gross debt increased by MXN 0.9 billion year-over-year, reaching MXN 34 billion.
The company's net debt, not counting the impact of IFRS 16, was MXN 28.3 billion, which is MXN 1.7 billion more than it was at the same time last year. The bank loans are allocated towards selling the minority stake in the European operations, as well as addressing short-term debt requirements for working capital and capital expenditure needs. Consolidated net debt reached MXN 45.2 billion, including lease liabilities. At the end of the quarter, 58% of the debt was long term, with 77% denominated in Mexican pesos and 22% in euros. We remain focused on maintaining a healthy capital structure, supported by prudent financial management. At the end of the quarter, the cash position stood at MXN 5.7 billion.
Turning to financial ratios, the total debt to post-tax IFRS 16 EBITDA ratio closed the quarter at 2.8x , and the net debt to EBITDA ratio stood at 2.5x . Our full year results were broadly in line with the guidance we provided and subsequently updated during 2025. Same-store sales, revenue growth, EBITDA, and leverage all finished within expected ranges. We will provide more detail regarding the guidance for 2026 during Alsea Day on 18 March in New York City. This will be a great opportunity to invite everyone to our event and connect with you. We will now open the call for questions. Please, operator?
We will now start the Q&A session. If you have a question, please press the Question button in the browser. Please make sure you are not in full screen mode to see the button. The first question is from Mr. Thiago Bortolucci from Goldman Sachs. Please go ahead.
Good morning, everyone. [Foreign language], Christian Gurria.
[audio distortion].
Thank you very much for your time, presentation. It's always a pleasure to talk to you guys. I have two questions somehow related to free cash flow, right? When I try to see what you delivered in 2025 versus what is implied in your managerial guidance, right, what I see was that your EBITDA grew at the high end of your low single-digit expectations. CapEx came below the MXN 6 billion you were initially expecting, but your pre-IFRS leverage was a touch ahead of the 2.8x .
Yeah
... that you were guiding, right? Which makes me think that somehow your free cash flow generation was a little bit softer than initially expected. If this is true, just like to understand what where the miss is coming from and what is the plan to attack this going forward. I guess the refinancing is part of the story, but also want to hear on the operating level, right? The second part of the question that is related to CapEx, appreciate the focus, and I'm pretty sure everyone in this call appreciate your focus on portfolio and a more rational growth going forward. It would be great if you could share how you are seeing the incremental ROIs of the new cohorts of stores under this new balance between growth and profitability on the capital allocation. Thank you very much.
Yeah. Well, I will start with the first question regarding the cash burn. Yeah, it's correct what you just said, Thiago. The main driver for the cash burn was a worse working capital than expected, at beginning of 2025, mainly driven by a reduction in the expected EBITDA. As you know, we had to change the initial guidance we announced at March, but that was offset with a diminished CapEx. In 2026, the story will be completely different. You will have the expectations in the Alsea Day by mid-March, but the management is totally focused on the free cash flow generation with some initiatives. You have just mentioned one, the refinancing. You know what is gonna be the annual savings regarding this, in the line of $25 million.
Additionally, the operating leverage from same-store sales. As you know, we will have a low- to mid-single-digit regarding same-store sales guidance for each one of the brands, and it will lead to the consolidated figures and a more rationalized CapEx. This is one of the key drivers, Thiago. Obviously, we knew that we were failing at free cash flow generation. We have heard around the pushback you have launched to the management, to the administration during the last years, so we are totally focused there. We rationalize the CapEx with less openings. Obviously, we had one-off because of the distribution center of Guadalajara, but we do not have any kind of pressure to open more stores.
As I have said, a lot of times in the past, 95% of Alsea is in the same-store sales, in the comparable stores. That is the place where we have to put all the efforts because it is more relevant to have 1% increase in the traffic in the different brands, because you, that is the key part, where you have all the operating leverage. In some of the cases, maybe have a reduction of around 30 new stores from the initial guidance, that does not make any kind of hurt. It is not only for this year, but maybe for the future. We do not want to conquer the world regarding openings.
We want to have a more rationalized, CapEx, for the future, and this is aligned with what you have just, asked regarding free cash flow generation. I don't know, Christian, do you want to deep dive regarding the openings and the closure that we had in 2025?
Yes. Hello, Thiago. How are you? Good morning. As Federico mentioned, and we have mentioned in previous calls, our strategy is more about quality than quantity, no? As Federico mentioned, really our focus right now is on capitalizing on our existing assets, no? We have almost 5,000 stores in our portfolio between franchisee and company-owned stores, and we have a clear strategy on how we can improve the profitability of those stores. There are three levers that we are working on. The first is the remodeling and investing on our existing portfolio, which has the best returns, and the customer responds in a very positive way to that and keeps our brands at the right level to deliver the right experience.
The second one is to make sure we have the best operators in the market. We have always focused in Alsea in having the best operators, but we are having now a very intentional drive into elevating our operators in the stores. The third level is, I would say, innovation. Innovation is clearly driving our traffic to our stores. We have a very good example is what we are doing with Croissant Pizza and Domino's Pizza in Mexico. This was originally born in Spain with extraordinary results. We brought it to Mexico, and more than doubled the expectations that we had, and that's why you see a very strong quarter in 2025, particularly with Domino's. These are the levers that we are moving.
Of course, we will continue with our commitment to open the right stores. It's important to mention the right stores in the right geographies and with the right brands. Which, as I always say, sometimes we have to close stores to have a healthier portfolio, as we have done. The most of the stores that we closed, either in this number, you can see divestments, as we did with TGI Fridays and Chili's and P.F. Chang's in Chile. Likewise, most of the stores that we closed were, had an aging of average 15 years. The markets has changed, the neighborhoods, the trade areas have changed, so it's part of this healthier portfolio optimization.
This is great. Thank you very much for the color. Super helpful. Congrats on the deliveries this far. Really appreciate, guys. Thank you very much.
[Foreign language], Thiago.
Thank you.
Thank you very much for your question. Our next question is from Mr. Antonio Hernandez from Actinver. Please, go ahead.
Hi, good morning. Congrats on your results. Just a quick one regarding South America. I mean, you already mentioned Argentina is struggling a little bit there and different countries overall. Just wanted to get a sense on how you're seeing performance so far this year and expectations for the year. Thanks.
Yes. Good morning, Antonio. Well, we are seeing very similar trends to November and December, with a positive trend on same-store sales. One of the best news is the tailwinds we are having in terms of our dollarized raw materials, no? We have seen FX is helping us with the dollarized raw materials. We have also positive news in terms of the price of beef and the price of chicken, which is having a positive trend to what we were seeing in the previous year. Also, another positive effect is that we expect a reduction of coffee prices in the second half of 2026.
On one side, we are seeing a very similar trend to the last months of the year, which we see a shift on what we were seeing in previous months. On the other hand, different strategies around raw materials. On one side, the FX, and on the other side, some of the different synergies we have worked on the previous months are paying off now. In these terms, we should see better margins in the following across the year and a steady recovery on same-store sales.
I would say, Antonio, if I may add a little bit more color on particularly, I would say on the three big markets of South America. We've been doing a great job in Colombia. It's been kind of consistent. That's something that continues, I would say, towards the beginning of the year. The same, I would say, it's happening with Argentina and Chile. If, I would say 2025 was a tough year for those two markets.
... for two particular, let's say, reasons, and different reasons both. I think we are seeing also, at the end of last year, a bit of a recovery, and that is, I would say, also transitioning towards the beginning of the year. I would say we're more kind of cautiously optimistic, and I would say together to what Christian mentioned about kind of some of the tailwinds, should be a better year for this market.
Perfect. Appreciate the call. Have a nice day.
[audio distortion].
Thank you, Antonio.
Thank you very much for your question. Our next question is from Ms. Renata Cabral from Citi. Please go ahead.
Hi, everyone. Thank you so much for taking my question. My first one is regarding Starbucks in Mexico. What is the current approach for same-store sales improvement during the year? We are seeing a very good improvement overall in the operations of Alsea in Mexico. It seems more towards Domino's so far. It's understandable since considering the economic situation, but it seems there's an opportunity also for improvement in the Starbucks. If you can shed some light in the strategies for the year ahead, it would be really helpful. The second one, it's a follow-up regarding margins and a more long-term perspectives.
Of course, you have mentioned about the rationalization of the portfolio. My question is related also if you see other important levers that can improve margins in of the regions, instance, supply chain or optimization of digitalization, let's say, it would be really helpful to know a little bit more about that too. Thank you so much.
Thank you, Renata, and good morning. Regarding Starbucks in Mexico, we had in 2025, We struggled at the beginning of the year as with many other brands. Starting the second half of the year, we were able to read on what was going on with the market and the different trends from, and what the customer was looking for forward. We adjusted our strategies to first of all, we've clearly seen that Starbucks in Mexico, it's a love brand.
Mm-hmm.
Clearly innovation is driving a lot of traffic to our stores, both innovation in terms of product, but also innovation in terms of market, of merchandising. In during Q4, we launched, we brought to Mexico the barista, the Crystal Barista, which was a, as you may be aware, a extraordinary success in Asia, then in the U.S., and then it came to Mexico, and it was really driving a lot of transactions. We also, in this case, we also shifted the way we manage our promotional approach to the brand, making sure we could elevate the customer, the experience of the customer. To give you a more concrete answer, we are focusing on renewing our stores, in a very intentional way.
Just to give you some data, in 2026, in Mexico, we're gonna have more store renovations than openings in the case of Starbucks. We really understand what the customer is looking forward. The second part is innovation in terms of product and understanding that we are a love brand in Mexico and people are looking forward. We just recently launched in 2026, a bear that hugs the cup, and it's really. They flew out of the shelves. We have more surprises that I cannot share coming, you know.
Mm-hmm
... for the World Cup. In terms of experience, we are introducing a strategy around elevating the experience in the stores by implementing wooden trays, stainless steel cutlery for here serveware. Again, creating the right environment and the best experience for the customer. And in terms of operational impact, as I mentioned before, we are very much focused on our on having the best operators and making sure they can impact positively their business as we move forward. This is more or less regarding the strategy.
Yes
... that we are focusing.
Okay.
Thank you so much, Christian.
Regarding the second question, say, around margins for the future, Renata?
It is too soon. Obviously, we are seeing positive impacts, but I would say that we're expecting a positive trend regarding EBITDA margins expansion for 2026, as long as we are facing, as Christian have just mentioned, and you know it, some macro tailwinds like a stronger peso. Remember that each peso of appreciation or devaluation is around 30 basis points in the total EBITDA margin. Additionally, this is supporting the raw materials, the gross margin. We can move the mix in a positive way in the different business units. Remember, we want to attract more traffic to our stores. We are not in the rush to increase on an artificial way, the margin. We want to have a strong customer base into same-store sales.
Obviously, we have a lot of levers. You were asking around this. Obviously,
Of course.
... the stronger peso, it's some macro reason. We have some internal, and endogenous reasons, such as the optimization of the portfolio. We have not finished. You know that we are analyzing some of the units, mainly in Americas, to see what we are doing with them. We cannot disclose any more facts around this. I know there are a lot of news into the press. That's all that we can say. We need to respect and being really disciplined around that.
We have a bunch of collaborators into the different business units that we are analyzing, and we are doing this in an everyday basis because obviously, while we are selling some of the business units, such as the two casual dining brands that we sold in Chile in the third quarter, we are looking for new Tier One brands, such as Raising Cane's and Chipotle. That would be one of the first levers. The second one, we have a bunch of opportunities regarding productivity, I would say in America, not only in Mexico, but in South America, too. Especially because not this year, but in the future, we're facing a journey reduction of eight hours in four years in Mexico. We need to move forward and be in advance of the rest of the competitors.
I think that with 5,000 stores all around the world, with a stronger environment, such as the European one, we have a lot of ideas to increase productivity and have a expansion margins into the total EBITDA, while we offset these impacts. Additionally, we have ideas regarding simplifying the support center in Europe, in Mexico, in Colombia. I think that we need to consolidate a lot of things that we have not execute in the last 10 years, and we'll be doing that during 2026. As I always say, it is more relevant to have a strong same-store sale, because in the bottom, you can have a lot of savings. It's a bunch of money.
In the long term, we are more worried around comparable stores, around new openings, instead of only executing a saving cost, in the bottom.
Thank you so much, Federico, for the complete answer. If I may, a follow-up, maybe for Christian, about potential impacts from the situation we are seeing happening in Jalisco since Sunday. It would be great to have some color. Thank you.
Of course. Renata, as a precautionary measure, we had to close some of our stores in the region during Monday.
Sunday.
Sunday and Monday. Obviously, prioritizing the safety and security of our partners, our collaborators, our team members, and also our customers. By Tuesday morning, 100% of our stores were reopened. We're back into business as usual. Obviously, we are seeing in particular cities, a kind of a steady return of consumption, people being confident to get out there and going back to their lives. Delivery was clearly one of the channels highly and positively impacted by this as people were staying home. We are clearly seeing across the week, people going back to their routines and our business recovering in a steady way.
Thank you so much, Christian.
It's also important to mention that we have none of our stores were damaged. None of our stores in the region were damaged or targeted, and our supply chain was never disrupted. We have previous some blockades, our supply chain was fully operational, never disrupted. This is a very completely important-
Thanks for the call.
Thank you very much for your question. Our next question is from Mr. Ulises Argote from Santander. Please go ahead.
[Foreign language]. The question that I had was kind of a follow-up on those earlier comments that you were making on the quality over quantity approach to the portfolio. You mentioned there in the remarks, I think this has been kind of an ongoing discussion of focusing on store re-modelings across regions as a part of the strategy. I was wondering maybe if you could provide there some color on how this will be broken down in 2026 across the regions. Maybe if we can get some color on formats. I think more importantly, if you could comment on the sales lift and the improvements you are seeing from this from these remodeled locations. Then I have another one, but I'll do it afterwards.
... [Foreign langauge], Ulises. Good morning, and thank you for your question. Let me start by answering. We have, in the case of the full-service restaurant segment or casual dining, or in the case of Starbucks, what we've seen is that you have, when we remodel the stores, our same-store sales, in the case of Starbucks, grow from 6% to 13%. This is where we are, what we've seen and experienced is in a very consistent way.
In the case of the casual dining segment, clearly because the customer spends more time in our stores, in our restaurants, the uplift we've seen in same-store sales can go from 10% high to even we have cases where we are around 25%-30% increase in same-store sales. This is driven, first of all, not only because of the look and feel of the store improves, but in many cases, as we know how the store and the customer uses the store, these renovations normally are adapted to the reality of how these our customers use the store.
And in any other cases, we add additional seating, or we add a terrace, or we do some optimization in terms of the type of the mix of furniture we have in the stores. The reality is that that's why we are prioritizing these re-modellings. Also, it's important that when we choose to remodel a store, there are different reasons. Either because the store has... the look and feel is of the store and the conditions of the store are not up to the expectations, our expectations and the guest expectations, or different strategies around the market penetration, in some case, the competitive landscape.
There are different reasons why we go and decide which stores to remodel. To your first part of the question on if we have what is the breakdown? In the case, the information I can share with you is, for example, in casual dining is three to one. One opening, three re-modellings. In Starbucks is around 1.4.
1.4.
No? 1.4. In Domino's Pizza, the impact is less important when you remodel the store due to the way the business model works. When the stores that we have an important dining traffic, those are the stores where we put the resources, just to give you some example.
Yeah, additionally to Christian's answer, when we are performing a remodeling in the food service or the Starbucks coffee stores, usually we tend to see an incremental traffic of around 5%-10%.
Mm-hmm.
Obviously, this depends in some of the cases of casual dining, you have to increase the terrace, for example, to have more capacity. Each time you are changing the look and feel of the store, you are increasing the traffic, and that is completely linked to the same-store sales increase that we are highlighting as a target, not only for this year, but in the long term. Regarding the.
Sorry, Federico.
Yeah, sorry.
... if I may, also, one important component is how our team members feel. Honestly, every time we remodel a store, they are always super proud. They are happy to see the store being in the best shape, and proud to be part of that store, so.
For the long-term CapEx allocation, regarding the three main pillars, that we have into the portfolio, I would say that 60% is completely linked to Starbucks Coffee, 20% to Domino's Pizza, and 20% to the full-service restaurants, units, Ulises.
Perfect, very clear. If I understood correctly, these initiatives are a bit more focused on Mexico, but also, kind of cross-region, more selective. Is that a correct assumption to make?
It's across all our geographies, Ulises.
Okay.
The same is happening and going on in Spain, in South America, in France-
Portugal, France, et cetera.
Everywhere, yeah.
Okay, super clear. The other, the other question that I that I had was maybe if we could get some thoughts there or some or you share some insights of how you're positioning, let's say, to to capitalize from the, from the World Cup. Maybe any type of initiatives that you're taking, any color that we could get there, that would be very very much appreciated.
For sure. We have no doubt that the three brands that will be most benefit by the World Cup. incremental traffic are Domino's Pizza, Starbucks, and Chili's. As you know, Chili's has been the preferred concept and brand for people to go and watch sports, all types of sports, for many, many years. In the case of Chili's, we are doing very important investments in technology, in terms of screens, sound, and also a very, very fun campaign. As you know, there will be three stadiums in Mexico: Monterrey, Guadalajara, and Mexico City. We are having a campaign, "Chili's is your fourth, is the fourth stadium." We are already out there with the campaign.
We have, you know, we have a strong partnership with some strategic partners as Heineken and we are doing a lot of things together with them. We have important expectations of what, how Chili's is going to be benefited by this. As you know, only you can fit all 85,000-100,000 people in a stadium. The rest, well, Chili's for sure is an extraordinary option to watch the games and with a great happening.
In the case of Starbucks, obviously the traffic, the incremental traffic that we're gonna have in different airports, in hotels, and we have a very good market share of stores and penetration in Mexico and Guadalajara and Monterey and some adjacent cities and airports that are going to be activated for the World Cup. For sure. We have a fun initiatives coming also for the customers to drive this traffic. Obviously, Domino's Pizza, you know, watching games at home, it's going to be super powerful, and Domino's Pizza and the games and the World Cup have always been linked and been together as football. Those for sure are going to be the three brands that are most benefited. We have a lot of surprises.
We are already planning additional initiatives that we are reviewing as we speak. For sure, we are going to be able to capitalize this very special event.
Remember, Ulises, it's a one-off.
Yeah. Yep. Thanks for that, and thanks for the color, guys, so much.
Thank you very much for your question. Our next question is from Mr. Froylan Mendez from JP Morgan. Please go ahead.
Hello, gents. Thank you. Can you hear me well?
Yep.
Yes, we can.
Perfect. Thank you so much for taking my question. Federico, if we were to assume that the FX didn't move from current levels, would your comments regarding the better margins into 2026, would still hold? In that sense, what is your expectation? I know you'll have your guidance in the Alsea Day, but, how much of the margin expansion that you're seeing depends on having better pricing or less, let's say, less, promotional activity in the key brands? I will have a second question, if I may.
Sorry for being so repetitive, obviously this is a tailwind. Each peso should be around 30 basis points. Remember that maybe that implies that around 60 basis points during the first quarter year-over-year. In the remaining months, the weight and the comparison is not that much. As I said before, obviously, we have closed January. I have the figures. They are positive. We are expanding margins. I want to be cautious because obviously the events from Guadalajara, even while we only shut down 300 stores during one day, obviously I'm not having the total performance regarding traffic in those stores. As all the years, we have some different events, positive, negatives, and I want to be really cautious.
At this point, with January completed, we have expanded the margin, but I don't know what is happening in the rest of the year. Obviously, we have positive events such as the World Cup. We'll tell you the expansion of margins that we're thinking, but again, we want to increase the traffic in each one of the stores, each one of the brands. That is the main objective. I prefer to sacrifice some of the margin if I'm increasing, I'm gonna make stories, but three points in same-store sales in Chili's, Domino's Pizza, that is more money, and that is a more strong customer base for the future. Sorry for the ambiguous answer, Froy, but I don't want to take in advance with only one month close at this point.
Excellent. Thank you for that. My second question may be more for Cristian. We hear about these CapEx rationalization, the effort to divest some of the probably non-performing brands. At the same time, we see new brands coming into the portfolio, Cane's, Chipotle, with obviously not needle-moving CapEx, but I'm sure it will take time away from management. I'm not sure also how much synergies there are in their supply chain, in their sourcing of raw materials with the rest of the brands.
How should we think about when we see a lot of the long-term CapEx that you mentioned focused on Starbucks, Domino's, and full service with also these like small opportunities that you still are trying to tap and isn't that a little bit distracting at some point for management? Thank you.
Thank you, Froy. Several answers to different views, different points. First of all, fortunately, as you know, in Alsea, 36 years around, we are able to really develop our team members and to have a lot of internal talent that allows us to really being able to bring these brands and do not distract the rest of the organization. As you know, the way we are organized now is via Before, you know, we have these country managers, which were managing the different brands that we had in each region.
In the past months, we have moved into a brand manager that manages we have a brand manager for Domino's Pizza or a managing director, a managing director for Starbucks Alsea, for Domino's Pizza Alsea, for BK Alsea, a managing director for food service in Mexico, and a managing director for food service in Europe. That allows us to really focus. First of all, make sure all best practices, learnings, one single direction and strategy to keep the brand directors or managing directors focusing on their own brands. Likewise, we have created a new brand division, let's call it like that, where we have a team solely and fully and only dedicated to these two new brands.
There is really no distraction of the management. We were able to have a very strong managing director, which was part of our C-suite team for many, many years, Pablo Levrito, which now he's running. He was the commercial director for Alsea, and now he's the head of with a very clear and independent structure for both brands. In terms of synergies, obviously, there are synergies. We clearly have synergies. We have been working in the past six months to make sure we are ready to all around all the product sourcing, protein, produce. There are things that are proprietary to the brands that we will import, as we do with the rest of our brands, coming from the U.S. The reality is that there are a lot of synergies.
It's our Alsea muscle allows us to do this kind of plug-and-play approach when we bring these new brands, so clearly there are important synergies in these terms. In the case of supply chain and management, really there is no, actually, it's, it adds on to what we already have. Another point you made is about the CapEx. The reality is that the way we, the obligations we have with both brands is a non-intensive, non-CapEx intensive approach. We are going to open two Raising Cane's stores this year, at the end of the fourth quarter, and three to four Chipotle stores also during in the second half of 2026.
Once we see how we do, which we are very optimistic and positive of what, of how these brands are going to add value and being accretive to the Alsea portfolio, we will sit down and define. We know more or less what's the white space or the market holding capacity for both brands. We're going to share a little bit more about that during our Alsea Day. The reality is that we are very optimistic that by first divesting, and at the same time bringing the right brands and the brands of the future in the portfolio, we'll have a very, very strong portfolio of brands in the future.
Thank you very much. Appreciate it.
Thank you very much for your question. Our next question is from Mr. Bob Ford from Bank of America. Please go ahead.
Hey, good morning, everybody. You know, I'm inspired by your Raising Cane's cups, so I'll bite. You know, can you guys discuss the magnitude of the opportunity you see for the brand in Mexico? How do you think about replicating the authenticity of the celebrity and influencer engagement that Cane's enjoys in the U.S.? When you think about the unit economics, how would you compare that with your best practice or properties in Mexico?
Yeah.
Hi, Bob. Good morning. As you can see, we are excited, too, with bringing Raising Cane's into the family. In Mexico, we see a huge opportunity in Mexico for Raising Cane's, and let me tell you why. First of all, chicken is the number one protein consumed and the fastest-growing protein in Mexico.
Yeah.
This is clearly a fact. The second one is, for decades, there has been only one player in the chicken market in Mexico, in the organized segment, for decades. The white space and what we're seeing is huge. It's super important. The other roasted chicken industry is held by the moms and pops, and then you have this organized chain that has been there for decades. The reality is that we see a lot of white space and also Raising Cane's is not only an amazing and tier one brand, it also aligns to our full Alsea strategy.
On that and we will give you more light in terms of the market holding capacity that we see and our development plan during the Alsea Day in 18 March . The second question you answered, which I love this question because I truly believe that the way Raising Cane's communicates to and resonates between the community, for us, clearly, community is going to be a key success factor for the success of the brand. Bringing this... You know exactly what I'm talking about when I mention local teams, but at the same time, important celebrities, but at the same time, the college basketball team or the community school team.
We are already working with Raising Cane's to bring this same effect to Mexico. We are planning to have even the same agency. The reality is that we're working very close together, holding hands. Of course, we are going to take advantage of these assets in terms of influencers, celebrities that they have, but also the local influencers, the local community, the local celebrities are gonna play a very important role for us to be successful. I believe I have answered your two questions.
The last one was about unit economics.
Regarding the economics, I can take that question, Bob. Obviously, we cannot disclose the terms of the agreement we have signed with Raising Cane's, but the EBITDA margins at a forward level are pretty similar with the Starbucks or Domino's Pizza, and the same for the royalty fee and opening fee that we will be paying. It is relevant to consider that even while we are really excited about the opening of Raising Cane's and Chipotle, for 2026, we will be opening, as we have commented in the past, only five stores. We do not want to have a terrific contribution. We need to open the first store, and let's see what is happening. If we are achieving the EBITDA margins, the profitability that we model in the months before.
Great. Just one other question, and that is France. I mean, what are the next steps for you in France? Do you see any opportunities to either, you know, reduce some of the expenses or drive revenue?
Of course. Well, France, we have not, we have not, seen the expected recovery that we had. There has been some recovery. We are at 85% of our sales, pre-boycott sales in October 2023. There was additional pressure, a slight pressure in the summer. Our objective remains to fully restore the transactions that we had pre-boycott. We have a very strong strategy around how to turn this around in terms of resources, in terms of store renovations, additional things that are part of this plan that we are working on.
To your point around efficiencies, yes, we have done already the restructuring that we needed to do in terms of management, in terms of synergies with our operations in Europe. We will see for sure, better margins and better EBITDA as we move through the year. Our priority and our focus is to recover this 15% of traffic that we have not recovered yet. We have a clear, strong focus on this, and it's one of our priorities for 2026.
Great. Very encouraging. Thank you so much.
Thank you very much for your question. Our next question is from Mr. Pedro Perrone from UBS. Please go ahead.
Hi, Team. Thank you so much for the space. We have a quick question for you on a side based on same-store sales trends in the first quarter, especially for Mexico and for Europe. If you could give us some color about these trends, and especially connecting to top line, that would be very helpful.
Okay.
Thanks so much.
I would say, to be clear, not only Mexico, Europe, and South America, the trend is pretty similar to the one we have in the months of December and November. No news, good news. As I said before, it is in the target that we have set for 2026, from low to mid-single digit, depending on the maturity of the brand and the region. That's the answer, Pedro. Sorry.
No problem. See it. Thank you so much.
[Foreign language], Pedro.
Thank you very much for your question. Our next question is from Mr. Ben Theurer from Barclays. Please go ahead.
Hi, everyone. This is Rahi on for Ben. Just the first one, I know Bob mentioned a bit on with the EU. Is there any other challenges we should be aware of for the EU, that would impede recovery? Another one I thought would be interesting is to look at GLP-1. Have you seen any impact on consumption from GLP-1 in Europe, and when do you think you would see some impact in Mexico, if any? Have you had any formulation changes in the EU in regards to GLP-1? That's it for us. Thanks so much.
Let me get your second question first, Rahi. Really, we have not seen any particular effect on GLP-1. Nevertheless, as you have seen in previous months, protein is becoming a very important element in the market. In the case of Starbucks, we are fully in the game with different protein being an important priority in terms of beverage, and our food program is moving towards that. What I would answer to that, we are observing. We are observing it. We are acting around that. We are trying to be ahead of the curve, but we don't see. It's too early.
I would say it's too early, but so far we have not seen anything relevant. Obviously, the U.S. is the one kind of driving this trend, and we are watching, we are talking with our franchisors. What are they seeing? You know? The reality is that we were already ahead of the curve with protein drinks in Starbucks, and our food program is moving in a way towards that. Not fully, but it's part of the strategy. More or less that, and the rest of the brands, not really. Not really. We are watching, but, and that's it. No, we're observing what's going on. No, yeah.
I just wanna follow up for that answer. It was for the EU as well, right? No impact as well on the.
Exactly. In neither in the European Union.
Yeah
... or in Mexico or Latin America, we are seeing these types of effects. What I can tell you, to add a little bit of color to that, is that it's more now protein, it's more like trendy and innovation more than linked to GLP-1 or any of its effects, I would say, positive or negative. Yeah.
Yeah, I'm complementing the answer. France is less than 2% of the total revenues contribution for Alsea. In Europe, we are present in Iberia, Spain, and Portugal. I would say that is the most relevant-
Sure
... contribution for Europe. The trend is positive. We are expanding margin, increasing the same-store sales coming from traffic in the main brands such as Domino's, Starbucks, and the full-service formats that we hold in there. Even while in France, we're still at around 85% of the traffic that we had in 2023, is less relevant, but we still see the opportunity in there to open more stores. We will be strolling during 2026 to see if, in 2027, we can return to the path of growth.
Okay. Thanks so much.
[audio distortion].
Thank you very much for your question. That was the last question. I will now hand over to Mr. Christian Gurría for final comments.
First of all, thank you all very much for your questions and for your interest in Alsea. Really, thank you very much. 2025 reinforced the resilience of our business and the strength of our portfolio. We enter 2026 with a clear focus, a stronger financial position, and a disciplined approach to profitable growth. We look forward to continue the dialogue with you in the coming months, but most of all, we're really looking forward to see you all in New York. Here, the team is doing an amazing job to prepare a very good event there, and we are really looking forward to see you there. Thank you again.
Thank you very much.
Thank you.
Alsea would like to thank you for participating in today's video conference. You may now disconnect.