BBB Foods Inc.

Good morning, everyone. My name is Daniela and I will be your conference operator. Welcome to Tiendas 3B's second quarter 2026 conference call. All lines have been placed on mute to prevent any background noise. There will be a question and answer session after the speaker's remarks and instructions will be given at that time. Please ensure that your full name is displayed correctly on Zoom. If not, please take a moment to edit your display name Also note that this call is for investors and analysts only Questions from the media will not be taken, nor should the call be reported on Any forward-looking statements made during this conference call are based on information that is currently available to us Today we are joined by Tiendas 3B's Chairman and Chief Executive Officer Anthony Hatoum and Chief Financial Officer Eduardo Pizzuto. I will now turn the call over to Anthony. Please go ahead.

Good morning and thank you for joining us today. I will begin with a review of our operating results for the quarter and will be followed by our CFO, Eduardo Pizzuto, who will provide an overview of our financial performance. We will conclude with our Q&A session. We delivered another strong quarter, sustaining and even building on the momentum we achieved in the first quarter. Here are the key highlights from our second quarter results. We opened 155 net new stores during the quarter, bringing our total store count to 3,624 as of June 30th, 2026. Over the last 12 months, we've opened 593 net new stores. We also opened one new distribution center, expanding our network to 21 regions as of the end of June. Same store sales grew 20% compared to the second quarter of 2025. Total revenue increased 39% year over year to 26 billion pesos. Reported EBITDA reached 960 million pesos. Excluding non-cash share-based compensation, EBITDA increased 44% to 1.6 billion pesos. For the first half of the year, cash flow generated from operating activities reached 4.3 billion pesos, representing 119% growth compared to the first half of 2025. Let's now turn to our operational performance. As I mentioned, we opened 155 net new stores during the second quarter. Over the last 12 months, we've opened 593 net new stores, representing 20% growth in our store base compared to June 2025. Our expansion strategy remains unchanged. We continue to balance densifying our presence in existing regions while selectively expanding our footprint in others. Our revenue growth remained exceptionally strong, and we believe 3B continues to be amongst the fastest growing retailers globally. Total revenue reached 26 billion pesos in the second quarter, up 39% year over year. Same store sales increased 20%, reflecting another quarter of outstanding performance. This strong growth continues to be driven by ongoing improvements to our value proposition, increasing brand awareness, and growing customer loyalty. Our same-store sales performance continued to significantly outperform the market. During the quarter, we maintained a gap of more than 20 percentage points versus Antad, while our internal inflation remained very low. I will now pass the microphone to Eduardo.

Thank you, Anthony. Good morning, everyone. Sales expenses as a percentage of revenue decreased by 56 basis points to 10% year over year in the second quarter of 2026. Most of the expense lines showed operating leverage, including labor. Admin expenses, excluding share-based payment, increased by 57 basis points year-over-year. As seen in previous quarters, admin expenses reflect our continuing investment in talent and expansion into new regions to support our accelerated growth. In the second quarter of 2026, admin expenses reflects a one-time cash expense of 37 million pesos related to the equity follow-on offering in May 2026. With respect to the share-based payment expense, these are non-cash and already reflected in our fully diluted share count. Additional details are available in the appendix of this earnings release, where we also provide projections for this non-cash expense. EBITDA for the second quarter of 2026, excluding non-cash share-based payment expense, increased 44% to 1.6 billion pesos. driven by strong sales growth, improved gross margin, and operational efficiencies. The adjusted EBITDA margin increased by 21 basis points year over year. EBITDA in the second quarter of 2026 includes a one-time cash expense of 37 million pesos related to the equity follow-on offering in May 2026. Excluding this impact, the adjusted EBITDA margin in the second quarter of 2026 was 6.2%. As you know, we don't drive to an EBITDA. It will naturally continue to increase over time, driven by our disciplined execution. Our business model generates strong operating cash flow through our structurally negative working capital model. As of June 2026, adjusted negative working capital reached 10.2 billion pesos compared to 7.1 billion pesos in 2025, excluding IPO and follow-on proceeds. This represents approximately 11.2% of total LTM revenue also exploiting IPO and follow-on proceeds. Our operating cash flow fully funds our organic expansion. I will now turn the call back over to Anthony for final remarks.