Wal Mart de Mexico B de C : 4Q21 Results

Wal-Mart de México, S.A.B. de C.V.	Consolidated
Ticker:	WALMEX	Quarter: 4D Year: 2021

Quarterly Financial Information

[105000]	Management commentary..................................................................................................................................	2
[110000]	General information about financial statements ...........................................................................................	15
[210000]	Statement of financial position, current/non-current.....................................................................................	19
[310000]	Statement of comprehensive income, profit or loss, by function of expense ...........................................	21
[410000]	Statement of comprehensive income, OCI components presented net of tax.........................................	22
[520000]	Statement of cash flows, indirect method ......................................................................................................	24
[610000]	Statement of changes in equity - Accumulated Current ..............................................................................	26
[610000]	Statement of changes in equity - Accumulated Previous ............................................................................	29
[700000]	Informative data about the Statement of financial position .........................................................................	32
[700002]	Informative data about the Income statement...............................................................................................	33
[700003]	Informative data - Income statement for 12 months.....................................................................................	34
[800001]	Breakdown of credits.........................................................................................................................................	35
[800003]	Annex - Monetary foreign currency position ..................................................................................................	37
[800005]	Annex - Distribution of income by product .....................................................................................................	38
[800007]	Annex - Financial derivate instruments ..........................................................................................................	39
[800100]	Notes - Subclassifications of assets, liabilities and equities .......................................................................	43
[800200]	Notes - Analysis of income and expense.......................................................................................................	47
[800500]	Notes - List of notes ..........................................................................................................................................	48
[800600]	Notes - List of accounting policies ..................................................................................................................	77
[813000]	Notes - Interim financial reporting ...................................................................................................................	89

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Wal-Mart de México, S.A.B. de C.V.	Consolidated
Ticker:	WALMEX	Quarter: 4D Year: 2021

[105000] Management commentary

Management commentary [text block]

2021 was undoubtedly another atypical year that required us to innovate and adapt fast to the environment and to our customers' changing needs, while keeping our associates safe. We're even more convinced that customers want us to bring our stores and e-commerce businesses together in a seamless way that makes shopping easier; and we believe we are uniquely positioned to deliver value through our physical and digital assets.

In Bodega, we offer same-day delivery from store to the most price-sensitive customers via Despensa a tu Casa at more than 220 stores, which during the quarter represented almost 10% of on-demand sales. We launched Walmart Pass and saw a ~2x increase in shopping frequency vs. non-users. We converted 75 stores into Walmart Express. We rolled-out Scan and Go to all clubs, and its penetration doubled since we first launched it.

We are going beyond retail to deliver our purpose to save people money and help them live better. Through Cashi and Bait, we are giving customers access to the digital economy and delighting them with new experiences.

Our strong core business is fueling the ecosystem, and at the same time, the new businesses we are creating drive customer engagement that strengthen the core business to grow and to be more resilient.

We are a growth company, and we will continue to accelerate growth investing behind our strategic plans.

For the 2nd consecutive year, we were included in the Dow Jones Sustainability MILA Pacific Index and we were recognized as one of the best places to work for our LGTBQ+ equality efforts by the Human Rights Campaign (HRC).

Our small supplier support program -Pequeño Productor- turned 10 years in 2021: we have trained more than 20,000 small enterprises and commercialized +59,000 tons of products.

Disclosure of nature of business [text block]

Walmart de México y Centroamérica is one of the leader retail chains in the region.

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Wal-Mart de México, S.A.B. de C.V.	Consolidated
Ticker:	WALMEX	Quarter: 4D Year: 2021

As of December 31, 2021, it operates 3,620 units, throughout 6 countries (Costa Rica, Guatemala, Honduras, El Salvador, México, and Nicaragua), including self-service stores, membership clubs and omnichannel sales.

Walmart shares trade in the Mexican Stock Exchange since 1977; the ticker symbol is WALMEX.

Disclosure of management's objectives and its strategies for meeting those

objectives [text block]

The objective of the Company is to double total sales in 10 years and to leverage operating expenses to reinvest in the business.

Sales growth will come from:

• Same store sales
• Sales from new stores
• eCommerce

Disclosure of entity's most significant resources, risks and relationships [text block]

The Company is exposed to the effects of future events that could affect the purchasing power and/or buying habits of the population. These events may be economic, political or social in nature and some of the most important are described below:

I. Changes in exchange rates. Exchange rate fluctuations tend to put upward pressure on inflation and reduce the population's purchasing power, which could ultimately adversely affect the Company's sales, in particular due to the purchase of imported goods.

1. Competition. The retail sector has become very competitive in recent years, which has led to the need for all the players in the market to constantly look for ways to set themselves apart from the competition. This puts

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Wal-Mart de México, S.A.B. de C.V.	Consolidated
Ticker:	WALMEX	Quarter: 4D Year: 2021

the Company's market share at risk. Other factors affecting the Company's market share could be the business expansion of its competitors and the possible entrance of new competitors into the market.

1. Inflation. A significant increase in inflation rates could have a direct effect on the purchasing power of the Company's customers and the demand for its products and services, as well as employment and salaries.

IV. Changes in government regulations. The Company is exposed to the changes in different laws and regulations, which, after becoming effective, could affect the Company's operating results, such as an impact on sales, expenses for payroll indirect taxes and changes in applicable rates. Currently, the level of scrutiny and discretion by the tax authorities has greatly increased. Mexican legal courts have changed their position favoring the authorities and ignoring violations of form and procedure.

V. Recent developments. The COVID-19 pandemic has resulted in widespread and ongoing impacts on the local and international economy, on our associates, suppliers, customers, and other individuals and entities with whom we do business. There is considerable uncertainty regarding the extent to which COVID-19 will continue to spread (including additional outbreaks or spikes in the number of COVID-19 cases, future mutations or related strains of the virus in the areas in which we operate) and the scope and duration of measures to try to contain the virus, such as travel bans and restrictions, quarantines, government closures and other restrictions on the mobility of people.

Other uncertainty factors include, but are not limited to: the availability and prevalence of access to effective medical treatments and vaccines for COVID-19; the pace of economic recovery when the pandemic subsides; and the long-term impact of the COVID-19 pandemic on our business, including changing consumer behavior. These risks and their impacts are difficult to predict and could adversely affect our operations and our financial performance.

As of the date of this report, the financial effect of the combination of these events has not had a significant adverse impact on the financial statements taken as a whole.

Disclosure of results of operations and prospects [text block]

Please consider that Central America is referring to figures on a constant currency basis.

During the quarter, consolidated total revenue grew 9.5%: 9.1% in Mexico and 11.8% in Central America.

Topline growth accelerated quarter on quarter, reaching a consolidated two-year stacked growth of 15.5% on the fourth quarter.

For the full year 2021, revenue in Mexico grew 6.0% and 8.1% in Central America, resulting in a 4.9% consolidated growth.

On a constant currency basis, consolidated revenue growth was 6.3%.

MÉXICO

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Wal-Mart de México, S.A.B. de C.V.	Consolidated
Ticker:	WALMEX	Quarter: 4D Year: 2021

Same-store sales grew 7.8% during the quarter, reaching a double-digittwo-year stack of 13.1%.

PERFORMANCE BY REGION:

The Southern and Northern regions continue to lead in same-store sales growth, followed by the Central and Metro regions.

PERFORMANCE BY FORMAT:

Sam's Club delivered the highest same-store sales growth, on the back of positive new member sign-ups and renewals trends. The team is focusing on offering great products and on working in a more digital way, to further improve members' experience.

Omnichannel continues to show momentum at Sam's: on the Socio Fest event, online sales reached 10% penetration, and contributed- almost 80% of growth. 1 out of every 5 members that shopped online were new to the platform.

Our strategy to Win in Discount is being well appreciated by customers. The combination of the lowest prices and efficient assortment, together with a low-cost operation, is translating into strong growth and market share gains. In 2021, we expanded Bodega's price gap by 80 bps, marking a record high. I am very proud of the team for this achievement, they are really making a difference for our most price sensitive customers.

With the intention of further improving experience and driving traffic to the stores, we are adjusting the Fresh departments' layout and results are encouraging: our customer experience index increased by 40 bps and sales growth in pilot stores is 340 bps higher.

Walmart delivered solid same-store sales growth. The team is executing omnichannel seasonal events seamlessly. During the "El Fin Irresistible" event, we reached record high sales for the format. We leveraged our store fleet to launch "delivery in hours", and we fulfilled more than 30% of General Merchandise orders from stores in a matter of hours.

We also saw strong growth in Juguetilandia, our seasonal toys offering, which delivered double-digit sales growth in December, despite the restrictions that many locations had due to the pandemic.

During the year, we converted 75 Superama stores into Walmart Express, and opened 4 new stores under this format. The transition period was challenging, shopping experience is not ideal when remodel works are undergoing, and this translated into softer sales. It is good to see that customers are appreciating the changes we made in pricing and shopping experience. We lowered prices on basic items and enabled features that allow customers to have a fast, convenient shopping trip, such as self-scanning stations and digital tools. Pickup has become even more popular than before the conversions, and we've seen an 11.6 pp increase in penetration.

We see that stores that were converted into Walmart Express during the first half of last year are showing a positive trend, and even surpassing the level of sales they had before the conversion, which is encouraging. We are monitoring very closely customer feedback to the new format and adapting as needed.

PERFORMANCE BY DIVISION:

Among merchandise divisions, Apparel, Food and Consumables delivered the highest growth.

We hosted our annual "El Fin Irresistible" event with an omnichannel scope and Home, Apparel and Fresh Grocery categories stood out for their strong growth. During 2021's event, customers gave us a higher Net Promoter Score, which is a great achievement given the large volumes we handle during the event.

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