When you fridge as many cases of beer as we do at our house, it's tough to imagine that anywhere, at any time, selling more beer might be a challenge.
OK, the experiences of Anheuser-Busch
The full release is here (opens a .pdf file). And I'll say this again: I still think Mexican companies like this one produce some of the most transparent, to-the-point earnings releases available.
FEMSA, which is also the majority owner of Coca-Cola FEMSA
On the top line, things were worse for beer in Mexico, with sales volume up only 2.6%, a situation the company blamed on crummy weather. I'm not disinclined to think that weather can sometimes have an effect on good-time beverages like these. In fact, the Coca-Cola results for Mexico may confirm it, as they dragged in at 2.3% growth.
The problems crimped operating earnings 57.6% year over year, with the net earnings per ADS coming to $0.80, a small drop from last year's $0.84 per stub.
As a shareholder, I'm hardly pleased with the results, but sometimes these things happen. FEMSA still has an impressive portfolio of consumer staples and, in convenience-store chain Oxxo, it's got a rapidly expanding (if lower-margin) chain of outlets for these products. Commodity prices have a way of swinging back, and advertising spends can be cut as well. I'm content to give management the benefit of the doubt on this crummy quarter and let them stick to the game plan.
I still value the shares at around $130 each (why didn't I unload them at $140 a couple of months back? Good question). If they dip below the $100 mark, I'll probably grab an extra six-pack for the long ride.
At the time of publication, Seth Jayson had shares of FEMSA, but no positions in any other company mentioned. See his latest blog commentary here. View his stock holdings and Fool profile here. Coca-Cola and Anheuser-Busch are Motley Fool Inside Value recommendations. Fool rules are here.