| Debt and borrowings |
| | |
2024 | | |
2023 | | |
2022 | |
| | |
| | |
| | |
| |
| Simple credit line joint and several obligation with BBVA, up to Ps.1,500,000, with a term of 60 months and monthly interest payment at 28-day TIIE rate published in BANXICO, on non-working days, the TIIE rate could be at 26, 27 or 29 days, plus the applicable margin, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days, in addition, in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and the result will be applied to the unpaid and past-due balances. | |
Ps. | 1,355,000 | | |
| 1,500,000 | | |
| - | |
| | |
| | | |
| | | |
| | |
| Two-tranche sustainability bond, with maturities across 4 and 7 years, offered in the Mexican Market through the Bolsa Mexicana de Valores; the first offer of Ps.500,000 started paying interest at 5.15% plus 0.40% and for the monthly subsequent payments, the rate will be based on the 29-day TIIE rate issued by BANXICO plus 0.40%; the second offer of Ps.1,000,000 will pay interest semi-annually at a fixed rate of 8.35%, during the sustainability bond term. | |
| 1,493,237 | | |
| 1,488,830 | | |
| 1,485,545 | |
| | |
| | | |
| | | |
| | |
| Simple credit line with HSBC, up to Ps.950,000, valid until September 13, 2029 and monthly interest payment at the TIIE rate (the 28-day equilibrium interbank interest rate published in BANXICO), plus 1.3 points percentages, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days, in addition, in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and the result will be applied to the unpaid and past-due balances. | |
| 902,500 | | |
| 950,000 | | |
| - | |
| | |
| | | |
| | | |
| | |
| Two-tranche bond, with maturities across 4 and 7 years, offered in the Mexican Market through the Bolsa Mexicana de Valores; the third offer of Ps.313,974 started paying interest at 12.41% and for the monthly subsequent payments, the rate will be based on the 28-day TIIE rate issued by BANXICO plus 0.90%; the fourth offer of Ps.500,000 will pay interest semi-annually or every 182 days at a fixed rate of 11.23%, during the bond term. | |
| 808,122 | | |
| 806,361 | | |
| - | |
| | |
| | | |
| | | |
| | |
| On April 5, 2022, Betterware entered into a credit line with BBVA for up to Ps.400,000 and as of May 31, 2022, through an amending agreement, the amount was strengthened for up to Ps.800,000. The line of credit bearing interest at the 28-day TIIE rate plus 100 basis points, payable monthly, with a term of 36 months from the date of signing the original contract. | |
| 120,000 | | |
| 300,000 | | |
| - | |
| | |
| | | |
| | | |
| | |
| On March 10, 2020, Betterware entered into a credit line agreement with HSBC México, S.A., for an amount of Ps.50,000. BLSM is jointly and severally liable for this credit line. On June 17, 2022, we entered into the fourth amendment agreement by which the available funds under the credit line were increased to Ps.300,000. The line bears interest at the TIIE rate plus 100 basis points. | |
| 80,000 | | |
| - | | |
| - | |
| | |
| | | |
| | | |
| | |
| Credit line with Banamex, with interest rate at TIIE (28 days published in BANXICO) plus 110 basis points. The line considers payments of drawdowns within no more than 90days. This short-term line of credit, which is available and paid in a term of no more than 12 months. | |
| - | | |
| - | | |
| 200,000 | |
| | |
| | | |
| | | |
| | |
| Simple credit line with Banamex, HSBC, BBVA, Bajío, BanCoppel and Scotiabank, up to Ps.4,498,695, with interest (28-day TIIE published in BANXICO) plus the applicable margin, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days, in addition, in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and the result will be applied to unpaid and past-due balances. | |
| - | | |
| - | | |
| 4,432,711 | |
| | |
| | | |
| | | |
| | |
| Interest payable | |
Ps. | 66,084 | | |
| 86,231 | | |
| 30,419 | |
| | |
| | | |
| | | |
| | |
| Total debt | |
| 4,824,943 | | |
| 5,131,422 | | |
| 6,148,675 | |
| | |
| | | |
| | | |
| | |
| Less: Current portion | |
| 1,156,084 | | |
| 508,731 | | |
| 230,419 | |
| | |
| | | |
| | | |
| | |
| Long term debt and borrowings | |
Ps. | 3,668,859 | | |
| 4,622,691 | | |
| 5,918,256 | |
Long term debt- Credit Line
with HSBC
On
September 12, 2023, Betterware signed an agreement with HSBC to acquire a simple line of credit with joint obligation, up to Ps.950,000,
valid until September 13, 2029 and payment of monthly interest at the TIIE rate (the of interbank interest rate) at 28 days published
in BANXICO plus 1.3bp, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360
days, in addition, in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and
the result will be applied to the unpaid and past-due balances.
On
September 13, 2023, Betterware used the Ps.950,000 of the credit line with HSBC to pay our revolving lines.
As
of December 31, 2024, the amount paid to the principal of this credit line amounts to Ps.47,500.
As
of December 31, 2024, the current portion of this long-term simple line amounted to Ps.190,000.
Long term debt- Offering of
bonds in Securities Commission and to the Mexican Stock Exchange (“BMV”, for its acronym in Spanish) (BWMX 23 and BWMX 23-2)
On
July 7, 2023, Betterware successfully concluded the third and fourth bond issuance for a total of Ps.813,974, with maturities of
4 and 7 years, offered in the Mexican Market. The third offer of bonds for Ps.313,374 started paying interest at 12.41% rate and
for the subsequent monthly payments, the rate will be based on the 28-day TIIE rate issued by Banxico plus 0.90%, and the fourth offer
of Ps.500,000 will pay interest semi-annually at a fixed rate of 11.23% during the bond term. Principal payments are at the end of every
bond maturity.
On
July 10, 2023, Betterware used the bond amount net of issuance costs of Ps.810,197, to pay the syndicated credit line.
Long term debt- Credit Line
with BBVA
On
July 5, 2023, Betterware entered into a credit agreement with BBVA, up to Ps.1,500,000, with a term of 60 months and monthly interest
payment at 28-day TIIE rate published in BANXICO, on non-working days, the TIIE rate could be at 26, 27 or 29 days, plus the applicable
margin, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days, in addition,
in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and the result will be
applied to the unpaid and past-due balances.
On
July 10, 2023, Betterware used the Ps.1,500,000 of the credit line with BBVA to pay the syndicated credit line.
As
of December 31, 2024, the amount paid to the principal of this credit line amounts to Ps. 145,000.
As
of December 31, 2024, the current portion of this long-term simple line amounted to Ps.200,000. Long term debt- Syndicated
Credit Line
On
March 31, 2022, Betterware entered into a credit agreement with Banamex, HSBC, BBVA, BanBajio, BanCoppel, and Scotiabank, as syndicated
lenders, for a credit line of up to Ps.4,498,695. The funds under the credit line were entirely allocated to the Jafra Acquisition in
Mexico and the United States. The credit line had a maturity of 5 years from the date of signing the contract in March 2022, which paid
monthly interest at the 28-day TIIE rate plus the applicable margin established in the contract. The first 24 months the credit line had
no principal payments, and from month 25 principal payments began in an increasing manner, with a global payment of 30% in month 60. Jafra
subsidiaries were jointly responsible for this credit.
During
the months of March and June 2023, Betterware made two principal payments for Ps.1,000,000 and Ps.250,000, respectively. On July 10, 2023,
the remaining principal of the syndicated loan for Ps.3,248,695 was prepaid. The resources used came from long-term debt: Ps.1,500,000
from BBVA and Ps.810,197 from the new bond issue; and short-term loans: Ps.550,000 from the revolving line with BBVA, Ps.150,000 from
the revolving line with Santander, Ps.50,000, from the revolving line with HSBC, and the remaining amount for Ps.188,498 was taken from
available cash of Betterware and Jafra on the settlement date.
The
Management considered the transaction as an extinguishment of the original debt (Syndicated Loan) and a new debt was recognized for the
long-term simple credit lines with BBVA and HSBC, mainly due to substantial differences in financial obligations. As a result of the extinguishment
of the debt from July to December 2023, the Company cancelled in profit or loss the outstanding remainder of the initial issuance costs
for the original debt (syndicated credit), which amounted to Ps.50,447.
Long term debt- Offering of
bonds in Securities Commission and to the Mexican Stock Exchange (“BMV”, for its acronym in Spanish) (BWMX 21X and BWMX 21-2X)
On
August 30, 2021, Betterware successfully concluded the offering of a two-tranche sustainability bond issuance for a total of Ps.1,500,000,
with maturities across 4 and 7 years, offered in the Mexican Market and issued at favorable conditions for the Company. The first
offer of sustainability bonds for Ps.500,000 started paying interest at 5.15% rate plus 0.40% and for the subsequent monthly payments,
the rate will be based on the 29-day TIIE rate issued by Banxico plus 0.40%, and the second offer of Ps.1,000,000 will pay interest semi-annually
at a fixed rate of 8.35% during the sustainability bond term. Principal payments are at the end of every bond maturity.
On
August 31, 2021, Ps.588,300 of proceeds received from the bond offering, were used for the prepayment of the following long-term debt:
Ps.521,449 were paid to the secured credit line with Banamex, acquired in December 2018, plus an additional Ps.18,172 to cancel the swap
linked to that loan, and Ps.48,679 to the credit line with BBVA. The rest of the proceeds were used for general corporate purposes, including
additional investments in Campus Betterware and other initiatives with positive environmental and social impacts.
Banamex- Unsecured current
credit line
| ● | Betterware
has an unsecured credit line with Banamex since July 2016, for up to Ps.900,000, at a rate based on the 28-days TIIE plus 110 basis points.
As of December 31, 2021, the interest rate was 28-days TIIE plus 285 basis points. During the years 2023 and 2022, Betterware used Ps.700,000
and Ps.250,000, respectively. and as of December 31, 2023, and 2022 has been reimbursed to Ps.900,000 and Ps.50,000, respectively. During
2024, BWM did not receive cash from this credit line. |
As of December 31, 2022, the
balance of this current line closed at Ps.200,000. HSBC- Current credit line
| ● | On March 10, 2020, Betterware entered into a current account credit line agreement with HSBC México,
S.A., for an amount of Ps.50,000, with provisions by means of promissory notes specifying payment of principal and interest. BLSM is jointly
liable for this credit. On May 4, 2020, the first amendment agreement was signed, in which the amount of the credit line was increased
to Ps.150,000. On June 17, 2022, the fourth modifying agreement was signed, which increased the available funds to Ps.300,000; and it
bears interest at the TIIE rate plus 100 basis points. During the years 2024, 2023 and 2022, Betterware received several deposits of this
revolving line which together amounted to Ps. 1,120,000, Ps.300,000 and Ps.620,000, respectively, which, as of December 31, 2024, 2023
and 2022, had been paid. |
As of December 31, 2024, the balance
of this short-term line closed at Ps.80,000.
BBVA- Current credit line
| ● | On April 5, 2022, the Group
entered into a credit line with BBVA for up to Ps.400,000 and as of May 31, 2022, through an amending agreement, the amount was strengthened
for up to Ps.800,000. The line of credit bearing interest at the 28-day TIIE rate plus 100 basis points, payable monthly, with a term
of 36 months from the date of signing the original contract. During the years 2024, 2023 and 2022, Betterware received several deposits
of this revolving line which together amounted to Ps.1,723,000, Ps.1,855,020 and Ps.450,010, respectively, which, as of December 31, 2024,
2023, and 2022, were paid Ps. 1,903,000, Ps.1,555,020 and Ps.450,010, respectively. |
As
of December 31, 2024 and 2023, the balance of this short-term line closed at Ps.120,000 and Ps.300,000, respectively.
Santander-Current credit line
| ● | On May 30, 2022, Betterware
entered into a current account credit agreement with Santander México, S.A., for an amount of Ps.200,000. BLSM is jointly and severally
liable for this credit. The maturity date of this line of credit is May 31, 2024, and accrues interest at the TIIE rate plus 190 basis
points. During fiscal year 2023, Betterware has used Ps.380,000 under such revolving credit line and which has been reimbursed to Santander.
During 2024 and 2022, BWM did not receive cash from this credit line. |
HSBC Revolving
Credit
| ● | On May 3, 2024, Jafra entered into a current account credit agreement with HSBC México, S.A., Institución
de Banca Múltiple, for an amount of Ps.70,000. The term of the agreement is 24 (twenty-four) months from the date of execution
of the agreement and accrues interest at the 28-day TIIE reference base rate plus a margin applicable to the reference rate. During 2024,
Jafra has used of the revolving line Ps. 184,100, and at the end of the year were paid in full. |
As
of December 31, 2024, 2023 and 2022, the fair value of the debt (borrowings and long-term bond) amounted to Ps. 4,784,355, Ps.5,145,691,
and Ps.6,489,926, respectively. The fair value of the long term bond in 2024, 2023 and 2022, was calculated based on level 1 of the value
hierarchy, since its price is quoted in an active market on that date, meanwhile the fair value of borrowings in 2024, 2023 and 2022 was
calculated based on level 2 of the fair value, using the discounted cash flow method and the Interbank Equilibrium Interest Rate (“TIIE”,
for its acronym in Spanish), adjusted for credit risk, and used to discount future cash flows.
Interest
expenses related to the borrowings presented above are included in the interest expense item in the consolidated statement of earnings
and other comprehensive income. Reconciliation of movements
of liabilities to cash flows arising from financing activities
| | |
Long-term
debt and
borrowings | | |
Interest
payable | | |
Derivative
financial
instruments,
net | |
| | |
| | |
| | |
| |
| Balances as of January 1, 2022 | |
Ps. | 1,482,276 | | |
| 28,109 | | |
| (28,193 | ) |
| Changes that represent cash flows - | |
| | | |
| | | |
| | |
| Loans obtained | |
| 5,818,705 | | |
| - | | |
| - | |
| Payments | |
| (1,120,025 | ) | |
| (502,847 | ) | |
| - | |
| Bond issuance costs | |
| (88,722 | ) | |
| - | | |
| - | |
| Changes that do not represent cash flows: | |
| | | |
| | | |
| | |
| Interest expense | |
| - | | |
| 505,157 | | |
| - | |
| Control obtained over subsidiaries | |
| | | |
| | | |
| | |
| Amortization of bond issuance cost | |
| 3,285 | | |
| - | | |
| - | |
| Amortization of issuance cost from Long-term debt- Syndicated Credit | |
| 22,737 | | |
| - | | |
| - | |
| Valuation effects of derivative financial instruments | |
| - | | |
| - | | |
| 43,522 | |
| Balances as of December 31, 2022 | |
| 6,118,256 | | |
| 30,419 | | |
| 15,329 | |
| Changes that represent cash flows - | |
| | | |
| | | |
| | |
| Loans obtained | |
| 6,498,994 | | |
| - | | |
| - | |
| Payments | |
| (7,633,715 | ) | |
| (652,313 | ) | |
| - | |
| Bond issuance costs | |
| (8,355 | ) | |
| - | | |
| - | |
| Changes that do not represent cash flows: | |
| | | |
| | | |
| | |
| Interest expense | |
| - | | |
| 708,125 | | |
| - | |
| Amortization of bond issuance cost | |
| 4,026 | | |
| - | | |
| - | |
| Amortization of issuance cost from Long-term debt- Syndicated Credit | |
| 15,538 | | |
| - | | |
| - | |
| Cancellation of Line issuance cost from Long-term debt- Syndicated Credit | |
| 50,447 | | |
| - | | |
| - | |
| Valuation effects of derivative financial instruments | |
| - | | |
| - | | |
| 32,591 | |
| Balances as of December 31, 2023 | |
| 5,045,191 | | |
| 86,231 | | |
| 47,920 | |
| Changes that represent cash flows - | |
| | | |
| | | |
| | |
| Loans obtained | |
| 3,027,100 | | |
| - | | |
| - | |
| Payments | |
| (3,319,600 | ) | |
| (603,921 | ) | |
| - | |
| Changes that do not represent cash flows: | |
| | | |
| | | |
| | |
| Interest expense | |
| - | | |
| 583,774 | | |
| - | |
| Amortization of bond issuance cost | |
| 6,168 | | |
| - | | |
| - | |
| Valuation effects of derivative financial instruments | |
| - | | |
| - | | |
| (156,766 | ) |
| Balances as of December 31, 2024 | |
Ps. | 4,758,859 | | |
| 66,084 | | |
| (108,846 | ) |
The previous table details the changes
in the Group’s liabilities derived from financing activities corresponding to debt and borrowings, including both monetary and non-monetary
changes. Liabilities arising from financing activities are those for which cash flows are classified, or future cash flows will be classified,
in the consolidated statement of cash flows as cash flows from financing activities. The Group’s long-term debt and
interest maturities as of December 31, 2024, including non-accrued interest, are as follows:
| Year | |
Amount | |
| | |
| |
| 2025 | |
Ps. | 1,497,908 | |
| 2026 | |
| 1,025,563 | |
| 2027 | |
| 1,328,118 | |
| 2028 | |
| 1,595,499 | |
| 2029-2030 | |
| 734,406 | |
| | |
Ps. | 6,181,494 | |
The
long-term and current debt of the credit line with HSBC and the current account credit line with Banamex contains the following financial
obligations:
| a) | A leverage ratio less than
or equal to 3.00. |
| b) | A debt service coverage
ratio equal to or greater than 1.25. |
The
long-term debt of the credit line with BBVA contains the following financial obligations:
| a) | A leverage ratio equal to
or less than 3.50 to 1.0. |
| b) | A debt service coverage
ratio greater than or equal to 1.25 to 1.0. |
The
long-term debt of the syndicated credit line contained the following financial obligations:
| a) | A leverage ratio equal to
or less than 3.00. |
| b) | A debt service coverage
ratio equal to or greater than 1.25. |
| c) | A minimum stockholders’
equity equivalent to 90% of stockholders’ equity at the close of the last immediately preceding fiscal year. |
The
long-term debt of both bond issues has the following obligations:
| a) | Pay interest on bonds monthly
or semi-annually, as applicable to each issue (bond), and using the rate stipulated in the Title. |
| | | |
| b) | Use the resources derived
from the placement of the Stock Certificates for the authorized purposes. |
| | | |
| c) | Compliance with the general
provisions applicable to securities issuers and other participants; Among them, the delivery of quarterly financial information and an
annual report to the Banking Commission (CNBV, for its acronym in Spanish) and BMV. |
| | | |
| d) | Compliance with the general
provisions applicable to entities and issuers supervised by the CNBV that hire external audit services. |
The Group was in compliance with all
financial covenants as of December 31, 2024, 2023 and 2022 and at the end each reported quarter, with the exception of subsection “c”
of the syndicated loan’s financial obligations during 2022; however, a waiver was obtained from the agent bank before December 31,
2022; therefore, there were no implications for the classification of the syndicated debt. The Management determined that there is no
uncertainty regarding compliance with covenants in the next 12 months.
|