Edgar Filing: MEXICAN ECONOMIC DEVELOPMENT INC

Unassociated Document

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

For the month of October 2007

FOMENTO ECONÓMICO MEXICANO, S.A.B. DE C.V.

(Exact name of Registrant as specified in its charter)

Mexican Economic Development, Inc.

(Translation of Registrant’s name into English)

United Mexican States

(Jurisdiction of incorporation or organization)

General Anaya No. 601 Pte.

Colonia Bella Vista

Monterrey, Nuevo León 64410

México

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports

under cover of Form 20-F or Form 40-F:

Form 20-F x Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as

permitted by Regulation S-T Rule 101(b)(1): _______

Indicate by check mark if the registrant is submitting the Form 6-K in paper as

permitted by Regulation S-T Rule 101(b)(7): _______

Indicate by check mark whether by furnishing the information contained in this

Form, the registrant is also thereby furnishing the information to the

Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o No x

If "Yes" is marked, indicate below the file number assigned to the registrant in

connection with Rule 12g3-2(b): 82-_____________

Latin America´s Beverage Leader

FEMSA Reports 3Q07 Revenue and Income

from Operations Growth of 7.2% and 7.4%,

respectively

Monterrey, Mexico, October 26, 2007— Fomento Económico Mexicano, S.A.B. de C.V. (“FEMSA”) today announced its operational and financial results for the third quarter of 2007.

Third Quarter 2007 Highlights:

· Consolidated total revenues increased 7.2% and income from operations increased 7.4%. Strong growth at Oxxo and Coca-Cola FEMSA more than offset weakness at FEMSA Cerveza.

· Coca-Cola FEMSA total revenues increased 6.0% and income from operations increased 11.5%. Double-digit growth from most of our South American operations drove these results.

· FEMSA Cerveza total revenues increased 3.3%.

- Mexico sales volume grew 3.5%, Brazil sales volume grew 6.7% and export sales volume grew 2.3%.

- Income from operations decreased 8.8%, reflecting continued high commodity prices, increased promotional activity in Mexico, and sustained marketing investments in our brands and competitive position.

· Oxxo total revenues increased 15.2%, driven by 755 net new stores in the last twelve months for a total of 5,237 stores. Operating margin expanded by 120 basis points.

“As the months have gone by, the trends that were established in our businesses during the first half of the year have continued to develop, and generally conditions today have improved relative to the earlier periods. During the third quarter Coca-Cola FEMSA continued to build on the profitability of its all-important Mexico operation, achieving real growth in operating income for the first time in four quarters, while the rest of the territories continued their strong pace of earnings growth. Oxxo once again delivered a stellar quarter with solid revenue growth and remarkable margin expansion. At FEMSA Cerveza, we continued to experience a tough raw materials environment that, together with increased promotional activity in Mexico, put pressure on our profits in the short term even as we continued to make significant progress in the United States and Brazil.

And yet, our consolidated results for the quarter show robust growth in revenues and operating income above 7 percent in real terms. In a challenging year, we are being able to deliver results even as we continue to develop our brands and build the business model that will allow us to continue to compete successfully across our businesses and in a growing number of territories”, commented José Antonio Fernández, Chairman and CEO of FEMSA.

FEMSA Consolidated

Total revenues increased 7.2% to Ps. 36.731 billion in 3Q07. This increase was primarily driven by total revenue growth of 15.2% at Oxxo, 6.0% at Coca-Cola FEMSA and to a lesser extent FEMSA Cerveza with total revenue growth of 3.3%, despite tough year-on-year comparisons given the high growth rates registered in 2006 driven by the Soccer World Cup. For the first nine months of 2007, consolidated total revenues increased 7.8% to Ps. 106.083 billion.

Gross profit increased 8.4% to Ps. 16.941 billion in 3Q07, in spite of raw material cost pressures and a growing contribution of lower-margin Oxxo to our results. Margin improvements at Oxxo and Coca-Cola FEMSA more than offset a gross margin decline at Femsa Cerveza, resulting in a 50 basis point expansion to 46.1% in 3Q07.

For the first nine months of 2007, gross profit increased 6.8% to Ps. 48.370 billion. However, gross margin contracted 40 basis points compared to the same period in 2006, to 45.6% of total revenues. This contraction resulted primarily from raw material pressures as well as from the rapid growth of Oxxo’s operations, which have lower margins than our beverage businesses.

Income from operations increased by 7.4% to Ps. 5.077 billion in 3Q07, and operating margin remained flat at 13.8%. Double-digit growth at Coca-Cola FEMSA and Oxxo offset the decline at Femsa Cerveza.

For the first nine months of 2007, income from operations increased 0.3% to Ps. 13.486 billion. Our consolidated operating margin decreased 100 basis points compared to 2006 levels, reaching 12.7% of total revenues.

Net income increased 8.6% to Ps. 3.299 billion in 3Q07, mainly as a result of the growth in income from operations. This more than offset an increase in the integral cost of financing, driven itself by a reduction in the foreign exchange gain recorded in the quarter. The effective tax rate decreased from 29.8% in 3Q06 to 28.0% in 3Q07.

For the first nine months of 2007, net income increased 13.1% to Ps. 8.149 billion driven largely by a shift from a loss in foreign exchange in 2006 to a gain in 2007.

Net majority income increased 10.4% resulting in Ps. 0.65 per FEMSA Unit¹ in 3Q07. Net majority income per FEMSA ADS, using an exchange rate of Ps. 10.92 per dollar, which was the exchange rate at period end, was US$ 0.60 for the quarter. For the first nine months net majority income per FEMSA Unit¹ was Ps. 1.60 (US$1.47 per ADS).

Capital expenditures increased 21.4% to Ps. 2.786 billion in 3Q07, mainly reflecting increased investment in the beverage business units related to incremental capacity, as well as market-related investments.

Consolidated net debt: As of September 30, 2007, FEMSA recorded a cash balance of Ps. 10.875 billion (US$ 996 million), short-term debt of Ps. 8.906 billion (US$ 816 million) and long-term debt of Ps. 31.512 billion (US$ 2.886 billion), for a net debt balance of Ps. 29.543 billion (US$ 2.705 billion), which was Ps. 382 million (US$ 35 million) higher than on September 30, 2006.

¹ FEMSA Units consist of FEMSA BD Units and FEMSA B Units. Each FEMSA BD Unit is comprised of one Series B Share, two Series D-B Shares and two Series D-L Shares. Each FEMSA B Unit is comprised of five Series B Shares. The number of FEMSA Units outstanding as of September 30, 2007 was 3,578,226,270 equivalent to the total number of FEMSA Shares outstanding as of the same date, divided by 5.

Soft Drinks - Coca-Cola FEMSA

Coca-Cola FEMSA’s financial results and discussion are incorporated by reference from Coca-Cola FEMSA’s press release, which is attached to this press release.

Beer - FEMSA Cerveza

The results of FEMSA Cerveza provided here now fully consolidate the results of our subsidiary Cervejarias Kaiser (in Brazil), which we acquired in January of 2006. Beginning with our 1Q07 results, all comparisons to prior periods will fully reflect the Kaiser acquisition.

Mexico sales volume increased 3.5% to 6.888 million hectoliters in 3Q07, despite tough comparable growth figures from the third quarter of 2006. This increase reflects strong consumer demand during the first two months of the quarter that was partially offset by negative weather conditions mainly in southeast Mexico during September. Once again, growth was driven by our Tecate, Sol and Indio brand families. For the first nine months of 2007, Mexico sales volume increased 3.2% to 19.792 million hectoliters.

Brazil sales volume increased 6.7% to 2.195 million hectoliters in 3Q07. This growth was largely driven by our new Sol brand that continues to develop according to plan. For the first nine months of 2007, Brazil sales volume increased 9.8% to 6.536 million hectoliters.

Export sales volume increased 2.3% to 863 thousand hectoliters in 3Q07 as built-up inventory worked its way through the wholesaler network. For the first nine months of 2007, export sales volume increased 11.7% to 2.513 million hectoliters and we are on track to achieve full-year double-digit volume growth.

Total revenues increased 3.3% to Ps. 9.877 billion in 3Q07, as higher beer revenues in Brazil and Mexico were partly offset by lower third-party packaging revenues.

Mexico price per hectoliter increased 0.1% in real terms to Ps. 1,008.7 in 3Q07, reflecting below-inflation price increases implemented during the first half of the year, combined with the positive pricing effect of approximately 3% of incremental domestic volume brought under direct distribution, and a positive shift in mix due to an increase in non-returnable presentations. Brazil price per hectoliter increased 1.7% in real terms to Ps. 581 in 3Q07, reflecting a price increase rolled out in the first quarter combined with better product mix as volumes gradually shift from lower-price brands to Sol, which carries a higher price per hectoliter. Export price per hectoliter decreased 3.0% to Ps. 1,016.5 in 3Q07, as the effect of a strong Peso more than offset an increase in dollar terms of 0.7%.

For the first nine months of 2007, total revenues increased 3.2% to Ps. 28.422 billion driven by a 4.2% increase in beer revenues, which more than offset the decline in other revenues. Export beer revenues reached 9.9% of total beer revenues, up from 9.4% in the comparable period in 2006. Brazil beer revenues represented 14.5% of total beer revenues, up from 13.8% in the comparable period in 2006.

Cost of sales increased 6.4% to Ps. 4.439 billion in 3Q07. This increase was mainly driven by total volume growth of 4.1% and higher prices for raw materials, particularly grains which were partially offset by the effect of strong currencies in Brazil and Mexico applied to our dollar-denominated costs. Gross profit increased 0.8% to Ps. 5.438 billion in 3Q07, resulting in a gross margin of 55.1% for a decline of 130 basis points as compared to the same period of 2006. For the first nine months of 2007, cost of sales increased 8.5% to Ps. 12.816 billion. Gross margin year-to-date contracted by 220 basis points to 54.9% of total revenues.

Income from operations decreased 8.8% to Ps. 1.602 billion in 3Q07, and operating margin contracted by 220 basis points to 16.2% in the quarter. Operating expenses increased 5.5% to Ps. 3.836 billion, reaching 38.9% of total revenues in 3Q07. While administrative expenses were stable, selling expenses increased 7.9% to Ps. 2.791 billion. Over a third of this increase resulted from stepped-up marketing activities in Brazil in connection with our Sol and Kaiser brands, which compare with a period of limited marketing expenditures last year. We continued to invest in channel development and brand-building activities for Sol and Tecate in Mexico as well as for Dos Equis and Tecate in the U.S.

For the first nine months of 2007, income from operations decreased 23.8% to Ps. 3.765 billion, resulting in 13.2% of total revenues.

Oxxo Stores - FEMSA Comercio

Total revenues increased 15.2% to Ps. 11.009 billion in 3Q07, primarily as a result of the opening of 140 net new Oxxo stores in the quarter, representing a 20.7% increase over the prior year and a total increase of 755 net new Oxxo stores during the last twelve months. As of September 30, 2007, there were a total of 5,237 Oxxos in Mexico. For the first nine months of 2007, total revenues increased 13.8% to Ps. 30.655 billion.

Same-store sales increased an average of 3.4% during the quarter, reflecting a 3.1% increase in store traffic, which was driven by a broadening product assortment, and a slight improvement of 0.3% in the average customer ticket driven by selective increases in the price of some “impulse” items.

For the first nine months of 2007 Oxxo same-store sales increased an average of 2.6%, as an increase of 3.1% in store traffic more than offset a 0.5% reduction in average ticket.

Gross profit increased by 18.9% in 3Q07, expanding gross margin by 80 basis points to reach 27.7% of total revenues. This improvement was driven by better pricing strategies in some products and successful promotions implemented with our supplier partners, as well as by growth coming from higher-margin categories such as coffee. For the first nine months of 2007, Oxxo gross margin expanded by 80 basis points to 27.2%.

Income from operations increased 47.5% to Ps. 599 million in 3Q07. Operating expenses increased 13.5% to Ps. 2.451 billion, below revenue growth. Administrative expenses decreased 3.3% to Ps. 175 million, as our initial capitalized investments in the Oracle ERP system have been fully amortized and broad expense-containment initiatives begin to bear fruit. Selling expenses as a percentage of total revenues remained stable at 20.7% in 3Q07. Oxxo’s operating margin expanded 120 basis points to 5.4% of total revenues driven by the gross margin expansion and to a lesser extent, by better expense absorption resulting from higher revenues.

For the first nine months of 2007, income from operations increased 40.5% to Ps. 1.398 billion, resulting in an operating margin of 4.6%, a 90 basis point expansion from the prior year.

CONFERENCE CALL INFORMATION:

Our Third Quarter 2007 Conference Call will be held on: Monday October 29, 2007, 12:00 PM EDT (10:00 AM Mexico City Time). To participate in the conference call, please dial: Domestic U.S.: 1-888-713-4485, International: 1-913-312-1304. This Conference Call will also be transmitted through live webcast at www.femsa.com/investor.

If you are unable to participate live, an instant replay of the conference call will be available through November 2, 2007. To listen to the replay please dial: Domestic U.S.: 1-888-203-1112; International: 1-719-457-0820, Passcode:1468397.

Set forth in this press release is certain unaudited financial information for FEMSA for the third quarter of 2007 compared to the third quarter of 2006. We are a holding company whose principal activities are grouped under the following sub-holding companies and carried out by their respective operating subsidiaries: Coca-Cola FEMSA, S.A.B. de C.V., which engages in the production, distribution and marketing of non-alcoholic beverages; FEMSA Cerveza, S.A. de C.V., which engages in the production, distribution and marketing of beer and flavored alcoholic beverages; and FEMSA Comercio, S.A. de C.V., which engages in the operation of convenience stores.

All of the figures in this report were prepared in accordance with “Normas de Información Financiera” (Mexican Financial Reporting Standards or “Mexican FRS”, and have been restated in constant Mexican pesos (“Pesos” or “Ps.”) with purchasing power as of September 30, 2007. As a result, all percentage changes are expressed in real terms.

The translations of Mexican pesos into US dollars are included solely for the convenience of the reader, using the exchange rate provided by the company in the tables that accompany this release. The exchange rate used for this purpose is 10.9203 Mexican pesos per US dollar, which is as of the end of the reporting period.

FORWARD LOOKING STATEMENTS

This report may contain certain forward-looking statements concerning our future performance that should be considered as good faith estimates made by us. These forward-looking statements reflect management’s expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, which could materially impact our actual performance.

Six pages of tables and Coca-Cola FEMSA’s press release to follow

FEMSA

Consolidated Income Statement

Expressed in Millions of Pesos as of September 30, 2007

	For the third quarter of:													For the nine months of:
	2007			% of rev.		2006			% of rev.		% Increase			2007			% of rev.		2006			% of rev.		% Increase
Total revenues		36,731			100.0		34,272			100.0		7.2			106,083			100.0		98,430			100.0		7.8
Cost of sales		19,790			53.9		18,648			54.4		6.1			57,713			54.4		53,136			54.0		8.6
Gross profit		16,941			46.1		15,624			45.6		8.4			48,370			45.6		45,294			46.0		6.8
Administrative expenses		2,304			6.3		2,206			6.4		4.4			6,716			6.3		6,443			6.5		4.2
Selling expenses		9,560			26.0		8,692			25.4		10.0			28,168			26.6		25,407			25.8		10.9
Operating expenses		11,864			32.3		10,898			31.8		8.9			34,884			32.9		31,850			32.3		9.5
Income from operations		5,077			13.8		4,726			13.8		7.4			13,486			12.7		13,444			13.7		0.3
Other expenses		(203	)				(479	)				(57.6	)		(731	)				(1,116	)				(34.5	)
Interest expense		(1,056	)				(1,075	)				(1.8	)		(3,369	)				(3,215	)				4.8
Interest income		170					216					(21.3	)		559					607					(7.9	)
Interest expense, net		(886	)				(859	)				3.1			(2,810	)				(2,608	)				7.7
Foreign exchange (loss) gain		110					264					(58.3	)		459					(125	)				N.S.
Gain on monetary position		545					588					(7.3	)		955					789					21.0
Unhedged derivative instrument
loss		(64	)				88					N.S.			(1	)				(42	)				N.S.
Integral result of financing		(295	)				81					N.S.			(1,397	)				(1,986	)				(29.7	)
Income before income tax		4,579					4,328					5.8			11,358					10,342					9.8
Income tax		(1,280	)				(1,289	)				(0.7	)		(3,209	)				(3,139	)				2.2
Net income		3,299					3,039					8.6			8,149					7,203					13.1
Net majority income		2,343					2,123					10.4			5,730					5,315					7.8
Net minority income		956					916					4.4			2,419					1,888					28.1

*EBITDA & CAPEX*
Income from operations		5,077			13.8		4,726			13.8		7.4			13,486			12.7		13,444			13.7		0.3
Depreciation		1,124			3.1		1,138			3.3		(1.2	)		3,212			3		3,270			3.3		(1.8	)
Amortization & other		950			2.6		933			2.7		1.8			2,939			2.8		2,900			2.9		1.3
EBITDA		7,151			19.5		6,797			19.8		5.2			19,637			18.5		19,614			19.9		0.1
CAPEX		2,786					2,294					21.4			7,318					5,833					25.5

*FINANCIAL RATIOS*		2007					2006					Var. p.p.
Liquidity⁽¹⁾		1.03					0.90					0.13
Interest coverage⁽²⁾		6.99					7.52					(0.53	)
Leverage⁽³⁾		0.87					0.90					(0.03	)
Capitalization⁽⁴⁾		34.81	%				37.87	%				(3.06	)

⁽¹⁾ Total current assets / total current liabilities.

⁽²⁾ Income from operations + depreciation + amortization & other / interest expense, net.

⁽³⁾ Total liabilities / total stockholders' equity.

⁽⁴⁾ Total debt / long-term debt + stockholders´ equity.

Total debt = short-term bank loans + current maturities long-term debt + long-term bank loans and notes payable.

FEMSA

Consolidated Balance Sheet

As of September 30:

(Expressed in Millions of Pesos as of September 30, 2007)

*ASSETS*	2007		2006		% Increase
Cash and cash equivalents		10,875		11,647		(6.6	)
Accounts receivable		7,079		6,199		14.2
Inventories		9,147		7,611		20.2
Prepaid expenses and other		3,348		2,484		34.8
Total current assets		30,449		27,941		9.0
Property, plant and equipment, net		52,368		50,995		2.7
Intangible assets⁽¹⁾		58,960		57,988		1.7
Deferred assets		9,372		7,378		27.0
Other assets		6,700		6,295		6.4
TOTAL ASSETS		157,849		150,597		4.8

*LIABILITIES & STOCKHOLDERS´ EQUITY*
Bank loans		3,307		6,012		(45.0	)
Current maturities long-term debt		5,599		6,303		(11.2	)
Interest payable		465		479		(2.9	)
Operating liabilities		20,296		18,205		11.5
Total current liabilities		29,667		30,999		(4.3	)
Long-term debt		31,512		28,493		10.6
Deferred income taxes		4,229		3,788		11.6
Labor liabilities		3,354		2,823		18.8
Other liabilities		4,490		5,237		(14.3	)
Total liabilities		73,252		71,340		2.7
Total stockholders’ equity		84,597		79,257		6.7
LIABILITIES AND STOCKHOLDERS’ EQUITY		157,849		150,597		4.8

⁽¹⁾ Includes mainly the intangible assets generated by acquisitions.

	September 30, 2007
*DEBT MIX*	*Ps.*		*% Integration*			*Average Rate*
Denominated in:
Mexican pesos		30,496		75.5	%		9.2	%
Dollars		8,730		21.6	%		6.5	%
Argentinan pesos		530		1.3	%		10.6	%
Venezuelan bolivars		340		0.8	%		9.4	%
Brazilian Reals		322		0.8	%		11.7	%
Total debt		40,418		100.0	%		8.7	%

Fixed rate⁽¹⁾		29,711		73.5	%
Variable rate⁽¹⁾		10,707		26.5	%

*% of Total Debt*	2007			2008			2009			2010			2011			2012			2013+
*DEBT MATURITY PROFILE*		2.8	%		20.4	%		13.6	%		12.1	%		10.2	%		22.3	%		18.6	%

⁽¹⁾ Includes the effect of interest rate swaps.

Coca-Cola FEMSA

Results of Operations

Expressed in Millions of Pesos as of September 30, 2007

	For the third quarter of:											For the nine months of:
	2007		% of rev.		2006		% of rev.		% Increase			2007		% of rev.		2006		% of rev.		% Increase
Total revenues		16,701		100.0		15,749		100.0		6.0			49,236		100.0		45,656		100.0		7.8
Cost of sales		8,491		50.8		8,305		52.7		2.2			25,621		52.0		23,919		52.4		7.1
Gross profit		8,210		49.2		7,444		47.3		10.3			23,615		48.0		21,737		47.6		8.6
Administrative expenses		951		5.7		837		5.3		13.5			2,655		5.4		2,524		5.5		5.2
Selling expenses		4,437		26.6		4,076		25.9		8.9			12,937		26.3		11,990		26.3		7.9
Operating expenses		5,388		32.3		4,913		31.2		9.7			15,592		31.7		14,514		31.8		7.4
Income from operations		2,822		16.9		2,531		16.1		11.5			8,023		16.3		7,223		15.8		11.1
Depreciation		414		2.5		438		2.8		(5.5	)		1,206		2.4		1,222		2.7		(1.3	)
Amortization & other		336		2.0		401		2.5		(16.2	)		1,010		2.1		1,122		2.5		(10.0	)
EBITDA		3,572		21.4		3,370		21.4		6.0			10,239		20.8		9,567		21.0		7.0
Capital expenditures		985				737				33.6			2,319				1,981				17.1

Sales volumes
(Millions of unit cases)
Mexico		286.1		54.2		272.9		54.2		4.8			838.2		53.7		808.2		54.9		3.7
Central America		30.7		5.8		29.7		5.9		3.4			94.2		6.0		87.6		5.9		7.5
Colombia		49.5		9.4		49.7		9.9		(0.4	)		145.1		9.3		137.0		9.3		5.9
Venezuela		51.5		9.8		47.7		9.5		8.0			152.0		9.7		132.8		9.0		14.5
Brazil		68.9		13.1		64.0		12.7		7.7			208.4		13.3		192.0		13.0		8.5
Argentina		41.0		7.8		39.1		7.8		4.9			124.5		8.0		116.8		7.9		6.6
Total		527.7		100.0		503.1		100.0		4.9			1,562.4		100.0		1,474.4		100.0		6.0

FEMSA Cerveza

Results of Operations

Expressed in Millions of Pesos as of September 30, 2007

	For the third quarter of:											For the nine months of:
	2007		% of rev.		2006		% of rev.		% Increase			2007		% of rev.		2006		% of rev.		% Increase
Sales:
Mexico		6,948		70.3		6,700		70.1		3.7			19,768		69.6		19,258		69.9		2.6
Brazil		1,275		12.9		1,175		12.3		8.5			3,778		13.3		3,447		12.5		9.6
Export		877		8.9		884		9.2		(0.8	)		2,582		9.0		2,361		8.6		9.4
Beer sales		9,100		92.1		8,759		91.6		3.9			26,128		91.9		25,066		91.0		4.2
Other revenues		777		7.9		805		8.4		(3.5	)		2,294		8.1		2,469		9.0		(7.1	)
Total revenues		9,877		100.0		9,564		100.0		3.3			28,422		100.0		27,535		100.0		3.2
Cost of sales		4,439		44.9		4,171		43.6		6.4			12,816		45.1		11,807		42.9		8.5
Gross profit		5,438		55.1		5,393		56.4		0.8			15,606		54.9		15,728		57.1		(0.8	)
Administrative expenses		1,045		10.6		1,050		11.0		(0.5	)		3,145		11.1		3,079		11.2		2.1
Selling expenses		2,791		28.3		2,587		27.0		7.9			8,696		30.6		7,709		28.0		12.8
Operating expenses		3,836		38.9		3,637		38.0		5.5			11,841		41.7		10,788		39.2		9.8
Income from operations		1,602		16.2		1,756		18.4		(8.8	)		3,765		13.2		4,940		17.9		(23.8	)
Depreciation		405		4.1		435		4.5		(6.9	)		1,213		4.3		1,283		4.7		(5.5	)
Amortization & other		604		6.1		555		5.8		8.8			1,834		6.5		1,781		6.5		3.0
EBITDA		2,611		26.4		2,746		28.7		(4.9	)		6,812		24.0		8,004		29.1		(14.9	)
Capital expenditures		1,243				928				33.9			3,472				2,508				38.4

Sales volumes
(Thousand hectoliters)
Mexico		6,888.2		69.3		6,651.4		69.6		3.5			19,792.4		68.6		19,187.8		70.1		3.2
Brazil		2,194.5		22.1		2,055.9		21.5		6.7			6,535.7		22.7		5,953.9		21.7		9.8
Exports		862.7		8.7		843.2		8.8		2.3			2,512.9		8.7		2,249.3		8.2		11.7
Total		9,945.5		100.0		9,550.5		100.0		4.1			28,841.0		100.0		27,391.0		100.0		5.3

Price per hectoliter
Mexico		1,008.7				1,007.3				0.1			998.8				1,003.7				(0.5	)
Brazil		581.0				571.5				1.7			578.1				578.9				(0.2	)
Exports		1,016.5				1,048.4				(3.0	)		1,027.5				1,049.7				(2.1	)
Total		915.0				917.1				(0.2	)		905.9				915.1				(1.0	)

FEMSA Comercio

Results of Operations

Expressed in Millions of Pesos as of September 30, 2007

	For the third quarter of:											For the nine months of:
	2007		% of rev.		2006		% of rev.		% Increase			2007		% of rev.		2006		% of rev.		% Increase
Total revenues		11,009		100.0		9,555		100.0		15.2			30,655		100.0		26,926		100.0		13.8
Cost of sales		7,959		72.3		6,989		73.1		13.9			22,313		72.8		19,816		73.6		12.6
Gross profit		3,050		27.7		2,566		26.9		18.9			8,342		27.2		7,110		26.4		17.3
Administrative expenses		175		1.6		181		1.9		(3.3	)		547		1.8		548		2.0		(0.2	)
Selling expenses		2,276		20.7		1,979		20.8		15.0			6,397		20.8		5,567		20.7		14.9
Operating expenses		2,451		22.3		2,160		22.7		13.5			6,944		22.6		6,115		22.7		13.6
Income from operations		599		5.4		406		4.2		47.5			1,398		4.6		995		3.7		40.5
Depreciation		137		1.2		107		1.1		28.0			391		1.3		312		1.2		25.3
Amortization & other		103		1.0		93		1.0		10.8			316		1.0		273		1.0		15.8
EBITDA		839		7.6		606		6.3		38.4			2,105		6.9		1,580		5.9		33.2
Capital expenditures		495				584				(15.2	)		1,366				1,239				10.3


Information of Convenience Stores
Total stores													5,237				4,482				16.8
Net new convenience stores:		140				116				20.7
vs. September prior year													755				698				8.2
vs. December prior year													390				341				14.4
Same store data: ⁽¹⁾
Sales (thousands of pesos)		679.9				657.8				3.4			653.0				636.2				2.6
Traffic		23.3				22.6				3.1			22.4				21.8				3.1
Ticket		29.2				29.1				0.3			29.1				29.2				(0.5	)

⁽¹⁾ Monthly average information per store, considering same stores with at least 13 months of operations.

FEMSA

Macroeconomic Information

							Exchange Rate
	Inflation						as of September 30, 2007
	September 06 -			June 07 -
	September 07			September 07			Per USD		Per Mx. Peso
Mexico		3.79	%		1.62	%		10.9203		1.0000
Colombia		5.00	%		0.11	%		2,023.1900		0.0054
Venezuela		15.26	%		2.91	%		2,150.0000		0.0051
Brazil		4.95	%		1.21	%		1.8389		5.9385
Argentina		8.56	%		1.90	%		3.1500		3.4668

2007 THIRD-QUARTER AND FIRST NINE MONTHS RESULTS

	Third Quarter								YTD
	2007		2006			Δ%			2007		2006		Δ%
Total Revenues	16,701			15,749			6.0	%		49,236		45,656		7.8	%
Gross Profit	8,210			7,444			10.3	%		23,615		21,737		8.6	%
Operating Income	2,822			2,531			11.5	%		8,023		7,223		11.1	%
Majority Net Income	1,890			1,804			4.8	%		4,859		3,606		34.7	%
EBITDA⁽¹⁾	3,572			3,370			6.0	%		10,239		9,567		7.0	%

Net Debt ^{(2) (3)}	11,307			14,940			-24.3	%

EBITDA ⁽¹⁾ / Interest Expense	6.34			5.73
Earnings per Share	1.02			0.98
Capitalization⁽⁴⁾	31.2	%		33.1	%

Expressed in million of Mexican pesos with purchasing power as of September 30, 2007 (1) EBITDA = Operating income + Depreciation + Amortization & Other Non-cash Charges. See reconciliation table on page 11. (2) Net Debt = Total Debt - Cash (3) Figures for 2006 are as of December 31, 2006. (4) Total debt / (long-term debt + stockholders' equity) · Total revenues reached Ps. 16,701 million in the third quarter of 2007, an increase of 6.0% compared to the third quarter of 2006, and increased 7.8% for the first nine months of the year to Ps. 49,236 million compared to same period of 2006. · Driven by strong growth and higher profitability in the operations outside of Mexico, consolidated operating income increased 11.5% to Ps. 2,822 million for the third quarter of 2007, and 11.1% to Ps. 8,023 million for the first nine months of the year. Our operating margin was 16.9% for the third quarter of 2007 and 16.3% for the first nine months of the year. · Consolidated majority net income increased 4.8% to Ps. 1,890 million in the third quarter of 2007, and 34.7% to Ps. 4,859 million for the first nine months of the year, resulting in earnings per share of Ps. 1.02 for the third quarter of 2007, and Ps. 2.63 for the first nine months of the year. Mexico City (October 26, 2007), Coca-Cola FEMSA, S.A.B. de C.V. (BMV: KOFL, NYSE: KOF) (“Coca-Cola FEMSA” or the “Company”), the largest Coca-Cola bottler in Latin America and the second-largest Coca-Cola bottler in the world in terms of sales volume, announces results for the third quarter and the first nine months of 2007. “Our operations posted strong results for the third quarter of 2007. Our performance displayed the advantages of our balanced, geographically diversified portfolio of assets, with more than 73 percent of our top-line growth coming from our operations outside of Mexico. In Mexico, we have been increasing our profitability; in fact, this is the first quarter in more than a year that we have achieved operating income growth. We, together with the Coca-Cola Company also just launched the public tender offer for Jugos del Valle. This transaction, which we expect to close in November of 2007, will considerably increase our company’s position in Latin America’s fast-growing still beverage segment. Looking forward, the overall competitive environment is behaving more rationally, which should bode well for our future performance,” said Carlos Salazar Lomelín, Chief Executive Officer of the company.

CONSOLIDATED RESULTS

Our consolidated total revenues increased 6.0% to Ps. 16,701 million in the third quarter of 2007, compared to the third quarter of 2006 as a result of increases in all of our territories. Our consolidated average price per unit case increased 1.1% to Ps. 31.07 (US$ 2.84) in the third quarter of 2007 compared to the same period of 2006 as a result of higher average price in Colombia, Venezuela and Argentina.

Total sales volume increased 4.9% to 527.7 million unit cases in the third quarter of 2007 as compared to the same period of 2006, mainly driven by 5.4% volume growth of the Coca-Cola brand, which accounted for more than 65% of our total incremental volumes during the quarter. Sparkling beverages⁽¹⁾ sales volume grew 4.2% to 444.5 million unit cases, driven by volume growth across most of our territories.

Our gross profit increased 10.3% to Ps. 8,210 million in the third quarter of 2007, compared to the third quarter of 2006, driven by increases in all of our operations. Gross margin reached 49.2% in the third quarter of 2007 from 47.3% in the same period of 2006. Lower sweetener costs in Brazil and Colombia in conjunction with lower PET (Polyethylene terephtalate) costs in Mexico more than compensated for higher sweetener costs mainly in Mexico and Argentina.

Our consolidated operating income increased 11.5% to Ps. 2,822 million in the third quarter of 2007. Double-digit increases in operating income in Brazil, Colombia and Venezuela more than compensated for the decline in Central America and Argentina. Our operating margin was 16.9% in the third quarter of 2007, an improvement of 80 basis points as a result of higher fixed-cost absorption.

As we mentioned in our first quarter press release, beginning in 2007, pursuant to Mexican Financial Reporting Standards, we recorded employee profit sharing in the “other expenses” line, instead of recording it in the “income tax” line. For comparison purposes we are reflecting this change in the 2006 information presented, which amounted to Ps. 117 million in the third quarter of 2006 and Ps. 75 million in the same period of 2007.

Our integral cost of financing in the third quarter of 2007 reached Ps. 1 million as compared to a large gain of Ps. 387 million in the same period of 2006, mainly driven by (i) a less favorable foreign exchange gain resulting from the depreciation of the Mexican peso against the U.S. dollar as applied to our liability position denominated in foreign currency, and (ii) a lower inflation rate applied to our net monetary position.

During the third quarter of 2007 income tax, as a percentage of income before taxes, was 28.5%, compared to 27.9% in the same quarter of 2006. The tax rate in the third quarter of 2006 was lower than the same period this year, mainly due to tax credit benefits obtained in some our operations last year.

Our consolidated majority net income increased by 4.8% to Ps. 1,890 million in the third quarter of 2007, compared to the third quarter of 2006, an increase in our operating income and lower net interest expenses that more than offset a lower foreign exchange and monetary position gains recorded this quarter compared to the third quarter of 2006. Earnings per share (“EPS”) were Ps. 1.02 (US$ 0.93 per ADR) computed on the basis of 1,846.5 million shares outstanding (each ADR represents 10 local shares).

⁽¹⁾Sparkling Beverages - Beverages previously referred to as carbonated soft drinks.

BALANCE SHEET

As of September 30, 2007, Coca-Cola FEMSA had a cash balance of Ps. 8,172 million (US$ 748 million), an increase of Ps. 3,245 million (US$ 297 million), compared to December 31, 2006, resulting from internal cash generation.

Total short-term debt including current maturities of long term debt, was Ps. 4,905 million (US$ 449 million) and long-term debt was Ps. 14,574 million (US$ 1,333 million). Total debt decreased Ps. 389 million (US$ 36 million) compared with year end 2006. Net debt decreased approximately Ps. 3,634 million (US$ 332 million) compared to year end of 2006, mainly a result of internal cash generation.

The weighted average cost of debt for the quarter was 7.87%. The following charts sets forth the Company’s debt profile by currency and interest rate type and by maturity date as of September 30, 2007:

Currency	% Total Debt⁽¹⁾			% Interest Rate Floating⁽¹⁾
U.S. dollars		48.4	%		59.6	%
Mexican pesos		47.1	%		39.3	%
Venezuelan bolivares		1.8	%		0.0	%
Argentine pesos		2.7	%		0.0	%

⁽¹⁾ After giving effect to cross-currency and interest rate swaps.

Debt maturity Profile

2007

2008

2009

2010

2011

2012 +

% of Total Debt

2.1

23.1

18.9

5.2

0.3

50.4

Consolidated Statement of Changes in Financial Position

Expressed in millions of Mexican pesos and U.S. dollars as of September 30, 2007

	*Jan - Sep 2007*
	*Ps.*			*USD*
Net income		5,004			458
Non cash charges to net income		2,703			247
		7,707			705
Change in working capital		(367	)		(34	)
NRGOA⁽¹⁾		7,340			671
Total investments		(2,150	)		(197	)
Dividends paid		(818	)		(75	)
Decrease in debt		(389	)		(36	)
Deferred taxes and others		(738	)		(66	)
Increase in cash and cash equivalents		3,245			297
Cash and cash equivalents at begining of period		4,927			451
Cash and cash equivalents at end of period		8,172			748

(1) Net Resources Generated by Operating Activities

MEXICAN OPERATING RESULTS

Revenues

Total revenues from our Mexican territories increased 3.3% to Ps. 8,261 million in the third quarter of 2007, as compared to the same period of the previous year. Sales volume growth compensated for lower average price per unit case for the quarter. Average price per unit case declined 1.5% to Ps. 28.77 (US$ 2.63), as compared to the third quarter of 2006 mainly driven by incremental volumes from bulk water⁽¹⁾ which carry lower average price per unit case. Excluding bulk water under the brand Ciel, our average price per unit case was Ps. 33.47 (US$ 3.06) a 0.4% decline as compared to the same period of 2006.

Total sales volume increased 4.8% to 286.1 million unit cases in the third quarter of 2007, as compared to the third quarter of 2006, resulted from (i) a 3.1% sales volume growth in sparkling beverages, driven by a 4.5% increase in the Coca-Cola brands, (ii) a 12.0% sales volume growth in bulk water, and (iii) incremental volumes in bottled water in single serve presentations. Still beverages⁽²⁾, excluding bottled water, grew almost 10% in the third quarter of 2007 as compared to the same period of 2006, mainly driven by strong volume growth from Powerade, an isotonic beverage and Nestea, a ready-to-drink tea beverage.

Operating Income

Our gross profit increased by 3.6% to Ps. 4,347 million in the third quarter of 2007 as compared to the same period of 2006. Gross margin increased slightly from 52.5% in the third quarter of 2006 to 52.6% in the same period of 2007, as a result of lower PET (Polyethylene terephtalate) costs year-over-year, which more than compensated for higher cost of sweeteners.

Operating income increased 3.4% to Ps. 1,721 million in the third quarter of 2007, as compared to Ps. 1,664 million in the same period of 2006 as a result of operating leverage achieved by higher revenues as compared to the same period of 2006. Our operating margin was 20.8% in the third quarter of 2007, in line with that of the third quarter of 2006.

⁽¹⁾	Bulk Water - Bottled water in 5.0, 19.0 and 20.0 - liter packaging presentations

⁽²⁾	Still Beverages - Beverages previously referred to as non-carbonated beverages.

CENTRAL AMERICAN OPERATING RESULTS (Guatemala, Nicaragua, Costa Rica and Panama)

Revenues

Total revenues reached Ps. 1,084 million in the third quarter of 2007, a slight decline of 0.3% compared to the same period of 2006. Volume growth partially offset lower average prices per unit case. Average price per unit case declined by 4.0% to Ps. 35.15 (US$ 3.21) in the third quarter of 2007, as compared to the third quarter of 2006, partially as a result of strong volume growth in multi serve presentations, which carry lower average price per unit case.

Total sales volume in our Central American territories grew 3.4% to 30.7 million unit cases in the third quarter of 2007, as compared to the same period of 2006, resulting from incremental volumes in the sparkling beverage category, which accounted for more than 55% of the growth; the balance was brought mainly by still beverages, excluding bottled water. In the third quarter of 2007, still beverages, excluding bottled water, increased more than 20% as compared to the same period of 2006 due to strong growth of Hi-C, a juice based product and Powerade, an isotonic beverage.

Operating Income

Gross profit reached Ps. 509 million, an increase of 1.0% in the third quarter of 2007, as compared to the same period of 2006, as a result of improved operating leverage due to lower sweetener costs. Gross margin rose from 46.4% in the third quarter of 2006 to 47.0% in the third of 2007, resulting in a gross margin improvement of 60 basis points.

Our operating income decreased 9.5% to Ps. 143 million in the third quarter of 2007, as compared to the third quarter of 2006, driven by higher labor costs. Our operating margin reached 13.2% in the third quarter of 2007, a decline of 130 basis points as compared to the same period of 2006.

COLOMBIAN OPERATING RESULTS

Revenues

Total revenues increased 1.6% to Ps. 1,717 million in the third quarter of 2007, as compared to the third quarter of 2006. Higher average prices more than compensated a slight decline in sales volume. Our average price per unit case grew 2.0% to Ps. 34.69 (US$ 3.17), as a result of price increases implemented in the last 12 months.

Total sales volume in the third quarter of 2007 declined 0.4%, as compared to the same period of 2006, to 49.5 million unit cases. Volume growth in the Coca-Cola brand combined with growth in bottled water, excluding bulk water, partially offset a volume decline in flavored sparkling beverages. Still beverages, excluding bottled water, increased 6% as a result of the strong growth of Powerade, an isotonic beverage.

Operating Income

Our gross profit increased 14.8% to Ps. 859 million in the third quarter of 2007, as compared to the same period of the previous year. The strong appreciation of the Colombian peso as applied to our U.S. dollar denominated raw materials combined with lower sweetener costs and operating efficiencies, resulted in a gross margin expansion of 570 basis points from 44.3% in the third quarter of 2006 to 50.0% in the third quarter of 2007.

Despite facing tough top line comparables in the previous year, gross profit expansion and stable operating expenses, increased our operating income in Colombia by 38.0% to Ps. 356 million in the third quarter of 2007, as compared to the same period of 2006. Our operating margin reached 20.7% in the third quarter of 2007, an increase of 540 basis points as compared to the same period of 2006.

VENEZUELAN OPERATING RESULTS

Revenues

Total revenues from our Venezuelan operations increased 22.1% to Ps. 2,313 million in the third quarter of 2007, as compared to the same period of 2006. Improvement on average price per unit case accounted for more than 60% of the incremental revenues during the quarter and higher sales volume represented the balance. Our average price reached Ps. 44.83 (US$ 4.10) in the third quarter of 2007.

Total sales volume increased 8.0% to 51.5 million unit cases during the third quarter of 2007, as compared to the same quarter of 2006. Volume growth in the Coca-Cola brand combined with double-digit growth of flavored sparkling beverages, mainly Freskolita and Hit, more than offset a decline in bulk water and still beverages, excluding bottled water.

Operating Income

Gross profit reached Ps. 1,015 million, an increase of 38.1% in the third quarter of 2007, as compared to the same period of the previous year. Higher revenues combined with lower sweetener and PET costs improved our gross margin by 510 basis points from 38.8% in the third quarter of 2006 to 43.9% in the same period of 2007.

Operating income reached Ps. 155 million, in the third quarter of 2007, resulting in an operating margin increase of 380 basis points from 2.9% in the third quarter of 2006 to 6.7% in the third quarter of 2007. Operating expenses as a percentage of total revenues increased from 36.0% in the third quarter of 2006 to 37.2% in the same period of 2007, mainly due to higher labor costs.

ARGENTINE OPERATING RESULTS

Revenues

In Argentina, our total revenues reached Ps. 891 million in the third quarter of 2007 as a result of increases in sales volume and better average price per unit case. Average price per unit case reached Ps. 21.59 (US$ 1.97) in the third quarter of 2007, which continues to be the lowest among our territories.

In the third quarter of 2007, total sales volume increased 4.9% to 41.0 million unit cases, as compared to the same period of 2006. Sales volume growth from the Coca-Cola brand in returnable presentations and incremental volumes from the introduction of Coca-Cola Zero, more than compensated for the flavored sparkling beverages sales volume decline of our value protection brand Tai. Sales volume of still beverages, excluding bottled water, increased more than 31%, mainly driven by Cepita, our juice-based brand.

Operating Income

Gross profit increased 7.2% to Ps. 341 million in the third quarter of 2007, as compared to the third quarter of 2006. Higher revenues partially compensated for higher sweetener costs, resulting in a gross margin decrease of 130 basis points to 38.3%, as compared to the third quarter of 2006.

Operating expenses increased 17.8% in the third quarter of 2007 mainly due to higher salary expenses and freight costs. Higher revenues partially offset incremental expenses, resulting in a decrease in operating income of 16.2% to Ps. 83 million in the third quarter of 2007, as compared to the same period of 2006. Our operating income margin decreased 300 basis points to 9.3% in the third quarter of 2007.

BRAZILIAN OPERATING RESULTS

Revenues

Net revenues increased 7.1% to Ps. 2,428 million in the third quarter of 2007, as compared to the same period of 2006. Excluding beer, net revenues increased 7.5% to Ps. 2,176 million in the third quarter of 2007, as compared to the same period of 2006, mainly due to volume growth. Excluding beer, average price per unit case remained almost unchanged at Ps. 31.58 (US$ 2.88) during the third quarter of 2007. Total revenues from beer were Ps. 253 million in the third quarter of 2007.

Sales volume, excluding beer, increased 7.7% to 68.9 million unit cases in the third quarter of 2007, as compared to the third quarter of 2006. Sparkling beverages sales volume growth accounted for over 90% of the incremental volumes, mainly driven by the Coca-Cola brand in multi-serve presentations and the introduction of Coca-Cola Zero. Still beverages, excluding bottled water, almost doubled its size from a small base reaching 1.6% of our total sales volume, driven by the introduction of Aquarius, a no-calorie flavored water, combined with strong performance of juice based products under Minute Maid Mais brand.

Operating Income

In the third quarter of 2007, our gross profit increased by 20.8% to Ps. 1,139 million, as compared to the same period of the previous year. Lower average cost per unit case, resulting from (i) the appreciation from the Brazilian Real as applied to our U.S. dollar denominated raw materials, (ii) lower sugar costs and (iii) lower PET bottle costs resulting from better procurement negotiations, contributed to a gross margin improvement of 540 basis points to 46.8% in the third quarter of 2007.

Operating income increased 22.1% reaching Ps. 364 million in the third quarter of 2007, as compared to Ps. 298 million in the same period of 2006. Our operating margin was 14.9% in the third quarter of 2007, an increase of 180 basis points as compared to the third quarter of 2006, due to an expansion in gross margin that more than compensated (i) expenses related to projects intended to improve go to market execution and the distribution network (ii) incremental marketing expenses partially associated with the introduction of Coca-Cola Zero and other still beverages, and (iii) an increase in sales force due to our focus to strengthen our presence and execution in certain retail segments.

SUMMARY OF NINE-MONTH RESULTS

Our consolidated total revenues increased 7.8% to Ps. 49,236 million in the first nine months of 2007, as compared to the same period of 2006, as a result of growth in all of our territories. Venezuela, Mexico and Brazil represented more than 65% of this growth. Consolidated average price per unit case increased 1.8% to Ps. 30.92 (US$ 2.83) in the first nine months of 2007. Higher average prices per unit case for the sparkling beverages portfolio in most of our operations, more than offset incremental volumes of bulk water in Mexico, which carry lower average unit price per unit case.

Total sales volume increased 6.0% to 1,562.4 million unit cases in the first nine months of 2007, as compared to the same period of the previous year. Sales volume growth in Mexico, Venezuela and Brazil accounted for almost 70% of our incremental volumes. Sparkling beverages sales volume grew 5.4% to 1312.6 million cases, driven by incremental volume across all of our territories.

Our gross profit increased 8.6% to Ps. 23,615 million in the first nine months of 2007, as compared to the first nine months of the previous year, driven by revenue growth across all of our territories. Gross margin increased to 48.0% during the first nine months of 2007 from 47.6% in the first nine months of 2006, driven by revenue growth, which compensated for higher sweetener costs in Mexico.

Our consolidated operating income increased 11.1% to Ps. 8,023 million in the first nine months of 2007, as compared to the first nine months of 2006. Venezuela, Colombia and Brazil accounted for the majority of the incremental growth and more than offset an operating income decline in Mexico. Our operating margin improved 50 basis points to 16.3% in the first half of 2007, mainly driven by the improved operating leverage that resulted from higher revenues.

Our consolidated majority net income was Ps. 4,859 million in the first nine months of 2007 an increase of 34.7% compared to the first nine months of 2006, resulting from an increase in operating income combined with a decline in our integral cost of financing. EPS were Ps. 2.63 (US$ 2.40 per ADR) in the first nine months of 2007, computed on the basis of 1,846.5 million shares outstanding (each ADR represents 10 local shares).

RECENT DEVELOPMENTS

On September 26, 2007, the National Banking and Securities Commission (“Comisión Nacional Bancaria y de Valores”) authorized Administración, S.A.P.I. de C.V. (“Administración”), a Mexican company owned directly or indirectly in equal proportion by Coca-Cola FEMSA, S.A.B. de C.V. (BMV: KOFL, NYSE: KOF) (“Coca Cola FEMSA”) and the Coca-Cola Company (NYSE: KO), to launch a Public Tender Offer (“Public Tender Offer”) to buy 100% of the shares of the capital stock of the company Jugos del Valle, S.A.B. de C.V. (BMV: VALLEB) (“Jugos del Valle”). On October 10, 2007, Administración launched this Public Tender Offer to buy the shares for an aggregate amount of approximately US$ 370 million in cash, equivalent to a price of US$ 6.3409 per share, assuming liabilities of approximately US$ 86 million. Once the Public Tender Offer to buy the shares is completed, and as soon as practicable thereafter, both companies will invite the rest of the bottlers of The Coca-Cola Company branded products in Mexico and Brazil, respectively, to participate in the joint-venture. This transaction has been approved by the Mexican regulatory authorities.

CONFERENCE CALL INFORMATION

Our third-quarter 2007 Conference Call will be held on: October 26, 2007, at 2:00 P.M. Eastern Time (1:00 P.M. Mexico City Time). To participate in the conference call, please dial: Domestic U.S.: 866-700-7477 or International: 617-213-8840. We invite investors to listen to the live audiocast of the conference call on the Company’s website, www.coca-colafemsa.com

If you are unable to participate live, an instant replay of the conference call will be available through November 2, 2007. To listen to the replay, please dial: Domestic U.S.: 888-286-8010 or International: 617-801-6888. Pass code: 98344233.

v v v

Coca-Cola FEMSA, S.A.B. de C.V. produces and distributes Coca-Cola, Sprite, Fanta, Lift and other trademark beverages of The Coca-Cola Company in Mexico (a substantial part of central Mexico, including Mexico City and southeast Mexico), Guatemala (Guatemala City and surrounding areas), Nicaragua (nationwide), Costa Rica (nationwide), Panama (nationwide), Colombia (most of the country), Venezuela (nationwide), Brazil (greater São Paulo, Campiñas, Santos, the state of Mato Grosso do Sul and part of the state of Goias) and Argentina (federal capital of Buenos Aires and surrounding areas), along with bottled water, beer and other beverages in some of these territories. The Company has 31 bottling facilities in Latin America and serves over 1,500,000 retailers in the region. The Coca-Cola Company owns a 31.6% equity interest in Coca-Cola FEMSA.

v v v

Figures for the Company’s operations in Mexico and its consolidated international operations were prepared in accordance with Mexican financial reporting standards (Mexican FRS). All figures are expressed in constant Mexican pesos with purchasing power at September 30, 2007. For comparison purposes, 2006 and 2007 figures from the Company’s operations have been restated taking into account local inflation of each country with reference to the consumer price index and converted from local currency into Mexican pesos using the official exchange rate at the end of the period published by the local central bank of each country. In addition, all comparisons in this report for the third quarter of 2007, which ended on September 30, 2007, are made against the figures for the comparable period in 2006, unless otherwise noted.

This news release may contain forward-looking statements concerning Coca-Cola FEMSA’s future performance and should be considered as good faith estimates by Coca-Cola FEMSA. These forward-looking statements reflect management’s expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, many of which are outside Coca-Cola FEMSA’s control that could materially impact the Company’s actual performance.

References herein to “US$” are to United States dollars. This news release contains translations of certain Mexican peso amounts into U.S. dollars for the convenience of the reader. These translations should not be construed as representations that Mexican peso amounts actually represent such U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated.

U.S. dollar amounts in this report solely for the convenience of the reader have been translated from Mexican pesos at the noon day buying rate for pesos as published by the Federal Reserve Bank of New York at September 28, 2007, which exchange rate was Ps. 10.9315 to US $ 1.00.

v v v

(7 pages of tables to follow)

Consolidated Balance Sheet

Expressed in millions of Mexican pesos with purchasing power as of September 30, 2007

Assets		Sep 07				Dec 06
Current Assets
Cash and cash equivalents	Ps.		8,172		Ps.		4,927
Total accounts receivable			2,975				3,209
Inventories			3,556				2,822
Prepaid expenses and other			1,010				1,110
Total current assets			15,713				12,068
Property, plant and equipment
Property, plant and equipment			35,516				35,996
Accumulated depreciation			(15,803	)			(16,122	)
Bottles and cases			1,208				1,265
Total property, plant and equipment, net			20,921				21,139
Investment in shares and other			429				459
Deferred charges, net			1,784				1,969
Intangibles assets and other assets			44,179				42,965
Total Assets	Ps.		83,026		Ps.		78,600


Liabilities and Stockholders' Equity			Sep 07				Dec 06
Current Liabilities
Short-term bank loans and notes	Ps.		4,905		Ps.		3,320
Interest payable			280				276
Suppliers			5,264				5,570
Other current liabilities			4,264				3,724
Total Current Liabilities			14,713				12,890
Long-term bank loans			14,574				16,547
Pension plan and seniority premium			858				905
Other liabilities			5,050				4,785
Total Liabilities			35,195				35,127
Stockholders' Equity
Minority interest			1,542				1,264
Majority interest
Capital stock			3,070				3,070
Additional paid in capital			13,134				13,134
Retained earnings of prior years			27,380				22,994
Net income for the period			4,859				5,205
Cumulative results of holding non-monetary assets			(2,154	)			(2,194	)
Total majority interest			46,289				42,209
Total stockholders' equity			47,831				43,473
Total Liabilities and Equity	Ps.		83,026		Ps.		78,600

Consolidated Income Statement

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

	3Q 07			% Rev			3Q 06			% Rev			Δ%			YTD 07			% Rev			YTD 06			% Rev			Δ%
Sales Volume (million unit cases)		527.7						503.1						4.9	%		1,562.4						1,474.4						6.0	%
Average price per unit case		31.07						30.73						1.1	%		30.92						30.38						1.8	%
Net revenues		16,650						15,704						6.0	%		49,053						45,504						7.8	%
Other operating revenues		51						45						13.3	%		183						152						20.4	%
Total revenues		16,701			100	%		15,749			100	%		6.0	%		49,236			100	%		45,656			100	%		7.8	%
Cost of sales		8,491			50.8	%		8,305			52.7	%		2.2	%		25,621			52.0	%		23,919			52.4	%		7.1	%
Gross profit		8,210			49.2	%		7,444			47.3	%		10.3	%		23,615			48.0	%		21,737			47.6	%		8.6	%
Operating expenses		5,388			32.3	%		4,913			31.2	%		9.7	%		15,592			31.7	%		14,514			31.8	%		7.4	%
Operating income		2,822			16.9	%		2,531			16.1	%		11.5	%		8,023			16.3	%		7,223			15.8	%		11.1	%
Other expenses, net		122						364						-66.5	%		510						693						-26.4	%
Interest expense		474						582						-18.6	%		1,615						1,670						-3.3	%
Interest income		137						100						37.0	%		448						291						54.0	%
Interest expense, net		337						482						-30.1	%		1,167						1,379						-15.4	%
Foreign exchange (gain) loss		(24	)					(282	)					-91.5	%		(70	)					178					-139.3		%
(Gain) Loss on monetary position		(305	)					(505	)					-39.6	%		(565	)					(640	)					-11.7	%
Unhedged derivative instrument (gain) loss		(7	)					(82	)					-91.5	%		(68	)					139					-148.9		%
Integral cost of financing		1						(387	)					-100.3	%		464						1,056						-56.1	%
Income before taxes		2,699						2,554						5.7	%		7,049						5,474						28.8	%
Taxes		769						713						7.9	%		2,045						1,761						16.1	%
Consolidated net income		1,930						1,841						4.8	%		5,004						3,713						34.8	%
Majority net income		1,890			11.3	%		1,804			11.5	%		4.8	%		4,859			9.9	%		3,606			7.9	%		34.7	%
Minority net income		40						37						8.1	%		145						107						35.5	%
Operating income		2,822			16.9	%		2,531			16.1	%		11.5	%		8,023			16.3	%		7,223			15.8	%		11.1	%
Depreciation		414						438						-5.5	%		1,206						1,222						-1.3	%
Amortization and Other non-cash charges ⁽²⁾		336						401						-16.2	%		1,010						1,122						-10.0	%
EBITDA ⁽³⁾		3,572			21.4	%		3,370			21.4	%		6.0	%		10,239			20.8	%		9,567			21.0	%		7.0	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Includes returnable bottle breakage expense.

⁽³⁾EBITDA = Operating Income + Depreciation +Amortization & Other non-cash charges.

Mexican operations

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

	3Q 07		% Rev			3Q 06		% Rev			Δ%			YTD 07		% Rev			YTD 06		% Rev			Δ%
Sales Volume (million unit cases)		286.1					272.9					4.8	%		838.2					808.2					3.7	%
Average price per unit case		28.77					29.22					-1.5	%		28.62					28.93					-1.1	%
Net revenues		8,232					7,974					3.2	%		23,988					23,383					2.6	%
Other operating revenues		29					24					20.8	%		121					66					83.3	%
Total revenues		8,261		100.0	%		7,998		100.0	%		3.3	%		24,109		100.0	%		23,449		100.0	%		2.8	%
Cost of sales		3,914		47.4	%		3,802		47.5	%		2.9	%		11,629		48.2	%		11,046		47.1	%		5.3	%
Gross profit		4,347		52.6	%		4,196		52.5	%		3.6	%		12,480		51.8	%		12,403		52.9	%		0.6	%
Operating expenses		2,626		31.8	%		2,532		31.7	%		3.7	%		7,731		32.1	%		7,502		32.0	%		3.1	%
Operating income		1,721		20.8	%		1,664		20.8	%		3.4	%		4,749		19.7	%		4,901		20.9	%		-3.1	%
Depreciation, Amortization & Other non-cash charges ⁽²⁾		428		5.2	%		476		6.0	%		-10.1	%		1,263		5.2	%		1,362		5.8	%		-7.3	%
EBITDA ⁽³⁾		2,149		26.0	%		2,140		26.8	%		0.4	%		6,012		24.9	%		6,263		26.7	%		-4.0	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Includes returnable bottle breakage expense.

⁽³⁾EBITDA= Operating Income+ Depreciation+ Amortization & Other non-cash charges.

Central American operations

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

	3Q 07		% Rev			3Q 06		% Rev			Δ%			YTD 07		% Rev			YTD 06		% Rev			Δ%
Sales Volume (million unit cases)		30.7					29.7					3.4	%		94.2					87.6					7.5	%
Average price per unit case		35.15					36.60					-4.0	%		36.00					36.04					-0.1	%
Net revenues		1,079					1,087					-0.7	%		3,391					3,157					7.4	%
Other operating revenues		5					-					N.A.			8					-					#DIV/0!
Total revenues		1,084		100.0	%		1,087		100.0	%		-0.3	%		3,399		100.0	%		3,157		100.0	%		7.7	%
Cost of sales		575		53.0	%		583		53.6	%		-1.4	%		1,806		53.1	%		1,702		53.9	%		6.1	%
Gross profit		509		47.0	%		504		46.4	%		1.0	%		1,593		46.9	%		1,455		46.1	%		9.5	%
Operating expenses		366		33.8	%		346		31.8	%		5.8	%		1,110		32.7	%		1,035		32.8	%		7.2	%
Operating income		143		13.2	%		158		14.5	%		-9.5	%		483		14.2	%		420		13.3	%		15.0	%
Depreciation, Amortization & Other non-cash charges ⁽²⁾		55		5.1	%		53		4.9	%		3.8	%		168		4.9	%		170		5.4	%		-1.2	%
EBITDA ⁽³⁾		198		18.3	%		211		19.4	%		-6.2	%		651		19.2	%		590		18.7	%		10.3	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Includes returnable bottle breakage expense.

⁽³⁾EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges.

Colombian operations

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

	3Q 07		% Rev			3Q 06		% Rev			Δ%			YTD 07		% Rev			YTD 06		% Rev			Δ%
Sales Volume (million unit cases)		49.5					49.7					-0.4	%		145.1					137.0					5.9	%
Average price per unit case		34.69					34.00					2.0	%		35.18					33.43					5.2	%
Net revenues		1,717					1,690					1.6	%		5,104					4,580					11.4	%
Other operating revenues		-					-					N.M.			-					3					-100.0	%
Total revenues		1,717		100.0	%		1,690		100.0	%		1.6	%		5,104		100.0	%		4,583		100.0	%		11.4	%
Cost of sales		858		50.0	%		942		55.7	%		-8.9	%		2,623		51.4	%		2,562		55.9	%		2.4	%
Gross profit		859		50.0	%		748		44.3	%		14.8	%		2,481		48.6	%		2,021		44.1	%		22.8	%
Operating expenses		503		29.3	%		490		29.0	%		2.7	%		1,553		30.4	%		1,461		31.9	%		6.3	%
Operating income		356		20.7	%		258		15.3	%		38.0	%		928		18.2	%		560		12.2	%		65.7	%
Depreciation, Amortization & Other non-cash charges ⁽²⁾		76		4.4	%		94		5.6	%		-19.1	%		237		4.6	%		253		5.5	%		-6.3	%
EBITDA ⁽³⁾		432		25.2	%		352		20.8	%		22.7	%		1,165		22.8	%		813		17.7	%		43.3	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Includes returnable bottle breakage expense.

⁽³⁾EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges.

Venezuelan operations

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

	3Q 07		% Rev			3Q 06		% Rev			Δ%			YTD 07		% Rev			YTD 06		% Rev			Δ%
Sales Volume (million unit cases)		51.5					47.7					8.0	%		152.0					132.8					14.5	%
Average price per unit case		44.83					39.62					13.2	%		42.78					39.90					7.2	%
Net revenues		2,309					1,890					22.2	%		6,503					5,299					22.7	%
Other operating revenues		4					4					0.0	%		11					14					-21.4	%
Total revenues		2,313		100.0	%		1,894		100.0	%		22.1	%		6,514		100.0	%		5,313		100.0	%		22.6	%
Cost of sales		1,298		56.1	%		1,159		61.2	%		12.0	%		3,829		58.8	%		3,264		61.4	%		17.3	%
Gross profit		1,015		43.9	%		735		38.8	%		38.1	%		2,685		41.2	%		2,049		38.6	%		31.0	%
Operating expenses		860		37.2	%		681		36.0	%		26.3	%		2,290		35.2	%		1,951		36.7	%		17.4	%
Operating income		155		6.7	%		54		2.9	%		187.0	%		395		6.1	%		98		1.8	%		303.1	%
Depreciation, Amortization & Other non-cash charges ⁽²⁾		84		3.6	%		120		6.3	%		-30.0	%		235		3.6	%		287		5.4	%		-18.1	%
EBITDA ⁽³⁾		239		10.3	%		174		9.2	%		37.4	%		630		9.7	%		385		7.2	%		63.6	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Includes returnable bottle breakage expense.

⁽³⁾EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges.

Argentine operations

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

	3Q 07		% Rev			3Q 06		% Rev			Δ%			YTD 07		% Rev			YTD 06		% Rev			Δ%
Sales Volume (million unit cases)		41.0					39.1					4.9	%		124.5					116.8					6.6	%
Average price per unit case		21.59					20.38					5.9	%		21.52					20.01					7.5	%
Net revenues		885					797					11.0	%		2,679					2,337					14.6	%
Other operating revenues		6					7					-14.3	%		24					32					-25.0	%
Total revenues		891		100.0	%		804		100.0	%		10.8	%		2,703		100.0	%		2,369		100.0	%		14.1	%
Cost of sales		550		61.7	%		486		60.4	%		13.2	%		1,629		60.3	%		1,428		60.3	%		14.1	%
Gross profit		341		38.3	%		318		39.6	%		7.2	%		1,074		39.7	%		941		39.7	%		14.1	%
Operating expenses		258		29.0	%		219		27.2	%		17.8	%		747		27.6	%		646		27.3	%		15.6	%
Operating income		83		9.3	%		99		12.3	%		-16.2	%		327		12.1	%		295		12.5	%		10.8	%
Depreciation, Amortization & Other non-cash charges ⁽²⁾		54		6.1	%		44		5.5	%		22.7	%		150		5.5	%		128		5.4	%		17.2	%
EBITDA ⁽³⁾		137		15.4	%		143		17.8	%		-4.2	%		477		17.6	%		423		17.9	%		12.8	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Includes returnable bottle breakage expense.

⁽³⁾EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges.

Brazilian operations

Expressed in millions of Mexican pesos⁽¹⁾ with purchasing power as of September 30, 2007

Financial figures include beer results

	3Q 07		% Rev			3Q 06		% Rev			Δ%			YTD 07		% Rev			YTD 06		% Rev			Δ%
Sales Volume (million unit cases) ⁽²⁾		68.9					64.0					7.7	%		208.4					192.0					8.5	%
Average price per unit case⁽²⁾		31.58					31.62					-0.1	%		31.88					31.42					1.4	%
Net revenues		2,428					2,266					7.1	%		7,388					6,748					9.5	%
Other operating revenues		7					2,276					-99.7	%		19					6,785					-99.7	%
Total revenues		2,435		100.0	%		2,276		100.0	%		7.0	%		7,407		100.0	%		6,785		100.0	%		9.2	%
Cost of sales		1,296		53.2	%		1,333		58.6	%		-2.8	%		4,105		55.4	%		3,917		57.7	%		4.8	%
Gross profit		1,139		46.8	%		943		41.4	%		20.8	%		3,302		44.6	%		2,868		42.3	%		15.1	%
Operating expenses		775		31.8	%		645		28.3	%		20.2	%		2,161		29.2	%		1,919		28.3	%		12.6	%
Operating income		364		14.9	%		298		13.1	%		22.1	%		1,141		15.4	%		949		14.0	%		20.2	%
Depreciation, Amortization & Other non-cash charges ⁽³⁾		53		2.2	%		52		2.3	%		1.9	%		163		2.2	%		144		2.1	%		13.2	%
EBITDA ⁽⁴⁾		417		17.1	%		350		15.4	%		19.1	%		1,304		17.6	%		1,093		16.1	%		19.3	%

⁽¹⁾Except volume and average price per unit case figures.

⁽²⁾Sales volume and average price per unit case exclude beer results

⁽³⁾Includes returnable bottle breakage expense.

⁽⁴⁾EBITDA = Operating Income + Depreciation + Amortization & Other non-cash charges.

SELECTED INFORMATION

For the three months ended September 30, 2007 and 2006

Expressed in millions of Mexican pesos as of September 30, 2007

	3Q 07		3Q 06
Capex	985.3	Capex	736.8
Depreciation	414.3	Depreciation	437.6
Amortization & Other non-cash charges	336.3	Amortization & Other non-cash charges	400.7

VOLUME

*Expressed in million unit cases*

	3Q 07										3Q 06
	Sparkling		Water ⁽¹⁾		Bulk Water⁽²⁾		Still ⁽³⁾		Total		Sparkling		Water ⁽¹⁾		Bulk Water		Still ⁽³⁾		Total
Mexico		224.3		14.4		44.4		3.0		286.1		217.6		13.1		39.6		2.6		272.9
Central America		27.5		1.3		0.0		1.9		30.7		26.9		1.2		0.0		1.6		29.7
Colombia		43.2		2.8		2.8		0.7		49.5		43.5		2.7		2.8		0.7		49.7
Venezuela		46.6		3.1		0.0		1.8		51.5		42.2		3.0		0.2		2.3		47.7
Brazil		63.5		4.3		0.0		1.1		68.9		58.9		4.5		0.0		0.6		64.0
Argentina		39.4		0.3		0.0		1.3		41.0		37.6		0.6		0.0		0.9		39.1
Total		444.5		26.2		47.2		9.8		527.7		426.7		25.1		42.6		8.7		503.1

SELECTED INFORMATION

For the nine months ended September 30, 2007 and 2006

*Expressed in millions of Mexican pesos as of September 30, 2007*

	YTD 07		YTD 06
Capex	2,318.5	Capex	1,981.1
Depreciation	1,206.0	Depreciation	1,221.7
Amortization & Other non-cash charges	1,009.8	Amortization & Other non-cash charges	1,122.5

VOLUME
*Expressed in million unit cases*

	YTD 07										YTD 06
	Sparkling		Water ⁽¹⁾		Bulk Water⁽²⁾		Still ⁽³⁾		Total		Sparkling		Water ⁽¹⁾		Bulk Water		Still ⁽³⁾		Total
Mexico		653.3		44.2		131.8		8.9		838.2		641.4		39.6		120.3		6.9		808.2
Central America		84.4		4.2		0.0		5.6		94.2		79.6		3.8		0.0		4.2		87.6
Colombia		126.9		8.1		8.2		1.9		145.1		120.1		7.5		7.8		1.6		137.0
Venezuela		137.2		8.6		0.0		6.2		152.0		115.8		8.5		2.1		6.4		132.8
Brazil		190.8		14.2		0.0		3.4		208.4		175.8		14.3		0.0		1.9		192.0
Argentina		120.0		0.6		0.0		3.9		124.5		113.1		1.7		0.0		2.0		116.8
Total		1,312.6		79.9		140.0		29.9		1,562.4		1,245.8		75.4		130.2		23.0		1,474.4

⁽¹⁾Excludes still bottled water in 5.0, 19.0 and 20.0 - liter packaging presentations

⁽²⁾Bulk Water = Still bottled water in 5.0, 19.0 and 20.0 - liter packaging presentations

⁽³⁾Still Beverages include flavored water

September 2007

Macroeconomic Information

	Inflation ⁽¹⁾									Foreign Exchange Rate (local currency per US Dollar) ⁽²⁾
	LTM			3Q 2007			YTD			Sep 07		Dec 06		Sep 06
Mexico		3.79	%		1.62	%		2.21	%		10.9203		10.876		11.0152
Colombia		5.00	%		0.11	%		4.67	%		2023.19		2238.79		2394.31
Venezuela		15.26	%		2.91	%		10.89	%		2150		2150		2150
Argentina		8.56	%		1.90	%		5.84	%		3.150		3.062		3.104
Brazil		4.95	%		1.21	%		3.42	%		1.8389		2.138		2.1742

⁽¹⁾ Source: Mexican inflation is published by Banco de México (Mexican Central Bank).

⁽²⁾ Exchange rates at the end of period are the official exchange rates published by Central Banks in each country.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the

registrant has duly caused this report to be signed on its behalf of the

undersigned, thereunto duly authorized.


	FOMENTO ECONÓMICO MEXICANO, S.A. DE C.V.

	By:	/s/ Javier Astaburuauga
		Javier Astaburuauga Chief Financial Officer

Date: October 26, 2007