Good morning, and welcome, everyone, to FEMSA's Third Quarter 2014 Earnings Results Conference Call. [Operator Instructions] During this conference call, management may discuss certain forward-looking statements concerning FEMSA's future performance and should be considered as good faith estimates made by the company. These forward-looking statements reflect management expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, which can materially impact the company's actual performance. At this time, I would now like to turn the conference over to Javier Astaburuaga, FEMSA's Chief Financial Officer. Please go ahead, sir. Javier Gerardo Astaburuaga Sanjinés: Thank you, and good morning, everyone. Welcome to FEMSA's Third Quarter 2014 Results Conference Call. Juan Fonseca from FEMSA and Alfredo Fernandez from Coke are with us today as well. As we usually do in our calls, we will focus on the consolidated figures for FEMSA and on the results of FEMSA Comercio, as many of you probably had the opportunity to participate in Coca-Cola FEMSA's conference call on Wednesday. And since you have likely seen our detailed results, we'll use this opportunity to share some of what we see as highlights and main trends in our business. As you know, given our growth presence in Mexico and the fact that our consumer base cuts across segments and across geographies, we're usually seen as a good bellwether for the Mexican consumer. In that capacity, our third quarter data still does not provide enough evidence for the size of the improvement in consumer dynamics. The consumer is still having to allocate his or her reduced disposable income across categories and making decisions of where to maintain consumption or to trade down or where even to reduce or eliminate a purchase. We are all still feeling the pressure from increased taxation and slow…

[Operator Instructions] And your first question comes from the line of Robert Ford with Bank of America.

Javier, I was hoping you could expand a little bit on the third quarter gross margin improvement, particularly as you mentioned in light of the impact of telephony, which was margin-enhancing as well as both traffic-enhancing, if I'm not mistaken. Are you seeing -- anecdotally, it feels like we're seeing promotions grow generally, and I'm not convinced that this is simply just a pulling forward of some of that calendar. Could you comment a little bit on exclusivity agreements or the interest in exclusivity agreements, slotting fees and maybe the promotional calendar as it looks to you right now for the end of year, please? Javier Gerardo Astaburuaga Sanjinés: Sure, Bob. As I've said in the opening remarks, we saw an increase in the promotional activity in a number of categories, and that's at least partially explaining the expansion of the gross margin of the quarter. I think that if you look at the accumulated 9 months, it's a much better figure to look at when looking at the trend for the year, as I said as well. And again, we are -- if you mean by the exclusivity concept, the decision that we took and the process we're implementing in expanding the number of stores that now carry a full line of carbonated soft drinks and noncarbonated as well from different suppliers in Mexico. That is also helping in the short term, a little bit on the margin expansion because of the mix of products now being, let's say, wider and richer. But I wouldn't say that, that's necessarily driving the performance on the quarter. It's much more driven by, again, both commercial and promotional activity by a number of suppliers in some categories, which I would say were a little bit more skewed to the -- towards the end of the year than some others. So that's basically the explanation that I can provide on that.

And is there any change in your mix with respect to the -- I'm sorry, Juan, with respect to prepared or [ph]...

I was going to say that I think suppliers, when you have a channel or a retailer that is growing a little bit better than others or better than most, I think they tend to increase the allocation of resources that go to that particular supplier, and I think that may be a play here as well.

Okay. Now that's helpful. And is there anything different in terms of the mix, in terms of prepared food versus the shelf stable stuff? Or is there any categories in particular which represented disproportionate share of that margin improvement? Javier Gerardo Astaburuaga Sanjinés: No, not that much. That category is not necessarily moving the needle yet, but it's making progress. But still, the size of it within the whole mix, it doesn't really allow, really, to create a big impact on the full numbers of the company, Bob.

And your next question is from Antonio Gonzalez from Crédit Suisse. Antonio Gonzalez - Crédit Suisse AG, Research Division: Javier and Juan, just a quick follow-up on the previous question. Do you think the fourth quarter then is going to see some sort of moderation in the gross margin? And then I wanted to ask very quickly 2 things first. Can you give us a little bit more color on why CapEx is down at the OXXO level roughly 6%? I don't know if you're lapping any particular initiative from last year that was nonrecurring and whether -- because, obviously, the store openings has not declined and whether you're seeing a trend for the last 9 months as a more sustainable trend going forward. Or should it pick up again? And then just finally, I wanted to ask whether you can give us any sense, at least qualitatively, on a same-store sales breakdown. Have you seen the categories that have had higher excise taxes this year significantly underperform the other categories or if it's pretty much an impact that you saw across the board throughout the year in terms of same-store sales per category? Javier Gerardo Astaburuaga Sanjinés: Sure. Sure, Antonio. Good morning. First, on the first one, as I explained, looking at the full first 9 months, it's a much better way to look at kind of how the business is trending. And just to keep everybody in mind, remembering fourth quarter of 2013 being a very, very strong quarter because of a number of reasons but partially because of the way, again, the promotional calendar was developed through that year. If you remember, we grew more than 20% and expanded more than 100 basis points margins in the fourth quarter last year. So we're going to have a very challenging base for this quarter in which we are currently operating. So that will be my comment on your first question. On the second one, 6% down, you're right. I would say there's not really a fundamental change in the structure or the magnitude of the CapEx program. We're going to be, I would say, pretty much in line with the numbers we anticipated at the beginning of the year, maybe slightly down. So I wouldn't expect nor a major change on the upside or on the downside compared to the amount of CapEx that we said we're going to be investing in 2014 in FEMSA Comercio. And in the third question, there's definitely a higher impact in those categories which are heavily impacted by the taxes. The carbonated soft drinks category particularly has shown a very, very strong resiliency. Some others have suffered more. But even though we are seeing, let's say, declines in a number of categories, the decline is more -- is higher in those categories, which were impacted by taxes. And somehow, those taxes were transferred to consumers through pricing. So that's pretty much what we're seeing happening, Antonio.

And your next question comes from Alan Alanis from UBS.

Quick question. Why is the ticket still growing at a slower pace than inflation, Javier? And if you can also give us an update on the Saldazo, the banking accounts that you've been opening at the OXXO, and if it has had any impact on the numbers. And the third and last question would be any update on the integration of pharmacies. And how are you planning on integrating the pharmacies business into the overall OXXO chain? Javier Gerardo Astaburuaga Sanjinés: Sure. Alan, good talking to you. On the first one, I think it has a lot to do with -- in some categories, we're seeing some trading down. That's one explanation, not necessarily the largest one. And the second part, we are also -- as we keep on expanding the number of stores, particularly in some cities, we're seeing also people going. And again, you are looking at the national average traffic numbers and the national ticket. So we have very different phenomenas in different cities, in cities in which we have a very high density compared now with the U.S. with around 1 store per 2,000, 2,500 consumers. We're looking people that are going more frequently to the stores, and that reduces the average ticket. And if you look at the numbers, we are not necessarily on the ticket significantly below inflation. So all in all, I would say those are the main drivers we're seeing on the average ticket numbers. And I think I've already said that traffic is more impacted by these phenomena of minutes of the airtime now being more cheaper and people not having to go to the store to recharge their phones as frequently as they did in the past. And on the last question, on the integration of pharma, and I will…

Got it. That's clear.

This is Juan. On the subject of Saldazo, just to give you an update, I think it continues to be an unqualified success in terms of the metrics that we can track at this point. In other words, the number of plastic that have been rolled out, we are off to 1 million plastics. So consistent with the 100...

And how many months, Juan?

10 months. So that's 100,000 per month. Yes, I know, it's a remarkable number. And I think also the percentage of people that have the plastic that are actively using it is something like twice as high as the industry norm. So remembering that this is, for the most part -- this is the first banking relationship for most of the users of this product. So in a way, this is kind of uncharted territory. I guess we also need to kind of temper our expectations, in the sense that this is supposed to be -- I mean, one of the largest benefits that we expect to get from this is in the form of data. And obviously, we're getting troves of data, and it takes a while to develop the capabilities, to mine it and to convert it into bundles and promotions and things that you can really monetize. As you know, there are a few fees, and there are some, but we don't make a lot of money from fees from the product. It's really about kind of generating the traffic, the loyalty and then the data, and then you can really monetize this by tailoring promotional activity to your particular consumer. So again, I think off to a great start. The numbers are pretty remarkable, and we don't see any slowdown yet. So we expect the numbers to get significantly bigger.

Good. 1 million banking accounts in 10 months.

Your next question comes from the line of Alex Robarts from Citi.

Two questions, really. Wanted to start out with traffic at OXXO. And it relates to this idea of the new normal level of traffic growth. And I guess you've made -- you've given us a heads-up about fourth quarter, which is a valid point. And so if we assume that traffic is similar to recent quarter levels, you'd basically complete 8 consecutive quarters with flat to minus 1 traffic growth. Now the previous 7, 8 quarters, you were running traffic between 2.5% and 5%. So I guess as we think about 2015, and I think it's safe to assume that you'll have a benefit of lapping year 1 with fiscal reform, and secondly, you're expecting more traction from the banking services, but do you think we could contemplate it? And what do you have in your kind of -- in your budget for next year is a range of traffic? And do you think it's fair to assume that we get back up into low single digits next year? So that's question one. And then question 2 was just on cash deployment. If you could comment a little bit on some of the ideas that you've been contemplating, cost, share buyback, acquisitions in the pharma, that would be great. Javier Gerardo Astaburuaga Sanjinés: Sure, Alex. Of the traffic, you're absolutely right. If you look at the past performance, it's been a very tough 2013 and '14. But if you just do the math quickly as well, just looking at the gap between the pace at which the economy was growing before 2013 and the barely 1 point something average of these 2 couple of years, I think you will find in that gap a big part of the explanation of how the performance in general of retail and particularly in…

Alex, I'd like to add one thing on the traffic question. I think we cannot say enough about the impact over time of telephony to complement what Javier said. I mean, if you look at the time series, if you look before 2013, there were a number of years where our numbers were significantly aided by telephony. There were -- the big telcos were providing these -- electronic top-ups became commonplace and smaller and smaller increments and people could just come into the store and do MXN 20 and MXN 30 and MXN 50 top-ups. It clearly made the numbers look very, very good, and it helped us a lot. And now I think we are in the opposite of that. I mean, as the prices of the minutes have come down and the consumers have continued to move into more of a data as opposed to voice usage, and this is pushing them into more postpaid plans as opposed to prepaid, which used to be the norm, so right now, our numbers are looking worse than they really would be without telephony. So if we could strip out telephony off of the last 4 or 5 years of data, which of course internally we can, you would see less of a sine wave, if you will, of how the traffic has performed. So this question or when you talk about a new normal, I don't think the numbers today represent the new normal. I think telephony -- the negative drag on our numbers is increasingly lower because it's a smaller base and it's a smaller percentage. So we're not out of that impact yet, but as you correctly pointed out, I mean, financial services, we're now in the uptrend on those. I mean, I mentioned the million plastics that we've rolled out, and now we are taking deposits from minority customers. And so that's clearly still in a very positive part of the sine wave. There may be a time when that becomes less important and then something else will become important. So just to, again, highlight the impact of telephony and the fact that it is making our numbers look worse than they otherwise would.

Got it. Now that's very helpful indeed. But just to kind of clarify, I noticed in your laundry list of cash deployment options that the KOF shares were not mentioned. But is it safe to assume that, that is one of the several initiatives, I mean, buying back some KOF shares? Does that remain still in that kind of general list of potential opportunities? Sorry. Javier Gerardo Astaburuaga Sanjinés: Yes, it does. It's been on the list and it still is on the list. And I think it will continue to be in the list of potential usage of cash from the FEMSA perspective, Alex.

And your next question comes from the line of Andrea Teixeira from JPMorgan. Andrea F. Teixeira - JP Morgan Chase & Co, Research Division: Just what -- I mean, I was curious with Javier's comments on the U.S. refranchising. I guess, I mean, The Coca-Cola Company, over time, they have been very vocal about the way they might take on, and I wanted to see what would be the conditions that would make you interested. I mean, I hear a lot the -- obviously, some pushback on the fountain business and also some separation of production and distribution. And if that decision would be more of a lack of opportunities in Lat Am, given that a lot has been done already or if you can kind of like walk us through a -- the rationale or ways that would make this attractive for you, I would appreciate it. Javier Gerardo Astaburuaga Sanjinés: Sure, Andrea. First, on the relative attractiveness of the U.S. against any thinking Lat Am, I would say that we will look at any opportunity on its own merits. I would say that, of course, every opportunity is different. I mean, sometimes, the attractiveness of a potential opportunity is more related to an easier integration or a more business-as-usual kind of modeling. But sometimes, it's mostly driven by potential value creation going forward, which sometimes has a lot to do more with turnarounds maybe, such as one in the Philippines, for example. The case in the U.S., I would say that the main element that we will be looking is a clear alignment with The Coca-Cola Company in the objectives that are being pursued and in the relationship model that will be established and the scope of the activities that The Coca-Cola Company would look for a bottler…

I think I will also add. I mean, if you look at some of the important categories like snacks and beverages, also has a number of different alternatives with different price points. So there is the possibility that you move from one brand to another without getting necessarily to the private label, which is normally the lowest price point of all. But for the most part, as Javier said, this has had to do with other people's products. Andrea F. Teixeira - JP Morgan Chase & Co, Research Division: Yes, no, absolutely. You would see that in your ticket, if that would be like too much of a big movement, right?

Right. Andrea F. Teixeira - JP Morgan Chase & Co, Research Division: But it doesn't seem it is. But I appreciate your comments.

And your next question comes from the line of Luca Cipiccia from Goldman Sachs.

I have a quick follow-up on the capital allocation discussion. Just to understand, given what was mentioned about Coke FEMSA, what was mentioned about the refranchise in the U.S. and the debate, just how should we frame that in relation to the Heineken lookup coming up next year, in the sense that should we assume that on this front, everything, anything may be pending until there is clarity or there is a decision on how that situation may resolve? So that's my first question. And the second is, assuming that you may liberate once or different stages a significant capital firepower, with the comment that you made and with the type of trends that we see in Mexico, would you rather reinvest or reallocate that capital to participate more broadly in Mexico or rather, you will see more of a -- you will continue to see more of a preference to put that capital to play outside of Mexico? Javier Gerardo Astaburuaga Sanjinés: Lucas, yes. On the first one, we're still maintaining our position that we need and we will continue to look at our investment in Heineken by its own merits. As you well pointed out, the lockup will basically extinguish itself fully by April next year, where it has started to extinguish gradually since a number of months. And that is just -- I would say I think that was built into the contract when we made that transaction, that we knew what's going to happen. And we're basically now in the middle of it and very close to the finish or the expiration of the lockup. So we don't tend to say to connect necessarily decisions regarding a potential continuation or divestment of the Heineken shares in connection, strictly, with potential business opportunities. We have said that…

And our last question comes from José Yordán from Deutsche Bank. José J. Yordán - Deutsche Bank AG, Research Division: Javier, in the last conference call, you were, I think, among the most cautious or, let's say, negative on the current economic or the current operating environment of all the CFOs that we heard in the conference calls. And you were somewhat prophetic at the time, I guess. The -- what we're hearing this time around is much more doom from your competitors and a bit of a change in enthusiasm from you. And I guess I was more curious to explore kind of where that stems from, if it's really from the new macro data you've gotten in the last 3 months or internal things that you see sort of a light at the end of the tunnel. Any color you can give us here in terms of where the business is going would be great. Javier Gerardo Astaburuaga Sanjinés: Sure, José. I reflect a lot on the -- what has happened in the past couple of years in Mexico. And again, I'm not bringing to the picture what's going on with the oil price these days still, because I hope that things will get back not necessarily to the way they were before but not necessarily stay at the level at which they are today. But I think that a number of things for the long term in Mexico have been done in the very right way. But still, in the short term, there was a lot of pain to be dealt with, particular from the consumer standpoint of view. I think that it took all of us, both suppliers and retailers in Mexico, to adapt to these new phenomena. We were, most of the time, thinking, "Well,…

José, this is Juan. I would add one thing. I think of all the consumer companies that you talked to, very few, maybe none, were directly exposed to the tax changes at the beginning of the year. I mean, I've said this a thousand times. If you look at, obviously, Coke FEMSA but also the 50%-ish mix of the sales of OXXO that are exposed to the beverage or the calorie-dense taxes and the VAT in the border where maybe 20% of OXXO's revenues, consumers in that region also having to account for the higher VAT and everything that they buy, so I think part of what also happened in the second quarter is we were really in the middle of this year, where we were facing this adversity in every front. And now we are basically 2 months away from having all these be part of the base. So obviously, being optimistic, just because you're going to have easier comps, is not necessarily the highest quality growth that you can get, but it's growth, right? And so at the end of the day, we will lap a very hard first half of the year. And just like it was probably tougher for us than anybody else this year, we'll probably get a bit of a break better than other folks next year just because of the change in the comp base. José J. Yordán - Deutsche Bank AG, Research Division: Sure, sure. And the reason -- I mean, the reason I asked is that in some other retail conference calls, we heard some people begin to say recovery in mid-2015 as opposed to earlier in the year. So there seems to a tendency to push back the recovery. But I get it that you were punched harder and that perhaps you're starting to feel like it's still a gradual recovery, like you mentioned several times in the last call. But as you've been through the worst and that from now on, it's an upward pass. So very, very clear on both answers.

Thank you, José. Javier Gerardo Astaburuaga Sanjinés: Thank you. And thank you, all, for your participation today. Have a great rest of the week and see you next time. Bye.

Bye.