Betterware de México reported a challenging first quarter of 2025, with consolidated net revenue decreasing by 2.9% year-over-year to MXN 3,499,151 thousand. Consolidated EBITDA fell by 29.1% to MXN 535,265 thousand, resulting in an EBITDA margin of 15.3%, down 567 basis points. Net income declined by 48.7% to MXN 151,394 thousand, and EPS also decreased by 48.7% to MXN 4.06.
The company experienced negative free cash flow of MXN 55,841 thousand for the quarter, a 115.5% decrease year-over-year, and its net debt-to-EBITDA ratio increased to 2.08x from 1.78x in Q1 2024. Betterware Mexico's revenue decreased by 9.8%, while Jafra Mexico posted a modest 1.1% increase. Jafra US revenue, in USD, decreased by 4.7% year-over-year.
Amidst macroeconomic uncertainty and new policies, Betterware de México made a strategic decision to pause further growth investments in Betterware US operations, opting to preserve cash. Concurrently, the company is proceeding with its international expansion, with Betterware Ecuador on track to launch in May 2025. Despite the challenging quarter, management maintained its full-year 2025 guidance for net revenue and EBITDA growth in the range of 6% to 9%.
In response to the quarter's performance and to strengthen free cash flow, the Board of Directors proposed a reduced dividend of MXN 200 million for Q1 2025, pending approval. This represents a decrease from the MXN 250 million paid in previous quarters, reflecting a more conservative approach to cash management during uncertain economic conditions.
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