Grupo Famsa de CV : continues with the strengthening of its financial position in 2Q17

Monterrey, N.L., Mexico, July 27, 2017 - Grupo Famsa, S.A.B. de C.V. (BMV: GFAMSA), a leading Mexican commercial conglomerate in the retail, consumer credit and savings sectors, announces today its earnings results for the second quarter 2017, posting significant progress in the buy-sale process of 17 properties as outlined in its asset monetization plan, a Ps.1,078 million decrease in its banking and local notes debt, the selective closing of 9 units of its commercial network and the outstanding subscription of a Ps.2,634 million credit facility with Bancomext.

On July, Grupo Famsa moved forward in the solidification of its financial position towards the subscription of a Ps.2,634 million credit facility with Bancomext, at a floating rate of TIIE + 300 bps. and a 10-year term. The obtained proceeds will be used to settle an advance payment of US$110 million of its Senior Notes due 2020, and the amortization of approximate Ps.700 million of short-term maturities. With this transaction, Grupo Famsa anticipate the reduction of its dollar denominated debt by 43%, thus significantly lowering its exposure to FX fluctuations.

Separately, and following the asset monetization plan of the Company, Grupo Famsa achieved significant progress in the buy-sale process of 17 properties, with an approximate combined value of Ps.1,100 million, which are expected to be completed during the 2H17. The obtained proceeds will be mainly used to the amortization of liabilities with cost, to reduce the leverage of the Company.

Additionally, during the period, Grupo Famsa moved forward with its initiatives oriented to strengthen its financial structure; achieving a 16.9% net debt reduction, from Ps.8,497 million in 4Q16 to Ps.7,063 million at quarter- end, thanks to the application of the resources obtained from the asset monetization conducted last quarter.

Regarding the efforts directed toward its operational optimization, the Company executed the selective closing of 5 stores, 3 banking branches, in Mexico, and 2 stores in the U.S, having a store network of 861 units at the end of the 1H17. Likewise, for the second half of the year, is anticipated the closing of 3 stores, 4 banking branches and 10 non-banking branches, as well as 3 stores in the U.S.; seeking to consolidate a more efficient network. Additionally, the Company expects to replicate in its core categories the successful attained at its canvassing operation for payroll credit origination, to achieve an outreach going beyond of its salesfloor.

In relation to the operations in Mexico, year-over-year growth in Net Sales and Same Store Sales were recorded in 2Q17, 2.8% and 2.4%, respectively, as the Company decided to privilege an orderly growth in consumer credits. Additionally, EBITDA increased by 4.7% vs. 2Q16, with a 20 basis point margin expansion, reflecting the success in the reduction of operating expenses that follow the store network optimization and staff downsizing.

Moving into our banking operations, Banco Famsa achieved a solid growth in Bank Deposits, reaching Ps.23,395 million, an increase of 18.0% vs. 2Q16 and of 10.6% vs. 4Q16. NPL, on the other hand, continued with its downward trend recording a new all-time low of 8.3%,80 bps. and 20 bps. below in an annual and sequential basis, respectively; reflecting a higher asset quality of the credit portfolio, which has been invigorated with the higher participation of clients from the formal sector, which increased its participation from 61% in 2Q16 to 66% at end of the quarter.

In this regard, Mr. Humberto Garza Valdez, CEO of Grupo Famsa, stated: "During the 2Q17, we moved forward with the solidification of our financial structure as will allow us to have greater operating flexibility and liquidity on the incoming quarters; anticipating an incremental dynamism from our operations in Mexico throughout the strengthening of the canvass channel, to achieve a larger commercial footprint, in addition of the timely execution of our initiatives, thus anticipating to record a consolidated EBITDA figure in line of our Guidance."

Established in 1970 in Monterrey, Nuevo Leon, Grupo Famsa has consolidated its position as a publicly-traded company with a solid presence in the retail sector, focusing its efforts on satisfying families' diverse consumption, financing and savings needs. Its target market lies in the Mexican low-middle income households and the Hispanic population of the states where it operates in the USA. Retail sales of Grupo Famsa in Mexico comprise furniture, electronics, appliances, mobile phones, computers, motorcycles, clothing and other durable goods, which are mainly sold within the stores network of Grupo Famsa. In Texas and Illinois, in the USA, Grupo Famsa's offering comprises furniture, electronics, appliances, computers and other durable goods through the operation of its subsidiary Famsa, Inc.

Investor Relations Paloma E. Arellano Bujanda paloma.arellano@famsa.com Tel. (81) 8389-3400 ext. 1419