During 2017, Grupo Sanborns sales increased 4.6% for a total of $49,768 million, which meant $2,174 million more than the previous year. Sears, Sanborns, Promusa and other formats contributed with 51%, 25%, 17% and 7% of sales, respectively. Same stores sales increased by 2.3% during the year in a consolidated basis.

increase in credit income, totaling $3,609 million pesos.

As regards the credit business, over 268 thousand proprietary cards were issued during the year, an increase of 7.3%, amounting to 3.94 million plastics of all formats. Sears card penetration was maintained at 59% in the total payment mix. The credit portfolio evidenced a growth of 4.2% reaching $12,894 million. Credit income increased 13.4%, for a total of $3,609 million. The overdue accounts index in excess of 90 days is below the market and the competition, closing the year at 4.3%.

Operating income for the year decreased by 22.1%, to $5,158 million. This was due mainly for recording Other Income in 2016 por $1,263 million, where $1,141 million come from net income and reserves for the acquisition of 14.0% of Inmuebles SROM, S.A. de C.V. and $122 million resulting from investment property assessment, among other entries. Without considering these extraordinary items, operating profit would decrease by 5.9% in 2017.

For the annual EBITDA computation, Other Income for $85 million in 2017 or $1,263 million in 2016, mentioned in the preceding paragraph, were not considered. Therefore, EBITDA for 2017 was $6,332 million with a 12.7% margin.

As regards the financial results, they were positive for $58 million and slightly less by 1.5% as regards the overall financing results recorded during the preceding year.

The holding company’s net income for Grupo Sanborns decreased by 11.4% in 2017, for a total of $3,958 million as compared to $4,466 million in 2016, which includes the above-mentioned extraordinary entry.

During 2017, the expansion plan included the opening of two Sears stores, one Sanborns store, and six iShops. The number of remodeling projects was one Sanborns store and six iShops. The capital investments for the Group totaled $ 1,584 million. When considering all formats for the Group, we closed the year operating 443 units, with which the business area reached one million 207 thousand square meters.

Grupo Sanborns had no Debt as at December 31, 2017, while Cash amounted to $ 1,925 million, as compared to $1,714 at the close of December 2016. This $210 million increase was due, among others, to an increase in working capital and suppliers.


Sincerely yours,


Lic. Patrick Slim Domit
Chief Executive Officer Grupo Sanborns S.A.B. de C.V.