EARNINGS REPORT - latibex.com - [PDF Document] (2024)

EARNINGS REPORT - latibex.com - [PDF Document] (1)

1

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

ALFA, S.A.B. de C.V. (BMV: ALFAA)

Investor Relations [emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Monterrey, N.L., Mexico, April 20, 2021.

ALFA, S.A.B. de C.V. (BMV: ALFAA) (ALFA), a

company that has developed a diversified portfolio

of leading businesses with global operations,

announced today its unaudited results for the first

quarter of 2021 ("1Q21"). All figures have been

prepared in accordance with International

Financial Reporting Standards ("IFRS").

EARNINGS

First Quarter 2021 (1Q21) REPORT

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (2)

2

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Important note on changes to ALFA’s Consolidated Financial Statements

On August 17, 2020, ALFA’s shareholders approved to spin-off ALFA’s share ownership of Nemak into a new,

listed entity: Controladora Nemak, S.A.B. de C.V. (“Controladora Nemak”). The shares of “Controladora Nemak”

were distributed to ALFA shareholders and began trading on the Mexican Bolsa on December 14, 2020. In

accordance with International Financial Reporting Standards (IFRS), Nemak meets the definition of a

“Discontinued Operation” for purposes of ALFA’s Consolidated Financial Statements. “Discontinued Operations”

are the net results of an entity that is either being held for disposal or which has already been disposed of.

The changes in ALFA’s Consolidated Financial Statements are as follows:

- The Consolidated Statement of Financial Position presents all items related to Nemak as follows:

o At the close of 3Q20, as “Current assets from discontinued operations” and “Current liabilities

from discontinued operations”

o At the close of 4Q20, all items are eliminated

o At the close of 1Q21, no figures shown related to Nemak

o Prior periods are not restated

- The Consolidated Statement of Income presents Nemak´s net revenues and expenses as a single line

item “Profit (loss) from discontinued operations” as follows:

o 4Q20 accumulated figures for the two months and 14 days ended December 14, 2020

o 1Q20 accumulated figures from the complete quarter

o 1Q21 no figures shown related to Nemak

- The Change in Net Debt presents Nemak’s net inflows and outflows as a single line item “Decrease

(Increase) in Net Debt from Discontinued Operations” for the nine months ended September 30, 2020.

- The Change in Net Debt also presents Nemak’s Net Debt balance as “Net Debt from Discontinued

Operations” at the close of 3Q20. Prior periods are not restated.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (3)

3

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

ALFA reports 1Q21 EBITDA of US $535 million; second highest quarterly figure in our history

1Q21 HIGHLIGHTS

ALFA

• 2021 EBITDA Guidance revised up 13% to US $1.637 billion due to stronger Alpek outlook

• Obtained approval to expand ALFA’s foreign neutral investment trust from 50% to 75%.

New limit expected to be enacted shortly as other required approvals are underway

• Leverage ratio (Net Debt / EBITDA) of 2.9x; below 3.0x for the first time since the beginning

of the pandemic

Sigma

• EBITDA up 7% y-o-y driven by growth in Europe (+51%), Latam (+13%) and Mexico (+3%)

• Foodservice channel recovery trend accelerated in March amid increased mobility

• Launched second generation call-out to startups via “Tastech” program. Invested in a

minority stake in Latam startup selected among first generation participants

Alpek

• 1Q21 Comparable EBITDA of US $203 million (+38% y-o-y), driven primarily by strong

volume and higher than expected reference margins

• 2021 EBITDA Guidance revised up 34% to US $750 million based on strong 1Q21 results

and improved outlook

• Announced JV to develop CO2 capture & liquefaction facility in Mexico; first carbon

negative asset

Axtel • Actively engaging with potential buyers who have shown interest for its Infrastructure unit

• 1Q21 EBITDA on track with full-year guidance

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (4)

4

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

SELECTED FINANCIAL INFORMATION (US $ MILLIONS)

1Q21 4Q20 1Q20 Ch. % vs.

4Q20 Ch. % vs.

1Q20

ALFA & Subs with Nemak as Discontinued Operations

ALFA Revenues 3,388 3,218 3,261 5 4

Alpek 1,614 1,392 1,433 16 13

Sigma 1,613 1,662 1,637 (3) (1)

Axtel 140 150 157 (7) (11)

ALFA EBITDA1 535 419 415 28 29

Alpek 324 201 111 61 193

Sigma 181 178 169 2 7

Axtel 45 51 156 (12) (71)

Majority Net Income2 154 (63) 170 346 (10)

CAPEX & Acquisitions3 79 165 82 (52) (4)

Net Debt4 4,864 4,699 6,323 4 (23)

Net Debt/LTM EBITDA5 2.9 3.1 3.0

LTM Interest Coverage6 4.3 4.4 4.7 1 EBITDA = Operating Income + depreciation and amortization + impairment of assets. 2 Majority Net Income includes Majority Net Income from Discontinued Operations (Nemak). 3 Gross amount; excludes divestments and Capex from Discontinued Operations (Nemak). 4 Net Debt adjusted for Discontinued Operations (excluding Nemak) at the close of 3Q20; previous periods unchanged. As reference, 1Q20 Net Debt includes US $1.210 billion from Nemak. 5 Times. LTM = Last 12 months. Ratio calculated with Discontinued Operations for all periods. 6 Times. LTM = Last 12 months. Interest Coverage = EBITDA/Net Financial Expenses with Discontinued Operations.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (5)

5

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Contents

Message from ALFA’s President

Consolidated Financial Results ALFA (BMV: ALFAA)

Results by Business

Sigma – Food Products

Alpek (BMV: ALPEKA) – Petrochemicals

Axtel (BMV: AXTELCPO) – IT & Telecom

Tables

Financial Statements

Appendix – 1Q21 Reports of Listed Businesses

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (6)

6

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Message from ALFA’s President

“We hope that you and your families are staying safe and healthy. 1Q21 results reflect a strong start for

the year, extending the positive momentum from previous quarters as the global economy continues to recover.

ALFA achieved better-than-expected Revenue and EBITDA driven primarily by outstanding performance at Alpek.

1Q21 Consolidated EBITDA of US $535 million is the second highest quarterly figure in our history.

Sigma is on track with its full-year target supported by a 51% year on year increase in EBITDA from Europe

and a steeper Foodservice channel recovery trend observed in March. Axtel’s results are also in line with its 2021

EBITDA Guidance. Whereas, Alpek exceeded expectations by capitalizing on strong volume, higher reference

polyester and polypropylene margins, a favorable rise in oil and feedstock prices, and temporary disruptions

caused by the polar vortex affecting the U.S. Gulf Coast.

As a result, full-year EBITDA Guidance for Alpek and ALFA has been revised up to reflect a more positive

view on certain key variables for the remainder of the year. ALFA’s new 2021 EBITDA guidance is US $1.637

billion.

The first quarter was also marked by progress on top Corporate priorities, including: i) expanding the

“Nafinsa Trust” to allow for higher foreign ownership of ALFA shares and ii) our Unlocking Value strategy.

We recently obtained the required approval to expand ALFA’s foreign neutral investment trust, which is

also known as the “Nafinsa Trust”. The Foreign Investment Directorship of the Mexican Ministry of Economy

authorized to increase the maximum threshold of the “Nafinsa Trust” from 50% to 75% of ALFA’s total shares.

The next steps include an amendment to the Trust and certain authorizations from the National Banking and

Securities Commission (CNBV). We expect to enact the new 75% limit shortly.

In addition, we reaffirmed our commitment with shareholders at our recent Annual Meeting to continue

moving forward with our gradual and orderly transformational process towards fully independent businesses to

unlock ALFA’s high value potential, based on three key implementation directives: 1) Reduce debt, 2) Focus on

core businesses, and 3) Enhance business independence.

1. Reduce debt. Deleveraging is imperative as we go through the transformation process. Our goal is to

reach a 2.5x Net Debt/EBITDA target through strategic initiatives and organic cash flow generation. We

remain committed to reducing debt through the potential sale of Axtel or other strategic alternatives.

Axtel is actively engaged with potential buyers who have shown interest for its Infrastructure unit. Better

than expected 1Q21 EBITDA is also important for this key implementation directive. This is the first time

since the onset of the pandemic that Alfa’s consolidated leverage was below 3.0 times, supported by

Alpek at 1.6x and Sigma at 2.6x.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (7)

7

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

2. Focus on core businesses. Supporting growth and business-enhancing initiatives at Sigma, Alpek and

Axtel is important to boost underlying value amid ALFA’s transformation process. Sigma is diligently

implementing a comprehensive plan to achieve the full potential of its European operations; targeting a

double-digit EBITDA margin by 2025. The Company expects to achieve this through portfolio

optimization, ongoing operational efficiencies and pursuing high-growth opportunities.

As part of its innovation pipeline, Sigma recently launched its second-generation call-out of “Tastech”,

challenging startups and other smaller companies in three areas: i) Future food, ii) Green tech, and iii)

Power connections. We are excited by the prospects of this initiative after Sigma received more than 120

submissions from the first generation, and invested during 1Q21 in a minority stake in The Live Green

Co., a LATAM startup that blends plant nutrition, biotech and machine learning to develop plant-based

foods of the future.

Alpek announced a JV with ContourGlobal to develop a 70,000-ton CO2 recovery & liquefication facility

in Mexico to meet the increasing demand for food-grade CO2 while at the same time reducing the

Company’s carbon footprint. On the financial front, Alpek successfully issued a 10-year US $600 million

bond at a record-low 3.25% coupon. The average maturity of Alpek’s debt was extended from 4.4 to 7.2

years as proceeds were used to refinance shorter term debt.

3. Enhance business independence. Nemak was our first business to become fully independent, and we

had the opportunity to celebrate this milestone with our shareholders at the Annual Meeting. Going

forward, the focus is for individual businesses to achieve service-related independence from ALFA while

we reach our target leverage ratio. A joint analysis between ALFA and each of its businesses is underway

to determine the most appropriate allocation and effective transition of shared service capabilities.

Our capital allocation strategy includes a comprehensive approach to balance deleveraging, growth and

returning value to our shareholders. During our recent Annual Meeting, shareholders approved a cash dividend

of US $98 million, which was paid on April 7, 2021. This was in addition to the US $25 million dividend paid in

January 2021. Shareholders also approved a maximum amount of Ps $5,800 million (approximately US $280

million) for share buybacks. Buybacks have been another means through which we have provided value to our

shareholders as we believe the current share price does not adequately reflect the fundamentals and long-term

growth prospects of the business. Lastly, shareholders approved the cancellation of all ALFA shares held at

Treasury (145.9 million shares) - ALFA effectively transferred a benefit to shareholders that was equivalent to

2.9% of total shares.

The strong start for 2021 reinforces our positive view on the prospects of the ongoing recovery. We look

forward to continue building upon the positive momentum of recent operational results and consistent progress

with our strategic initiatives amid better than expected macro conditions.”

Keep well/Stay safe,

Álvaro Fernández

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (8)

8

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

ALFA (BMV: ALFAA) Consolidated Financial Results INCOME STATEMENT (US $ Millions)

(%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Total Revenues 3,388 3,218 3,261 5 4

Gross Profit 878 733 642 20 37

Operating expenses and others (498) (504) (397) 1 (25)

Operating income (loss) 380 229 244 66 55

Financial cost, net (167) (58) (220) (187) 24

Share of losses of associates 0 6 1 (105) (131)

Income Tax (16) (554) 156 97 (110)

Profit (loss) from Continuing Operations 197 (376) 182 152 8

Profit (loss) from Discontinued Operations1 0 496 (7) (100) 100

Consolidated net income (loss) 197 120 175 64 12

Controlling Interest 154 (63) 170 346 (10)

EBITDA 535 419 415 28 29 EBITDA/Revenues (%) 15.8 13.0 12.7

1 Breakdown of Profit (loss) from Discontinued Operations shown on Table 10.

Total Revenues in 1Q21 were US $3.388 billion, up 4% when compared to 1Q20 driven by Alpek. Higher average

consolidated prices and volume growth at Alpek were partially offset by lower sales in Axtel and Sigma

(see table 2).

EBITDA was US $535 million, up 29% year-on-year and 28% quarter on quarter. 1Q21 EBITDA includes a US $121

million net gain from extraordinary items related to Alpek, comprised of a US $63 million non-cash inventory

gain and a US $58 million positive carry-forward effect. Alpek’s carry-forward effect reflects the estimated impact

from feedstock price swings between the time of purchase and consumption. Hence, it is considered as an

extraordinary item for ALFA’s Comparable EBITDA calculations beginning 1Q21. In this report, Comparable

EBITDA figures from previous quarters include the carry-forward effect.

Adjusting for extraordinary items in all periods, Comparable ALFA EBITDA was US $414 million, US $364 million

and US $344 million in 1Q21, 4Q20 and 1Q20, respectively. Comparable ALFA EBITDA was up 20% year-on-year,

boosted by 38% and 7% growth at Alpek and Sigma, respectively (see tables 3, 4 and 5).

Operating Income was US $380 million, up from US $244 million in 1Q20 reflecting the increase in EBITDA

explained above (see table 3).

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (9)

9

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Comprehensive Financing Expense (CFE) of US $167 million was down from US $220 million in 1Q20, primarily

due to lower foreign exchange losses resulting from a more moderate depreciation of the Mexican peso in 1Q21

versus 1Q20. CFE also includes US $42 million in non-recurring costs associated with the partial prepayment of

Alpek’s 2022 bond and the issuance of its new bond in 1Q21 (see table 6).

Controlling Interest Net Income was US $154 million in 1Q21 compared to US $170 million in 1Q20. Higher

Operating Income and lower Comprehensive Financing Expense in 1Q21 were more than offset by higher Income

Tax year on year. 1Q20 Income Tax includes a US $233 million gain in Deferred Tax associated mainly with the

depreciation of the Mexican peso, compared with a US $54 million Deferred Tax gain in 1Q21 (see table 7).

CHANGE IN NET DEBT (US $ Millions)

(%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

EBITDA 535 419 415 28 29

Net Working Capital (275) 165 (53) (267) (419)

Capital expenditures & Acquisitions (79) (165) (82) 52 4

Net Financial Expenses (131) (77) (95) (70) (37)

Taxes (159) (51) (189) (210) 16

Dividends (48) (15) (133) (220) 64

Other Sources / Uses (8) (81) 91 90 (109)

Decrease (Increase) in Net Debt from Discontinued Operations1 0 0 0 - -

Net Debt from Discontinued Operations – Nemak 0 0 0 - -

Decrease (Increase) in Net Debt (165) 195 (46) (184) (256) 1 Breakdown of Decrease (Increase) in Net Debt from Discontinued Operations shown on Table 11.

Net Debt was US $4.864 billion at the close of 1Q21. Adjusting for discontinued operations in previous periods,

1Q21 Net Debt was down 5% and up 4% versus 1Q20 and 4Q20, respectively. On an absolute basis, consolidated

ALFA Net Debt increased US $165 million versus year-end 2020 due primarily to investment in Net Working

Capital.

As of March 31, 2021, Cash totaled US $1.396 billion, down US $232 million quarter-on-quarter, approaching

pre-pandemic levels as macro conditions continue to normalize and subsidiaries reduce debt. At the close of

1Q21, ALFA had US $2.944 billion in available Credit Lines. Financial ratios at the close of 1Q21 were: Net Debt

to EBITDA of 2.9 times and Interest Coverage 4.3 times, compared with 3.0 and 4.7 times in 1Q20, respectively,

after adjusting for Discontinued Operations (see table 8).

Net Working Capital was US $275 million during 1Q21, as Alpek increased US $192 million due to the effect of

higher feedstock prices.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (10)

10

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Capital Expenditures (CAPEX) & Acquisitions was US $79 million in 1Q21, down 4% versus 1Q20. Sigma and

Alpek account for 82% of total Capex during the quarter. Most of these funds were used for maintenance and

minor asset replacements.

Dividends of US $48 million in 1Q21 correspond to the US $25 million dividend paid to ALFA shareholders on

January 5, 2021 as approved by ALFA’s Board of Directors at the end of 2020, plus dividends paid to minority

shareholders at the subsidiary level.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (11)

11

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

RECENT DEVELOPMENTS - ALFA

2021 Guidance

• 2021 EBITDA Guidance revised up driven by better than expected Alpek results and outlook

Unlocking

Value

• Transformational initiative to maximize valuation – eliminate conglomerate discount

• Gradual and orderly transition to full business independence (vs conglomerate)

• Transfer absolute autonomy to ALFA shareholders

• Commitment to maintain strong credit profile throughout transformation

• Emphasis on three key implementation directives:

o Reduce debt

o Focus on core businesses

o Enhance business independence

NAFINSA

Trust (“NT”)

• ALFA foreign shareholders can only acquire shares via the NT, in place since 1991

• NT reached its limit in 2020 (50% of total shares outstanding)

• The Foreign Investment Directorship of the Mexican Ministry of Economy approved

expansion of the NT from 50% to 75% of total shares

• Next steps include an amendment to the Trust and certain regulatory approvals

• Shareholders approved at Annual Meeting an adjustment to ALFA’s bylaws to expand

foreign ownership

• ALFA expects to enact the new NT limit of 75% shortly

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (12)

12

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

ALFA

Shareholders’

Meetings

• Shareholders approved:

o Cash dividend of 2 cents (US $) per share equivalent to US $98 million, paid in

April 2021

o Cancellation of 145.9 million shares (2.9% of total shares)

o Maximum amount of Ps $5,800 million (US $280 million) for share buybacks

• Adrián G. Sada Cueva joins ALFA’s Board replacing Adrián Sada González. Other

members of the Board were ratified by shareholders

Published 2020

ESG report

• 2020 ESG report integrated in ALFA’s Annual Report

• Focus on continuous ESG improvement and how ESG is embedded in ALFA’s business

• Highlights:

o In 2020, ALFA increased its S&P Global CSA rating from 23 to 32, above average

for conglomerates.

o Also, the CDP assessment rating increased from “D” to “C”, higher than the

region average and in line with the industry

o Since 2006, ALFA has been a signatory of the United Nations Global Compact,

which promotes social development, economic welfare and universal values

▪ Alpek also joined this initiative as an individual signatory in 2020

o Sigma continued to work on its sustainability commitments, which are aligned

with the U.N. Sustainable Development Goals

o Axtel began identifying and compiling the information needed to comply with

the Sustainability Accounting Standards Board (SASB) criteria for the software,

ICT and telecommunications industry

o During 2020, ALFA invested 26% more in environmental initiatives compared

to the previous year, thus reducing emissions by 9%, compared to 2019

o The Company continued to promote the use of clean energy sources and

recycling:

▪ 56% of the power consumed by Sigma comes from clean sources

▪ Alpek consolidated its position as the leading producer of recycled PET

(rPET) in the Americas

• ALFA and its companies are committed to build upon their progress on ESG to benefit

employees, the community, shareholders and its entire value chain

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (13)

13

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Results by Business Sigma – FOOD PRODUCTS

48% of ALFA’s Revenues in 1Q21

QUARTERLY HIGHLIGHTS • Consolidated volume decreased 5% YoY versus high comparable, including pantry loading effect in 1Q20

• Highest 1Q EBITDA margin since 2016; YoY margin expansion in Mexico, Europe, and Latam

• Steeper Foodservice recovery in March 2021 due to increased mobility; +21% in Revenues YoY, for the same month

• Positive results in Growth initiatives, tapping into the entrepreneurial network and driving sustained growth in E-commerce, as well as its Snacking and Plant-Based business units

• Lower Net Debt YoY supported by cash-maximizing initiatives and operating performance

• Paid US $50 million dividend during 1Q21

SELECTED FINANCIAL INFORMATION (US $ Millions) (%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Volume (ktons) 419 418 441 - (5)

Mexico 201 204 216 (1) (7)

Europe 113 117 121 (3) (7)

United States 81 73 79 11 3

Latam 24 25 25 (5) (7)

Revenues 1,613 1,662 1,637 (3) (1)

Mexico 637 644 679 (1) (6)

Europe 576 634 572 (9) 1

United States 289 269 268 8 8

Latam 110 116 118 (4) (6)

EBITDA 181 178 169 2 7

Mexico 93 89 90 4 3

Europe 38 43 25 (11) 51

United States 38 33 42 13 (11)

Latam 12 12 11 (2) 13

CAPEX & Acquisitions1 34 38 23 (11) 48

Net Debt 1,781 1,756 2,037 1 (13)

Net Debt / LTM EBITDA* 2.6 2.6 2.9

LTM Interest Coverage2* 5.8 5.5 5.9 * Times. LTM = Last 12 months 1 Gross amount; does not include divestments 2 Interest Coverage = EBITDA/Net Financial Expenses

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (14)

14

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

INCOME STATEMENT (US $ Millions) (%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Total Revenues 1,613 1,662 1,637 (3) (1)

Gross Profit 472 469 451 1 5

Operating expenses and others (345) (383) (337) 10 (2)

Operating income (loss) 127 86 114 47 11

Financial cost, net (30) (86) (2) 65 -

Share of losses of associates 0 0 0 - 100

Income Tax (15) (28) 29 47 (151)

Consolidated net income (loss) 81 (28) 141 394 (42)

EBITDA 181 178 169 2 7 EBITDA/Revenues (%) 11.2 10.7 10.3

Revenues were US $1.613 billion, down 1% year over year as the Company was comparing against a higher-than-

usual 1Q20 volume level due to a high pre-pandemic base in January and February, in addition to a pantry loading

effect during March 2020.

On a positive note, increased mobility resulted in a steeper foodservice channel recovery trend in March 2021

with revenue increasing 40% month-to-month and 21% year on year. Excluding Foodservice results, revenues

during 1Q21 were 2% higher year-on-year and flat when adjusting for exchange rate fluctuations, given a strong

euro appreciation when compared to 2020 (see table 13).

First quarter revenues in line with Sigma´s guidance, which considers a gradual recovery for 2021.

EBITDA during the quarter reached US $181 million, a 7% improvement year-on-year mainly driven by strong

results in Europe (+51%), Mexico (+3%), and Latam (+13%). Sigma´s EBITDA margin increased to 11.2%, 94 basis

points more versus 1Q20, reaching its highest first quarter margin since 2016 driven by a lower raw material

cost, revenue management efforts and cost-savings initiatives. In local currency, and excluding Foodservice

results, EBITDA also grew 7% year-on-year (see table 14).

Operating Income was US $127 million, increasing 11% from US $114 million in 1Q20 reflecting the increase in

EBITDA explained above (see table 14).

Comprehensive Financing Expense (CFE) of US $30 million, up from US $2 million in 1Q20. The change is mainly

explained by a US $32 million gain in 1Q20, amid the depreciation of the Mexican peso, compared to a

US $1 million exchange rate loss in 1Q21 (see table 15).

Net Income was US $81 million in 1Q21 versus US $141 million in 1Q20, mainly due to a higher CFE and higher

income tax year-on-year. 1Q20 income tax includes a larger gain in deferred taxes associated mainly with the

depreciation of the Mexican peso, versus 1Q21.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (15)

15

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

CHANGE IN NET DEBT (US $ Millions) (%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

EBITDA 181 178 169 2 7

Net Working Capital (52) 152 (107) (134) 51

Capital expenditures & Acquisitions (34) (38) (23) 11 (48)

Net Financial Expenses (29) (25) (33) (16) 12

Taxes (41) (26) (94) (58) 56

Dividends (50) 0 0 (100) (100)

Other Sources / Uses 0 (66) 46 100 (100)

Decrease (Increase) in Net Debt (25) 174 (43) (114) 42

Net Debt was US $1.781 billion, 13% below 1Q20 and 1% above 4Q20. On an absolute basis, Net Debt decreased

US $256 million versus the first quarter of 2020 due a solid operating performance and cash-maximizing

initiatives.

Cash totaled US $749 million at the end of the first quarter, increasing US $31 million year-on-year and decreased

US $71 million when compared to year end 2020. Financial ratios at the end of the quarter were: Net Debt to

EBITDA of 2.6 times and Interest Coverage of 5.8 times (see table 16).

Net Working Capital was US $53 million during 1Q21, reflecting primarily the seasonal investment in inventories.

Capital expenditures (CAPEX) totaled US $34 million during 1Q21, a 47% increase year-on-year, following the

2020 cash-preservation initiatives amid the pandemic implemented at that time. Close to 75% of CAPEX was used

for maintenance, while the rest was invested in expansion and optimization projects.

Dividends paid during the first quarter of 2021 were US $50 million.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (16)

16

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

INDUSTRY COMMENTS - SIGMA

Consumer confidence and food retail sales

During 1Q21, Sigma displayed strong operational results despite external challenges. As the vaccination roll-out

continues, economic growth and consumer confidence have improved.

In Mexico, the average consumer confidence reported by INEGI1 increased sequentially, but remains below

confidence levels observed in 1Q20. Same-store-sales reported by ANTAD2 also reversed from a decrease of 8.2%

in January to an increase of 1.5% YoY during February, amid lower restrictions.

The consumer confidence index3 in the U.S., decreased 24% year-on-year in 1Q21. Meanwhile, food retail sales

reported by the U.S. Census Bureau decreased 2.3% when compared to 1Q20.

In Europe, the average consumer confidence index reported by the European Commission increased from

negative 15.6 during the 4Q20 to negative 13.7 in 1Q21. Food retail sales measured by Eurostat also show signs

of improvement reaching the highest level since April 2020.

Exchange Rate

The average exchange rate for the Mexican peso versus the U.S. dollar depreciated 2% year-on-year in 1Q21. In

contrast, the average euro-dollar exchange rate appreciated 9% year-on-year. Sigma´s currency mix versus the

U.S. dollar in Latam had a net appreciation of 4% year-on-year in 1Q21.

Raw Materials

During 1Q21, pork ham prices in the U.S. increased 3% on a sequential basis and 11% year-on-year, while pork

prices in Europe remained below 2020 levels with shoulder, ham and lean hog prices 21%, 21% and 27% below

1Q20, respectively. It is important to note that pork prices posted an upward trend in both regions during the

quarter due to higher demand and a long production cycle which limits supply increases.

Higher demand as well as disruptions in supply caused by the polar vortex in February increased pressure on

poultry prices. Turkey thigh and other poultry meat prices increased between 8% and 11% sequentially and

posted an upward trend during the first quarter.

1 Instituto Nacional de Estadística y Geografía – National Institute for Statistics and Geography

2 Asociación Nacional de Tiendas de Autoservicio y Departamentales - National Association of Supermarkets and Department Stores

3 Source: The Conference Board

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (17)

17

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

RESULTS BY REGION - SIGMA

During 1Q21, revenues in Mexico accounted for 40% of the total, while Europe represented 37%, the U.S. 17%,

and Latam 7%.

Mexico: 1Q21 revenues, in local currency, decreased 3% year-on-year. The change is explained by a high pre-

pandemic comparable base in addition to a pantry loading effect in March of 2020, as well as lower volume in

the Foodservice and Convenience channels during this quarter. Meanwhile, EBITDA, in local currency, increased

6%, benefiting from revenue management efforts and cost-saving initiatives. Excluding Foodservice results,

Revenues and EBITDA increased 2% and 6% versus 1Q20, respectively.

Europe: During the quarter, revenues in euros decreased 7% when compared to 1Q20, mainly due to a higher

comparable base resulting from stronger-than-normal demand amid pantry loading in March 2020. In contrast,

1Q21 EBITDA increased a noteworthy 40% year on year, mainly due to lower raw material costs. This represents

a margin improvement of 221 basis points versus 1Q20. In U.S. dollars, revenues and EBITDA increased 1% and

51% YoY, respectively.

United States: Revenues were up 8% in 1Q21 when compared to the same period of 2020, driven by both price

and volume growth. During the first quarter, EBITDA was US $38 million, down 11% year over year mainly as a

result of one-off events such as disruptions caused by the polar vortex in February, and a technology substitution

project at one of the Company’s production facilities.

Latam: Revenues in local currencies were down 3% year-on-year due to a high comparable base in 1Q20. In

contrast, EBITDA increased 18% driven by continued cost and expense reduction initiatives that drove margin

expansion of 190+ basis points. Excluding Foodservice results, Revenues and EBITDA increased 2% and 30% YoY,

respectively.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (18)

18

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

RECENT DEVELOPMENTS - SIGMA

Europe Turnaround

• Comprehensive plan to reach double-digit EBITDA Margin by 2025

• Dedicated taskforces focused on: - Portfolio optimization - Ongoing operational efficiencies - Pursuing high-growth opportunities

Growth

Sigma established the role of Chief Growth Officer to lead efforts on new sources of

revenue, including:

− Snacking and Plant-Based units

− High Potential Opportunities: Initiatives aiming to increase market share in underdeveloped categories where Sigma participates

− New Business Models: Leveraging existing capabilities through an agile approach to identify, pilot, and scale business opportunities

• Limited partnership investment in Blue Horizon Ventures, a food technology

venture capital fund focused on Plant-based proteins and cellular agriculture

• Invested in a minority stake in The Live Green Co., a Latam startup and first-

generation participant of “Tastech by Sigma”, that combines plant nutrition with

biotech and machine learning to develop plant-based foods and clean-label

products

• Grillhouse, a premium service app focused on consumers who love the grill,

expanded its coverage from Monterrey into Mexico City and Guadalajara

Tastech by Sigma

• Strong presence from Tastech by Sigma in the food startup ecosystem

• Second generation call-out open until April 26, 2021. So far, 250+ startups and

scaleups from 23 counties have applied, exceeding the 123 applications and 19

countries from the first generation

Innovation • 120+ new products launched during 1Q21

• New products represented 10% of 1Q21 Revenues

Sustainability

• Signed a Power Purchase Agreement to ensure clean energy in 100% of the Company’s facilities in Peru

• Sigma joined the CDP Supply Chain member program to evaluate global suppliers on climate change and deforestation

• Participation in the Responsible Sourcing Assessment Program from BSD Elevate to evaluate the sustainability criteria from raw material suppliers in Mexico and Latam

• 400+ employees recognized as change agents in our Women’s Day initiatives

• Visit Sigma’s sustainability web page for more information

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (19)

19

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Liquidity Management

• Strong cash position of US $749 million (+4% vs. 1Q20); approximately 80% is held in hard currency (e.g. US dollars and euros)

• +US $780 million in available committed credit lines

• Next long-term maturity in 2024; no liability management is considered in the short term

Financial Hedges • As of March 2021, Sigma´s currency forward hedges amounted to US $635

million with an average exchange rate of $21.30 MXN/USD, enough to cover its remaining 2021 U.S. dollar needs

Credit Ratings • Fitch Ratings affirmed Sigma's Issuer Default Ratings (IDR), its senior unsecured notes at 'BBB', and its National scale rating at 'AAA (mex)' with stable outlooks.

(See “Financial Statements” for Sigma´s 1Q21 Balance Sheet and Income Statement)

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (20)

20

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Alpek (BMV: ALPEKA) – PETROCHEMICALS 48% of ALFA's revenues in 1Q21

SELECTED FINANCIAL INFORMATION (US $ Millions) (%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Volume (ktons) 1,230 1,248 1,184 (1) 4

Polyester 996 992 967 - 3

Plastic & Chemicals 234 256 217 (9) 8

Revenues 1,614 1,392 1,433 16 13

Polyester 1,069 967 1,094 11 (2)

Plastic & Chemicals 471 374 300 26 57

EBITDA 324 201 111 61 193

Polyester 184 124 58 48 216

Plastic & Chemicals 123 73 49 69 153

Others 17 4 3 337 385

CAPEX & Acquisitions1 30 97 15 (69) 107

Net Debt 1,219 1,185 1,436 3 (15)

Net Debt / LTM EBITDA* 1.6 2.1 1.7

LTM Interest Coverage2* 5.8 6.0 7.3

Volume was 1,230 ktons up 4% versus 1Q20, posting a record first quarter driven by solid demand in both

business segments. Plastics & Chemicals segment volume also benefited from the recently acquired expandable

styrenics business in the U.S.

Revenues totaled US $1.614 billion in 1Q21, up 13% year-on-year, as a result of higher volume and average prices

which reflect the rise in oil and feedstock prices.

EBITDA was US $324 million, up 193% from 1Q20, including a non-cash inventory gain of US $63 million, as well

as a positive carry-forward effect of US $58 million. Alpek’s carry-forward effect reflects the estimated impact

from feedstock price swings between the time of purchase and consumption. Hence, it is considered as an

extraordinary item for Alpek’s Comparable EBITDA calculations beginning 1Q21. In this report, Comparable

EBITDA figures from previous quarters include the carry-forward effect which had been disclosed separately

until now.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (21)

21

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Adjusting for extraordinary items, Alpek’s Comparable 1Q21 EBITDA was US $203 million, up 38% year-on-year,

boosted by the rise in reference polyester margins, temporary benefits to polypropylene margins and the

Company’s commercialization of natural gas inventories to third-parties amid shortages caused by the polar

vortex.

Capital expenditures (CAPEX) & Acquisitions were US $30 million in 1Q21, compared to US $15 million in 1Q20.

During the quarter, maintenance and minor asset replacements accounted for the majority of the capital

investments.

Net Debt was US $1.219 billion, down 15% and up 3% when compared with 1Q20 and 4Q20, respectively. On an

absolute basis, Net Debt increased US $34 million versus year-end 2020 as investment in Net Working Capital

and non-recurring financial expenses related to the bond prepayment were partially offset by strong EBITDA.

Cash totaled US $495 million at the end of the first quarter, down 3% versus 4Q20, moving towards historical

averages. Financial ratios at the end of 1Q21 were Net Debt to EBITDA of 1.6 times and Interest Coverage of 5.8

times.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (22)

22

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

RECENT DEVELOPMENTS - ALPEK

Revised 2021

Guidance

• Alpek’s 2021 EBITDA Guidance revised up based on improved industry margins and

strong 1Q21 results

• Revised 2021 Guidance:

• Assumptions

o Average Brent oil reference price: US $63 per barrel (previous US $48

per barrel)

o Asian Integrated PET reference margin: US $285 per ton (previous

US $245 per ton)

• EBITDA Guidance

o Reported EBITDA: US $750 million (previous US $561 million)

o Comparable EBITDA: US $675 million (previous US $561 million)

Bond Issuance

• Alpek successfully issued a US $600 million bond in the international market with a

10-year maturity

• The notes had a 3.25% annual coupon, setting a record as the lowest in Alpek´s

history

• Transaction was oversubscribed by 9.0 times

• Strong participation from high-quality investors with geographic diversity and ESG-

dedicated funds

• Net proceeds were used in a concurrent tender offer with Alpek’s 2022 bond

• As a result of the transaction, Alpek´s average debt maturity increased from 4.4 to

7.2 years

Annual

Shareholders’

Meeting

• Approved a dividend of US $126 million to be paid to shareholders in 2Q21

• Shareholders ratified all members of Alpek’s Board of Directors

• Approved a maximum amount of Ps. $2,000 million for share repurchases, same

amount approved in the previous year

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (23)

23

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

JV with

ContourGlobal

• Alpek formed a JV with ContourGlobal to develop a 70,000-ton CO2 capture &

liquefaction facility in Altamira, Mexico

• The facility will serve the rising demand of food-grade CO2 from Mexico´s food &

beverage industry

• First carbon negative asset

• Project well aligned with Alpek’s long-term strategic plan, supporting its path

towards carbon neutrality and growth into more ESG-friendly markets

• Next step: expected to finalize detailed engineering analyses to reach a final

investment decision by the end of 3Q21

Corpus Christi

Polymers (CCP)

Update

• Alpek and its JV partners unanimously agreed to extend pre-construction phase

through the end of 2021

• Sharp increase in PET demand over past year has driven site attractiveness

• Focus on exploring various alternatives to minimize CAPEX required for the project

(See “Appendix – 1Q21 Reports of Listed Businesses” for Alpek´s complete 1Q21 Earnings Report)

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (24)

24

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Axtel (BMV: AXTELCPO) – IT & TELECOM 4% of ALFA’s Revenues in 1Q21

SELECTED FINANCIAL INFORMATION (US $ Millions) (%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Revenues 140 150 157 (7) (11)

Services - Enterprise 93 94 102 (1) (9)

Services - Government 17 26 27 (37) (38)

Infrastructure 60 59 59 2 2

Eliminations (30) (30) (31) (1) 3

EBITDA 45 51 156 (12) (71)

CAPEX & Acquisitions1 13 32 36 (58) (62)

Net Debt 627 602 586 4 7

Net Debt / LTM EBITDA* 3.2 2.0 1.8

LTM Interest Coverage2* 3.2 4.9 5.3 * Times. LTM = Last 12 months 1 Gross amount; does not include divestments 2 Interest Coverage = EBITDA/Net Financial Expenses

Revenues totaled US $140 million, down 11% year-on-year due to a 15% decrease in the Services unit that was

partially offset by a 2% increase in the Infrastructure unit. Lower Services unit Revenues reflect a 38% decline in

its Government segment, resulting primarily from the termination of contracts and a reduction in value-added

and digital transformation projects with government entities.

EBITDA was US $45 million, down 71% year-on-year. Adjusting for the US $107 million one-time gain associated

with the Data Center sale in 1Q20, EBITDA was 7% lower year-on-year mainly due to the decline in the Service

unit contribution. On a currency neutral basis and adjusting for the one-time gain, 1Q21 EBITDA was down 4%

versus 1Q20.

Capital expenditures (CAPEX) & Acquisitions totaled US $13 million in 1Q21, compared to US $36 million in 1Q20

which included an extraordinary investment of US $19 million for the renewal of spectrum frequencies.

Net Debt was US $627 million at the close of 1Q21, up 7% and 4% when compared to 1Q20 and 4Q20,

respectively. On an absolute basis, Net Debt increased US $26 million versus year-end mainly due to investment

in Net Working Capital. Cash totaled US $69 million at the end of the first quarter, down from US $100 million at

year-end 2020 as the Company deployed US $63 million to reduce its 2024 Senior Notes plus US $15 million to

pay short-term loans. Financial ratios at the close of 1Q21 were: Net Debt to EBITDA of 3.2 times and Interest

Coverage of 3.2 times.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (25)

25

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

RECENT DEVELOPMENTS - AXTEL

Strategic Sale

Process • Actively engaging with potential buyers who have shown interest for its

Infrastructure unit

Annual

Shareholders’

Meeting

• Shareholders approved a maximum amount of Ps. $200 million for share buybacks

• Shareholders ratified all members of the Board of Directors

“Frecuencia

Alestra” virtual

event

• Virtual event hosted in March to showcase innovations in IT and Digital

Transformation solutions

• Complement to the “Alestra Fest” in-person event which is currently on hold due to

the pandemic

• Over 2,300 participants

NAVE

• Business acceleration program launched in 2016

• 26 scale-ups and 21 startups accelerated through NAVE over the last 5 years

- 18 pilot tests

- 7 product launches

2024 Senior Notes

prepayment

• Axtel redeemed an aggregate principal amount of US $60 million of its Senior Notes

due 2024 at a redemption price of 104.781%

• The aggregate principal amount outstanding after the redemption is US $440 million

• Fitch upgraded the ratings of Axtel´s 2024 Senior Notes from BB- to BB and revised

the Company’s outlook to Stable

(See “Appendix - 1Q21 Reports of Listed Businesses” for Axtel´s complete 1Q21 Earnings Report)

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (26)

26

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Newpek – OIL & GAS

Following ALFA’s decision to exit the oil and gas business and the subsequent sale of the Eagle Ford and Edwards Shale formations, Newpek has become a significantly smaller part of ALFA. As a result, Newpek’s financial results will no longer be shown as separate line items. However, additional information related to the remaining operations of Newpek are available in Tables 17, 18 and 19 (pg. 36).

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (27)

27

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Nemak (BMV: NEMAKA) – ALUMINUM AUTOPARTS In accordance with International Financial Reporting Standards (IFRS), ALFA’s Consolidated Results account for Nemak as Discontinued Operations due to the spin-off of this business. Additional details related to the effects of discontinued operations on ALFA’s consolidated results are available in Tables 9, 10 and 11. It is important to note that accounting for Nemak as a Discontinued Operation in ALFA’s financial statements ended on December 14, 2020. Please refer to Nemak’s 1Q21 Earnings Report for the full analysis of operating figures.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (28)

28

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

1Q21 EARNINGS CALL INFORMATION

Date: Wednesday, April 21, 2021

Time: 1:00 p.m. EDT (NY) / 12:00 p.m. CDT (CDMX)

By Phone: United States: +1-877-451-6152

International: +1-201-389-0879

Mexico: 800-522-0034

Conference ID: 13718399

Webcast: http://public.viavid.com/index.php?id=144229

Replay: https://www.alfa.com.mx/RI/conference.htm

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (29)

29

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

About ALFA

ALFA a company that has developed a diversified portfolio of leading businesses with global operations: Sigma,

a leading multinational food company, focused on the production, marketing and distribution of quality foods

through recognized brands in Mexico, Europe, United States and Latin America. Alpek, one of the world’s largest

producers of polyester (PTA, PET and fibers), and the leader in the Mexican market for polypropylene,

expandable polystyrene (EPS) and caprolactam. Axtel, a provider of Information Technology and Communication

services for the enterprise and government segments in Mexico. Newpek, an oil and gas exploration and

production company with operations in Mexico. In 2020, ALFA reported revenues of Ps. 263,867 million (US $12.3

billion), and EBITDA of Ps. 32,597 million (US $1.5 billion). ALFA’s shares are quoted on the Mexican Stock

Exchange and on Latibex, the market for Latin American shares of the Madrid Stock Exchange. For more

information, please visit www.alfa.com.mx

Disclaimer

This release may contain forward-looking information based on numerous variables and assumptions that are

inherently uncertain. They involve judgments with respect to, among other things, future economic, competitive

and financial market conditions and future business decisions, all of which are difficult or impossible to predict

accurately. These uncertainties include, but are not limited to, risks related to the impact of the COVID-19 global

pandemic, such as the scope and duration of the outbreak, government actions and restrictive measures

implemented in response, availability of workers and contractors due to illness and stay at home orders, supply

chain disruptions and other impacts to the business, or on the Company’s ability to execute business continuity

plans, as a result thereof. Accordingly, results could vary from those set forth in this release. The report presents

unaudited financial information. Figures are presented in Mexican Pesos or US Dollars, as indicated. Where

applicable, Peso amounts were translated into US Dollars using the average exchange rate of the months during

which the operations were recorded. Financial ratios are calculated in US Dollars. Due to the rounding up of

figures, small differences may occur when calculating percent changes from one period to the other.

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (30)

30

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Tables ALFA Table 1 | VOLUME AND PRICE CHANGES (%)

1Q21 vs. 4Q20 1Q20

Total Volume (0.5) 1.5

Domestic Volume (0.2) 3.7

Foreign Volume (1.0) (1.5)

Avg. Ps. Prices 4.4 4.7

Avg. US $ Prices 5.8 2.4

Table 2 | REVENUES

(%) 4Q20 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Total Revenues

Ps. Millions 68,918 66,329 64,854 4 6

US $ Millions 3,388 3,218 3,261 5 4

Domestic Revenues

Ps. Millions 27,952 25,761 24,930 9 12

US $ Millions 1,375 1,251 1,260 10 9

Foreign Revenues

Ps. Millions 40,966 40,568 39,925 1 3

US $ Millions 2,013 1,967 2,001 2 1

Foreign / Total (%) 59 61 61

Table 3 | OPERATING INCOME AND EBITDA

(%) 4Q20 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Operating Income

Ps. Millions 7,736 4,729 4,789 64 62

US $ Millions 380 229 244 66 55

EBITDA

Ps. Millions 10,886 8,626 8,163 26 33

US $ Millions 535 419 415 28 29

EBITDA/Revenues (%)* 15.8 13.0 12.7 *US Dollar denominated EBITDA margin

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (31)

31

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Table 4 | EXTRAORDINARY ITEMS (US $ Millions) Company Extraordinary item 1Q21 4Q20 1Q20 YTD´ 21 YTD´ 20

Alpek Inventory gain (loss) 63 9 (17) 63 (17) Carry-forward gain (loss) 58 9 (20) 58 (20) Gain on business combination (Wilton) - 35 - - - Legal fees/expenses & others - (2) - - - Total Alpek (previous) - 41 (17) - (17) Total Alpek (with carry-forward)1 121 50 (36) 121 (36)

Axtel Data Center sale gain - - 107 - 107 Total Axtel - - 107 - 107

Newpek Mexico expense recovery provision - 4 - - - Total Newpek - 4 - - -

ALFA Total effect on EBITDA (previous) - 46 91 - 91 Total effect on EBITDA (with carry forward)1 121 55 71 121 71

1 Extraordinary items include ”Carry-forward gain (loss)” beginning 1Q21. Total figures from previous quarters include the carry-forward effect for comparability purposes.

Table 5 | COMPARABLE EBITDA (US $ Millions)

(%) 1Q21 vs.

Company 1Q21 4Q20 1Q20 4Q20 1Q20

ALFA 414 364 344 14 20

Alpek 203 151 147 35 38

Sigma 181 178 169 2 7

Axtel 45 51 48 (12) (7)

Newpek (3) 1 (6) (373) 45

ALFA EBITDA/Revenues (%) 12.2 11.3 10.6

Table 6 | COMPREHENSIVE FINANCING INCOME / EXPENSE (US $ Millions)

(%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Financial Expenses (136) (85) (106) (60) (29)

Financial Income 7 5 13 64 (41)

Net Financial Expenses (129) (81) (93) (60) (38)

Exchange Rate Gains (Losses) (39) 22 (127) (273) 70

Capitalized Comp. Fin. Expense 0 0 0 47 7

Comprehensive Financing Expense (167) (58) (220) (187) 24

Avg. Cost of Borrowed Funds (%) 7.7 4.8 5.9

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (32)

32

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Table 7 | NET INCOME (US $ Millions) (%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Consolidated Net Income (Loss) 197 120 175 64 12

Minority Interest 43 183 5 (77) 734

Majority Interest 154 (63) 170 346 (10)

Per Share (US Dollars) 0.03 (0.01) 0.03 (344) (8)

Avg. Outstanding Shares (Millions) 4,909 4,909 5,010

Table 8 | STATEMENT OF FINANCIAL POSITION & FINANCIAL RATIOS (US $ Millions)

(%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Assets

Cash and cash equivalents 1,393 1,611 2,252 (14) (38)

Trade accounts receivable 1,027 870 1,177 18 (13)

Inventories 1,771 1,658 2,376 7 (25)

Other current assets 0 0 0 - -

Current assets from discontinued operations1 790 773 842 2 (6)

Total current assets 4,981 4,913 6,646 1 (25)

Investment in associates and others 450 444 471 (20) (23)

Property, plant and equipment, net 4,255 4,395 6,669 (3) (36)

Goodwill and intangible assets, net 2,201 2,279 2,886 (3) (24)

Other non-current assets 847 810 1,481 5 (44)

Total assets 12,734 12,841 18,153 (1) (30)

Liabilities & stockholders' equity

Debt 188 166 1,054 432 (4)

Suppliers 2,064 1,971 2,937 5 (30)

Other current liabilities 0 0 0 - -

Current liabilities from discontinued operations1 1,054 1,102 1,437 (11) (5)

Total current liabilities 3,306 3,239 5,428 17 (40)

Debt (include debt issuance cost) 5,728 5,815 7,095 6 7

Employees' benefits 225 237 257 (5) (12)

Other long-term liabilities 826 876 1,031 (33) (39)

Total liabilities 10,086 10,166 13,811 (1) (27)

Total stockholders' equity 2,648 2,674 4,342 (1) (39)

Total liabilities & stockholders' equity 12,734 12,841 18,153 (1) (30)

Net Debt 4,864 2,674 6,323 4 (23)

Net Debt/EBITDA* 2.9 3.1 3.0

Interest Coverage* 4.3 4.4 4.7 * Times. LTM=Last 12 months 1 Breakdown of Balance Sheet line items from Discontinued Operations shown on Table 9

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (33)

33

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Table 9 | STATEMENT OF FINANCIAL POSITION DISCONTINUED OPERATIONS – NEMAK (US $ MILLIONS)

3Q20

Current assets 1,719

Non-Current assets 3,336

Total assets 5,055

Current liabilities 1,500

Non-Current liabilities 1,833

Total liabilities 3,333

Table 10 | INCOME STATEMENT DISCONTINUED OPERATIONS – NEMAK (US $ MILLIONS)

(%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Total Revenues 0 794 907 (100) (100)

Gross Profit 0 117 138 (100) (100)

Operating expenses and others 0 (55) (67) 100 100

EBITDA 0 136 142 (100) (100)

Operating income (loss) 0 62 71 (100) (100)

Financial cost, net 0 (17) (71) 100 100

Share of losses of associates 0 0 1 (100) (100)

Income Tax 0 (7) (7) 100 100

Profit (loss) from discontinued operations (Nemak) 0 38 (7) (100) 100

Other effects associated to the Nemak spin-off (ALFA) 0 458 0 (100) -

Profit (loss) from discontinued operations (ALFA) 0 496 (7) (100) 100

Table 11 | CHANGE IN NET DEBT DISCONTINUED OPERATIONS – NEMAK (US $ MILLIONS)

(%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

EBITDA 0 0 142 (100) (100)

Net Working Capital 0 0 (26) (100) 100

Capital expenditures & Acquisitions 0 0 (97) (100) 100

Net Financial Expenses 0 0 (18) (100) 100

Taxes 0 0 (14) (100) 100

Dividends 0 0 0 (100) -

Other Sources / Uses 0 0 13 (100) (100)

Decrease (Increase) in Net Debt 0 0 0 (100) -

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (34)

34

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Sigma

Table 12 | SIGMA - VOLUME AND PRICE CHANGES (%) 1Q21 vs. 4Q20 1Q20

Total Volume 0.0 (5.2)

Avg. Ps. Prices (4.3) 6.3

Avg. US $ Prices (3.0) 3.9

Table 13 | SIGMA - REVENUES (%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Total Revenues

Ps. Millions 32,811 34,271 32,569 (4) 1

US $ Millions 1,613 1,662 1,637 (3) (1)

Domestic Revenues

Ps. Millions 12,948 13,261 13,394 (2) (3)

US $ Millions 637 644 678 (1) (6)

Foreign Revenues

Ps. Millions 19,862 21,010 19,175 (5) 4

US $ Millions 976 1,019 960 (4) 2

Foreign / Total (%) 61 61 59

Table 14 | SIGMA - OPERATING INCOME AND EBITDA

(%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Operating Income

Ps. Millions 2,578 1,807 2,282 43 13

US $ Millions 127 86 114 47 11

EBITDA

Ps. Millions 3,689 3,675 3,375 - 9

US $ Millions 181 178 169 2 7

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (35)

35

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Table 15 | SIGMA - COMPREHENSIVE FINANCING INCOME / EXPENSE (US $ Millions) (%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Financial Expenses (31) (28) (36) (11) 13

Financial Income 3 3 2 (3) 16

Net Financial Expenses (29) (25) (33) (12) 15

Exchange Rate Gains (Losses) (1) (60) 32 98 (105)

Capitalized Comp. Fin. Expense 0 0 0 - -

Comprehensive Financing Expense (30) (86) (2) 65 -

Avg. Cost of Borrowed Funds (%) 4.4 4.4 4.5

Table 16 | SIGMA - STATEMENT OF FINANCIAL POSITION & FINANCIAL RATIOS (US $ Millions) (%) 1Q21 vs.

1Q21 4Q20 1Q20 4Q20 1Q20

Assets

Cash and cash equivalents 746 817 715 (9) 4

Trade accounts receivable 210 192 258 9 (19)

Inventories 782 764 879 2 (11)

Other current assets 217 218 212 0 2

Total current assets 1,956 1,992 2,064 (2) (5)

Investment in associates and others 7 7 5 2 29

Property, plant and equipment, net 1,613 1,672 1,560 (4) 3

Goodwill and intangible assets, net 1,543 1,595 1,479 (3) 4

Other non-current assets 244 243 280 1 (13)

Total assets 5,363 5,508 5,388 (3) -

Liabilities & stockholders' equity

Debt 57 67 356 (15) (84)

Suppliers 1,023 1,020 1,107 0 (8)

Other current liabilities 367 416 313 (12) 17

Total current liabilities 1,448 1,503 1,775 (4) (18)

Debt (include debt issuance cost) 2,461 2,495 2,385 (1) 3

Employees' benefits 87 91 73 (4) 19

Other long-term liabilities 222 250 206 (12) 8

Total liabilities 4,217 4,339 4,439 (3) (5)

Total stockholders' equity 1,146 1,168 949 (2) 21

Total liabilities & stockholders' equity 5,363 5,508 5,388 (3) -

Net Debt 1,781 1,756 2,037 1 (13)

Net Debt/EBITDA* 2.6 2.6 2.9

Interest Coverage* 5.8 5.5 5.9 * Times. LTM=Last 12 months

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (36)

36

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

NEWPEK Table 17 | NEWPEK – REVENUES (US $ Millions)

(%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Volume (MBOEPD)1 1.4 1.3 6.3 11 (77)

Total Revenues

Ps. Millions 51 (42) 317 220 (84)

US $ Millions 3 (2) 16 237 (85)

Domestic Revenues

Ps. Millions 49 (45) 154 209 (68)

US $ Millions 2 (2) 8 223 (70)

Foreign Revenues

Ps. Millions 2 2 163 13 (99)

US $ Millions - - 8 14 (99)

Foreign / Total (%) 5 - 51 1 Thousands of Barrels of Oil Equivalent Per Day

Table 18 | NEWPEK - OPERATING INCOME AND EBITDA (US $ Millions)

(%) 1Q21 vs. 1Q21 4Q20 1Q20 4Q20 1Q20

Operating Income

Ps. Millions (65) 105 (153) (162) 58

US $ Millions (3) 5 (8) (166) 57

EBITDA

Ps. Millions (60) 119 (112) (151) 46

US $ Millions (3) 6 (6) (154) 46

CAPEX

US $ Millions (1) (1) (6) (119) 76

Table 19 | NEWPEK - SELECTED BALANCE SHEET INFORMATION & FINANCIAL RATIOS (US $ Millions)

1Q21 4Q20 1Q20

Assets 553 567 560

Liabilities 214 222 314

Stockholders’ Equity 340 345 246

Net Debt (16) (9) (6)

Net Debt/EBITDA* (0.4) (0.2) 0.1

Interest Coverage* (3.8) (3.4) 7.4

* Times. LTM= Last 12 months

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (37)

37

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Financial Statements ALFA, S.A.B. de C.V. and Subsidiaries BALANCE SHEET

Information in millions of Nominal Mexican Pesos (%) Mzo 21 vs.

Mzo 21 Dec 20 Mzo 20 Dec 20 Mzo 20 ASSETS CURRENT ASSETS:

Cash and cash equivalents 28,699 32,144 52,945 (11) (46)

Trade accounts receivable 21,159 17,356 27,671 22 (24)

Other accounts and notes receivable 6,001 5,957 7,156 1 (16)

Inventories 36,489 33,084 55,854 10 (35)

Other current assets 10,284 9,466 12,645 9 (19)

Current assets from discontinued operations 0 0 0 - -

Total current assets 102,632 98,007 156,271 5 (34)

Investments in associates and joint ventures 9,265 8,866 11,071 4 (16)

Property, Plant and equipment 87,679 87,670 156,807 - (44)

Intangible assets 45,346 45,461 67,845 - (33)

Other non-current assets 17,454 16,152 34,818 8 (50)

Total assets 262,376 256,156 426,812 2 (39)

LIABILITIES AND STOCKHOLDER'S EQUITY CURRENT LIABILITIES:

Current portion of long-term debt 3,048 2,872 4,028 6 (24)

Bank loans and notes payable 829 430 20,758 93 (96)

Suppliers 42,527 39,321 69,055 8 (38)

Other current liabilities 21,724 21,981 33,788 (1) (36)

Current liabilities from discontinued operations 0 0 0 - -

Total current liabilities 68,127 64,605 127,629 5 (47)

LONG-TERM LIABILITIES:

Long-term debt 118,028 115,997 166,828 2 (29)

Deferred income taxes 9,953 9,529 13,670 4 (27)

Other liabilities 7,065 7,940 10,567 (11) (33)

Estimated liabilities for seniority premiums and pension plans

4,641 4,733 6,034 (2) (23)

Total liabilities 207,815 202,804 324,728 2 (36)

STOCKHOLDERS' EQUITY: Controlling interest: Capital stock 170 169 207 1 (18)

Earned surplus 39,281 38,330 76,861 2 (49)

Total controlling interest 39,451 38,499 77,068 2 (49)

Total Non-controlling interest 15,110 14,853 25,016 2 (40)

Total stockholders' equity 54,562 53,352 102,084 2 (47)

Total liabilities and stockholders' equity 262,377 256,156 426,813 2 (39)

Current ratio 1.5 1.5 1.2

Debt to equity 3.8 3.8 3.2

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (38)

38

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

ALFA, S.A.B. de C.V. and Subsidiaries INCOME STATEMENT

Information in millions of Nominal Mexican Pesos 1Q21 vs. (%)

1Q21 4Q20 1Q20 4Q20 1Q20

Net sales 68,918 66,329 64,854 4 6

Domestic 27,952 25,761 24,930 9 12

Export 40,966 40,568 39,925 1 3

Cost of sales (51,065) (51,205) (52,083) - 2

Gross profit 17,853 15,124 12,772 18 40

Operating expenses and others (10,117) (10,395) (7,983) 3 (27)

Operating income 7,736 4,729 4,789 64 62

Comprehensive financing expense, net (3,406) (1,185) (4,591) (187) 26

Equity in income (loss) of associates (6) 131 27 (105) (122)

Income before the following provision 4,323 3,676 225 18 -

Provisions for: Income tax (328) (11,185) 3,379 97 (110)

Profit (loss) from continuing operations 3,996 (7,510) 3,605 153 11

Profit (loss) from discontinued operations 0 9,985 (179) (100) 100

Consolidated net income 3,996 2,475 3,426 61 17

Income (loss) corresponding to minority interest

869 3,699 (50) (77) -

Net income (loss) corresponding to majority interest

3,127 (1,223) 3,476 356 (10)

EBITDA 10,886 8,626 8,163 26 33

Interest coverage* 4.2 4.3 4.7

* Times. LTM=Last Twelve Months

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (39)

39

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Sigma Alimentos, S.A. de C.V. and Subsidiaries BALANCE SHEET

Information in millions of Nominal Mexican Pesos (%) Mar 21 vs.

Assets Mar 21 Dec 20 Mar 20 Dec 20 Mar 20 CURRENT ASSETS:

Cash and cash equivalents 15,380 16,301 16,801 (6) (8)

Restricted cash 25 24 14 3 75

Customers, net 4,335 3,833 6,071 13 (29)

Income tax recoverable 900 741 490 21 84

Inventories 16,119 15,248 20,664 6 (22)

Other current assets 3,547 3,585 4,487 (1) (21)

Total current assets 40,306 39,732 48,527 1 (17)

Property, plant and equipment, net 33,233 33,346 36,681 - (9)

Intangible assets, net 17,143 17,179 18,961 - (10)

Goodwill 14,641 14,638 15,802 - (7)

Deferred income tax 4,119 4,125 4,173 - (1)

Investments in associates and joint ventures 139 132 123 5 13

Other non-current assets 917 719 2,417 27 (62)

Total non-current assets 70,193 70,140 78,157 - (10)

Total assets 110,499 109,872 126,684 1 (13)

LIABILITIES AND STOCKHOLDER'S EQUITY CURRENT LIABILITIES:

Current debt 458 649 7,640 (29) (94)

Notes payables 720 558 728 29 (1)

Suppliers 21,080 20,352 26,020 4 (19)

Income tax payable 594 461 506 29 17

Provisions 126 182 121 (31) 4

Other current liabilities 6,812 7,748 6,722 (12) 1

Total current liabilities 29,789 29,949 41,738 (1) (29)

NON-CURRENT LIABILITIES:

Non-current debt 48,632 47,746 53,848 2 (10)

Notes payables 2,067 2,030 2,227 2 (7)

Deferred income taxes 3,865 3,934 4,375 (2) (12)

Employees benefits 1,793 1,807 1,717 (1) 4

Provisions 87 90 94 (4) (8)

Income tax payable 616 974 370 (37) 66

Other non-current liabilities 35 37 4 (4) 823

Total non-current liabilities 57,095 56,618 62,634 1 (9)

Total liabilities 86,885 86,567 104,372 - (17)

STOCKHOLDERS' EQUITY: Total controlling interest: 23,614 23,304 22,312 1 6

Total non-controlling interest: 0 0 0 - -

Total stockholders' equity 23,614 23,304 22,312 1 6

Total liabilities and stockholders' equity 110,499 109,871 126,684 1 (13)

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (40)

40

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Sigma Alimentos, S.A. de C.V. and Subsidiaries INCOME STATEMENT

1Q21 vs. (%)

1Q21 4Q20 1Q20 4Q20 1Q20

Revenue 32,811 34,271 32,569 (4) 1

Cost of sales (23,219) (24,603) (23,596) (6) (2)

Gross profit 9,591 9,668 8,974 (1) 7

Selling expenses (5,319) (5,325) (5,259) - 1

Administrative expenses (1,656) (1,739) (1,473) (5) 12

Other income (expenses), net (39) (797) 40 (95) (196)

Operating profit 2,578 1,807 2,282 43 13

Comprehensive financial expenses, net (610) (1,774) 35 (66) -

Equity in income (loss) of associates 0 0 0 - (100)

Profit before income tax 1,968 32 2,317 - (15)

Provisions for:

Income tax (309) (598) 677 (48) (146) Net consolidated profit 1,659 (566) 2,994 (393) (45)

Non-controlling interest 0 0 0 - -

Controlling interest 1,659 (566) 2,994 (393) (45)

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (41)

41

Earnings Report First Quarter 2021 (1Q21)

[emailprotected]

www.alfa.com.mx

+ (52) 81-8748-2521

Appendix - Listed Business 1Q21 Reports

Alpek (BMV: ALPEKAA) – Petrochemicals

Axtel (BMV: AXTELCPO) – IT & Telecom

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (42)

FIRST QUARTER 2021 RESULTS

EARNINGS REPORT - latibex.com - [PDF Document] (43)

FIRST QUARTER 2021 RESULTS

2

Alpek Posts U.S. $203M in Comparable EBITDA (U.S. $324M in Reported EBITDA) Guidance Raised to U.S. $675M due to Record Volume & Higher-than-Expected Margins

Monterrey, Mexico – April 20th, 2021 – Alpek, S.A.B. de C.V. (BMV: ALPEK), a leading petrochemical company in the

Americas, announced today its first quarter 2021 results (1Q21).

QUARTERLY HIGHLIGHTS • Record high first quarter volume, reaching 1.2 million tons (+4% YoY) and on track with Guidance estimates

• Comparable EBITDA of U.S. $203 million (+38% YoY) due to record volume & higher-than-expected margins

• Successfully issued a 10-year U.S. $600 million bond with a record low annual coupon (3.25%) and spread (200bps)

• Joint venture for development of CO2 capture facility to supply Mexican beverage market & lower carbon footprint

• Dividend payment of U.S. $126 million approved at Annual Shareholders’ Meeting; payable in 2Q21

• Leverage improved to 1.6x as Net Debt remained at U.S. $1,219 million as LTM EBITDA increased

• Comparable EBITDA Guidance raised to U.S. $675 million (+20%) due to strong 1Q21 & improved industry margins

1Q21 KEY METRICS (in U.S.$ million, except for volume and production figures)

1Q21 4Q20 1Q20 QoQ (%) YoY (%)

Volume1 (ktons) 1,230 1,248 1,184 (1) 4

Polyester 996 992 967 - 3

Plastics & Chemicals 234 256 217 (9) 8

Production (ktons) 1,621 1,612 1,583 1 2

Polyester 1,346 1,343 1,318 - 2

Plastics & Chemicals 274 269 265 2 3

Revenues 1,614 1,392 1,433 16 13

Polyester 1,069 967 1,094 11 (2)

Plastics & Chemicals 471 374 300 26 57

EBITDA 324 201 111 61 193

Polyester 184 124 58 48 216

Plastics & Chemicals 123 73 49 69 153

Others 17 4 3 337 385

Comparable EBITDA2 203 151 147 35 38

Polyester 89 81 94 10 (5)

Plastics & Chemicals 97 66 50 48 95

Others 17 4 3 337 385

Net Income (Controlling Interest) 121 99 (19) 23 722

CAPEX 30 97 15 (69) 107

Net Debt 1,219 1,185 1,436 3 (15)

Net Debt / EBITDA3 1.6 2.1 1.7

(1) Excludes intracompany sales (2) Excludes carry forward effect (3) Times: last 12 months

EARNINGS REPORT - latibex.com - [PDF Document] (44)

FIRST QUARTER 2021 RESULTS

3

MESSAGE FROM OUR CEO

“I am pleased to report Alpek has kicked off 2021 on an extraordinarily strong

note. During the first quarter, in addition to an outstanding performance, we made

important strides in terms of our liability management and our long-term strategic

growth plan.

Results were supported by the continued recovery of the global economy, which

increased demand for several products, including PET. This in turn improved Asian

Integrated Polyester margins which benefited our business. Moreover, the U.S. Gulf

Coast was impacted by a polar vortex, creating a shortage of Polypropylene and

natural gas, which Alpek was able not only to navigate, but to capitalize on. Finally,

and as we expected, Alpek’s volume reached record highs for the first quarter. Based

on our strong results to date, as well as a vastly improved competitive landscape,

we have raised our EBITDA Guidance for the year.

Of note, Alpek successfully issued a U.S. $600 million bond at the lowest coupon

in the Company’s history, which significantly improved our debt profile. This bond

issuance was oversubscribed by more than 9.0 times and enjoyed participation from

several ESG-dedicated funds. Finally, the creation of a joint venture with

ContourGlobal, facilitates our ability to develop a CO2 capture and liquefaction

facility, which is vital to our efforts to reduce Alpek’s carbon footprint while serving

the unmet demand for food-grade CO2 in Mexico.”

Overview

We witnessed global economies continue to recover throughout the first quarter of 2021, as COVID-19 vaccines

were further distributed and overall demand for refined products continued to rise. Average spot Brent crude oil price

rose to U.S. $61 per barrel, 36% higher than that of 4Q20, closing the quarter at U.S. $62 per barrel. Correspondingly,

U.S. reference paraxylene (“Px”) prices also increased by 30% versus last quarter.

As a result of strong worldwide demand for petrochemical products, driven largely by China, Asian integrated

Polyester reference margins increased to an average of U.S. $330 dollars per ton in 1Q21 (+36% QoQ), much higher

than Alpek’s original Guidance figure of U.S. $245 dollars per ton, which was based on the supply/demand balance

prevalent at the end of 4Q20.

José de Jesús Valdez CEO

EARNINGS REPORT - latibex.com - [PDF Document] (45)

FIRST QUARTER 2021 RESULTS

4

U.S. Gulf Coast Polar Vortex

During February, the U.S. Gulf Coast was hit by an unprecedented polar vortex, which led to interruptions in the

supply of natural gas, power, and petrochemical feedstocks. While a large portion of the industry was adversely

affected by this meteorological phenomenon, Alpek’s operations continued uninterrupted for several reasons. First,

our facilities are not located in the affected area; second, we have a business unit specifically dedicated to

commercializing natural gas from the U.S. into Mexico, and finally, we have worked to develop alternative sources for

our raw material supply.

The most significant impact of the polar vortex to Alpek’s results came from a decrease in the industry-wide

inventory levels of Polypropylene and natural gas. As a result of this diminished supply, natural gas and Propylene

prices soared to over U.S. $400.00 per MMBtu and 125cpp respectively at one point, as average Polypropylene margins

for the quarter increased to 32cpp (+43% QoQ). Alpek was able to not only overcome, but capitalize on all these effects,

particularly by commercializing some of its natural gas inventories to third-party buyers, which contributed U.S. $17

million to the Company’s EBITDA in 1Q21.

Bond Issuance

On February 18th, Alpek successfully issued a U.S. $600 million bond in the international market with a 10-year

maturity. The notes also established a record-low 3.25% annual coupon for Alpek. Perhaps most notably, the

transaction was oversubscribed by 9.0 times, due to the Company’s high volume and strong cash flow generation

throughout 2020, despite the COVID-19 pandemic environment. Additionally, high-quality investor accounts with

geographic diversity amply participated in the issuance, including ESG-dedicated funds, the latter of which reflects

Alpek’s continued progress on the matter.

The net proceeds from the bond were used in a concurrent tender offer with Alpek’s 2022 bond. As a result, the

Company’s debt profile strongly improved, as the average debt life increased from 4.4 to 7.2 years.

CO2 Carbon Capture & Liquefaction JV

On March 29th, Alpek announced it had formed a joint venture with ContourGlobal plc to develop a 70,000-ton CO2

capture and liquefaction facility, to be integrated into their existing cogeneration plant in Altamira, Mexico. The facility

aims to help meet the unmet demand of food-grade CO2 from Mexico’s food & beverage industry, where it is used in

the carbonation of soft drinks, beer, and sparkling water, among other products.

This venture is well aligned with Alpek’s long-term strategic growth plan as it represents a carbon negative asset

for the Company, supporting it on its path towards carbon neutrality. This joint venture also seeks to diversify the

Company’s current portfolio actively into profitable, growing, and more ESG-friendly markets. Our goal is to reach a

final investment decision by the end of 3Q21, following detailed engineering analyses.

EARNINGS REPORT - latibex.com - [PDF Document] (46)

FIRST QUARTER 2021 RESULTS

5

Corpus Christi Polymers (“CCP”) Update

Alpek and its joint venture partners are committed to maximizing value from their investment in CCP. As such,

during 1Q21, the group unanimously agreed to extend CCP’s pre-construction phase through the end of 2021. The

sharp increase in PET demand over the past year has further driven the attractiveness of the completion of this site, as

the partners remain focused on exploring various alternatives to minimizing CAPEX requirements for the project.

Revised Guidance & Outlook

Alpek originally provided 2021 Guidance figures based on the market conditions prevalent at the beginning of the

year. Having observed the stronger-than-expected PET demand and margins, as well as the one-time benefits generated

in 1Q21 results by the polar vortex, the Company is providing updated guidance figures and key assumptions.

In the Polyester segment, we expect the continuation of improved demand and strong Asian integrated margins

throughout 2021, which could normalize over the second half of the year. In the Plastics & Chemicals segment, the

positive effect on Polypropylene margins created by the polar vortex is also expected to carry over into the second

quarter, with a decline in the second half of the year, but a stronger finish in 2021 than originally expected. Figures for

volume for both segments as well as CAPEX will remain the same as original Guidance. Accordingly, we maintain a

positive outlook for the remainder of 2021.

The new Guidance figures are based on the following key assumptions:

• Average Brent crude oil reference price of U.S. $63 per barrel (up from U.S. $48 per barrel)

• Asian Integrated PET Reference Margins of U.S. $285 per ton (up from U.S. $245 per ton)

Revised 2021

Guidance (US$M) Change

(% vs. ’20) Previous 2021

Guidance (US$M) Change

(% vs. ’20)

Reported EBITDA U.S. $750M 33 U.S. $561M (1)

Comparable EBITDA U.S. $675M 12 U.S. $561M (7)

Alpek will discuss its Guidance in further detail during its 1Q21 Webcast.

EARNINGS REPORT - latibex.com - [PDF Document] (47)

FIRST QUARTER 2021 RESULTS

6

FINANCIAL RESULTS

EBITDA (in U.S.$ million)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Reported EBITDA 324 201 111 61 193

Inventory Adjustment (63) (9) 17 (626) (479)

Carry-forward effect (58) (9) 20 (561) (393)

Others - (33) - 100 -

Comparable EBITDA 203 151 147 35 38

Comparable EBITDA was U.S. $203 million, 38% higher than 1Q20, as a result of the increase in polyester margins, solid

EPS performance, and one-time benefits to PP margins and commercialization of natural gas from the polar vortex

impact.

Reported EBITDA was U.S. $324 million, a 193% increase versus 1Q20 figures, largely due to a positive inventory effect

of U.S $63 million and carry-forward effect of U.S $58 million during the quarter.

INCOME STATEMENT (in U.S.$ million)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Total Revenues 1,614 1,392 1,433 16 13

Gross Profit 334 183 118 82 183

Operating expenses and others (61) (31) (60) (98) (1)

Operating Income 273 152 57 79 374

Financial cost, net (74) 1 (88) (5,444) 16

Share of losses of associates - (2) 3 112 (90)

Income tax (46) (33) 12 (38) (494)

Consolidated Net Income 152 118 (16) 29 1,033

Controlling interest 121 99 (19) 23 722

Revenues for the first quarter totaled U.S. $1,614 million, 13% higher than 1Q20, due to higher average consolidated

prices and strong consolidated volume in 1Q21.

Net Income attributable to Controlling Interest for the first quarter of 2021 was U.S. $121 million, compared to the

loss of U.S. $19 million in 1Q20. This improvement was due to a higher operating income.

EARNINGS REPORT - latibex.com - [PDF Document] (48)

FIRST QUARTER 2021 RESULTS

7

CASH FLOW (in U.S.$ million)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

EBITDA 324 201 111 61 193

Net Working Capital & Others (192) (16) 100 (1,119) (292)

CAPEX (30) (97) (15) 69 (107)

Financial Expenses (67) (23) (26) (194) (154)

Income Tax (44) (24) (64) (80) 31

Dividends (23) (15) (163) (52) 86

Other Sources / Uses (2) 22 (49) (109) 96

Decrease (Increase) in Net Debt (34) 49 (106) (168) 68

Net Working Capital (NWC) totaled U.S. -$192 million due to higher feedstock prices during 1Q20, resulting from the rise in crude oil prices and its impact on Px, as well the effects of the polar vortex, specifically for Propylene. CAPEX totaled U.S. $30 million during the quarter with most of these funds being used for maintenance and minor asset replacements. Financial expenses were U.S. $67 million in 1Q21, which include U.S. $42 million in expenses related to the bond issuance and the subsequent tender for Alpek’s 2022 bond. Income Tax during 1Q21 was U.S. $44 million, which already includes a portion of Alpek’s payment for the fiscal year. Dividends were U.S. $23 million in 1Q21, paid out entirely to minority shareholders. The Company approved a U.S. $126-million Dividend during its Annual Shareholders’ Meeting, which will be paid out in 2Q21.

NET DEBT & LEVERAGE (in U.S.$ million)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Net Debt 1,219 1,185 1,436 3 (15)

EBITDA (LTM) 778 565 821 38 (5)

Net Debt / EBITDA (LTM) 1.6 2.1 1.7

Consolidated Net Debt as of March 31, 2021 was U.S. $1.219 billion, up 3% QoQ but down 15% YoY. Net Debt increased

by U.S. $34 million during 1Q21 as investment in net working capital rose, as well as financial expenses related to the

bond issuance and subsequent tender. Gross Debt reached U.S. $1.714 billion, and Cash declined to U.S. $495 million,

a slight decrease more in line with historical averages. Financial ratios as of quarter-end improved to: Net Debt to

EBITDA of 1.6x and Interest Coverage of 5.8x, with Leverage decreasing as a result of higher LTM EBITDA, while net

debt remained at similar levels.

EARNINGS REPORT - latibex.com - [PDF Document] (49)

FIRST QUARTER 2021 RESULTS

8

RESULTS BY BUSINESS SEGMENT: POLYESTER (Purified Terephthalic Acid (PTA), Polyethylene Terephthalate (PET), rPET, Polyester fibers – 72% of Alpek’s Net Sales)

QUARTERLY HIGHLIGHTS

• Record Polyester volume during a first quarter of 996 thousand tons (+3% YoY)

• Integrated Asian polyester reference margins increased sharply due to strong demand (+36% QoQ)

• Polyester Comparable EBITDA of U.S. $89 million (10% QoQ) mainly as a result of higher margins

• Polyester Reported EBITDA of U.S. $184 million (+48% QoQ), including positive inventory adjustment (U.S. $50

million) and Carry-forward effect (U.S. $45 million)

KEY METRICS - POLYESTER (in U.S.$ million, except volume and production)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Volume (ktons) 996 992 967 - 3

Production (ktons) 1,346 1,343 1,318 - 2

Revenues 1,069 967 1,094 11 (2)

Reported EBITDA 184 124 58 48 216

Inventories (50) (1) 16 (4,756) (419)

Carry-forward effect (45) (9) 20 (410) (326)

Others - (33) - 100 -

Comparable EBITDA 89 81 94 10 (5)

Polyester Volume posted a new first quarter record of 996 thousand tons, 3% higher YoY. The higher volume was

largely due to consistently strong post-COVID-19 demand.

Polyester Comparable EBITDA reached U.S. $89 million during the quarter, a 10% increase QoQ. This was due to an

increase in average integrated polyester margins to U.S. $330 per ton, 36% higher QoQ, as well as strong and steady

volume, which offset a negative effect of U.S. $6 million from higher-than-expected natural gas costs during the polar

vortex, mentioned previously.

As a result of the 36% increase in average Brent Crude oil price, average U.S. reference paraxylene (“Px”) prices

increased accordingly by 30% QoQ. This resulted in a non-cash inventory gain of U.S. $50 million and a positive Carry-

forward effect of U.S. $45 million in 1Q21.

Polyester Reported EBITDA was U.S. $184 million for the quarter, up 48% QoQ, and reflecting inventory gains, positive

carry-forward effects and others that resulted in a U.S. $95 million gain, versus a U.S. $43 million gain during 4Q20,

mainly due to prominent feedstock price increases.

EARNINGS REPORT - latibex.com - [PDF Document] (50)

FIRST QUARTER 2021 RESULTS

9

RESULTS BY BUSINESS SEGMENT: PLASTICS & CHEMICALS (P&C) (Polypropylene (PP), Expandable Polystyrene (EPS), Caprolactam (CPL), Other products – 25% of Alpek’s Net Sales)

QUARTERLY HIGHLIGHTS

• P&C volume increased 8% versus 1Q20 largely due to our EPS acquisition in the USA (flat if excluded)

• Strong improvement in Polypropylene margins (+43% QoQ) as a result of the polar vortex in Texas

• P&C Comparable EBITDA was U.S. $97 million (+48% QoQ) due to higher PP margins and resilient EPS performance

• P&C Reported EBITDA of U.S. $123 million (+69% QoQ), due to an inventory gain of U.S. $13 million and a positive

Carry-forward effect of U.S. $13 million

KEY METRICS - P&C (in U.S.$ million, except volume and production)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Volume (ktons) 234 256 217 (9) 8

Production (ktons) 274 269 265 2 3

Revenues 471 374 300 26 57

Reported EBITDA 123 73 49 69 153

Inventories (13) (8) 1 (69) (1,515)

Carry-forward effect (13) - - (100) (100)

Others - - - - -

Comparable EBITDA 97 66 50 48 95

P&C Volume was 234 thousand tons, up 8% YoY and down 9% QoQ. Excluding the incremental volume from our recently acquired Expandable Styrenics business in the United States, volume was flat YoY and down by 7% QoQ. P&C Comparable EBITDA was U.S. $97 million, 48% and 95% higher compared to 4Q20 and 1Q20, respectively, mainly

due to higher PP margins resulting from the polar vortex.

The polar vortex that occurred in the U.S. Gulf Coast region resulted in a decrease in PP supply as demand continued

to be strong, causing a reduction in the industry’s inventory levels of Polypropylene. Propylene prices also surged to

U.S. $0.73 per pound, up 77% this quarter, resulting in an inventory gain of U.S. $13 million.

P&C Reported EBITDA was U.S. $123 million during the quarter, up 69% QoQ and 153% YoY, reflecting strong business fundamentals, as well as the inventory gain and positive carry-forward effect mentioned previously.

EARNINGS REPORT - latibex.com - [PDF Document] (51)

FIRST QUARTER 2021 RESULTS

10

ABOUT ALPEK

Alpek is a leading petrochemical company operating two business segments: “Polyester” (PTA, PET, rPET, and polyester

fibers), and “Plastics & Chemicals” (polypropylene, expandable styrenics, caprolactam, and other specialty & industrial

chemicals). Alpek is a leading producer of PTA and PET worldwide, one of the largest rPET producers in the Americas,

the 3rd largest expandable polystyrene manufacturer worldwide, and the only producer of polypropylene and

caprolactam in Mexico.

NOTE ON FORWARD LOOKING STATEMENTS

This release contains forward‐looking information based on numerous variables and assumptions that are inherently

uncertain. They involve judgments with respect to, among other things, future economic, competitive and financial

market conditions and future business decisions, all of which are difficult or impossible to predict accurately.

Accordingly, results could vary from those set forth in this release. The report presents unaudited financial information

based on International Financial Reporting Standards (IFRS). Figures are stated in nominal Mexican pesos ($) and in

current U.S. Dollars (U.S. $), as indicated. Where applicable, peso amounts were translated into U.S. Dollars using the

average exchange rate of the months during which operations were recorded. Financial ratios are calculated in U.S.

Dollars. Due to the rounding up of figures, small differences may occur when calculating percent changes from one

period to the other.

INVESTOR RELATIONS CONTACT INFORMATION Alejandro Elizondo F., Investor Relations Officer

Alejandra Bustamante, Investor Relations Manager

+52 (818) 748-1146

[emailprotected]

www.alpek.com

EARNINGS REPORT - latibex.com - [PDF Document] (52)

FIRST QUARTER 2021 RESULTS

11

APPENDIX A – ADDITIONAL FINANCIAL INFORMATION

TABLE 1 | PRICE CHANGES (%) QoQ (%)

YoY (%)

Polyester

Avg. Ps. Prices 9 (3)

Avg. U.S. $ Prices 10 (5)

Plastics & Chemicals

Avg. Ps. Prices 36 49

Avg. U.S. $ Prices 38 45

Total

Avg. Ps. Prices 16 11

Avg. U.S. $ Prices 18 8

TABLE 2 | REVENUES 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Total Revenues

Ps. Million 32,830 28,709 28,522 14 15

U.S. $ Million 1,614 1,392 1,433 16 13

Domestic Revenues

Ps. Million 11,757 9,166 8,037 28 46

U.S. $ Million 578 445 405 30 43

Foreign Revenues

Ps. Million 21,072 19,543 20,485 8 3

U.S. $ Million 1,036 947 1,028 9 1

Foreign / Total (%) 64 68 72

TABLE 3 | OP. INCOME AND EBITDA 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Operating Income

Ps. Million 5,546 3,124 1,151 78 382

U.S. $ Million 273 152 57 79 374

EBITDA

Ps. Million 6,594 4,131 2,205 60 199

U.S. $ Million 324 201 111 61 193

EARNINGS REPORT - latibex.com - [PDF Document] (53)

FIRST QUARTER 2021 RESULTS

12

TABLE 4 | COMPARABLE EBITDA 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

EBITDA

Ps. Million 6,594 4,131 2,205 60 199

U.S. $ Million 324 201 111 61 193

Adjustments*

Ps. Million (2,461) (969) 745 (154) (430)

U.S. $ Million (121) (50) 36 (141) (432)

Comparable EBITDA

Ps. Million 4,133 3,161 2,950 31 40

U.S. $ Million 203 151 147 35 38 *Adjustments: Inventory, Carry-forward effect and non-operating, one-time (gains) losses

TABLE 5 | IFRS 16 EFFECT (in U.S.$ million)

1Q21

Income Statement

Amortization 11

Financial Expense 2

Balance Sheet

Assets- Right of use 146

Liabilities

Short term lease 39

Long term lease 108

Net Debt 9

TABLE 6 | FINANCIAL COST, NET (in U.S.$ million)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Financial Expenses (67) (26) (32) (157) (113)

Financial Income 4 2 8 151 (54)

Net Financial Expenses (64) (25) (23) (158) (173)

Fx Gains (Losses) (11) 26 (65) (142) 83

Financial Cost, Net (74) 1 (88) (5,444) 16

TABLE 7 | NET INCOME (in U.S.$ million, except as noted)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Consolidated Net Income 152 118 (16) 29 1,033

Non-Controlling Interest 31 20 3 59 912

Controlling Interest 121 99 (19) 23 722

Earnings per Share (U.S. $) 0.06 0.05 (0.01) 23 723

Avg. Outstanding Shares (million)* 2,112 2,112 2,115 * The same number of equivalent shares are considered in the periods presented

EARNINGS REPORT - latibex.com - [PDF Document] (54)

FIRST QUARTER 2021 RESULTS

13

TABLE 8 | STATEMENT OF FINANCIAL POSITION & FINANCIAL RATIOS (in U.S.$ million)

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Assets

Cash and cash equivalents 495 509 570 (3) (13)

Trade accounts receivable 718 565 574 27 25

Inventories 965 875 898 10 7

Other current assets 369 335 314 10 18

Total current assets 2,547 2,283 2,356 12 8

Investment in associates and others 439 433 441 1 (1)

Property, plant and equipment, net 1,899 1,934 1,876 (2) 1

Goodwill and intangible assets, net 178 182 193 (2) (8)

Other non-current assets 504 499 604 1 (17)

Total assets 5,567 5,331 5,470 4 2

Liabilities & stockholders’ equity

Debt 29 23 189 29 (84)

Suppliers 908 811 819 12 11

Other current liabilities 366 237 487 55 (25)

Total current liabilities 1,303 1,070 1,496 22 (13)

Debt (include debt issuance costs) 1,528 1,514 1,642 1 (7)

Employees’ benefits 65 66 55 (1) 19

Other long-term benefits 411 400 431 3 (5)

Total liabilities 3,308 3,050 3,623 8 (9)

Total stockholders’ equity 2,259 2,281 1,847 (1) 22

Total liabilities & stockholders’ equity 5,567 5,331 5,470 4 2

Net Debt 1,219 1,185 1,436 3 (15)

Net Debt / EBITDA* 1.6 2.1 1.7

Interest Coverage* 5.8 6.0 7.3 * Times: last 12 months

EARNINGS REPORT - latibex.com - [PDF Document] (55)

FIRST QUARTER 2021 RESULTS

14

POLYESTER

TABLE 9 | REVENUES 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Total Revenues

Ps. Million 21,742 19,949 21,795 9 -

U.S. $ Million 1,069 967 1,094 11 (2)

Domestic Revenues

Ps. Million 4,444 4,063 4,020 9 11

U.S. $ Million 219 197 202 11 8

Foreign Revenues

Ps. Million 17,298 15,886 17,775 9 (3)

U.S. $ Million 851 769 892 11 (5)

Foreign / Total (%) 80 80 82

TABLE 10 | OP. INCOME AND EBITDA

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Operating Income

Ps. Million 2,961 1,813 336 63 783

U.S. $ Million 145 89 17 63 742

EBITDA

Ps. Million 3,748 2,542 1,151 47 226

U.S. $ Million 184 124 58 48 216

TABLE 11 | COMPARABLE EBITDA 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

EBITDA

Ps. Million 3,748 2,542 1,151 47 226

U.S. $ Million 184 124 58 48 216

Adjustments*

Ps. Million (1,933) (825) 732 (134) (364)

U.S. $ Million (95) (43) 36 (121) (366)

Comparable EBITDA

Ps. Million 1,815 1,717 1,883 6 (4)

U.S. $ Million 89 81 94 10 (5) *Adjustments: Inventory, Carry-forward effect and non-operating, one-time (gains) losses

EARNINGS REPORT - latibex.com - [PDF Document] (56)

FIRST QUARTER 2021 RESULTS

15

PLASTICS & CHEMICALS

TABLE 12 | REVENUES 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Total Revenues

Ps. Million 9,589 7,687 5,964 25 61

U.S. $ Million 471 374 300 26 57

Domestic Revenues

Ps. Million 5,865 4,081 3,348 44 75

U.S. $ Million 288 198 169 46 70

Foreign Revenues

Ps. Million 3,724 3,606 2,616 3 42

U.S. $ Million 183 176 131 4 40

Foreign / Total (%) 39 47 44

TABLE 13 | OP. INCOME AND EBITDA

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

Operating Income

Ps. Million 2,247 1,232 748 82 200

U.S. $ Million 111 60 37 85 200

EBITDA

Ps. Million 2,509 1,509 987 66 154

U.S. $ Million 123 73 49 69 153

TABLE 14 | COMPARABLE EBITDA 1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

EBITDA

Ps. Million 2,509 1,509 987 66 154

U.S. $ Million 123 73 49 69 153

Adjustments*

Ps. Million (528) (144) 13 (267) (4,181)

U.S. $ Million (26) (7) 1 (264) (2,966)

Comparable EBITDA

Ps. Million 1,981 1,365 1,000 45 98

U.S. $ Million 97 66 50 48 95 *Adjustments: Inventory, Carry-forward effect and non-operating, one-time (gains) losses

EARNINGS REPORT - latibex.com - [PDF Document] (57)

FIRST QUARTER 2021 RESULTS

16

APPENDIX B – FINANCIAL STATEMENTS

ALPEK, S.A.B. DE C.V. and Subsidiaries CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Mar-21 Dec-20 Mar-20 QoQ (%)

YoY (%)

(in millions of Mexican Pesos)

ASSETS

CURRENT ASSETS:

Cash and cash equivalents 10,180 10,144 13,197 - (23)

Restricted cash 12 12 199 3 (94)

Trade accounts receivable 14,800 11,271 13,497 31 10

Other accounts and notes receivable 5,011 5,190 6,260 (3) (20)

Inventories 19,882 17,447 21,107 14 (6)

Other current assets 2,598 1,485 1,128 75 130

Total current assets 52,483 45,549 55,388 15 (5)

NON-CURRENT ASSETS:

Investment in associates and others 9,043 8,634 10,379 5 (13)

Property, plant and equipment, net 39,133 38,579 44,108 1 (11)

Goodwill and intangible assets 3,668 3,637 4,532 1 (19)

Other non-current assets 10,386 9,954 14,210 4 (27)

Total assets 114,713 106,353 128,617 8 (11)

LIABILITIES AND STOCKHOLDERS´EQUITY

CURRENT LIABILITIES:

Debt 608 456 4,450 33 (86)

Suppliers 18,700 16,173 19,263 16 (3)

Other current liabilities 7,549 4,723 11,457 60 (34)

Total current liabilities 26,857 21,352 35,170 26 (24)

NON-CURRENT LIABILITIES:

Debt (include debt issuance cost) 31,480 30,196 38,598 4 (18)

Deferred income taxes 4,794 4,092 4,926 17 (3)

Other non-current liabilities 3,685 3,885 5,204 (5) (29)

Employees’ benefits 1,349 1,316 1,290 3 5

Total liabilities 68,165 60,841 85,188 12 (20)

STOCKHOLDERS’ EQUITY:

Controlling interest:

Capital stock 6,035 6,035 6,035 - -

Share premium 9,021 9,025 9,025 - -

Contributed capital 15,056 15,060 15,060 - -

Earned surplus 26,023 25,326 23,017 3 13

Total controlling interest 41,079 40,386 38,077 2 8

Non-controlling interest 5,469 5,126 5,352 7 2

Total stockholders’ equity 46,548 45,512 43,429 2 7

Total liabilities and stockholders’ equity 114,713 106,353 128,617 8 (11)

EARNINGS REPORT - latibex.com - [PDF Document] (58)

FIRST QUARTER 2021 RESULTS

17

ALPEK, S.A.B. DE C.V. and Subsidiaries

CONSOLIDATED STATEMENT OF INCOME

1Q21 4Q20 1Q20 QoQ (%)

YoY (%)

(in millions of Mexican Pesos)

Revenues 32,830 28,709 28,522 14 15

Domestic 11,758 9,166 8,037 28 46

Export 21,072 19,543 20,485 8 3

Cost of sales (26,042) (24,928) (26,175) (4) 1

Gross profit 6,788 3,781 2,347 80 189

Operating expenses and others (1,242) (657) (1,196) (89) (4)

Operating income 5,546 3,124 1,151 78 382

Financial result, net (1,531) 39 (1,883) (3,992) 19

Equity in income of associates and joint ventures

5 (43) 59 112 (92)

Income before taxes 4,020 3,120 (673) 29 697

Income taxes (930) (693) 270 (34) (444)

Consolidated net income 3,090 2,427 (403) 27 868

Income attributable to Controlling interest 2,452 2,020 (453) 21 641

Income attributable to Non-controlling interest

638 407 50 57 1,162

EARNINGS REPORT - latibex.com - [PDF Document] (59)

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

Revenues (Ps.) 2,835 3,077 3,106 (8) (9) 2,835 3,106 (9)US $ 140 150 157 (7) (11) 140 157 (11)

EBITDA (Ps.)1 916 1,052 2,974 (13) (69) 916 2,974 (69)US $ 45 51 156 (12) (71) 45 156 (71)

Net Income (loss) (Ps.) (286) (207) 599 (38) -- (286) 599 --US $ (14) (11) 42 (29) -- (14) 42 --

CAPEX (Ps.)2 274 657 686 (58) (60) 274 686 (60)US $ 13 32 36 (58) (62) 13 36 (62)

Net Debt (US $) 627 602 586 4 7

Net Debt / LTM EBITDA* 3.2 2.0 1.8LTM Interest Coverage* 3.2 5.1 5.3

(%) 1Q21 vs.

Axtel Investor [emailprotected]

axtelcorp.mx+52 (81) 8114-1128

First Quarter 2021 (1Q21)EARNINGS REPORT

Monterrey, Mexico, April 20, 2021. - Axtel, S.A.B. de C.V. (BMV: AXTELCPO) (“Axtel” or “the Company”), a Mexican Information and Communications Technology company,announced today its unaudited results for the first quarter of 2021 (“1Q21”).

1Q21 HIGHLIGHTS

Business Units Separation

• During the quarter, conversations to attract potential investors for Business Units continued, with an emphasis on the Infrastructure Unit.

• Concurrently, the Company is working on legally separating the two business units into separate corporate entities.

Financial Structure

• In March, Axtel redeemed US $60 million of its 6.375% Senior Notes due 2024 (“Notes”).

− The amount outstanding of the Notes is US $440 million.

• In process to renew the US $50 million committed, revolving credit facility for an additional 3 years.

• Fitch Ratings upgraded Axtel’s ratings to ‘BB’ from ‘BB-‘; revised outlook to stable.

Annual Shareholders’ Meeting

• In March, shareholders approved a share repurchase program for up to Ps. 200 million.

FrecuenciaAlestra and NAVE

• In March, the Company hosted the first edition of its virtual event “Frecuencia Alestra” to showcase the latest innovations in Digital Transformation solutions.

− More than 2,300 participants

• Axtel celebrated its first five years of promoting digital B2B scaleups and startups through NAVE, its business accelerator program.

− 26 scaleups and 21 startups have been accelerated.

− 7 product launches for Alestra’s portfolio.

SELECTED FINANCIAL INFORMATION (IN MILLIONS)

Axtel reports 1Q21 EBITDA of US $45 million (Ps. 916 million)

* Times. LTM = Last twelve months. See page 7 for ratio calculation details.1) EBITDA = Operating income + depreciation & amortization + impairment of assets.2) Gross amount; does not include divestments.

EARNINGS REPORT - latibex.com - [PDF Document] (60)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

MESSAGE FROM AXTEL’S CEO

“Business prospects in 2021, particularly for our Enterprise and Infrastructure

customers, are improving despite a challenging first quarter. The Enterprise

segment reflected the contracted acquisition of new projects that prevailed in

2020. This quarter, new contracts’ acquisition experienced a relevant increase, an

enticing trend for the rest of the year. In the Government segment, we saw a

meaningful impact largely due to a slowdown in new Digital Transformation

projects for the federal government. For its part, Axtel Networks’ results were in

line with our positive view for the year.

In the quarter, we continued conversations to attract investment proposals for our

Business Units, with a focus in Axtel Networks. Alongside, we are moving forward

to legally separate the two business units taking into consideration all relevant

legal, regulatory, operational and contractual aspects, and their corresponding

implications.

Internally, we remained working remotely, waiting for a widely available

vaccination program in Mexico to protect the well-being of all collaborators in

Axtel. Until then, we will start the transition to a hybrid, in-office and remote

working scheme under the “Axtel Digital” project.

Looking ahead, we will continue pursuing opportunities with Enterprise and Axtel

Networks’ customers, amid more favorable economic expectations and will refocus

on opportunities with state and local government entities. Our “Axtel Digital”

project will continue to drive the reshaping of our operations and processes,

producing a more streamlined and efficient operation. Finally, we will continue

maximizing cashflow to improve our capital structure and pursue all strategic

efforts to attract new investors to our Business Units.”

Eduardo Escalante

2

EARNINGS REPORT - latibex.com - [PDF Document] (61)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

SERVICES (Ps.) 2,219 2,473 2,552 (10) (13) 2,219 2,552 (13)US $ 109 120 129 (9) (15) 109 129 (15)

Enterprise (Ps.) 1,880 1,935 2,015 (3) (7) 1,880 2,015 (7)US $ 93 94 102 (1) (9) 93 102 (9)

Government (Ps.) 339 538 537 (37) (37) 339 537 (37)US $ 17 26 27 (37) (38) 17 27 (38)

INFRASTRUCTURE (Ps.) 1,230 1,218 1,169 1 5 1,230 1,169 5US $ 60 59 59 2 2 60 59 2

ELIMINATIONS (Ps.) * (614) (614) (615) 0 0 (614) (615) 0US $ (30) (30) (31) (1) 3 (30) (31) 3

TOTAL REVENUES (Ps.) 2,835 3,077 3,106 (8) (9) 2,835 3,106 (9)US $ 140 150 157 (7) (11) 140 157 (11)

(%) 1Q21 vs.

Total revenues were US $140 million in 1Q21, down 11% when compared to 1Q20. In pesos, revenuesdecreased 9%, due to a 13% decrease in Alestra’s revenues, partially mitigated by a 5% increase in AxtelNetworks.

INFRASTRUCTURE BUSINESS UNIT (“AXTEL NETWORKS”)

Revenues reached US $60 million in 1Q21; up 2% compared to 1Q20. In pesos, revenues were 5% higher,driven by a strong 11% increase in revenues coming from third-party customers, mainly due to up-frontpayment contracts providing dark-fiber to wholesale and mobile operators.

Revenues coming from Alestra remained flat and represented 50% of total Infrastructure Unit YTD revenues.

SERVICES BUSINESS UNIT (“ALESTRA”)

Revenues totaled US $109 million in 1Q21, down 15% compared to 1Q20. In pesos, revenues decreased 13%,due to 7% and 37% declines in Enterprise and Government segment revenues, respectively.

ENTERPRISE SEGMENT (85% of Services Unit YTD revenues)

Enterprise segment revenues totaled US $93 million in 1Q21. In pesos, revenues were 7% lower than 1Q20,due to 9% and 12% declines in Standard services and Value-added services, respectively, partially offset by a7% increase in Digital Transformation services. (Table 1).

STANDARD SERVICES revenues reached Ps. 1,315 million in 1Q21, down 9% year-over-year, mainly dueto a 29% decrease in voice revenues mainly due to a one-time revenue recognition of equipmentcomponent under IFRS 15 during 1Q20, and also due to its maturing technological cycle and less voicetraffic due to remote work for many clients. This decline was partially mitigated by a 6% growth inhosting solutions.

VALUE-ADDED SERVICES revenues reached Ps. 222 million in 1Q21, down 12% when compared to1Q20, mainly due to a 20% decrease in managed services mainly due to fewer non-recurring wiring andequipment sales projects during 1Q21, as premises and capacity expansions are not yet a priority forclients; partially mitigated by a 9% increase in system integration solutions.

DIGITAL TRANSFORMATION revenues reached Ps. 342 million in 1Q21, up 7% compared to 1Q20,mainly due to a 21% increase in cybersecurity and a combined 8% increase in cloud and collaborationsolutions, due to both new customers and incremental services with existing customers.

3

REVENUES – Business Units

* For consolidation purposes, revenues of Infrastructure Unit coming from Services Unit are presented as “eliminations”.

EARNINGS REPORT - latibex.com - [PDF Document] (62)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

SERVICES BUSINESS UNIT (“ALESTRA”) (cont’d)

GOVERNMENT SEGMENT (15% of Services Unit YTD revenues)

Government segment revenues amounted US $17 million in 1Q21. In pesos, revenues declined 37%compared to 1Q20, due to termination of contracts mainly with federal government and contraction in non-recurrent revenues, which declined 80% this quarter (Table 2). The Company is emphasizing opportunitieswith state and local governments to compensate for the uncertainty in Value-added and DigitalTransformation projects with federal government entities.

STANDARD SERVICES revenues reached Ps. 160 million in 1Q21, 34% lower than 1Q20, mainly due toa 90% decrease in hosting services and a 24% decline in data & internet.

VALUE-ADDED SERVICES revenues reached Ps. 93 million in 1Q21, down 52% when compared to1Q20, due to a combined decline in system integration solutions and managed services.

DIGITAL TRANSFORMATION revenues reached Ps. 86 million in 1Q21, a 14% decline compared to1Q20, mainly due to declines in managed applications and cybersecurity solutions.

4

REVENUES – Business Units

GROSS PROFIT

Gross profit is defined as revenues minus cost of revenues. For 1Q21, gross profit was US $102 million. Inpesos, gross profit totaled Ps. 2,063 million, down 6% compared to 1Q20.

SERVICES UNIT (ALESTRA) gross profit amounted to Ps. 942 million, down 14% compared to the year-earlierquarter, mainly due to the decline in voice revenues for the enterprise segment and Value-added and DigitalTransformation revenues in the government segment, with fairly stable margins.

INFRASTRUCTURE UNIT (AXTEL NETWORKS) gross profit amounted to Ps. 1,121 million, 2% higher comparedto the year-earlier quarter, due to increases in revenues, marginally affected by a reclassification of certainintra-business units’ costs.

OPERATING EXPENSES AND OTHER INCOME (EXPENSES)

Operating expenses reached US $56 million in 1Q21; in pesos, operating expenses decreased 8%.

SERVICES UNIT (ALESTRA) operating expenses decreased 18% compared to 1Q20, due to declines inpersonnel due to right-sizing, as well as declines in maintenance and lower debt-provision charge.

INFRASTRUCTURE UNIT (AXTEL NETWORKS) operating expenses increased 3% compared to 1Q20, due toincreases in personnel and maintenance expenses reclassified from Alestra this year, partially mitigated by adecline in rents due to the downsizing in office space .

Other expenses reached Ps. 1 million during 1Q21, compared to other income of Ps. 2,028 million during1Q20, which includes a Ps. 2,021 million (US $107 million) gain from the divestment of the data centers.

EARNINGS REPORT - latibex.com - [PDF Document] (63)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

419

378

535

53

8

954

916

2,01

9

774

86

20* 19*21 20**

YTDQTR

20 1921 20

YTDQTR

5

EBITDA

EBITDA totaled US $45 million in 1Q21. In pesos, EBITDA reached Ps. 916 million, a4% decrease compared to Ps. 954 million in 1Q20 adjusted for the Ps. 2,021 milliongain of the data centers divestment. (Table 4).

EBITDA margin increased from 30.7% in 1Q20 to 32.3% in 1Q21, driven by a greaterproportion of higher-margin Infrastructure unit EBITDA.

SERVICES UNIT (ALESTRA)(41% of Axtel’s YTD EBITDA)

Services Business Unit EBITDA amounted to US $19 million in 1Q21. In pesos,EBITDA reached Ps. 378 million, a 10% decrease year-over-year, due to thedecline in gross profits, partially mitigated by a decline in operating expensespreviously described.

INFRASTRUCTURE UNIT (AXTEL NETWORKS)(59% of Axtel’s YTD EBITDA)

Infrastructure Unit EBITDA reached US $26 million in 1Q21. In pesos, EBITDAreached Ps. 538 million, up 1% compared to 1Q20, due to increases in grossprofit mitigated by increases in operating expenses previously described.

OPERATING INCOME

In the 1Q21, operating income totaled US $4 million. In pesos, operating incometotaled Ps. 86 million, compared to Ps. 2,019 million in 1Q20, a Ps. 1,933 milliondecrease due to the extraordinary data centers divestment gain of Ps. 2,021 millionin 1Q20.

(in Million Ps.)

(in Million Ps.)

(in Million Ps.)

(in Million Ps.)

20* 19*21 20**YTDQTR

20 2021 21

YTDQTR

* Adjusted for data center divestment transaction.

* Adjusted for data center divestment transaction.

EARNINGS REPORT - latibex.com - [PDF Document] (64)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

For 1Q21, net debt was US $627 million, an increase of 7% or US $42 million in comparison with 1Q20;comprised of an US $18 million decrease in debt, a US $25 million non-cash increase in debt caused by a 14%appreciation of the Mexican peso year-over-year and a US $35 million decrease in cash.

Total debt reduction of US $18 million year-over-year is explained by i) a US $60 million decrease related tothe partial redemption of the 2024 Senior Notes; ii) a US $47 million increase in short-term loans; iii) a US $2million decrease in the long-term facility; and iv) a US $3 million decrease in accrued interests.

As of 1Q21, cash balance totaled US $69 million (Ps. 1,428 million). Cash in 1Q20 totaled US $104 million (Ps.2,448 million), which included US $13 million of restricted cash and US $60 million from remaining proceedsfrom the data centers transaction, which were used in March this year to partially redeem the 2024 SeniorNotes.

Financial ratios for the first quarter 2021 were: Net Debt to EBITDA of 3.2 times and Interest Coverage of 3.2times. (Table 6).

NET DEBT

The comprehensive financing cost reached US $33 million in 1Q21 or Ps. 668 million, down 72% compared toPs. 2,355 million cost in 1Q20; mostly explained by a Ps. 307 million FX loss during 1Q21 resulting from a 3%depreciation of the Mexican peso against the US dollar, compared to a Ps. 1,993 million FX loss in 1Q20resulting from a 20% depreciation of the peso. Interest expenses declined less than 1% notwithstanding thePs. 60 million premium paid in March related to the US $60 million partial redemption of the 2024 SeniorNotes. (Table 5).

Capital investments totaled US $13 million in 1Q21, compared to US $36 million in 1Q20.

Capex in the first quarter of 2020 includes an extraordinary investment of US $19 million related to therenovation of spectrum frequencies, and excludes a US $167 million benefit from the data center divestment.

COMPREHENSIVE FINANCING RESULT

CAPITAL EXPENDITURES (CAPEX)

6

EARNINGS REPORT - latibex.com - [PDF Document] (65)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

• The report presents unaudited financial information based on International Financial Reporting Standards (IFRS).Figures are presented in Mexican Pesos (Ps.) or US Dollars (US $), as indicated. Where applicable, Peso amountswere translated into US Dollars using the average exchange rate of the months during which the operationswere recorded.

• This report may contain forward-looking information based on numerous variables and assumptions that areinherently uncertain. They involve judgments with respect to, among other things, future economic, competitiveand financial market conditions and future business decisions and financial performance of the company, all ofwhich are difficult or impossible to predict accurately. These statements reflect management's current views,which are subject to different risks. Accordingly, results could vary from those set forth in this release. Thecompany disclaims any obligation to update statements in this release based on new information available.

• Net Debt / EBITDA ratio: means net debt translated into US Dollars using the end-of-period exchange ratedivided by LTM EBITDA translated into US Dollars using the average exchange rate for each month during whichthe operations were recorded. Net debt means total debt (including accrued interests) minus cash (includingrestricted cash).

• Interest coverage ratio: means the ratio of LTM EBITDA to interest expense (net of interest income), bothtranslated into US Dollars using the average exchange rate for each month during which the operations wererecorded. Interest expense calculated pro forma for debt prepayments.

• Axtel maintains an interest rate swap (“IRS”) for Ps. 3,380 million, maturing in December 2022, where Axtel pays8.355% and receives TIIE 28d.

• Subject to market conditions, the Company’s liquidity position and its contractual obligations, from time to time,the Company may acquire or divest its own shares and/or its Senior Notes, as well as enter into or unwindfinancial instruments whose underlying is related to the performance of its shares.

OTHER INFORMATION

ABOUT AXTEL

7

Axtel is a Mexican Information and Communication Technology company that serves the enterprise, government andwholesale segments through its business units Alestra (Services) and Axtel Networks (Infrastructure).

Axtel is a subsidiary of ALFA, which owns 52.8% of its equity.

Axtel adhered to the UN Global Compact in 2011 the world's largest social responsibility initiative. It has receivedrecognition from CEMEFI as a Socially Responsible Company since 2008.

Axtel shares, represented by Ordinary Participation Certificates, or CPOs, trade on the Mexican Stock Market under thesymbol “AXTELCPO” since 2005.

Axtel’s Investor Relations Center: axtelcorp.mxEnterprise and Government services website: alestra.mx

NOTE: Axtel no longer offers services for the residential segment. In December 2018, it sold part of its residential business to Televisa (IZZI) and, in May2019, the rest to Megacable.

EARNINGS REPORT - latibex.com - [PDF Document] (66)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

STANDARD SERVICES 1,315 1,297 1,443 1 (9) 1,315 1,443 (9)VALUE-ADDED 222 283 253 (21) (12) 222 253 (12)DIGITAL TRANSFORMATION 342 355 320 (4) 7 342 320 7TOTAL ENTERPRISE (Ps.) 1,880 1,935 2,015 (3) (7) 1,880 2,015 (7)

US $ 93 94 102 (1) (9) 93 102 (9)Recurrent (Ps.) 1,822 1,839 1,925 (1) (5) 1,822 1,925 (5)Non recurrent (Ps.) 57 96 90 (40) (37) 57 90 (37)

(%) 1Q21 vs.

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

STANDARD SERVICES 160 219 243 (27) (34) 160 243 (34)VALUE-ADDED 93 157 194 (40) (52) 93 194 (52)DIGITAL TRANSFORMATION 86 163 100 (47) (14) 86 100 (14)TOTAL GOVERNMENT (Ps.) 339 538 537 (37) (37) 339 537 (37)

US $ 17 26 27 (37) (38) 17 27 (38)Recurrent (Ps.) 317 375 433 (16) (27) 317 433 (27)Non recurrent (Ps.) 22 163 104 (86) (79) 22 104 (79)

(%) 1Q21 vs.

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

TOTAL INFRASTRUCTURE (Ps.) 1,230 1,218 1,169 1 5 1,230 1,169 5US $ 60 59 59 2 2 60 59 2

ELIMINATIONS (Ps.) * (614) (614) (615) 0 0 (614) (615) 0US $ (30) (30) (31) (1) 3 (30) (31) 3

(%) 1Q21 vs.

TABLE 1 | SERVICES BUSINESS UNIT (ALESTRA) REVENUES - ENTERPRISE SEGMENT(IN MILLIONS)

TABLE 2 | SERVICES BUSINESS UNIT (ALESTRA) REVENUES - GOVERNMENT SEGMENT(IN MILLIONS)

Appendix A – Tables

8

TABLE 3 | INFRASTRUCTURE BUSINESS UNIT (AXTEL NETWORKS) REVENUES(IN MILLIONS)

* For consolidation purposes, revenues coming from Services Unit (Alestra) are presented as “eliminations”.

EARNINGS REPORT - latibex.com - [PDF Document] (67)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

Net interest expense (362) (270) (356) (34) (2) (362) (356) (2)FX gain (loss), net (307) 1,125 (1,993) -- 85 (307) (1,993) 85Ch. FV of Fin. Instruments 0 0 (6) -- -- 0 (6) --Total (Ps.) (668) 855 (2,355) -- 72 (668) (2,355) 72

US $ (33) 41 (110) -- 70 (33) (110) 70

(%) 1Q21 vs.

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

Operating Income (Ps.) 86 179 2,019 (52) (96) 86 2,019 (96)US $ 4 9 107 (53) (96) 4 107 (96)

EBITDA (Ps.) 916 1,052 2,974 (13) (69) 916 2,974 (69)US $ 45 51 156 (12) (71) 45 156 (71)

Adjustments* (Ps.) 0 0 (2,021) -- -- 0 (2,021) --US $ 0 0 (107) -- -- 0 (107) --

Comparable EBITDA (Ps.) 916 1,052 954 (13) (4) 916 954 (4)US $ 45 51 48 (12) (7) 45 48 (7)Services Unit (Ps.) 378 512 419 (26) (10) 378 419 (10)Infrastructure Unit (Ps.) 538 540 535 (0) 1 538 535 1

(%) 1Q21 vs.

TABLE 4 | OPERATING INCOME AND EBITDA(IN MILLIONS)

TABLE 6 | NET DEBT AND FINANCIAL RATIOS (US $ MILLIONS)

9

TABLE 5 | COMPREHENSIVE FINANCING RESULT(IN MILLIONS)

Appendix A – Tables

*Adjustments include one-time (gains) losses, such as the Data Centers divestment in 1Q20.

* Times. LTM = Last twelve months. See page 7 for calculation details.

1Q21 4Q20 1Q20 4Q20 1Q20Senior Notes 2024 440 500 500 (12) (12)Long-term bank loan 156 163 139 (4) 13Short-term bank loans 49 65 2 (24) >1,000Other loans + leases 39 38 35 1 10Accrued interests 12 5 14 128 (11)Total Debt 697 771 690 (10) 1

% US $ denominated debt 71% 72% 74%

(-) Cash and cash eq. (69) (170) (104) 59 33Net Debt 627 602 586 4 7Net Debt / LTM EBITDA* 3.2 2.0 1.8LTM Interest Coverage* 3.2 5.1 5.3

(%) 1Q21 vs.

EARNINGS REPORT - latibex.com - [PDF Document] (68)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

TABLE 7 | 2020 and 2021 REVENUES (NEW SERVICES FAMILIES)(IN MILLIONS)

TABLE 8 | 2020 AND 2021 REVENUES (FORMER SERVICES FAMILIES – as reported in 2020) (IN MILLIONS)

Appendix B – SERVICES UNIT (ALESTRA) – New vs. Former Services Families

10

1Q20 2Q20 3Q20 4Q20 2020 1Q21

SERVICES UNIT (Ps.) 2,552 2,372 2,427 2,473 9,824 2,219

US $ 129 102 110 120 461 109

ENTERPRISE (Ps.) 2,015 1,925 1,959 1,935 7,834 1,880

STANDARD SERVICES 1,443 1,336 1,320 1,297 5,396 1,315

VALUE ADDED 253 266 295 283 1,096 222

DIGITAL TRANSFORMATION 320 324 343 355 1,342 342

GOVERNMENT (Ps.) 537 447 468 538 1,990 339

STANDARD SERVICES 243 257 243 219 961 160

VALUE ADDED 194 105 104 157 560 93

DIGITAL TRANSFORMATION 100 85 121 163 469 86

1Q20 2Q20 3Q20 4Q20 2020 1Q21

SERVICES UNIT (Ps.) 2,552 2,372 2,427 2,473 9,824 2,219

US $ 129 102 110 120 461 109

ENTERPRISE (Ps.) 2,015 1,925 1,959 1,935 7,834 1,880

TELECOM 1,710 1,610 1,589 1,570 6,478 1,549

IT 305 316 370 366 1,356 330

GOVERNMENT (Ps.) 537 447 468 538 1,990 339

TELECOM 239 236 226 258 960 187

IT 298 211 242 280 1,030 152

EARNINGS REPORT - latibex.com - [PDF Document] (69)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

1Q21 4Q20 1Q20 4Q20 1Q20ASSETS

CURRENT ASSETSCash and equivalents 1,428 3,124 2,132 (54) (33) Restricted cash - 262 316 -- --Accounts receivable 1,826 1,795 2,631 2 (31) Related parties 9 8 40 12 (77) Refundable taxes and other acc. rec. 1,060 1,098 877 (3) 21 Advances to suppliers 741 714 626 4 18 Inventories 140 79 122 78 15 Financial Instruments - - 63 -- --Financial Instruments (ZSC) - - 87 -- --Total current assets 5,204 7,079 6,894 (26) (25)

NON CURRENT ASSETSRestricted cash - - - -- --Property, plant and equipment, net 11,134 11,578 12,493 (4) (11) Long-term accounts receivable - - - -- --Intangible assets, net 1,860 1,854 1,917 0 (3) Deferred income taxes 2,857 2,541 3,853 12 (26) Investment shares associated co. 292 292 295 (0) (1) Other assets 366 361 457 1 (20) Total non current assets 16,509 16,624 19,014 (1) (13)

TOTAL ASSETS 21,713 23,704 25,908 (8) (16)

LIABILITIES & STOCKHOLDERS' EQUITYCURRENT LIABILITIESAccount payable & Accrued expenses 2,359 2,376 3,394 (1) (30) Accrued Interest 249 106 320 135 (22) Short-term debt - 310 - -- --Current portion of long-term debt 1,520 1,488 458 2 231 Taxes payable 2 376 16 (100) (91) Financial Instruments 127 154 89 (18) 43 Deferred Revenue 104 116 191 (10) (45) Provisions 22 18 232 21 (90) Other accounts payable 815 1,100 963 (26) (15) Total current liabilities 5,198 6,044 5,663 (14) (8)

LONG-TERM LIABILITIESLong-term debt 12,492 13,367 15,302 (7) (18) Employee Benefits 750 743 700 1 7 Derivative Financial Instruments 28 53 97 (48) (71) Other LT liabilities 1 1 153 (29) (99) Total long-term debt 13,270 14,165 16,253 (6) (18)

TOTAL LIABILITIES 18,468 20,209 21,916 (9) (16)

STOCKHOLDERS' EQUITYCapital stock 464 464 464 - - Reserve for repurchase of shares 198 186 396 6 (50) Cumulative earnings (losses) 2,583 2,845 3,131 (9) (18)

TOTAL STOCKHOLDERS' EQUITY 3,245 3,495 3,991 (7) (19)

TOTAL LIABILITIES AND EQUITY 21,713 23,704 25,908 (8) (16)

(%) 1Q21 vs.

Axtel, S.A.B. de C.V. and SubsidiariesUnaudited Consolidated Balance Sheet(IN MILLION PESOS)

Appendix C – Financial Statements

11

EARNINGS REPORT - latibex.com - [PDF Document] (70)

[emailprotected]

EARNINGS REPORTFirst Quarter 2021 (1Q21)

Axtel, S.A.B. de C.V. and SubsidiariesUnaudited Consolidated Income Statement(IN MILLION PESOS)

12

Appendix C – Financial Statements

YTD1Q21 4Q20 1Q20 4Q20 1Q20 YTD'21 YTD'20 Δ (%)

Total Revenues 2,835 3,077 3,106 (8) (9) 2,835 3,106 (9) Cost of sales and services (773) (861) (910) 10 15 (773) (910) 15 Gross Profit 2,063 2,216 2,197 (7) (6) 2,063 2,197 (6) Operating expenses (1,146) (1,189) (1,250) 4 8 (1,146) (1,250) 8 Other income (expenses), net (1) 25 2,028 -- -- (1) 2,028 --Depr., amort. & impairment assets (830) (873) (956) 5 13 (830) (956) 13 Operating income 86 179 2,019 (52) (96) 86 2,019 (96) Comprehensive financing result, net (668) 855 (2,355) -- 72 (668) (2,355) 72 Equity in results of associated company (0) - - -- -- (0) - --Income (loss) before income taxes (583) 1,035 (337) -- (73) (583) (337) (73) Income taxes 297 (1,242) 936 -- (68) 297 936 (68) Net Income (Loss) (286) (207) 599 (38) -- (286) 599 --

(%) 1Q21 vs.

EARNINGS REPORT - latibex.com - [PDF Document] (71)

General Internal Use

1Q21

April 20, 2021

Earnings Presentation

EARNINGS REPORT - latibex.com - [PDF Document] (72)

General Internal Use

Safe HarborThis presentation contains forward-looking information based on numerous variables and assumptions

that are inherently uncertain. They involve judgments with respect to, among other things, future

economic, competitive and financial market conditions and future business decisions, all of which are

difficult or impossible to predict accurately. These uncertainties include, but are not limited to, risks

related to the impact of the COVID-19 global pandemic, such as the scope and duration of the

outbreak, government actions and restrictive measures implemented in response, availability of

workers and contractors due to illness and stay at home orders, supply chain disruptions and other

impacts to the business, or on the Company's ability to execute business continuity plans, as a result

there of. Accordingly, results are likely to vary from those set forth in this presentation. Copyright ©

2021 ALFA, S.A.B. de C.V. All rights reserved. Reproduction and distribution is forbidden without the

prior written consent of ALFA, S.A.B. de C.V.

EARNINGS REPORT - latibex.com - [PDF Document] (73)

General Internal Use

Important note on changes to ALFA’s Consolidated Financial Statements (Page 1 of 2)

3

On August 17, 2020, ALFA’s shareholders approved to spin-off ALFA’s share ownership of Nemak into a new, listed entity: Controladora Nemak, S.A.B. de C.V. (“Controladora Nemak”). The shares of “Controladora Nemak” were distributed to ALFA shareholders and began trading on the Mexican Bolsa on December 14, 2020. In accordance with International Financial Reporting Standards (IFRS), Nemak meets the definition of a “Discontinued Operation” for purposes of ALFA’s Consolidated Financial Statements. “Discontinued Operations” are the net results of an entity that is either being held for disposal or whichhas already been disposed of.

The changes in ALFA’s Consolidated Financial Statements are as follows:

• The Consolidated Statement of Financial Position presents all items related to Nemak as follows:

• At the close of 3Q20, as “Current assets from discontinued operations” and “Current liabilities from discontinued operations”

• At the close of 4Q20, all items are eliminated

• At the close of 1Q21, no figures related to Nemak

• Prior periods are not restated

EARNINGS REPORT - latibex.com - [PDF Document] (74)

General Internal Use

Important note on changes to ALFA’s Consolidated Financial Statements (Page 2 of 2)

4

• The Consolidated Statement of Income presents Nemak´s net revenues and expenses as a single line item “Profit (loss) from discontinued operations” as follows:

• 4Q20: accumulated figures for the two months and 14 days ended December 14, 2020

• 1Q20 accumulated figures from the complete quarter

• 1Q21 no figures related to Nemak

• The Change in Net Debt presents Nemak’s net inflows and outflows as a single line item “Decrease (Increase) in Net Debt from discontinued operations” for the nine months ended September 30, 2020

• The Change in Net Debt also presents Nemak’s Net Debt balance as “Net Debt from discontinued operations” at the close of 3Q20. Prior periods are not restated

EARNINGS REPORT - latibex.com - [PDF Document] (75)

General Internal Use

1Q21 Highlights

5

• 1Q21 Consolidated EBITDA of US $535 million is the second highest quarterly figure in our history

• 2021 EBITDA Guidance revised up 13% to US $1.637 billion due to stronger Alpek outlook

• Obtained approval to expand ALFA’s foreign neutral trust from 50% to 75%; next steps underway

• Net Debt / EBITDA of 2.9 times; below 3.0x for the first time since the beginning of the pandemic

• Annual Shareholders Meeting (March 11, 2021)

1. Reaffirmed commitment with Shareholders to continue transformational process - Unlocking Value strategy

2. Cash Dividend of US $98 million paid on April 7th, 2021. US $123 million dividends paid YTD

3. Cancelled 2.9% of total shares

4. Approved maximum amount of Ps. 5,800 million for share buybacks (US $280 million)

EARNINGS REPORT - latibex.com - [PDF Document] (76)

General Internal Use

Revenues were up driven by higher average consolidated prices and volume growth at Alpek; partially offset by lower sales in Axtel and Sigma

6

Revenues (US $ Million)

1Q21 vs 1Q20(US $ Million)

1Q21 vs 4Q20(US $ Million)

3,260

2,7893,057

3,2183,388

1Q20 2Q20 3Q20 4Q20 1Q21

ALFA & Subs with Nemak as Discontinued Operations

EARNINGS REPORT - latibex.com - [PDF Document] (77)

General Internal Use

Comparable ALFA EBITDA was up 20% year-on-year, boosted by 38% and 7% growth at Alpek and Sigma, respectively

7

415

263

438 419

53512.7%

9.4%

14.3%13.0%

15.8%

1Q20 2Q20 3Q20 4Q20 1Q21

Reported EBITDA(US $ Million)

Extraordinary Items Comparable EBITDA1

(US $ Million)

EBITDA Margin1Q21 vs 1Q20: 29%1Q21 vs 4Q20: 28% 1Q20 2Q20 3Q20 4Q20 1Q21

ALPEK Carry Fwd.

(20) (39) 6 9 58

ALPEK Others

(17) (36) 19 41 63

SIGMA - - - - -

AXTEL 107 4 - - -

NEWPEK - - 48 4 -

TOTAL 71 (71) 73 55 121

344 333365 364

41410.6%

12.0% 12.0% 11.3% 12.2%

1Q20 2Q20 3Q20 4Q20 1Q21

1Q21 vs 1Q20: 20%1Q21 vs 4Q20: 14%

ALFA & Subs with Nemak as Discontinued Operations

EBITDA Margin

1. Extraordinary items include ”Carry-forward gain (loss)” beginning 1Q21. Total figures from previous quarters include the carry-forward effect for comparability purposes.

EARNINGS REPORT - latibex.com - [PDF Document] (78)

General Internal Use

EBITDA with Nemak as Discontinued Operations (US $ Million)

8

344 421 409

482 415

263

438 419

535

1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21

Reported EBITDA

Comparable EBITDA 1

1. Extraordinary items include ”Carry-forward gain (loss)” beginning 1Q21. Total figures from previous quarters include the carry-forward effect for comparability purposes.

372 439 451

362 344 333 365 364414

1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21

EARNINGS REPORT - latibex.com - [PDF Document] (79)

General Internal Use

Net Debt increased US $165 million versus year-end 2020 due primarily to investment in Net Working Capital at Alpek amid higher oil and feedstock prices

9

ALFA Net Debt(US $ Million)

Leverage Ratio1

(Net Debt/EBITDA)

4,8944,699 4,864

1Q20 2Q20 3Q20 4Q20 1Q21

3.03.2

3.0 3.12.9

1Q20 2Q20 3Q20 4Q20 1Q21

Cash (US $ Million)

1,505

1,748

1,408

1,628

1,396

1Q20 2Q20 3Q20 4Q20 1Q21

ALFA & Subs with Nemak as Discontinued Operations

1. Ratio calculated with Discontinued Ops. for all periods

Nemak

6,6406,323

EARNINGS REPORT - latibex.com - [PDF Document] (80)

General Internal Use

10

Highest 1Q EBITDA margin (11.2%) since 2016; YoY margin expansion in Mexico, Europe and Latam

13.3

15.8

9.1

4.4

14.6

13.1

11

6.6

Mexico USA LatAm Europe

EBITDA Margin By Region (%)Highlights

• EBITDA up 7% y-o-y driven by growthin Europe (+51%), Latam (+13%) andMexico (+3%)

• Steeper Foodservice recovery inMarch 2021 due to increasedmobility; +21% in revenues YoY, forthe same month

• Positive results in Growth initiatives,tapping into the entrepreneurialnetwork and driving sustained growthin E-commerce, as well as its Snackingand Plant-Based business units

• Lower Net Debt YoY supported bycash-maximizing initiatives andoperating performance

1Q20

1Q21

6.5

Pork Ham Price

Jan. Mar. Jun. Sept. Dec.

U.S. ($/lb)

Europe (€/kg)

0.0

1.0

2.0

3.0

2020

2021

0.0

0.2

0.4

0.6

0.8

1.0

1.2

EARNINGS REPORT - latibex.com - [PDF Document] (81)

General Internal Use

11

Comparable EBITDA up 38% y-o-y (US $203 million) driven primarily by strong volume and higher-than-expected reference margins

Highlights

• Record high first quarter volume, reaching 1.2 million tons (+4% YoY)

• Comparable EBITDA of U.S. $203 million (+38% YoY) due to record volume & higher-than-expected margins

• Successfully issued a 10-year U.S. $600 million bond with a record low annual coupon (3.25%)

• Dividend payment of U.S. $126 million approved at Annual Shareholders’ Meeting; payable in 2Q21

Paraxylene vs Brent Crude Oil Price (Base=100)

Margin: Asia PET to Px/MEG (US $ / Ton)

40

100

160

Brent Px

342

478

377333 323

370304

227275

310250 242

330

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21

EARNINGS REPORT - latibex.com - [PDF Document] (82)

General Internal Use

12

1Q21 EBITDA on track with full-year guidance

Highlights

• Actively engaging with potential buyers who have shown interest for its Infrastructure unit

• Axtel redeemed an aggregate principal amount of US $60 million of its Senior Notes due 2024

• In March, shareholders approved a share repurchase program for a maximum of Ps. 200 million.

• In March, the Company hosted the first edition of its virtual event “Frecuencia Alestra” to showcase the latest innovations in Digital Transformation solutions.

EBITDA by Business Unit(Total 1Q21: US $45 million)

EBITDA (US $ Million)

48 49 49 51 45

107

4

1Q20 2Q20 3Q20 4Q20 1Q21

Current Operations

Extraordinary Items

59%

41%

ServiceInfrastructure

EARNINGS REPORT - latibex.com - [PDF Document] (83)

General Internal Use

Next steps to expand Nafinsa Trust

13

Key Milestones

Shareholder approval to amend ALFA bylaws

Foreign Investment Directorship (Ministry of Economy) approval to expand trust from 50% to 75%

Nafinsa Trust amendment

CNBV authorization and other regulatory requirements

EARNINGS REPORT - latibex.com - [PDF Document] (84)

General Internal Use

2021 EBITDA Guidance revised up 13% to US $1.637 billion due to stronger Alpek outlook

141 - Includes US $75 million inventory gains and carryforward effect from Alpek (Comparable ALFA EBITDA: US $1,562 million)

2 - Includes US $75 million inventory gains and carryforward effect (Comparable Alpek EBITDA: US $675 million)

(US $ Millions)Revised

2021Previous

2021

EBITDA

ALFA1 1,637 1,448

Alpek2 750 561

Sigma 725 725

Axtel 209 209

(US $ / Barrel)Revised

2021Previous

2021

Assumptions Brent Oil Avg. 63 48

Revised ALFA Comparable

EBITDA 2021e

Original ALFA EBITDA Guidance

2021e

Revised ALFA EBITDA Guidance

2021e

1,4481,562

1,637

(US $ Millions)

Δ AlpekExtraordinary Gains 2021e

75114

Δ AlpekComparable

EBITDA 2021e

+13%

EARNINGS REPORT - latibex.com - [PDF Document] (85)

General Internal Use

T. +52 (81) [emailprotected]

Contact

Hernán F. LozanoV.P. of Investor Relations

mailto:[emailprotected]

EARNINGS REPORT - latibex.com - [PDF Document] (86)

General

First Quarter 2021 (1Q21)Results Conference Call

ALFA cordially invites you to participate in its 1Q21 Conference Call

Eduardo Escalante | Chief Financial Officer ALFA

Roberto Olivares | Chief Financial Officer Sigma

Hernán F. Lozano | V.P. of Investor Relations ALFA

Representatives from all ALFA Companies available for Q&A

P R E S E N T E R S D A T E

D I A L I N

Wednesday, April 21, 2021

T I M E

1:00 p.m. EDT (NY)

12:00 p.m. CDT (CDMX)

+1 (877) 451 6152 (U.S.)

+1 (201) 389 0879 (International)

800 522 0034 (Mexico)

C O N F E R E N C E I D

13718399

W E B C A S T

http://public.viavid.com/index.php?id=144229

R E P L A Y

https://www.alfa.com.mx/RI/conference.htm

N O T E

First Quarter 2021 results will be released on Tuesday, April 20, 2021; after the Mexican market close.

About ALFA

ALFA manages a diversified portfolio of subsidiaries with global operations: Sigma, a leading multinational food company, focused on the production, marketingand distribution of quality foods through recognized brands in Mexico, Europe, United States and Latin America. Alpek, one of the world’s largest producers ofpolyester (PTA, PET and fibers), and the leader in the Mexican market for polypropylene, expandable polystyrene (EPS) and caprolactam. Axtel, a provider ofInformation Technology and Communication services for the enterprise and government segments in Mexico. Newpek, an oil and gas exploration andproduction company with operations in Mexico. In 2020, ALFA reported revenues of Ps. 263,867 million (US $12.3 billion), and EBITDA of Ps. 32,597 million (US$1.5 billion). ALFA’s shares are quoted on the Mexican Stock Exchange and on Latibex, the market for Latin American shares of the Madrid Stock Exchange. Formore information, please visit www.alfa.com.mx

[emailprotected]

+ (52) 81-8748-2521

EARNINGS REPORT - latibex.com - [PDF Document] (2024)
Top Articles
Latest Posts
Article information

Author: Msgr. Benton Quitzon

Last Updated:

Views: 5795

Rating: 4.2 / 5 (43 voted)

Reviews: 90% of readers found this page helpful

Author information

Name: Msgr. Benton Quitzon

Birthday: 2001-08-13

Address: 96487 Kris Cliff, Teresiafurt, WI 95201

Phone: +9418513585781

Job: Senior Designer

Hobby: Calligraphy, Rowing, Vacation, Geocaching, Web surfing, Electronics, Electronics

Introduction: My name is Msgr. Benton Quitzon, I am a comfortable, charming, thankful, happy, adventurous, handsome, precious person who loves writing and wants to share my knowledge and understanding with you.