Financial Data and Key Metrics Changes - Revenue grew 1.4% year over year, while EBITDA increased by 22%, with the margin expanding by 362 basis points to 21.4% [4][19] - Free cash flow conversion remained strong at 77% of EBITDA, reflecting financial discipline and a healthy balance sheet [4] - Adjusted net income increased by 71% compared to the third quarter of 2024, driven by higher operating profits and lower net interest expenses [20] - Free cash flow increased by 32.6% year over year, with an expected annual rate of 60% free cash flow to EBITDA by year-end [21] Business Line Data and Key Metrics Changes - Betterware Mexico's sales decreased by 5.3% year over year due to softer demand, but profitability remained solid [6] - Jafra Mexico's revenue increased by 8% year over year, with EBITDA growing by 31% and a margin of 24% [10] - Jafra US showed sequential improvement, with a stable revenue performance and a strong month in September, achieving 30% year-over-year growth [12] Market Data and Key Metrics Changes - The Mexican consumer market has shown volatility, with consumption growth lessening and trends declining [40] - The Andean and Central American direct selling markets are estimated to be $4.5 billion in total size, presenting significant growth opportunities [15] Company Strategy and Development Direction - The company has defined five strategic pillars to guide growth and transformation, focusing on strengthening leadership in the Mexican market, regional expansion, new brands and categories, activating digital selling, and maintaining financial strength [5][17] - The company plans to launch Betterware in Colombia in early 2026, aiming to strengthen its presence in Latin America [14] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging external environment in Mexico and the U.S. but emphasized the resilience and viability of the business model [24] - The company aims to maintain strong profitability and cash flow while pursuing growth and market share even in tough times [41] Other Important Information - The company has reduced total debt from 6,700 million pesos to 5,200 million pesos, with a net debt to EBITDA ratio falling from 3.1 times to 1.8 times [23][24] - A dividend of $200 million was proposed and approved, marking the 23rd consecutive quarter of dividend payments since going public [21] Q&A Session Summary Question: Inventory reduction and free cash flow - Management projected inventory to close 2025 at around 2,100 to 2,200 million pesos, down from 2,500 million pesos at the start of the year [30][31] Question: Impact of stronger peso on margins - The company is benefiting from a strong peso and lower freight costs, allowing for more aggressive pricing to drive demand while protecting profitability [33] Question: Jafra's expansion strategy - Jafra is focusing on direct ownership for expansion, hiring experienced management on-site to manage growth in new regions [35] Question: Mexican consumer behavior - The Mexican consumer has been sluggish, with volatile spending patterns, but management believes this may be temporary [40] Question: Sustainability of EBITDA margins - The strong gross margin in Jafra Mexico is not expected to be fully sustainable, but reinvestment will continue to drive growth [43] Question: Technology transformation opportunities - The company is investing in technology advancements, including generative AI and digital selling platforms, to enhance efficiency and adapt to market trends [45]