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

Updates shares move and adds detail on Alpek's outlook

Shares in Mexican conglomerate Alfa ALFAA.MX sink 8% after publishing Q4 results and updating on its plans to spin-off its petrochemical unit Alpek ALPEKA.MX, whose own separately-listed shares tumble some 13%

Together, the losses have wiped nearly $600 million off the stocks' combined market values. Alpek's nosedive triggered a trading suspension on Mexico's stock exchange

*Alpek said in a call on Wednesday it expects earnings before interest, taxes, depreciation, and amortization (EBITDA) to decrease by 11% year-on-year in 2025, citing a challenging industry environment

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

($1 = 20.3870 Mexican pesos)