The following is a summary of the Alfa S.A.B. De C.V. (ALFFF) Q2 2024 Earnings Call Transcript:

Financial Performance:

• ALFA reported double-digit EBITDA growth in Q2 2024, attributed to exceptional performance at Sigma and a sequential improvement at Alpek.

• Alpek's Comparable EBITDA reached $312 million, driven by resilient demand and cost reduction initiatives.

• Sigma achieved an all-time high quarterly EBITDA, driven by revenue growth across all regions and favorable market conditions.

• Consolidated revenue guidance was raised to $16.78 billion and EBITDA guidance to $1.59 billion for 2024.

• Alpek improved its leverage ratio to 3.3 times at the end of the quarter.

Business Progress:

• Sigma's exceptional growth continues with the introduction of new plant-based products under the 'Better-nera' and 'Better Balance' brands.

• Alpek completed a comprehensive plan capturing $75 million in annualized savings through footprint optimization and operational restructuring.

• Sigma announced an upward revision of the 2024 revenue and EBITDA forecast to $8.85 billion and $1.0 billion, respectively.

• A strong focus on cost competitiveness and operational efficiency remains a priority for both Alpek and Sigma.

Opportunities:

• ALFA is focused on separate operations between Alpek and Sigma to unlock value, indicating a potential significant discount in its current market capitalization compared to the sum of parts valuation.

Risks:

• The slower recovery in polyester margins due to persistent headwinds in the global petrochemical industry could pose risks to Alpek's performance.

• Variability in commodity prices, especially for pork and milk, may impact Sigma's profitability in the US market.

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