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Operator: Greetings, and welcome to the Bolsa Americana de Valores Conference Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your host, Ramón Güémez. Please go ahead, sir.
Ramón Sarre: Thank you. Good morning, and welcome to Bolsa Mexicana de Valores Fourth Quarter 2025 Earnings Conference Call. Before proceeding, I would like to provide a brief safe harbor statement. This presentation contains forward-looking statements and information related to Bolsa that are based on the analysis and expectations of its management as well as assumptions made and information currently available at Bolsa. Such statements reflect the current views of Bolsa related to future events and are subject to risks and uncertainties. Many factors could cause the current results, performance or achievements to be somewhat different from any future results or performance that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic, political, governmental and business conditions, both in a global scale and in the individual countries in which Bolsa does business, such as changes in monetary policies, inflation rates, prices, business strategy and various other factors. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may vary considerably from those described herein as anticipated, estimated, expected or targeted. Bolsa does not intend and does not assume any obligation to update these forward-looking statements. This call is intended for the financial community only, and the floor will be open at the end to address any questions you may have. Joining us for today's call are Jorge Alegria, CEO; Claudio Vivian, Chief Information Officer; Gabriel Rodriguez, SIF ICAP CEO; Alfredo Guillén, Managing Director of Equity Markets; José Miguel De Dios, Managing Director of Derivatives Markets; Luis René Ramón, Chief Commercial Officer; Hanna Rivas, FP&A and IR Director; and myself, Ramón Güémez, CFO. With that, I'd like to turn the call over to our CEO, Jorge Alegria.
Jorge Formoso: Thank you, Ramón, and good morning, everyone. Yesterday evening, we released our earnings results, including a detailed review of our fourth quarter 2025 performance. The press release and slide deck are available on bmv.com.mx, in the Investor Relations section. Before turning to our ongoing initiatives, I'd like to briefly frame where we are headed as a group. Our focus is clear, positioning the company as a market leader through innovation, supported by advanced technology and a stronger infrastructure that enables expansion, access to new markets and long-term value creation. We remain committed to disciplined capital allocation that supports our strategy while maintaining shareholder returns. As mentioned and communicated since 2024, our strategic plan contemplates higher investment levels to support growth initiatives. Accordingly, in 2025, we invested over MXN 250 million to maintain the competitiveness of our core systems and advance toward NASDAQ platforms, making the start of a multiyear investment cycle with CapEx declining from 2027 onwards. In 2026, we are planning an additional investment of approximately MXN 500 million, supporting a data-driven business, the expansion of our debt CCP, enhanced surveillance, cybersecurity, cloud migration and stronger continuity and recovery plans. Initial deliveries are expected with the completion of the derivatives platform under the Nasdaq Eqlipse solution, followed by the repo CCP, both this same year towards 4Q '26. While executing a significant investment program, we continue to balance this investment program with our shareholder return. So we are maintaining a dividend of MXN 2.05 per share and a buyback program of at least MXN 160 million, implying a distribution of 81% of 2025 net income with flexibility to complement this objective through an extraordinary dividend towards year-end if required. In 2026, our focus will be on the execution of our initiatives, laying the groundwork for revenue-generating initiatives that we are expecting to see generating revenues and contributing from 2027 onwards. Let us begin also with a brief overview of the quarter's most relevant initiatives. We continue advancing on our new bond services for our CCP. November 2025 marked a significant milestone for the Mexican market with the launch of the first central counterparty for fixed income bonds. The first live transactions cleared by 5 banks through 2 interdealer brokers confirm the successful launch of the CCP. While participation is not mandatory and adoption is expected to be gradual, its introduction lays the foundation for the debt markets transition from a traditionally voice-based environment to a fully electronically centrally clear marketplace. Experience from other markets shows the impact of combining centralized clearing and electronic trading. Mexican equities, as an example, experienced a nearly 20-fold increase in activity over 2 decades, while U.S. Treasury volumes expanded by roughly tenfold after adoption. These examples show how CCPs and electronic trading support growth across asset classes. And in this context, the Mexican bond market is a pivotal point. With an average trading daily volume of around $6 billion, the introduction of a CCP and the shift toward electronic trading are setting the stage for higher volumes, more access and greater liquidity. Consistent with our road map, the initiative is to advance for a second phase, the repo service on our CCP. This is expected to be completed by the end of 2026. And unlike the initial phase, adoption is expected to be faster given strong market demand and benefit. With approximately USD 100 billion daily trading volumes, the repo segment materially expands the scope of centralized clearing and sets the stage of a third phase extending to securities lending. On our data agenda, we are defining a unified data infrastructure strategy. This includes designing the target architecture to support the new trading and clearing platforms for derivatives, along with data requirements across the rest of the business. A core element is the transition from an on-premise setup to a cloud-based model, which will support advanced analytics, customizable reporting, data-driven products and coordination with MexDer and Asigna. New data product releases are planned for late 2026, aligned with the launch of the new derivatives platform. I would also like to briefly update you on our efforts and progress in market data. As part of our long-term strategy initiated several years ago, we have focused on increasing the international visibility of the Mexican markets by reducing access barriers and bringing market information closer to global participants. Complementing this solution, during 2025, we further evolved our access model through the deployment of the global access network product, a fully virtualized colocation solution now operating in production and under this model, Bolsa provides the core access and connectivity infrastructure, enabling a scalable framework for direct market access. This architecture enables more competitive pricing, faster time to market. As adoption gains traction, the existing client pipeline supports a potential 5% uplift in market data revenues for 2026. Turning to derivatives. We see growth potential for MexDer given that substantial share of activity in the derivatives market remains in the OTC. This creates an opportunity to keep migrating volume towards listed and clear products over time. To address this, we are focusing on 3 levers: international exposure, retail product expansion such as seeing the stock derivatives and SIC options and also supporting institutional participation through the Asigna liquidity alternative framework. At the same time, we are advancing the migration of our transactional services to Nasdaq Eclipse trading solution, which essentially -- and this is essential to provide the scalability required for the long-term growth in the listed derivatives marketplace. As mentioned regarding the liquidity alternatives initiative for Asigna, progress is still being made. Gradual but continuous. We have 3 major banks advancing in their implementation, while regulators are working on aligning the legal framework. From Asigna side, the infrastructure is already in place and the initiative is expected to materialize in the coming months. In parallel, equity listing activity resumed with the IPOs announced in the prior quarter materializing through Essentia, Aeromexico and Fibra Next, the follow-on transactions. This reflected an improvement in market conditions after several years of inactivity with momentum continuing beyond the quarter. Currently, there are 4 companies actively exploring potential IPOs on a confidential basis. In parallel, the IPC index has reached historical highs and equity valuations have improved. So together, all these factors reflect the strengthening equity market conditions and growing interest in public markets as a source of capital. Beyond the recovery in equity listings, market activity is also strengthening across other asset classes with record levels in 2025 as total financing reached MXN 755 billion, a 24% increase compared to 2024. Demand for debt listings is increasing across short- and long-term maturities, supported by a pipeline of approximately more -- MXN 80 billion for the first 2 months of the year with high-profile transactions that increase visibility. Most of these issues are expected to be listed on BMV. Finally, structured products are also showing strengthening activity with higher demand for listed warrants driven by private banking and wealth management participation. Following on, the simplified listing initiative remains an ongoing long-term initiative. The same confidential company is still in process alongside with our ongoing efforts to promote the regime and build market awareness. This is a constant effort that -- with adoption expected to be gradual. Turning to our equity fee schedule. And as noted last quarter, we received the regulatory authorization to adjust our fees. However, implementation remains our discretion with no requirement regarding timing our application. Currently, we are not planning any changes on our fees. Let me now move to our key financial highlights in the following slides. Please keep in mind that all figures are expressed in Mexican pesos. On Slide 3 and 4, for the key 2025 financial highlights, Q4 2025 revenues were flat at MXN 1.1 billion, while operating expenses rose 15% due to our accelerated strategic investments. This pressure operating leverage, driving a 9% EBITDA decline to MXN 608 million and with a 900 basis point margin contraction to 54%. Net income fell 20%. And at the full year level, revenues grew 7% to MXN 4.5 billion, Operating expenses increased 11% and EBITDA rose 5% to MXN 2.5 billion. Despite the investment cycle, margins remained strong at 56%, only 198 basis points below 2024 as expected. Net income showed resilience, easing 2% year-over-year. Taken together, Q4 reflects the timing of our accelerated and planned investments, not a change in the business structural profitability. The full year results provide the right lens with solid revenue growth, higher EBITDA in absolute terms and structurally strong margins. Let's turn to the next slide, please. Revenues by business line across both 4Q 2025 and the full year. Top line behavior followed the same pattern and was driven by revenue mix. Growth consistently came from equity and derivatives trading, MXN 7 million and MXN 4 million and for equity clearing, MXN 10 million. Information Services, MXN 19 million and capital formation were MXN 8 million. Steady growth in central securities depository Indeval of MXN 10 million, and these gains were partially offset in both periods, seeing declines in the derivatives clearing space for MXN 19 million and our OTC trading for MXN 6 million. Top line in both periods reflected a similar mix of strong growth segments and areas of softness, highlighting our model of stability of the business fundamentals. Turning to the next slide on equity trading and clearing activity. We see on 4Q 2025 equity trading activity strengthened. Average daily trading value increased 10% versus Q4 '24. This performance was driven mostly by growth across local and global markets. In addition, global markets transaction rose 23%, reflecting higher investor participation. BMV's market share remained stable, ranging between 78% and 80%. In the clearing businesses, revenues increased 19% in Q4 '25, reaching the highest fourth quarter level and delivering a strong year-over-year increase. Meanwhile, equity segment revenues rose 10%, reflecting a solid year-over-year recovery and remaining broadly stable compared to the previous quarter. Let us go on the next slide to review derivatives. MexDer posted 16% year-over-year revenue growth. However, this increase was offset by a significant decline in the derivatives clearing business, resulting in a 19% increase in quarterly revenues for the Derivatives segment. Against this, trading dynamics remain active, particularly in dollar futures, where the average daily notional value increased 68% and open interest grew 1.2x compared to 2024. Regarding margin deposits in Asigna, year-to-date average balance in 2025 decreased by 15% compared to the prior year. On Slide 9, we can see OTC trading results moving to SIF ICAP. OTC trading revenue declined 4% year-over-year. Both Mexico and Chile experienced an appreciation of their currencies. So Mexico revenue grew 6% and Chile decreased 8%. The performance in Chile was driven by lower market interest rates combined with volume discounts. On Slide 10, we have figures for our Capital Formation segment, where revenue increased by 6%, mainly driven by a 58% increase in medium- and long-term debt listing activity. As a result of this record-breaking issuance base, total outstanding long-term listings rose 8% year-over-year, reaching 546 issuers as of December of 2025. While the equity market has shown renewed activity, as previously noted, the debt market continues to strengthen. In 2025, BMV financed MXN 636 billion. This represents an 8% year-over-year increase. This momentum has been further reinforced by the addition of new high-profile participants such as CFE, AMH and SAC. Moving to the Central Securities depository. Slide 11 shows Indeval revenue increased by 3%, driven by more dynamic cross-border activity and higher assets under custody across both domestic and global markets. This is compensated in part by FX. During 4Q 2025, total assets under custody reached MXN 45 trillion, representing a 13% increase compared to our 4Q '24. Custody volumes increased across all segments, led by a strong growth on SIC listed ETFs and debt securities. This higher level of activity was also reflected in settlement metrics with the average daily value settled increased by 4%. And additionally, following the recent retail tariff adjustment, operations in this segment grew by more than 50%. Let's move to Slide 12 for Information Services. Information Services revenue increased 9%, driven primarily by market data, which grew 13% compared with the fourth quarter of 2024 and accounted for 72% of the total revenue. At Valmer, our quarterly revenues remained flat, while FX movements had a negative impact on our results. Let us now take a look at our operating expenses on Slide 13 and 14. 4Q '25, the 15% expenses reflects a clear reinvestment and execution phase. As Grupo BMV accelerated its strategic initiatives and advanced its modernization agenda, expenses grew across key categories, led by personnel on $22 million, technology, $23 million and depreciation, $21 million. The evolution of expenses through 2025 was concentrated in the same key categories, all directly linked to the implementation of the strategic plan. The expansion of teams in priority areas strengthened internal capabilities, while the increase in technology and depreciation reflects sustained investments in infrastructural renewal, particularly in storage and cyber. The expense level reached in the fourth quarter establishes the new cost baseline for 2026, which clearly reflects a phase of strategic execution and modernization. With this, I would like to thank you for connecting today and listening to my remarks. Here and alongside with my colleagues, we will gladly address any questions you may have. Thank you very much.
Operator: [Operator Instructions] And our first question will come from Yuri Fernandes with JPMorgan.
Yuri Fernandes: Maybe if you can explore more a high-level guidance and view regarding the investments in technology, like the OpEx, how much should we see on growth on that line? And maybe an update on CapEx. I guess the last message for 2026 was for CapEx to increase some 50%. 50%, 75% over 2025. So just checking if we -- it was clear from Mr. Alegria that we should see more investments this year, right? But if you can provide more color, how much -- just for us to quantify this. So basically, OpEx, CapEx and maybe if you want to discuss a little bit the margins, what should we expect for EBITDA margin here for the company?
Ramón Sarre: Yes, Yuri, as you say, we are expecting CapEx for 2026 to be close to MXN 500 million. It should come down for 2027. We don't have an exact number yet, but it will still be above MXN 300 million for 2027 and then decrease further for 2028. For operating expenses, we're expecting a high single-digit increase for 2026. We're expecting margins to be stable. Maybe revenues are hard to estimate. But I would say a stable plus/minus 1% for EBITDA margins. That would be our expectations for 2026.
Yuri Fernandes: Just on the margins, if I may, just a clarification. When you say stable or maybe down 1 point, are you referring to the fourth quarter margin of 54%? Are you referring to the full year margin around 56%? Just to be clear here.
Ramón Sarre: I'm referring to the full year margin of 56%.
Operator: And our next question comes from Daniela Miranda with Santander.
Daniela Miranda: Just a very quick one on financial income in 2026. I mean assuming additional 50 basis points cut in reference rates from current levels, how should we think about financial income next year or this year? Could you help us frame approximately like how sensitive is financial income under that scenario?
Ramón Sarre: Daniela, we didn't fully understand, but I understand you're asking about financial income. We're expecting less according to the reduction of interest rates. So that's something that's definitely going to affect us. And we're also taking steps to reduce the variability on the FX gain loss. So you should have an impact from the reduced interest rates and less -- and we're working towards less volatility in FX gain and loss.
Operator: [Operator Instructions] And we'll go next to Carlos Gomez with HSBC.
Carlos Gomez-Lopez: Going back to the expenses, you ended up growing them 10.6% this year. Was that more or less than you initially expected? I think it's a little bit more. On the CapEx, can you also remind us the average life of the CapEx that you're introducing and therefore, the amortization rate? And should we expect your depreciation charges, which were up 14% this year to increase significantly in the next couple of years? And finally, can you remind us your sensitivity to exchange rate?
Ramón Sarre: Carlos, the -- I would say the increase in expenses came in line with our expectations. We had -- a year ago, we had said that we expected a decrease in margins for this -- for 2025. Revenues were higher at the beginning of the year, but expenses came in line where we had expected them. Regarding your second question, average depreciation is done between 7 and 10 years for the technological evolution program that we're calling these new platforms, we're thinking about 10 years. You should start seeing most of the impact in 2028. That's when we'll begin to amortize the full investment. Regarding your third question, our sensitivity to the FX, as a rule of thumb because it varies depending on market conditions, it's about MXN 50 million in EBITDA for MXN 1 of depreciation. As I said, it can vary, and with the new -- it will surely vary with the new expenses that we're acquiring, which are more related to the FX. But as of now, take that rule of thumb.
Carlos Gomez-Lopez: Okay. So it hasn't changed. It's still a $50 million in EBITDA for the 5% move in the currency?
Ramón Sarre: Yes.
Carlos Gomez-Lopez: And I don't think the queue is too long. So I'm going to throw another question. You are buying the systems from NASDAQ. As you have seen, because of the impact of AI, the market has interpreted that pricing for those -- that type of software is going to decrease. As an acquirer of these products of cloud services, of software services, have you seen any change in pricing over the last year that you can say is the impact of NASDAQ? And do you expect any changes in the coming years?
Ramón Sarre: We haven't seen any changes. We are -- let me say, we're still in the process of ending negotiations on some of the services we're acquiring. But we haven't seen any changes, and we would love to see a decrease in some of them.
Carlos Gomez-Lopez: I would imagine, but you haven't so far.
Ramón Sarre: Sorry. No, we have not.
Operator: And our next question will come from Ernesto Gabilondo with Bank of America.
Ernesto María Gabilondo Márquez: My first question will be a follow-up in terms of FX and interest rates. Just wondering what are your expectations for the FX and interest rates for this year? And if you are evaluating any kind of hedge to mitigate the impact? And looking into the first half of this year, it seems it will be a tough comp considering the strong peso appreciation and rates. So just wondering what are you deciding to do on that? And then my second question is also related, a follow-up in terms of your investment phase and OpEx. So just wondering, for this year, should we expect OpEx growing at a higher pace when compared to revenues? If you can provide if there will be some seasonality in expenses throughout this year? And also, can you walk us through the timing of the investments this year? And when do you think the revenues will start showing up, I think, will be very helpful. And I also remember you were expecting Indeval to be at the cloud by 2027. So just wondering how should we expect OpEx, as you were saying, it should be declining in 2027, but maybe not at the lows that could be at 2028. Just wondering if 2027 will continue to have some of the Indeval investments or other investments in 2027.
Ramón Sarre: Ernesto, we thought we were going to have to do without the pleasure of your questions. Regarding your first question, FX and interest rates, interest rates are coming down, so we're expecting less financial income there. And FX, we've been working to hedge to reduce our exposure to the FX gain loss that we have. So we're expecting less financial income and a little less impact from the FX gain loss. For OpEx, for this year, we're expecting it to be high single digits, somewhat in line with what we're expecting in revenues. So you're asking timing, when we would expect to see -- if there's going to be seasonality in the expenses. Yes, there's always some seasonality. It's usually -- they start slower towards the first half and tend to lean a little more. We try to even the math throughout the year, but there is usually some seasonality. We expect to see revenues from our initiatives in 2027, especially with the launching of the repo services in our CCP. We're expecting to see some revenues from the bond clearing for this year, but really nothing significant, nothing that moves the needle. So expect them for 2027 with the launching of the repo services. And regarding Indeval in the cloud, yes, we're expecting to have our -- the new platform for Indeval towards the end of 2027. So it will be fully operational in 2028. We would expect to start seeing, let me say, some -- we'll have double expenses while we take out the old platforms and the old technology. So we would expect to see a reduction in revenues -- sorry, a reduction in expenses for 2028 and downward, at least from an overall point of view.
Operator: And this now concludes our question-and-answer session. I would like to turn the floor back over to Jorge Alegria. Please go ahead.
Jorge Formoso: Thank you. Thank you very much again to everyone. We had a very, very active -- I think we may have another question, sorry.
Ramón Sarre: Apparently, we have one more person lining up.
Operator: Okay. Yes. We have a question from Pablo Ordóñez with GBM.
Jorge Formoso: Okay. Go ahead. I'll keep my remarks for later.
Pablo Ordóñez Peniche: Can you hear me?
Ramón Sarre: Yes, Pablo.
Pablo Ordóñez Peniche: Just quickly, how should we think in terms of the payout for dividends and buybacks for the next 3 years? And are you considering using some part of the MXN 3.7 billion that you're still holding in your balance sheet for dividends and buybacks in this cycle of CapEx? And also a second question is maybe if you can help us with some magnitude of how should we think of the additional revenues for the debt CCP once that you start rolling out the repos business in 2027?
Ramón Sarre: Thank you, Pablo. For the dividend, this year, we're -- our distribution is going to be a dividend of 71% of net income, and we're doing a buyback of at least another 10%. This -- we will keep -- we'll try to keep our -- this cash distribution at this 80% level of net income. That's at least, let's say, our guideline. And we estimate that in spite of the investments we're doing, that's fully achievable. And this will be for next year and after that as well. We could have additional -- on buybacks, yes, but let's take the guideline as at least or around 80% of distribution. Regarding your second question on the additional revenues from the repo services, we don't have an estimate on that yet. It's a big market. It's about MXN 100 billion in average daily -- $100 billion in daily volume. So we're still working on the fee to get that. But when we have additional information on that, we'll let you know.
Operator: And this does conclude the question-and-answer session, Jorge?
Jorge Formoso: Now it's my turn again. Thank you very much. And again, this 2025 proved to be a year where we realized and started to operate on our strategic plan for the next 3, 4, 5 years. This year, we are going to be focusing on the execution of the plan, providing value to our shareholders, and we look forward for an exciting 2026 and onwards. So thank you very much, and talk to you soon.
Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines, and have a wonderful day.