UPDATE 3-Mexico's Coke Femsa's sales rise, profit drops on acquisitions
MEXICO CITY Feb 26 (Reuters) - A string of recent acquisitions helped to boost fourth-quarter sales volumes at Coca-Cola Femsa, Latin America's biggest Coke bottler, but the cost of financing the deals led to a 29 percent drop in earnings.
Shares of the joint venture of Coca-Cola Co and Mexican retailer Femsa fell nearly 4 percent after it reported results on Wednesday.
Without revenue from the newly acquired businesses, sales dipped because of weak consumer spending in Brazil and Mexico and poor weather, Chief Financial Officer Hector Trevino told analysts on a conference call.
To pare down debt, he said, the company will trim its investment this year to between $600 million and $700 million from roughly $800 million in 2013. Projects slated for this year include work on new plants to expand production in Colombia and Brazil.
The company reported a profit of 3.066 billion pesos ($234 million) for the quarter, down from 4.320 billion pesos a year earlier.
Financing expenses more than tripled to 1.9 billion pesos from 611 million pesos as net debt increased more than six times to 45.2 billion pesos.
Most of the debt increase was to fund acquisitions in Brazil, Coke Femsa said.
A decline in the value of the peso against the U.S. dollar also drove up financing costs, since about one-fifth of the company's debt is in dollars. Continuación...