Betterware de Mexico, S.A.P.I. de C.V. Ordinary Shares

Thank you, and welcome to BEFRA's first quarter 2026 earnings conference call. Before BEFRA management begins to prepare remarks, please note the disclaimer regarding forward-looking statements on slide two. To remind participants that this call may contain forward-looking statements, which are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Please consider these statements alongside the questionary language and safe harbor statement in today's earnings release, as well as the risk factors outlined in BFRA's SEC filing. BFRA undertakes no obligation to update any forward-looking statements. A reconciliation of and other information regarding non-GAAP financial measures discussed on this call can be found in the earnings release published earlier today. as well as the investor section of the company's website. Presented on today's call are BAFRA's President and Chief Executive Officer, Andres Campos, and Chief Financial Officer, Raul Del Villar. Now, I would like to turn the call over to Mr. Campos. Please go ahead, sir.

Thank you, operator, and good afternoon, everyone. Thank you for joining our call today. First, I'd like to introduce Raul Del Villar. our new CFO. Raul brings more than 30 years of experience in senior finance roles within multinational consumer companies, playing strategic roles in expanding their brand portfolios and entering new geographic markets, both of which are integral to BEFRA's own growth strategy. His experience and leadership will be instrumental in supporting our growth objectives. Turning to key highlights on slide four, we delivered slight revenue growth of 0.3% year-over-year and EBITDA growth of 14% year-over-year, expanding our EBITDA margin from 15.3% to 17.4%, supported by improving profitability across all of our business units. Net income and free cash flow remain strong and reflect a more normalized quarter without the extraordinary effects seen last year. Turning to slide five, we continue to diversify our revenue mix in terms of brands and geographies. We expect this trend to accelerate once we receive regulatory approval of the top reward transaction, which we expect to happen in Q2. In addition to significantly diversifying our revenue and giving us entry into the Brazilian market, this new brand will be immediately earnings accretive. contributing an estimated 40% to earnings per share. Looking at revenue on a quarter-on-quarter basis, I'd like to highlight the early success of BetterWars expansion into Equalor and its improving performance in Guatemala, the contributions of which increased from 0.1% to 0.7% of total revenue over the past year. We expect this share to continue growing as the business scales in the region. Now, I will hand the call over to Raul so he can explain PEPFRA's key financials in detail.

Thank you, Andres. Very excited to be part of the team. Let's turn to slide six. Contributing to the 0.3% year-over-year increase in revenue was better work. which grew 2.6% despite one less week in the quarter, and which benefited from its geographic expansion. Improving trends at Jafra U.S. also contributed to BEFRA's top-line growth, which was partially upset by lower sales at Jafra Mexico. Looking at the associate base, we are beginning to see the impact of targeted initiatives with better-worse base returning to growth. Although Jafra Mexico's associate base declined as a result of our focus on productivity, we are now shifting towards initiatives aimed at attraction and retention, which we expect to begin showing results in Q2. Overall, these trends demonstrate improving momentum across both businesses and position as well for sustained growth. On slide seven, EBTA performance reflects a clear improvement in profitability across our business units, with margin expanding 211 basis points to 17.4%. It is important to note that extraordinary expenses related to Tupperware's transaction impacted the margin. Without these expenses, margin would have been approximately 18.4%. On the right-hand side of the slide, net income accelerated, nearly doubling year over year, reflecting a return to more normalized profitability levels following the extraordinary expenses recorded in the prior year, as well as lower interest expenses. Overall, BEFRA's improving profitability embodies our fifth strategic pillar of maintaining financial discipline. Turning to the next slide, free cash flow normalized during the quarter, converting 58% of DBTA into cash, supported by stronger underlying profitability and continued discipline in working capital management, particularly with respect to inventory. This will enable us to pay our 25th consecutive quarterly dividend since going public, which the board has proposed at 200 million pesos, subject to shareholder approval. Dividend payments remained aligned with our disciplined capital allocation framework, maintaining a 33% trailing 12-month dividend to EBITDA ratio, while also using the cash we generate to further reduce debt leverage and continue investing in geographic expansion. Slide nine summarizes BEFRA's financial strength. Total debt continued falling, with net debt to VGA improving to 1.5 times. Following the completion of the top-reward transaction, we expect our leverage ratio to increase to approximately 1.9 times, with the aim of maintaining healthy leverage levels. As you can see in the chart at the left of the slide, we successfully reduced leverage from 2.4 times at the end of 2022 and 3.1 times at the time of the JAFA acquisition to current levels. Our asset-like model remains a key source of resilience, with ROTA improving to 22.7%, demonstrating greater capital efficiency and stronger profitability. On the right-hand side, you can see that returns have also strengthened versus last year's quarter, with ROIC increasing to 27% and EPS reaching 31.9 Mexican pesos on a trailing basis, reflecting a stronger earnings profile. Overall, we are not only improving profitability, but also translating these gains into stronger results a healthier balance sheet, and high returns on capital, while enabling us to continue funding initiatives across our five strategic pillars. I will now pass the call back to Andrés, who will talk more about each plan's performance, as well as provide an update on the strategic pillars.