BUZZ-Alfa, Alpek tumble after results as conglomerate plans spin-off

Shares in Mexican conglomerate Alfa ALFAA.MX sink 5% after publishing Q4 results and updating on its plans to spin-off its petrochemical unit Alpek ALPEKA.MX, whose own separately-listed shares tumble nearly 15%

Together, the losses have shaved around half a billion dollars off the stocks' combined market values. Alpek's nosedive triggered a trading suspension on Mexico's stock exchange

Alfa has long sought to spin off Alpek as a way of shoring up its finances as market swings batter the unit's market value. Shareholders approved this last October

Alfa late on Tuesday posted a net loss of 6.3 billion pesos ($309 million), nearly halving the loss it posted a year earlier, while its revenues jumped 14% to 44 billion pesos

"It is important to mention that the firm presented a smaller loss than in Q4 2023," say analysts at Ve Por Mas, adding: "The spin-off process continues, the next step will be the distribution of shares for Controladora Alpek"

Vector Analisis notes that while food subsidiary Sigma beat its own estimates for core earnings in 2024, Alfa's overall results were weaker than expected by a consensus of analysts

Alfa will hold its quarterly earnings presentation at 12 p.m. local time on Wednesday

($1 = 20.3870 Mexican pesos)