Standard&Poor's Ratings Services' ratings on Coca-Cola Femsa S.A.B. de C.V. (KOF) reflect: the company's strong business profile supported by implicit support from The Coca-Cola Co. (KO; A+/Stable/A-1) through its 31.6% stake in KOF; KOF's strategic position in Coca-Cola's Latin American distribution system; its geographic diversification throughout the region; and our expectation that the company will continue to generate significant cash flow in the next three years and maintain its intermediate financial profile, as reflected by its strong financial measures and robust cash-flow generation. Intense competition, a volatile market, and partial foreign-currency exposure related to KOF's dollar-denominated debt partly offset the positive factors. KOF holds a leading market presence in its Mexican franchised territories and, while still concentrated in
