Good morning to all, and welcome to our presentation of Grupo Comercial Chedraui's third quarter 2026 financial results. During the quarter, the commitment, dedication, and execution capabilities of our employees were instrumental in navigating a challenging environment.

Combined with disciplined cost management and ongoing efficiency initiatives, these efforts enabled us to increase our consolidated EBITDA margin by 14 basis points, reaching 8.7%, demonstrating the resilience and strength of our business model. In Mexico, our same-store sales performance exceeded ANTAD self-service segment results in five of the seven regions where we operate: North, Southeast, Southwest, Metropolitan, and Center.

Consumer demand softened further during the quarter, particularly in the Southeast region, which is our most significant market, due to the lower public and private investment and a marked slowdown in tourism activities, resulting in a marginal decline in Chedraui Mexico same-store sales performance for the quarter. At Chedraui USA, EBITDA margin improved by 18 basis points year-over-year, reaching 7.5%.

This performance was driven by ongoing expense control initiatives and operational efficiencies generated through our Rancho Cucamonga distribution center. These benefits helped offset the impact of a slowdown in the consumer spending environment, affecting particularly El Super and Fiesta Mart, influenced by immigration enforcement measures, reduced SNAP program resources, and higher gasoline prices.

Supported by our strong cash position, we continued executing our organic growth strategy during the quarter, opening two stores in the United States and 27 stores in Mexico. For the first nine months of 2026, capex totaled 7,285 million pesos, representing 3.4% of consolidated sales and in line with our annual investment plan and strategic priorities.

Overall, these results underscore the effectiveness of our operational initiatives, our financial discipline, and our ability to continue generating sustainable and profitable growth while successfully navigating a dynamic market environment. Now, to start our presentation, I will highlight key achievements for the third quarter of 2026.

Please turn to slide 4. Same-store sales in Mexico, in line with ANTAD, were affected by a weak performance in the Southeast region.

Consolidated gross margin increased by 53 basis points, driven mainly by efficiencies at the Rancho Cucamonga distribution center and improved cost of goods sold. Consolidated EBITDA margin increased by 14 basis points to 8.7%.

Chedraui Mexico's EBITDA margin stood at 9.8%, compared with 9.9% in the third quarter of '25. Chedraui USA's EBITDA margin increased by 18 basis points to 7.5%.

Net cash to EBITDA improved to -0.13 times in the third quarter of 2026, compared to the -0.03 times in the third quarter of '25. Consolidated sales floor expansion in the last 12 months grew by 3.5%, while sales floor at Chedraui Mexico grew 4.7%.

In the following slides, I will comment in more detail about our consolidated results for the quarter. Please turn to slide 5.

Consolidated sales declined 2% compared to the same quarter of last year, reflecting the currency translation effect for Chedraui USA sales from a 6.2% appreciation of the Mexican peso against the US dollar. For its part, EBITDA declined by only 0.3%, while EBITDA margin reached 8.7%, a 14 basis point improvement compared to the third quarter of '25.

This result is explained mainly by cost efficiencies from the RCDC and improved cost of goods sold in the US, which compensated for the loss of operating leverage. Turn to slide 6.

Our strategic M&A investments and organic growth strategy continued to support the positive long-term trend in consolidated net income. During the last 5 years, net income achieved a compounded annual growth of 12.7%, highlighting the effectiveness of our growth strategy and disciplined financial management.

Our return on equity has been affected by RCDC costs, non-recurring items, and immigration enforcement in the US in past quarters. However, even considering these factors, our long-term strategic focus drove a 99 basis point increase in ROE in the third quarter of 2026, compared to the same quarter of 2021.

This demonstrates our strong commitment to creating long-term value for our shareholders. In the following slides, we will review the main highlights of our business in Mexico.

On slide 7, during the quarter, same-store sales declined marginally, with a performance similar to ANTAD self-service segment. We surpassed ANTAD's same-store sales results in five of the seven regions: Center, Metropolitan, Southeast, Southwest, and North.

Nonetheless, our strong presence in the Southeast of Mexico, which continues to experience softer consumer trends than the rest of the country, is impacting our results. I want to highlight that Supercito continues to grow its same-store sales above mid-single digit, driven by higher customer traffic as a result of our broad product base and competitive pricing strategy.

Our e-commerce penetration continues to strengthen. As such, e-commerce sales as a percentage of sales in Mexico increased by 57 basis points to 4.4% in the third quarter of '26, compared to the same quarter in '25, boosted by improved sales in both our own channels and third parties, mainly from Rappi Turbo, Rappi, Uber Eats, and DiDi.

Please turn to slide 8. Despite a continued weakness in consumption trends in Mexico, total sales in the quarter increased by 4.6% compared to the third quarter of 2025, supported by a 4.7% expansion in sales floor area.

EBITDA in the quarter grew 4.1% compared to the same period of the previous year, and EBITDA margin stood at 9.8%, declining by 5 basis points due to a loss of operating leverage as higher labor costs were offset by our strict expense control program along with strategic promotional and inventory management. I will now turn the meeting over to Carlos Smith, CEO of Chedraui USA, for his comments on our US operations.

Carlos, please go ahead.

Thank you, Antonio, and good morning, everyone. As Antonio mentioned, Chedraui USA grew EBITDA margin to 7.5%, an 18 basis point increase to the prior-year quarter.

Our team is committed to our plan to make RCDC operations more efficient, being great merchants at store level, while maintaining tight expense control across all areas of the business. The US macro environment remains challenging, with changes to both immigration enforcement policy and SNAP benefit availability, along with higher fuel prices, impacting customer spend.

Although El Super and Fiesta showed a slight improvement in sales trends compared to Q2, the tough environment kept same-store sales negative for the quarter. On a positive note, the improvements in sales trends for Smart & Final continued, and I'm pleased to report that same-store sales turned positive for the quarter.

We are seeing our strategic initiatives with our business customers pay off, where we saw both larger basket sizes and an increase in traffic in the quarter. Chedraui USA's strong balance sheet and positive cash flow generation allowed us to pay down over $127 million in debt in the last 12 months.

Additionally, in the third quarter of '26, we opened one El Super store in Las Vegas and one Fiesta store in Houston. We remain confident that in the medium and long term, our operations and profitability will continue to improve as we optimize RCDC operations and maintain our disciplined approach to expense control, while at the same time implementing different strategies to remain front and center to our customers.

Now, we will review the results of the quarter. Please turn to slide 9.

Chedraui USA's same-store sales declined by 2% in dollar terms compared to the same quarter of last year. This is explained mainly by a lower number of transactions at El Super and Fiesta due to stricter immigration enforcement, softer consumer trends resulting from lower SNAP benefit availability, and higher fuel prices.

At Smart & Final, same-store sales increased by 0.1% in dollar terms, with customer count down 0.5%, but average ticket up 0.7%, bringing Chedraui USA's overall average ticket size in line with the third quarter of 2025. Chedraui USA's total sales decreased by 1.8% in dollar terms.

In Mexican pesos, the 6.2% translation effect contributed to a sales decline of 7.9%. Please turn to slide 10.

EBITDA declined marginally in dollar terms and 5.7% in Mexican pesos, while EBITDA margin rose 18 basis points to 7.5% as a result of continued expense control across the organization, efficiencies from RCDC, and improved cost of goods sold. The combined El Super and Fiesta EBITDA margin remains at a very healthy level, even in this complex environment, reaching 7.9% in the third quarter of '26, compared to 8.1% in the third quarter of '25.

Finally, Smart & Final's EBITDA margin of 7.1% improved by 55 basis points compared to the same quarter of 2025, explained by the efficiencies gained at RCDC and improved supplier negotiations. This concludes our report on the US operations.

Thank you, Carlos. We now turn to the consolidated financial results on slide 11.

Consolidated sales of 70,356 million pesos declined 2% compared to the third quarter of '25, mainly explained by a 6.2% appreciation of the Mexican peso when consolidating Chedraui USA sales. Gross profit rose by 0.2%, mainly explained by distribution efficiencies at Chedraui USA due to the RCDC and better promotion and inventory management in Mexico.

This contributed to a gross profit margin expansion of 53 basis points to 25.1% in the third quarter of '26. Consolidated operating expenses, excluding depreciation and amortization, increased by 0.4% and represent 16.4% of sales.

This result is mainly explained by higher labor costs in Mexico, which were partially compensated by the effect of the appreciation of the Mexican peso when consolidating the results of Chedraui USA's operations and expense control programs implemented in both countries. Consolidated operating income declined 0.7%, with operating margin of 5.3%, improving slightly compared to the same quarter of 2025.

Consolidated EBITDA declined by 0.3%, and EBITDA margin was up 14 basis points to 8.7%, benefiting from cost and expense efficiencies in Mexico and the US. Financial expenses increased by 1.7%, explained by lower financial income in Mexico, driven by lower interest rates, and higher financial costs related to IFRS 16.

Consolidated net income declined 1.2% to 1,626 million pesos and represented 2.3% of consolidated sales. Finally, please move to slide 12.

As of September 30th of 2026, we closed with a net cash position of 3,197 million pesos, and our net cash to EBITDA ratio improved to -0.13 times from a -0.03 times in the same period of last year. We continue with our organic growth program despite the complex environment.

As such, capex for the first nine months of 2026 totaled 7,285 million pesos, representing 3.4% of sales, and increased by 24.3% compared to the third quarter of 2025, a few steps above the 2.9% average level we've had since 2021, excluding Smart & Final's acquisition. Now, please allow me to move to the question-and-answer section.

Hi, good morning, and thanks for taking my question. I have just a few questions on the US for Carlos.

First, you had mentioned the B2B recovery at Smart & Final, but can you also comment on sales to the end consumer? Then as we start to lap some of the greater enforcement efforts in Texas and initial SNAP benefit cuts, are you seeing any signs of recovery?

Then on the margin side, can you just discuss where you're seeing the biggest gains from RCDC and where you see further opportunities to generate efficiencies? Thank you.

Yes, good morning, Melissa. Yes, our business sales at Smart & Final have been very strong, and I think that if we go back a series of calls, you know that we've been very focused on this particular segment.

I think that there's a couple of things that are driving this benefit. Our in-stock position in business items has been terrific.

This is a customer that values consistency, and our ability to provide that consistent experience when they come in, items that they want are in stock, has been beneficial to this segment. In addition to that, we've been incredibly focused on our pricing position on key items for business customers.

I think overall, our let's call it sales initiatives to garner new business customers is also paying off. I think the team has done a terrific job of leaning in to this segment, which is an important segment at Smart & Final.

The household consumer is, as stretched very thin. We're in a very challenging macro environment, and the Smart & Final stores feel that, particularly in lower income segments.

Look, people are very worried about grocery prices. There's less EBT.

They're paying more for gas prices, and they're looking for values, sometimes they're willing to shop at multiple locations. That's the fight that we're in, that we're trying to win at, right?

With respect to margins at RCDC, well, there's two big components to where our savings were coming from. Number one is obviously logistics expense, a combination of consolidating warehouse expense and optimizing our transportation routes to lower costs.

Number two, cost of goods. We had the ability at El Super in particular to consolidate and self-distribute a lot of categories that we were buying from a wholesaler.

That's presented a great opportunity to lower cost of goods sold, and the margins at El Super are showing that. The benefit for Smart & Final is from buying on a consolidated basis.

We have more scale, and we're using it, and it's also showing up in the margin results there.

Thanks, and how much do you think you have left to be able to extract? I know the current sales environment and operating deleverage makes it a little bit difficult to show that.

That's exactly right. We certainly have identified opportunities that we're going after, but, look, the environment is very uncertain right now, and it's hard to forecast certain things past what's in front of us, right?

Thanks, and just on the other formats, are you seeing any signs of improvement? It sounds like things are still quite challenging for the consumer.

Look, SNAP benefits have been a big challenge across all markets, some markets more than others. I think it's well documented that a market like Arizona has lost 50%, and that hurts.

That'll cycle through. We are hoping that there are no additional cuts to SNAP down the road, but we should cycle through that.

Immigration enforcement has had less theater and less media noise, but they're very active in the communities that we serve, and there's been a lot of activity in Texas lately. For sure that's something that's impacting those formats.

Fortunately, we're seeing a little light. You saw that traffic was still negative at El Super, but better than the second and first quarter, we're happy about that.

Smart & Final sales have turned positive. In the end, we are super bullish on the Hispanic consumer.

There are 70 million Hispanics in the United States. The US-born Hispanic population is the fastest-growing demographic in the country, and we are excited to continue to be a part of servicing this community.

Great. Thank you so much for the color.

Hi, guys, can you hear me? Hello?

Yes, we can.

Yes, we hear you well, Froylán.

Perfect. Thank you so much.

Just wanted to understand a little bit more on the regional weakness in Mexico. You mentioned obviously the Southeast part being a drag.

Can you help us quantify if we were to extract the Southeast, what would have been your same-store sales during the quarter? If you're seeing any encouraging trend into October, those would be my first questions.

If I may, just on gross margin versus pricing, very, very resilient gross margin. I'm just wondering how sustainable this is if traffic remains weak, in other words, how much gross margin are you willing to reinvest into price?

Thank you.

Thank you for your question, Froylán. Yes, if you divide the country, we do close to 42% of our sales in the Southeast region, which is the most affected one.

To give you some numbers, ANTAD autoservicio reported a drop of four, over, a little over 4% in same-store sales, and we were closer to 2% drop in same-store sales in the same region. That effect has affected our overall growth in a very important way.

The region's still affected by tourism. I think sargazo, the dollar-to-peso exchange rate and security, for sure, has affected that particular region.

That will also cycle, and we have a very important presence there, and we feel that we're going to be able to recover. On the other hand, we have been very efficient managing gross margin and expenses, even though with a slowdown in consumption, we have been able to sustain and sometimes even to increase margins, and still being very aggressive on the pricing strategy.

We still maintain the gaps that we think benefit the consumer and allow us to differentiate ourselves from our competition. Due to the slowdown in consumption, basically more on the capacity of the consumer, we feel that there's no need to become more aggressive on the pricing to increase our sales, because when there's a limited capacity for the consumer, even if you promote more, that does not necessarily turn into better sales, no?

We believe that we're on the right track, and this will also cycle. I don't know, Froylan, if this answers your question.

It does. Thank you so much.

Hi, Antonio, Carlos, thanks for the space for questions. Just on Supercito, could you provide some color on the geographic expansion strategy, which regions are you prioritizing for the new openings, and what are the key factors driving your decisions on this expansion?

Also, a second one, just on the US, if you could go deeper on how you're seeing the competitive environment in terms of price investments. Thank you.

Thank you for your question, Emiliano. We're very happy with Supercito.

Is the fastest-growing format and is growing basically in every region where we have open stores. We are more focused in the metropolitan area of Mexico City.

That's where our biggest presence is, and that's where we're prepared better to support the new stores. We'll continue to grow in that region.

We have presence also in Xalapa and Veracruz that probably are the best, where we get the best returns at the moment, because our sales by square meter are very high there, but still a limited market to grow in the future. We'll concentrate in the regions where we think we have more opportunity to grow, which is, again, the metropolitan area of Mexico City.

We're expanding into Guadalajara as well, and we're very happy with the format. The efficiencies, the low investment of the format brings very high returns to the table.

Carlos, please go ahead about the US.

As I mentioned earlier, well, certainly the macro environment is very challenging. The consumer is stretched thin, they're looking for value.

We're dealing with some inflation in some categories, we're dealing with some deflation in others. I think, in general, the competitive set is working very hard, just like we are, at being as sharp as possible with price.

Yes, you're dealing with more promotional activity, more aggressive pricing, as everybody's struggling and in trying to bring in and hold on to traffic. Nothing that we haven't experienced before, and I think that what you see in our results, as our team has done a terrific job of maintaining and actually growing our gross profit at all three banners in the quarter, even with this aggressive competitive activity in the market.

That's very clear. Thank you.

Also, Carlos, just following up, and don't want to get too ahead, but do you think this challenging environment could eventually bring some M&A opportunities in the long term?

You always hear me say, I think that in these types of environments, there are winners, and there are losers, and we are very disciplined in our approach to M&A, as you've seen, and as we've demonstrated. We will continue to do that, but we are always looking for opportunities.

That's great. Thank you very much.

Good morning, and thank you for taking the questions. It's coming back on to the, first of all, on the US immigration enforcement.

I take your point that it might be a little bit more low-key, but I'm guessing that you have mapped that in some sort of in some areas. I'm just wondering what sort of trends you're seeing in those areas where you've lapsed the tighter immigration enforcement.

Perhaps you could just give some more color on that, please. Then secondly, in Mexico, the cost containment on SG&A, how much more is there to come out of there, and how are you thinking about the challenges that we all know that the industry has got into 2027 with higher minimum wages and with changes in the working week?

Thank you.

Joe, this is Carlos. I apologize, I didn't have enough clarity on your question, but I think it's related to immigration enforcement and how we're seeing some of these trends, etc.

I'm not qualified to tell you exactly what the strategies are. What I am qualified to tell you is how it's played out and how it's manifesting itself in the communities that we serve.

Once again, a lot of noise, a lot of media in the early stages of the administration, a lot less right now, but a lot more activity in the streets that our customers are witnessing and are communicating with each other about, and obviously that has an impact in consumer behavior, and that's what we're trying to react to.

On the Mexican...

Sorry, in the areas, is that

still going, the trends first? Sorry, Joe, I did not hear you clearly.

Sorry, I think my line's a little bit bad. It sounds like in the areas where you have, in theory, lapsed the tighter immigration enforcement, the volumes are only coming back very slowly, or they're flatish, for want of better words, there.

Is that correct?

Yes. As an example, our performance in Northern California has been better than in Southern California.

Thanks.

About the Mexican operation and the possibilities of sustaining the efficiencies and increment them related to cost to sustain margins, we believe as a company that there are always opportunity to do better what we do. We're pretty much focused in that.

We were aware of the workweek reduction, and we were prepared for that. It's nothing new that it's coming for next year.

We believe we're prepared for that. We think that the slowdown in consumption will continue, but it will always cycle.

The base that we have already acquired this year, we believe it's going to benefit for next year. At the moment, we don't see any reason why we should expect any decrease in our margins and profitability for next year.

Thank you very much.

Thank you, Thomas.

Hi, guys. Thank you for allowing me for a follow-up.

Just wanted to know your thoughts around the tax reform here in Mexico, if you have done any analysis. We have made our own analysis and have some idea on what could be the impact, but wondering if you have done yourselves and what to expect on that front for next year, cash flow and even capital allocation strategy, if there's something there.

Just to make sure on October trends in Mexico, anything encouraging, something changing in the margin that you think the consumer is starting to inflect? Thank you so much.

If you allow me, Froylán, I think Humberto is very well prepared to talk about the fiscal reform for next year, and he'll explain the effects that we could expect.

Thank you, Antonio. Froylán, hi.

We have been evaluating all the changes that the authorities have put together. I'll say that we're evaluating what our options, we are talking with authorities, we're talking with ANTAD to see what the impact of that reform will be, and then we're talking with our tax advisors in order to see how that reform can or will impact us.

I'll say we're still in analysis of that, but as soon as we have something, for sure that we will come back with everyone and let you know what we think the effect of that will be next year.

Gracias, Humberto.

Sure.

Froylán, about trends of October, we don't see any change, unfortunately, on the consumption side, but still, we were aware and prepared for the situation that we're experiencing in the same regions of the country. There's no change.

I just want to thank everyone for joining, and I hope to talk to all of you next year again. Thank you very much.