UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM20-F
☐REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 2025
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
☐SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of event requiring this shell company report __________
Commission file number 001-39251
BETTERWARE DE MÉXICO, S.A.P.I. DE C.V.
(Exact name of Registrant as specified in its charter)
Not Applicable
(Translation of Registrant’s name into English)
MEXICO
(Jurisdiction of incorporation or organization)
Luis Campos, Board Chairman
+52(33) 3836-0500
Gdl-Ameca-Huaxtla km-5
El Arenal Jalisco, 45350, México
(Name, Telephone, E-mail and or Facsimile number and Address Company Contact Person)
Securities registered pursuant to Section 12(b) of the Act:
Securities registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 37,316,546 Ordinary Shares, as of December 31, 2025.
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
☐ Yes ☒ No
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
☒Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☒
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☒
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
☐ Item 17 ☐ Item 18
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
TABLE OF CONTENTS
i
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This annual report contains a number of forward-looking statements, including statements about the financial conditions, results of operations, earnings outlook and prospects and may include statements for the period following the date of this annual report. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “guideline,” “project,” “target,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would” and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.
The forward-looking statements are based on the current expectations of the management of the Company (See “Presentation of Financial Information”), as applicable, and are inherently subject to uncertainties and changes in circumstance and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Given these uncertainties, you should not rely upon forward looking statements as predictions of future events. These risks and uncertainties include, but are not limited to, those factors described in “Risk Factors,” those discussed and identified in public filings made with the Securities and Exchange Commission (“SEC”) by Betterware and the following:
Should one or more of these risks or uncertainties materialize or should any of the assumptions made by the management of the Company prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Except to the extent required by applicable law or regulation, the Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this annual report or to reflect the occurrence of unanticipated events.
ii
SUMMARY OF RISK FACTORS
The Company’s business, results of operations, financial conditions and cash flows are subject to, and could be materially adversely affected by a number of risks and uncertainties, including risks relating to the nature of the Company’s business and its operations in Mexico. The following list summarizes some, but not all, of these risks. Please read the information in the section entitled “Risk Factors” for a more thorough description of these and other risks.
Risks Related to Our Business
iii
Risks Related to Mexico
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Risks Related to Ownership of our Ordinary Shares
v
CERTAIN CONVENTIONS
Betterware de México, S.A.P.I. de C.V. (formerly Betterware de México, S.A.B. de C.V.), a Mexican sociedad anónima promotora de inversión de capital variable, was incorporated under the laws of Mexico in 1995. Unless otherwise stated or unless the context otherwise requires, the terms (i) “we,” “us,” “our,” “Company,” the “Group”, “the Group BeFra” or “BeFra” refer to Betterware de México, S.A.P.I. de C.V., and subsidiaries on a consolidated basis, (ii) “Betterware,” “BTW,” “BWM” and “BW” refer to Betterware de México, S.A.P.I. de C.V. on a standalone basis, and (iii) “JAFRA” or “Jafra” refers to Jafra Cosmetics International, Inc., Jafra Mexico Holding Company, B.V., Distribuidora Comercial Jafra, S.A. de C.V., Jafra Cosmetics International, S.A. de C.V., Jafra Cosmetics, S.A. de C.V., Serviday, S.A. de C.V., Jafrafin, S.A. de C.V. and Distribuidora Venus, S.A. de C.V., on a consolidated basis. See “Company Information—Organizational Structure.”
CURRENCY PRESENTATION
In this annual report, unless otherwise specified or the context otherwise requires:
Certain numbers and percentages included in this annual report have been subject to rounding adjustments. Accordingly, figures shown for the same category presented in various tables or other sections of this annual report may vary slightly, and figures shown as totals in certain tables may not be the arithmetic aggregation of the figures that precede them.
PRESENTATION OF FINANCIAL INFORMATION
This annual report contains our Audited Consolidated Financial Statements as of December 31, 2025, 2024, and 2023, and for our fiscal years ended December 31, 2025, 2024 and 2023 (collectively, our “Audited Consolidated Financial Statements”).
For purposes of this annual report, the term fiscal year is synonymous with the financial year and refers to the years covered by our Audited Consolidated Financial Statements.
We prepare our Audited Consolidated Financial Statements in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). We have applied IFRS issued by the IASB effective at the time of preparing our Audited Consolidated Financial Statements. Our Audited Consolidated Financial Statements as of and for the years ended December 31, 2025, 2024 and 2023 have been audited by PricewaterhouseCoopers, S. C. (“PWC”), an independent registered public accounting firm, whose report dated April 30, 2026, is also included in this annual report.
vi
The Audited Consolidated Financial Statements include the position and results of operations of the Group formed by Betterware, BLSM Latino America Servicios, S.A. de C.V. (“BLSM”), Programa Lazos, S.A. de C.V., Betterware de Guatemala, S.A., Finayo, S.A.P.I. de C.V. SOFOM ENR, Betterware America, LLC, Betterware Perú, S.A.C, Betterware Ecuador, S.A.S, Betterware Colombia, S.A.S and Jafra (See “The Business Combination—Organizational Structure”). The transactions, balances and unrealized gains or losses arising from intra-group transactions have not been considered for the preparation of the Audited Consolidated Financial Statements.
Our Audited Consolidated Financial Statements are presented in thousands of Pesos.
Non-IFRS Measures
We define “EBITDA” as profit for the year adding back the depreciation of property, plant and equipment and right-of-use assets, amortization of intangible assets, financing cost, net and total income taxes. We define “Adjusted EBITDA” as the same ratio with the elimination of non-concurrent transactions and events. EBITDA and adjusted EBITDA are not measures required by or presented in accordance with IFRS. EBITDA and Adjusted EBITDA are non-IFRS financial measures that do not follow generally accepted accounting principles or IFRS. These non-IFRS measures do not have standardized meanings and may not be directly comparable to similarly titled measures adopted by other companies. Potential investors should not rely on information not recognized under IFRS as a substitute for the measures of earning or liquidity required by IFRS in making an investment decision.
We believe that these non-IFRS financial measures are useful to investors because (i) we use these measures to analyze our financial results internally and believe they represent measures of operating profitability and (ii) these measures will provide investors more tools for their analysis of our operating performance.
For reconciliations of EBITDA and Adjusted EBITDA, see “Operating and Financial Review and Prospects—Operating Results—Reconciliation of Non-IFRS Measures.”
PRESENTATION OF INDUSTRY AND MARKET DATA
In this annual report, we rely on, and refer to, information regarding our business and the markets in which we operate and compete. The market data and certain economic and industry data and forecasts used in this annual report were obtained from internal surveys, market research, governmental and other publicly available information, and independent industry publications. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. We believe that these industry publications, surveys, and forecasts are reliable, but we have not independently verified them and cannot guarantee their accuracy or completeness.
Certain market share information and other statements presented herein regarding our position relative to our competitors are not based on published statistical data or information obtained from independent third parties but reflects our best estimates. We have based these estimates upon information obtained from publicly available information from our competitors in the industry in which we operate.
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PART I
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
ITEM 3. KEY INFORMATION
An investment in our Ordinary Shares carries a significant degree of risk. You should carefully consider the following risk factors, together with all of the other information included in this annual report, before making a decision to invest in our ordinary shares. The risks described below are those which the Group believes are the material risks that it faces. Some statements in this annual report, including such statements in the following risk factors, constitute forward-looking statements. See the section entitled “Cautionary Note Regarding Forward-Looking Statements.” If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment.
If we are unable to retain our existing, or recruit new, independent distributors, leaders and consultants, our results of operations could be negatively affected.
We distribute almost all of our products through our independent distributors, leaders and consultants, and we depend on them directly for the sale of our products. We experience high turnover among distributors, leaders and consultants from year to year since they can terminate their services at any time. As a result, we need to make significant efforts to retain existing distributors, leaders, and consultants and to recruit or attract others.
To increase our revenue, we must increase the number and/or the productivity of our distributors, leaders and consultants. The number and productivity of our distributors, leaders and consultants also depends on several additional factors, including:
1
Our operations would be harmed if we failed to generate continued interest and enthusiasm among our distributors, leaders and consultants or we failed to attract new ones, or if our distributors, leaders and consultants are unable to operate due to internal or external factors.
The number of our active distributors, leaders and consultants may not increase and could decline in the future. Our operating results could be harmed if existing and new business opportunities and products do not generate sufficient interest in retaining existing distributors, leaders and consultants or recruiting new ones.
The loss of key high-level distributors, leaders or consultants could negatively impact our growth and our revenue.
As of December 31, 2025, BWM had approximately 654,680 active associates and 40,723 distributors, and JAFRA had approximately 470,925 and 20,483 active consultants and leaders, respectively. BWM’s distributors and JAFRA’s leaders and consultants, together with their extensive networks of downline distributors or leaders, account for an important part of our net revenue. As a result, the loss of a high-level distributors, leaders or consultants, could negatively impact our network growth and our net revenue.
A decline in our customers’ purchasing power or consumer confidence or in customers’ financial condition and willingness to spend could materially and adversely affect our business.
The sale of our products strongly correlates to the level of consumer spending generally, and thus is significantly affected by the general state of the economy and the ability and willingness of consumers to spend on discretionary items. Reduced consumer confidence and spending generally may result in reduced demand for our products and limitations on our ability to maintain or increase prices. A decline in economic conditions or general consumer spending in any of our major markets could have a material adverse effect on our business, financial condition and results of operations.
Failure to successfully develop new products could harm our business.
An important component of our business is our ability to develop new products that create enthusiasm among our customers. If we fail to introduce new products planned for the future, our distributors, leaders and consultants’ productivity could be harmed. In addition, if our new products fail to gain market acceptance, are restricted by regulatory requirements, or have quality problems, this would harm our results of operations. Factors that could affect our ability to continue to introduce new products include, among others, government regulations, proprietary protections of competitors that may limit our ability to offer comparable products and any failure to anticipate changes in consumer tastes and buying preferences.
2
We depend on multiple contract manufacturers mostly located in China, and the loss of the services provided by any of our manufacturers could harm our business and results of operations.
We outsource product manufacturing to third-party contractors located mainly in China. During the year 2025, products supplied by Chinese manufacturers accounted for approximately +87.2% of BWM’s revenues.
If these suppliers have unscheduled downtime or are unable to fulfill their obligations under these manufacturing agreements because of political or regulatory restrictions, equipment breakdowns, labor strikes, natural disasters, health diseases on health epidemics or pandemics, or any other cause, this could adversely affect our overall business, results of operations and financial condition.
Also, although we provide all of the formulations used to manufacture our products, we have limited control over the manufacturing process itself. As a result, any difficulties encountered by the third-party manufacturer that result in product defects, production delays, cost overruns, or the inability to fulfill orders on a timely basis, due to, for instance, sanctions, tariffs or blocks imposed on Chinese products, could have a material adverse effect on our business, financial condition and results of operations.
Disruptions or delays at our facility in Queretaro, Mexico could have a material adverse effect on our business, particularly with respect to the beauty and personal care segment.
Our facility in Queretaro, Mexico, manufactures a substantial portion of the products of our beauty and personal care segment, which accounted for 84.3% of JAFRA sales, and as of December 31, 2025, represented 59.9% of our total sales at a consolidated level. Significant unscheduled downtime or a reduction in capacity at this facility, whether due to equipment breakdowns, power failures, natural disasters (due to climate change or otherwise), pandemics, weather conditions hampering delivery schedules, shortages of raw materials and products, technology disruptions or other disruptions, including those caused by transitioning manufacturing across these facilities, or any other cause could have a material adverse effect on our ability to provide products to our leaders, consultants and customers, which could have a material adverse effect on our sales, business, prospects, reputation, results of operations, financial condition and/or cash flows.
Additionally, some of our employees at this facility are members of labor unions. In the past, we have experienced labor-union related work strikes in Mexico which have affected our operations. Also, negotiating labor contracts, either for new locations or to replace expiring contracts, is time consuming or may not be accomplished on a timely basis. If we are unable to satisfactorily negotiate those labor contracts with the labor unions on terms acceptable to us or without a strike or work stoppage, our business could be materially adversely affected. Any strike or work stoppage could disrupt our business, adversely affecting our results of operations and our public image could be materially adversely affected by such labor disputes. In addition, existing labor contracts may not prevent a strike or work stoppage, and any such work stoppage could have a material adverse effect on our business.
Volatility in costs, along with delays and disruptions in the supply of materials and services, could have a material adverse effect on our business, prospects, results of operations, financial condition and/or cash flows.
We purchase raw materials, including essential oils, alcohols, chemicals, containers and packaging components, from various third-party suppliers. Substantial cost increases delays and the unavailability of raw materials or other commodities, as a result of continued global supply chain disruptions, and higher costs for energy, transportation and other necessary services have adversely affected and may continue to adversely affect our beauty and personal care segment profit margins if we are unable to wholly or partially offset them, such as by achieving cost efficiencies in its supply chain, manufacturing and/or distribution activities. In addition, we purchase certain finished goods, raw materials, packaging and other components from single-source suppliers or a limited number of suppliers and if we are required to find alternative sources of supply, these new suppliers may have to be qualified under applicable industry, governmental and Company-mandated vendor standards, which can require additional investment and be time-consuming.
3
Any significant disruption to our manufacturing or sourcing of products or raw materials, packaging and other components for any reason (including the continued global supply chain disruptions) could materially impact our inventory levels and interrupt and delay our supply of products to our leaders and consultants. Such events, if not promptly remedied, could have a material adverse effect on our business, prospects, reputation, results of operations, financial condition and/or cash flows.
Competition could have a material adverse effect on our business, prospects, results of operations, financial condition and/or cash flows.
The markets in which we operate are competitive. Our results of operations may be harmed by market conditions and competition in the future. Many competitors have greater name recognition and financial resources than we have, which may give them a competitive advantage.
We compete against a number of multi-national manufacturers, some of which are larger and have substantially greater resources than us, and which may therefore have the ability to spend more aggressively than us on new business acquisitions, research and development activities, technological advances to evolve in their e-commerce capabilities and advertising, promotional, social media and/or marketing activities and have more flexibility than us to respond to changing business and economic conditions.
Also, our products compete directly with branded, premium retail products. We currently do not have significant patent or other proprietary protection, and competitors may introduce products with the same ingredients that we use in our products.
We also compete with other companies for distributors, leaders and consultants. Some of these competitors have a longer operating history, better name recognition and greater financial resources than we do. Some of our competitors have also adopted and could continue to adopt some of our business strategies. Consequently, to successfully compete in this market and attract and retain distributors, leaders and consultants, we must ensure that our business opportunities and compensation plans are financially rewarding. We may not be able to continue to successfully compete in this market for distributors, leaders and consultants, which would ultimately affect our business operations.
If the industry in which we operate, our business or our products are subject to adverse publicity, our business may suffer.
We are very dependent upon our distributors, leaders, consultants and the general public perception of the overall integrity of our business, as well as the safety and quality of our products and similar products distributed by other companies. The number and motivation of our distributors, leaders and consultants and the acceptance by the general public of our products may be negatively affected by adverse publicity regarding:
Any event that negatively affects the general public perception of our industry, business or products could have a material effect on our results of operations.
4
Failure of our technology initiatives to create sustained enthusiasm in our distributors, leaders and consultants and incremental cost savings could negatively impact our business.
We constantly develop and implement strategies to continue using technology to attract distributors, leaders and consultants and provide them new technology to facilitate taking orders of our products. In certain demographic markets, we have experienced some success implementing our technology strategies to improve our operating efficiency. However, any cost savings from our technology strategies may not prove to be significant, or we may not be successful in adapting and implementing these strategies to other markets in which we operate. This could result in our inability to service our distributors, leaders and consultants in the manner they expect, which could ultimately affect our results of operations.
We are dependent on information and communication technologies, and our systems and infrastructures face certain risks, including cybersecurity risks.
The operation of complex infrastructures and the coordination of the many actors involved in our operation require the use of several highly specialized information systems, including both our own information technology systems and those of third-party service providers, such as systems that monitor our operations or the status of our facilities, communication systems to inform the public, access control systems and closed circuit television security systems, infrastructure monitoring systems and data and voice communication systems used by our personnel. In addition, our accounting and fixed assets, payroll, budgeting, human resources, supplier and commercial, hiring, payments and billing systems and our websites are key to our functioning. The proper functioning of these systems is critical to our operations and business management. These systems may, from time to time, require modifications or improvements as a result of changes in technology, the growth of our business and the functioning of each of these systems.
The risk of cyber-crime continues to increase across all industries and geographies as infiltrating technology is becoming increasingly sophisticated. If we are unable to prevent a significant cyber-attack, such attack could materially disrupt our operations, damage our reputation and lead to regulatory penalties and financial losses. To prevent such disruptions to our operations we have implemented a multi-layer security framework, from strategic corporate policies to operational procedures and controls. To support this framework, we use sophisticated technologies to secure our perimeter, computing equipment, networks, servers, storage and databases.
Information technology systems cannot be completely protected against certain events such as natural disasters, fraud, computer viruses, hacking, communication failures, equipment breakdown, software errors and other technical problems. However, our security framework allows us to minimize and manage these risks through the use of enabling technologies such as, but not limited to, firewalls, mail & web filtering, end point protection, antivirus and anti-malware, access lists, encryption and hardening. To ensure security at the web application level, a WAF - Web Application Firewall is implemented that protects web applications by filtering and blocking malicious traffic. This helps to prevent data theft, security breaches, and applications downtime.
In addition, our business operations routine involves gathering personal information about vendors, distributors, leaders, consultants, customers and employees among others, through the use of information technologies. Breaches of our systems or those of our third-party contractors, or other failures to protect such information, could expose such people’s personal information to unauthorized use. Any such event could give rise to significant potential liability and reputational harm. To reduce the risk of cyberattacks, we plan to hire a Security Operations Center (SOC) to provide real-time protection for the Group’s most critical information assets.
During 2025, we experienced a number of non-material phishing attempts which consisted of fake e-mails requesting minor payments and/or confidential information and e-mails with malicious files that we were able to successfully quarantine and contain, as well as sporadic attempted attacks, that were minor and unsuccessful, on our infrastructure. None of such incidents were material nor had any significant effect on our business or operations. However, we cannot guarantee any future events will not affect our operations or customers, particularly with AI use. We are constantly seeking to improve and strengthen our security strategy by aligning it with Security Frameworks and Best Practices such as NIST CSF and ISO 27000.
5
Because of the costs and difficulties inherent in managing cross-border business operations, our results of operations may be negatively impacted.
Managing our business, operations, personnel or assets in multiple jurisdictions is challenging and costly. Management may be inexperienced in cross-border business practices and unaware of significant differences in accounting rules, legal regimes and labor practices. Even with a seasoned and experienced management team, the costs and difficulties inherent in managing cross-border business operations, personnel and assets can be significant (and much higher than in a purely domestic business) and may negatively impact our financial and operational performance.
Our distributors, leaders and consultants are independent contractors and not employees. If regulatory authorities were to determine, however, that our distributors, leaders and consultants are legally our employees, we could have significant liability under social benefit laws.
Distributors, leaders and consultants are self-employed and are not our employees. Periodically, the question of the legal status of our distributors, leaders and consultants has arisen, usually with regard to possible coverage under social benefit laws that would require us to make regular contributions to social benefit funds. We cannot guarantee there will not be a future judicial or administrative determination adverse to the current criteria, which would substantial and materially adversely affect our business, results of operations and financial condition.
Deterioration of general economic and geopolitical conditions, including due to the ongoing military conflicts between Russia and Ukraine and in the Middle East, could have a material adverse effect on our business.
Our business may be adversely affected by changes in global economic and political conditions, particularly given our cross-border activity, which may result in increased volatility in our markets. Global markets have experienced economic uncertainty, volatility and disruption due to ongoing conflicts such as the Russian Ukrainian war, the instability and the United States’ intervention in Venezuela, Israel and the United States’ conflict with Iran, and various other Middle East tensions. Additionally, U.S. tariff policies, the decoupling of the Chinese and U.S. economies, and the weakening of multilateralism in trade further exacerbate global trade uncertainties. These geopolitical tensions collectively contribute to market volatility, disrupt supply chains, and create an unpredictable economic climate, posing substantial challenges for businesses operating on a global scale including:
Any such event may increase our costs and adversely affect our business if we are not able to pass such increased costs onto our customers. In addition, in the event there is a slowdown or disruption of the global and local supply chains, we may face interruptions in our production if we are not able to proactively manage our inventory and enter into strategic partnerships with suppliers. A delay in the transit time of our shipments would impact the availability of our products in the relevant consumer markets and increase our cost of capital employed as a result of larger inventories and longer accounts receivable turnover, therefore impacting our results of operations and financial position.
6
Geopolitical and economic risks have also increased over the past few years as a result of constant intensification of trade tensions between the United States and China, Brexit, and the rise of populism. The complexity of commercial relationships and the change in the tariff policies can result in fluctuations in our costs. Global supply chains, on which we heavily rely, may also face additional challenges, requiring effective mitigation strategies. Growing tensions may lead, among others, to the weaking of multilateral regime of world economy and WTO rules, a deglobalization of the world economy, an increase in protectionism or barriers to immigration, a general reduction of international trade in goods and services and a reduction in the integration of financial markets, any of which could materially and adversely affect our business, financial condition and results of operations.
Economic and political uncertainty in the United States may also create uncertainty in the global economy. In November 2024, Donald Trump was elected U.S. president. Trump’s administration will result in changes in legislation, regulation and government policy that could significantly impact our business, the relationship between Mexico and the United States as well as the markets in which we compete in the United States.
On April 2, 2025, President Donald Trump announced the implementation of global reciprocal tariffs between 10%-50%. Later, President Donald Trump announced the suspension of new tariffs for 90 days and raised the tariffs applied to China to 145%. President Donald Trump’s global reciprocal tariffs represent a new phase in US trade and economic policy, aiming to create a durable tariff wall around the country to address what it is seen to be as trade imbalances. Countries around the globe (including China and EU members) are planning or have already implemented retaliation tools against the United States. China, for example, applied 125% retaliatory tariffs over US imports. These rapidly evolving tariffs are unpredictable and are expected to impact global growth prospects an increase inflation, with potential effect amplified by a shift toward global economic fragmentation beyond direct retaliation against the U.S.
In addition to the broad-based tariffs described above, the current U.S. administration has indicated that it may adopt Mexico-specific measures targeting strategic sectors such as automobiles, auto parts, steel, aluminum and other industrial goods manufactured in Mexico. The administration has also suggested the possibility of restricting preferential treatment under the USMCA framework through stricter enforcement of rules of origin, labor compliance provisions and dispute mechanisms, without formally terminating the agreement. Furthermore, the United States may implement enhanced customs inspections, border controls or other non-tariff barriers that could delay cross-border trade and increase logistics costs. Certain public statements have also linked potential trade measures to immigration enforcement, enforcement against drug traffickers and border security policies, creating the risk that tariffs could be reimposed or expanded based on non-trade considerations. These sector-specific and non-tariff measures could adversely affect Mexican manufacturing, supply chains and the demand for our products.
We are continuing to monitor the situation in Russia, Ukraine, Venezuela, the Middle East, U.S. and globally, and assess its potential impact on our business. The ongoing geopolitical tensions, including contribute to significant market volatility and disrupt global supply chains. The weakening of multilateralism in trade further exacerbates these uncertainties. Any of these factors could adversely affect our business, prospects, financial condition, and operating results. These disruptions may also magnify the impact of other risks described elsewhere in this annual report.
Goodwill, property, plant and equipment and intangible assets represent a significant portion of the Group’s statement of financial position, and our operating results may suffer from possible impairments.
Goodwill, property, plant and equipment and intangible assets in our statement of financial position derived from past business combinations carried out by the Group, are further explained in the notes to the consolidated financial statements located elsewhere in this annual report. Goodwill and intangible assets with indefinite useful lives are tested for impairment at least annually. Property, plant and equipment and intangible assets with definite useful lives are tested for impairment whenever there is an indication that these assets may be impaired. In the case of an impairment, we will recognize charges to our operating results based on the impairment assessment processes. In addition, future acquisitions may be made by the Group and a portion of the purchase price of these acquisitions may be allocated to acquired goodwill, property, plant and equipment and intangible assets. An impairment on property, plant and equipment or goodwill of acquired businesses could have a material adverse effect on our financial condition and results of operations.
7
Material weaknesses have been identified in Betterware’s internal control over financial reporting, and if we fail to establish and maintain proper and effective internal controls over financial reporting, our results of operations and our ability to operate our business may be materially adversely affected.
As of December 31, 2025, our management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control – Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
Our management concluded that we did not design and maintain effective controls over (i) the effectiveness of the controls over the business combination process, specifically, we did not design and maintain controls to determine the goodwill and long-lived assets at acquisition and its ongoing impairment assessment; including controls over the review of the data and assumptions used to determine the fair value of the assets and liabilities and the recoverable amount; (ii) the effectiveness of the controls over substantially all accounts and disclosures in the period-end financial reporting and consolidation process. Specifically, we did not design and maintain formal accounting policies, procedures and controls to ensure complete, accurate and timely reporting in the consolidated financial statements; and (iii) the effectiveness of information technology (“IT”) general controls for information systems that are relevant to the preparation of our consolidated financial statements including control over change management, user access, computer operations and program development.
We are in the process of implementing several measures to strengthen our internal control over financial reporting such as the deployment of IT applications to enable and automate the consolidation and ITGC process. For details of the controls and remediation plan, see “Item 15—Controls and Procedures—Disclosure Controls and Procedures.”
The Company is an accelerated filer and has maintained that status from 2022 to 2025. The Company continues working to improve on the implementation of a formal internal control over financial reporting program based on a top-down risk assessment ensure the existence of controls over significant accounts, processes, applications and IT environments. See “Item 15—Controls and Procedures—Disclosure Controls and Procedures.”
If we fail to establish and maintain proper and effective internal controls over financial reporting or fail to adequately resolve our existing material weaknesses, our results of operations and our ability to operate our business may be materially adversely affected.
Our controlling shareholder may have interests that conflict with your interests.
As of the date of this annual report, Campalier S.A. de C.V. (“Campalier”), directly and through Banco Invex S.A. Institucion de Banca Múltiple, Invex Grupo Financiero,, controls approximately 54.2% of our outstanding Ordinary Shares. As the controlling shareholder, Campalier may take actions that are not in the best interests of the Group’s other shareholders. These actions may be taken in many cases even if they are opposed by the Group’s other shareholders. In addition, this concentration of ownership may discourage, delay or prevent a change in control which could deprive you of an opportunity to receive a premium for your Ordinary Shares as part of a sale of the Group.
Our business and results of operations may be adversely affected by the increased strain on our resources from complying with the reporting, disclosure and other requirements applicable to public companies in the United States promulgated by the U.S. Government, the NYSE or other relevant regulatory authorities.
Compliance with existing, new and changing corporate governance and public disclosure requirements adds uncertainty to our compliance policies and increases our costs of compliance. Changing laws, regulations and standards include those relating to accounting, corporate governance and public disclosure, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Sarbanes-Oxley Act of 2002, new SEC regulations and the NYSE listing guidelines. Application of these laws, regulations and guidelines may evolve over time as new guidance is provided by regulatory and governing bodies. In particular, compliance with Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) and related regulations regarding required assessment of internal controls over financial reporting and our external auditor’s audit of that assessment, requires the commitment of significant financial and managerial resources.
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We also expect the regulations to increase our legal and financial compliance costs and to make it more difficult to attract and retain qualified officers and members of our board of directors, particularly to serve on our audit committee, and make some activities more difficult, time-consuming and costly.
Existing, new and changing corporate governance and public disclosure requirements could result in continuing uncertainty regarding compliance matters and higher costs of compliance as a result of ongoing revisions to such governance standards. Our efforts to comply with evolving laws, regulations and standards have resulted in, and are likely to continue to result in, increased general and administrative expenses. In addition, new laws, regulations and standards regarding corporate governance may make it more difficult for our company to obtain director and officer liability insurance. Further, our board members and senior management could face an increased risk of personal liability in connection with their performance of their duties. As a result, we may face difficulties attracting and retaining qualified board members and senior management, which could harm our business. If we fail to comply with new or changed laws or regulations and standards differ, our business and reputation may be materially adversely affected.
Our revenue and profitability may be affected if we fail to acquire new companies or integrate those that we have already acquired, such as Jafra and, eventually Tupperware.
We consider acquisitions a useful instrument to complement our organic growth. We opportunistically explore acquiring other businesses and assets, such as the Jafra Acquisition and the pending Tupperware Acquisition, as defined below.
However, we may face financial, managerial and operational challenges, including diversion of management attention and resources needed for existing operations, difficulties with integrating acquired businesses, such as Jafra, integration of different corporate cultures, increased expenses, potential dilution of our brand, assumption of unknown liabilities, potential disputes with the sellers and the need to evaluate the financial systems of and establish internal controls for acquired entities. Further, we seek out acquisitions of companies that maintain the same high quality standards that we maintain, and if we misjudge or overestimate products quality standards, we may not be able to use these products or implement the strategies that were the primary reason for the corresponding acquisition, such as may be the case with the Jafra Acquisition, which would lead to a significant loss both financially and in time spent by our teams trying to integrate the products or implement the strategy.
In addition, our ability to realize the benefits we anticipate from our acquisition activities, including the Jafra Acquisition, including any anticipated sales growth, cost synergies and other anticipated benefits, will depend in large part upon whether we are able to integrate such businesses efficiently and effectively. Integration is an ongoing process, and we may not be able to fully integrate such businesses smoothly or successfully, and the process may take longer than expected. Further, the integration of certain operations and the differences in operational culture following such activity will continue to require the dedication of significant management resources, which may distract management’s attention from day-to-day business operations.
There may also be unasserted claims or assessments that we failed or were unable to discover or identify in the course of performing due diligence investigations of target businesses. While we normally negotiate representation and warranties and related indemnification in relation to such acquisitions, these may not be enough to cover our exposure if a significant liability arises in connection with any acquisition agreement, including the Jafra Acquisition. We cannot assure you that these indemnification provisions will protect us fully or at all, and as a result we may face unexpected liabilities that could adversely affect our business, financial condition and results of operations.
If we are unable to successfully integrate the operations of Jafra, Tupperware or any other acquired business, into our business, we may be unable to realize the sales growth, cost synergies and other anticipated benefits of such transactions, and our business, results of operations and cash flow could be materially adversely affected.
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Our indebtedness and any future inability to meet any of our obligations under our indebtedness could adversely affect us by reducing our flexibility to respond to changing business and economic conditions.
As of December 31, 2025, we had Ps.4,464 million of outstanding indebtedness (current and non-current borrowings and leases). We rely on obtaining financing and refinancing of existing indebtedness in order to operate our business, implement our strategy and grow our business. Recent disruptions in the global credit markets and their effect on the global and Mexican economies could materially adversely affect our business. We may also incur additional working capital lines of credit to meet future financing needs, subject to certain restrictions under our indebtedness, which would increase our total indebtedness. We may be unable to generate sufficient cash flow from operations and future borrowings, and other financing may be unavailable in an amount sufficient to enable us to fund our current and future financial obligations or our other liquidity needs, which would have a material adverse effect on our business, prospects, financial condition, liquidity and results of operations as well as reduce the availability of our cash flow to fund working capital, operations, capital expenditures, dividend payments, strategic acquisitions, expansion of our operations and other business activities. Our indebtedness could have material negative consequences on our business, prospects, financial condition, liquidity, results of operations and cash flows, including the following:
Certain of our indebtedness contain customary covenants, including, among other things, limits on the ability of the company and any restricted subsidiary to, subject to certain exceptions, incur liens, incur debt, merge, consolidate or dispose of all or substantially all of its assets.
Changes in taxes and other assessments may adversely affect us.
The legislatures and tax authorities in the tax jurisdictions in which we are subject to tax regularly enact reforms to the tax and other assessment regimes to which we, our distributors, leaders and consultants, and our customers are subject. Such reforms include changes in tax rates and, occasionally, enactment of temporary taxes, the proceeds of which are earmarked for designated governmental purposes. In addition, the interpretation of tax laws by courts and taxation authorities is constantly evolving. The effects of these changes and any other changes that result from enactment of additional tax reforms or changes to the manner in which current tax laws are applied cannot be quantified and there can be no assurance that any such reforms or changes would not have an adverse effect upon our business directly or indirectly (e.g., by affecting the business of our consultants and representatives).
For example, Latin American governments have often increased taxes or changed tax legislation as a response to macroeconomic crises or other developments affecting their respective jurisdictions. These and any other possible future changes in tax policy laws in the countries where we are subject to tax may adversely affect our business, financial condition, and results of operations.
In December 2021, the Organization for Economic Cooperation and Development “OECD” released the pillar two model rules (the Global Anti-Base Erosion Proposal, or “GloBE”) to reform international corporate taxation. Large multinational enterprises within the scope of the rules are required to calculate their GloBE effective tax rate for each jurisdiction where they operate. They will be liable to pay a top-up tax for the difference between their GloBE effective tax rate per jurisdiction and the 15% minimum rate.
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As of December 31, 2025, the Group is not within the scope of the pillar two model rules because this legislation has not been enacted in the jurisdictions where it operates. Since pillar two legislation is not effective at the reporting date, the Group has no current tax exposure; however, the Group will be analyzing the potential implications of the application of the pillar two rules, including evaluating whether the requirements in each jurisdiction qualify as income taxes under the scope of IAS 12. We cannot provide any assurance regarding the effect, if any, that such rules would have on our results of operations or financial condition.
Distributions to U.S. Holders of our shares may be fully taxable as dividends.
It is difficult to predict whether or to what extent the Company will generate earnings or profits as computed for U.S. federal income tax purposes in any given tax year. If the Company makes distributions on the shares from current or accumulated earnings and profits as computed for U.S. federal income tax purposes, such distributions generally will be taxable to U.S. Holders of the Company’s shares as ordinary dividend income for U.S. federal income tax purposes. Under current law, if certain requirements are met, such dividends would be eligible for the lower tax rates applicable to qualified dividend income of certain non-corporate U.S. Holders. Because the Company does not maintain calculations of its earnings and profits under U.S. federal income tax principles, it is expected that any such distribution on ordinary shares (including any Mexican taxes withheld) will be reported to U.S. Holders as foreign source dividend income. See “Taxation of distributions” below.
We are subject to environmental laws and regulations risks that could affect our business, results of operations and financial condition.
Our operations are subject to a wide range of environmental laws and regulations in each of the jurisdictions in which we operate. These laws and regulations impose increasingly rigorous environmental protection standards. According to Mexican General Law of Ecological Balance and Environmental Protection (Ley General de Equilibrio Ecológico y la Protección al Ambiente or LGEEPA in Spanish), organizations must comply with the following, among others: (i) guarantee the human right of every person to a healthy environment for their development and well-being; (ii) the preservation, restoration and improvement of the environment; (iii) the preservation and protection of biodiversity, as well as the establishment and administration of protected natural areas; (iv) the sustainable use, preservation and, where appropriate, restoration of soil, water and other natural resources, so that they are compatible for obtaining economic benefits and the activities of society with the preservation of the ecosystems; and (v) prevention and control of air, water and soil pollution, among others. The establishment of these controls and security measures exposes us to a risk of significant environmental costs and responsibilities, such as taxes, investment in equipment and technology, investment in spaces for development and well-being, fines and penalties. In addition, we are exposed to the fact that, over time, these laws and regulations may become more stringent over existing ones, which could lead to the imposition of new risks and costs resulting in a decrease in our profitability.
Environmental requirements can restrict trade which could lead to increased transportation and import costs for the products we sell to our customers.
Environmental, social and corporate governance (ESG) issues, including those related to climate change and sustainability, may have an adverse effect on our business, financial condition and results of operations and damage our reputation.
There is an increasing focus from certain investors, customers, consumers, employees and other stakeholders concerning ESG matters. Additionally, public interest and legislative pressure related to public companies’ ESG practices continue to grow. If our ESG practices fail to meet regulatory requirements or investor, customer, consumer, employee or other stakeholders’ evolving expectations and standards for responsible corporate citizenship in areas including environmental stewardship, support for local communities, board of director and employee diversity, human capital management, employee health and safety practices, product quality, supply chain management, corporate governance and transparency, our reputation, brand and employee retention may be negatively impacted, and our customers and suppliers may be unwilling to continue to do business with us. See “Company Information—Environment, Social and Governance.”
Customers, consumers, investors and other stakeholders are increasingly focusing on environmental issues, including climate change, energy and water use, plastic waste and other sustainability concerns. Concern over climate change may result in new or increased legal and regulatory requirements to reduce or mitigate impacts to the environment. Changing customer and consumer preferences or increased regulatory requirements may result in increased demands or requirements regarding plastics and packaging materials, including single-use and non-recyclable plastic products and packaging, other components of our products and their environmental impact on sustainability, or increased customer and consumer concerns or perceptions (whether accurate or inaccurate) regarding the effects of substances present in certain of our products. Complying with these demands or requirements could cause us to incur additional manufacturing, operating or product development costs.
If we do not adapt to or comply with new regulations, or fail to meet evolving investor, industry or stakeholder expectations and concerns regarding ESG issues, investors may reconsider their capital investment in our Company, and customers and consumers may choose to stop purchasing our products, which could have a material adverse effect on our reputation, business, results of operations or financial condition.
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Our products are subject to federal, state and international regulations that could have a material adverse effect on our business, prospects, results of operations, financial condition and/or cash flows.
Our business is subject to numerous laws, regulations and trade policies. We are subject to regulation by the FTC and the FDA in the U.S., as well as various other federal, state, local and foreign regulatory authorities, including those in the countries in which the Company operates. Our facility located in Queretaro, Mexico is registered with the FDA as a drug manufacturing establishment, permitting the manufacture of cosmetics and other beauty-care products that contain over-the-counter drug ingredients, such as sunscreens, anti-perspirant deodorants and anti-dandruff hair-care products. Regulations in the U.S., the EU, Canada and other countries in which we operate are designed to protect consumers or the environment, such as regulations enacted to address the impacts of climate change, have an increasing influence on our product claims, ingredients and packaging. To the extent federal, state, local and/or foreign regulatory changes occur in the future, whether due to changes in applicable laws or regulations or evolving interpretations and enforcement policies by regulatory authorities, they could require us to reformulate or discontinue certain of our products or revise its product packaging or labeling, any of which could result in, among other things, increased our costs, delays in product launches, product returns or recalls and lower net sales, and therefore could have a material adverse effect on our business, prospects, results of operations, financial condition and/or cash flows.
Our limited proprietary intellectual property and failure to keep pace with technological developments, including emerging technologies such as artificial intelligence, could adversely affect our competitive position.
We rely primarily on our trademarks, brand recognition and operational execution rather than significant proprietary technology or intellectual property. As a result, our business may be more susceptible to competitive pressures, including from companies that develop or control proprietary technologies or other intellectual property rights.
Our industry is subject to ongoing technological change, including the increasing use of digital tools, data analytics and artificial intelligence by competitors. Competitors that more effectively adopt or leverage such innovations may improve efficiency, enhance customer experience or reduce costs, which could make their products or services more profitable than ours.
Since more that 90% our operations are concentrated in Mexico, we are subject to political, economic, legal, and regulatory risks specific to Mexico and are vulnerable to an economic downturn, other changes in market conditions, acts of violence, or natural disasters in s in Mexico which may adversely affect our business and results of operations.
Currently, almost all of our operations are conducted, and almost all of our customers are located, in Mexico. Accordingly, our ability to raise revenues, our financial condition and results of operations are substantially dependent on the economic conditions prevailing in Mexico. As a result, our business may be significantly affected by the Mexican economy’s general condition, political events and by the depreciation of the Mexican peso, by inflation and high interest rates in Mexico, among others. Declines in growth, high rates of inflation and high interest rates in Mexico may have a generally adverse effect on our operations. If inflation in Mexico increases while economic growth slows or stagnates, our business, results of operations and financial condition could be affected. In addition, high interest rates and economic instability could increase our costs of financing. For the years ended December 31, 2023, 2024 and 2025, annual GDP growth in Mexico was 3.1%, 1.4% and decreased to 0.8%, respectively.
During 2025, Mexico’s sovereign debt rating was confirmed by several rating agencies (S&P Global, HR Ratings and Fitch Ratings) and a stable outlook was maintained. We cannot ensure that the rating agencies will not announce an outlook revision and/or any downgrades of Mexico or any of its state-owned companies. These revisions and downgrades could adversely affect the Mexican economy and, consequently, our business, financial condition, operating results and prospects.
Decreases in the growth rate of the Mexican economy, periods of low or negative growth or high inflation may adversely affect, the activities, financial situation, operating results, cash flows and/or prospects of the Group.
The market prices of securities issued by companies with Mexican operations are affected to varying degrees by the economic and market situation in other places, including the United States, China, the rest of Latin America and other countries with emerging markets. Therefore, investors’ reactions to events in any of these countries could have an adverse effect on the market price of securities issued by companies with Mexican operations. Past economic crises that have occurred in the United States, China or in countries with emerging markets could cause a decrease in the levels of interest in the securities issued by companies with Mexican operations.
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In the past, the emergence of adverse economic conditions in other emerging countries has led to capital flight and, consequently, to decreases in the value of foreign investments in Mexico. The financial crisis that arose in the United States during the third quarter of 2008, unleashed a global recession that directly and indirectly affected the economy and the Mexican stock markets and caused, among other things, fluctuations in purchase prices the sale of securities issued by publicly traded companies, shortage of credit, budget cuts, economic slowdowns, volatility in exchange rates, and inflationary pressures.
Financial problems or an increase in risk related to investment in emerging economies or a perception of risk could limit foreign investment in Mexico and adversely affect the Mexican economy. Mexico has historically experienced uneven periods of economic growth and the economy as a whole has recently been adversely affected by the current expectation of a recession or slowdown in the United States and other countries’ economies. There can be no assurance that the overall business environment in which we operate will improve and we cannot predict the impact any future economic downturn could have on our results of operations and financial condition. However, consumer demand generally decreases during economic downturns, which will negatively affect our business, results of operations and financial condition.
Political events and Mexican governmental policies may result in disruptions to our business operations and financial condition.
The Mexican government has exercised, and continues to exercise, a significant influence over many aspects of the Mexican economy. Thus, the actions and policies of the Mexican federal government relating to the economy as a whole, and in particular taxes, salaries, pension, air transport and similar services, and other political events in the country, could have a significant impact on us, as well as a more general impact on market conditions, prices and yields on Mexican variable and fixed income securities. We cannot predict whether political events or changes in the law, policy and regulations in Mexico, including measures related to new or increased taxes, could affect our business activities, financial condition, operating results, cash flows and prospects.
Political events in Mexico can significantly affect Mexican economic policy and, consequently, our operations. Political disagreements between the executive, legislative and judicial branches could come to a standstill and avoid the timely implementation of political and economic reforms, which in turn could have a major adverse effect on Mexican economic policy and, therefore, also on our business. We cannot predict the impact that political, economic and social conditions will have on the Mexican economy. In addition, we cannot guarantee that political, economic or social developments in Mexico, over which we have no control, will not have an adverse effect on our business, financial condition, operating results and prospects.
Presidential, congressional and other governmental elections were held in Mexico on June 2, 2024, and Ms. Claudia Sheinbaum of the National Regeneration Movement (Movimiento de Regeneración Nacional), or Morena (the main political party of the Morena-PT (Partido del Trabajo) – PVEM (Partido Verde Ecologista de México) coalition), was elected president, taking office on October 1, 2024. The legislators elected in June, 2024, took office on September 1, 2024. As a result of the elections, the Morena coalition currently holds a qualified two-thirds majority in the Mexican House of Representatives and a qualified majority in the Mexican Senate. These majorities give the Morena coalition substantial authority to implement changes to the Constitution, laws, policies and regulations of Mexico.
On September 15, 2024, a constitutional judicial reform overhauling the functioning of the federal judiciary, mandating that all federal judges, including Supreme Court justices, be elected by popular vote, and lowering the qualification requirements to run for a judicial post in Mexico was published in the Federation Official Gazette (Diario Oficial de la Federación) and became effective the day after its publication in the Federal Official Gazette. Pursuant to this constitutional reform, the first election to select new federal judges took place in June 2025. Following this, the Mexican federal and local legislatures were given 90 and 180 calendar days, respectively, from September 16, 2024, to amend federal and local laws to align with the judiciary reform. This process includes the enactment of secondary laws, such as the Organic Law of the Judiciary (Ley Orgánica del Poder Judicial) and the Judicial Career Law of the Federal Judiciary (Ley de Carrera Judicial del Poder Judicial de la Federación), which are in force as of the date of this prospectus. The new laws abolish the existing Federal Judiciary Council (Consejo de la Judicatura Federal) that oversaw judiciary discipline and replaces it with a new disciplinary tribunal (with ability to supervise and sanction judges) controlled by the Mexican Congress. Additionally, secondary rules and regulations are still to be approved by the Mexican Congress, but these laws may significantly and adversely affect legal certainty and protections in Mexico, which could adversely affect our ability to defend or enforce claims in court, as well as negatively impact investor confidence in Mexico.
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In December 2024, President Sheinbaum initiated a comprehensive restructuring of the federal government which will have the effect of dissolving several autonomous governmental bodies, such as the National Institute for Transparency, Access to Information, and Personal Data Protection (Instituto Nacional de Transparencia, Acceso a la Información y Protección de Datos Personales), or INAI, the National Council for the Evaluation of Social Development Policy (Consejo Nacional de Evaluación de la Política de Desarrollo Social), or CONEVAL, the COFECE, the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones), or IFT, the National Commission for the Continuous Improvement of Education (Comisión Nacional para la Mejora Continua de la Educación), or MEJORADU, the Energy Regulation Commission (Comisión Reguladora de Energía), or CRE, the National Hydrocarbon Commission (Comisión Nacional de Hidrocarburos), or CNH, and the National Center of Energy Control (Centro Nacional de Control de Energía), or CENACE, and the transfer of their functions to Mexican Government agencies or to the INEGI. We cannot assure you that similar measures will not be taken in the future, which could have a negative effect on Mexico’s economy.
In March 2026, President Sheinbaum’s administration proposed significant updated electoral reforms that may materially impact the political landscape, including constitutional amendments aimed at eliminating political reelection and restricting immediate family members from succeeding each other in elected offices, seeking to reduce political dynasties and promote democratic transparency. This updated electoral reform further proposals to overhaul the electoral system by reducing public funding for political parties, cutting the budget of the National Electoral Institute (Instituto National Electoral), and eliminating proportional representation seats in the legislature. These reforms, if enacted, could substantially alter Mexico’s electoral framework and governance structures. The proposed changes require constitutional approval and face political debate, which creates uncertainty regarding their final form and timing.
We cannot assure you that these reforms will not have a negative impact on our business, financial condition and results of operations.
Any adverse changes in our business operations in Mexico would adversely affect our revenue and profitability.
The following factors, among others, could harm our business in Mexico:
Economic and political developments in Mexico and the United States may adversely affect Mexican economic policy.
Mexico’s economy is vulnerable to global market downturns and economic slowdowns. Moreover, Mexico’s economy is largely influenced by economic conditions in the United States and Canada as a result of various factors, including the volume of commercial transactions under the United States–Mexico–Canada Agreement (the “USMCA”) and the level of U.S. investments in Mexico.
Therefore, events and conditions that affect the U.S. economy can also directly and indirectly affect our business, financial condition, and results of operations. The global economy, including Mexico and the United States, has been materially and adversely affected by a significant lack of liquidity, disruption in the credit markets, reduced business activity, rising unemployment, a decline in interest rates, and erosion of consumer confidence during recent periods of recession. This situation has had a direct adverse effect on the purchasing power of our customers in Mexico. The macroeconomic environment in which we operate is beyond our control, and the future economic environment may continue to be less favorable than in recent years. The risks associated with current and potential changes in the Mexican and United States economies are significant and could have a material adverse effect on our business, financial condition, and results of operations.
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Likewise, any action taken by the current U.S. or Mexico administrations, including changes to the USMCA and/or other U.S. government policies that may be adopted by the U.S. administration, such as the tariff policy on imports, could have a negative impact on the Mexican economy, such as reductions in the levels of remittances, reduced commercial activity or bilateral trade or declining foreign direct investment in Mexico. In addition, increased or perceptions of increased economic protectionism in the United States, Mexico and other countries could potentially lead to lower levels of trade and investment and economic growth, which could have a similarly negative impact on the Mexican economy. These economic and political consequences could adversely affect our business, results of operations and financial condition.
We cannot make assurances that any events in the United States or elsewhere will not materially and adversely affect us.
Investments in Mexican companies entail substantial risk; 2024 judicial reform; the Mexican government has exercised, and continues to exercise, an important influence on the Mexican economy.
Investments in Mexico carry significant risks, including the risk of expropriation or nationalization laws being enacted or imposing exchange controls, price controls, taxes, inflationary, hyperinflationary, exchange rate risk, credit risk, among other governmental or political restrictions. We are incorporated under the laws of Mexico and most of our operations and assets are located in Mexico. As a consequence of the foregoing, our financial condition and results of operations could be negatively affected.
In 2024, Mexico approved a judicial reform that introduces significant changes to the structure and appointment process of the judiciary, including the Supreme Court and lower courts. The reform allows for the direct election of judges and justices, potentially increasing political influence in the judicial system. These changes may affect the predictability and stability of legal rulings, enforcement of contracts, and the overall business environment in Mexico. Any uncertainty or perceived weakening of judicial independence could impact investor confidence, the enforceability of legal rights, and the resolution of commercial disputes, which may adversely affect our business, financial condition, and results of operations.
The Mexican government has exercised, and continues to exercise, a strong influence on the country’s economy. Consequently, Mexican federal government actions and policies related to the economy, state-owned and controlled companies, and financial institutions, could have a significant impact on private sector entities in general, including us, in particular and on market conditions, prices and returns on Mexican securities, including counterparty risk. The Mexican federal government has made major policy and regulatory changes and may do so again in the future. Actions to control inflation and other regulations and policies have involved, among other measures, an increase in interest rates, changes in fiscal policies, price controls, currency devaluations, capital controls and limits on imports. Tax and labor legislation, in particular, in Mexico is subject to continuous change, and we cannot guarantee that the Mexican government will maintain current economic or other policies in force or if any changes to such laws and policies would have a material adverse effect on us or on our financial performance. The measures adopted by the government could have a significant effect on private sector entities in general, as well as on the market situation and on the price of our shares.
Additionally, the Mexican federal government has implemented protectionist policies in the past and could implement certain national policies in the future that could restrict our operations, including restrictions on imports from certain countries.
Our business may be significantly affected by the Mexican economy’s general condition, by the depreciation of the peso, inflation, and high-interest rates in Mexico.
Declines in growth, high rates of inflation, and high-interest rates in Mexico could materially adversely affect our business. If inflation in Mexico increases while economic growth slows, our business, results of operations, and financial condition will be affected. In addition, high-interest rates and economic instability could increase our costs of financing.
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In the past, the rating agencies rating Mexico have downgraded Mexico and/or placed Mexico on negative outlooks. On July 18, 2023, Fitch Ratings affirmed Mexico’s Long-Term (LT) Foreign Currency (FC) Issuer Default Rating (IDR) at ‘BBB-’; with a stable rating outlook. On November 14, 2024, Moody’s affirmed Mexico’s senior unsecured long-term ratings at Baa2; but changed the outlook on the Government of Mexico’s ratings from stable to negative. We cannot ensure that the rating agencies will not announce additional downgrades of Mexico in the future. These downgrades could adversely affect the Mexican economy and, consequently, our business, financial condition, results of operations, and prospects.
In addition, increased inflation would raise our cost of funding, which we may not be able to fully pass on to our customers, given that doing so could adversely affect our business. Our financial condition and profitability may be adversely affected by the level of, and fluctuations in, interest rates, which affect our ability to earn a spread between the interest received on our loans or the rentals and fees charged on our leases and the cost of our funding. Although we have taken measures to minimize the potential impact of inflation by ensuring that the majority of our liabilities have fixed interest rates, if the rate of inflation increases or becomes uncertain and unpredictable, our business, financial condition and results of operations could be adversely affected.
If the Mexican government imposes exchange controls and/or other similar restrictions, the Mexican economy and our operations may be negatively affected.
In the past, the Mexican economy has experienced a balance of payment deficits and shortages in foreign exchange reserves. There can be no assurance that the Mexican government will not institute a restrictive exchange control policy or other restrictions. If the Mexican government imposes exchange controls and/or other similar restrictions, the Mexican economy and our operations may be negatively affected.
Security risks in Mexico could increase, and this could adversely affect the Mexican economy and our business, financial condition, and results of operations.
In recent years, Mexico has experienced a period of increasing criminal activity and particularly high homicide rates, primarily due to organized crime. The presence of violence among drug cartels, and between drug cartels and the Mexican law enforcement and armed forces, or an increase in other types of crime, pose a risk to our business, and could negatively impact business continuity. This situation in Mexico could worsen if the economy continues to deteriorate. On February, 2025, the U.S. Department of State announced the designation of certain Mexican drug cartels as “Foreign Terrorist Organizations” and “Specially Designated Global Terrorists”. This may lead to increased regulatory scrutiny, sanctions, and enforcement actions, and could result in heightened compliance requirements, disruptions to cross-border trade, and potential reputational risks for entities with operations or business relationships in Mexico. Additionally, such measures may exacerbate political and economic tensions between the United States and Mexico, potentially impacting the broader business environment and bilateral relations. Such designation could have a material adverse effect on our business, reputation, results of operations and financial condition.
We are subject to anti-corruption, anti-bribery, anti-money laundering, and antitrust laws and regulations in Mexico.
We are subject to anti-corruption, anti-bribery, anti-money laundering, antitrust and other international laws and regulations and are required to comply with the applicable laws and regulations of Mexico, including (but not limited to) the Ley Federal Para la Prevención e Identificación de Operaciones con Recursos de Procedencia Ilícita (Mexican Federal Law for the Prevention and Identification of Transactions with Illicit Proceeds). In addition, we are subject to regulations on economic sanctions that restrict our dealings with certain sanctioned countries, individuals, and entities. There can be no assurance that our internal policies and procedures will be sufficient to prevent or detect all inappropriate practices, fraud, or violations of law by our affiliates, employees, directors, officers, partners, agents, and service providers or that any such persons will not take actions in violation of our policies and procedures. Any violations by us of anti-bribery and anti-corruption laws or sanctions regulations could have a material adverse effect on our business, reputation, results of operations and financial condition.
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The regulatory environment in which we operate is evolving, and our operations may be modified or otherwise adversely affected by regulatory changes, subjective interpretations of laws or an inability to work effectively with national and local government agencies.
Although we review applicable local laws in developing our plans, our efforts to comply with them may be harmed by an evolving regulatory climate and subjective interpretation of laws by the authorities. Any determination that our operations or activities are not in compliance with applicable regulations could negatively impact our business and our reputation with regulators in the markets in which we operate.
Laws and regulations may restrict our direct sales efforts and adversely affect our revenue and profitability.
Various government agencies throughout the world regulate direct sales practices. These laws and regulations are generally intended to prevent fraudulent or deceptive schemes, often referred to as “pyramid” schemes, that compensate participants for recruiting additional participants irrespective of product sales and/or which do not involve legitimate products. The laws and regulations in our current markets often:
Complying with these rules and regulations can be difficult and requires the devotion of significant resources on the Group’s part.
In addition, Mexico could change its laws or regulations to negatively affect or prohibit completely network or direct sales efforts. Government agencies and courts in Mexico may also use their powers and discretion in interpreting and applying laws in a manner that limits our ability to operate or otherwise harms our business. If any governmental authority were to bring a regulatory enforcement action against the Group that interrupts our business, our revenue and earnings would likely suffer.
You may have difficulty enforcing your rights against Betterware and our directors and executive officers.
Betterware is a company incorporated in Mexico. Most of our directors and executive officers are non-residents of the U.S. You may be unable to effect service of process within the U.S. on Betterware, its directors and executive officers. In addition, as all of our assets and substantially all of the assets of our directors and executive officers are located outside of the U.S., you may be unable to enforce against BWM and our directors and executive officers’ judgments obtained in the U.S. courts, including judgments predicated upon civil liability provisions of the U.S. federal securities laws or state securities laws. There is also doubt as to the enforceability, in original actions in Mexican courts, of liabilities including those predicated solely on U.S. federal securities laws and as to the enforceability in Mexican courts of judgments of U.S. courts obtained in actions, including those predicated upon the civil liability provisions of U.S. federal securities laws. There is no bilateral treaty currently in effect between the United States and Mexico that covers the reciprocal enforcement of civil foreign judgments. In the past, Mexican courts have enforced judgments rendered in the United States by virtue of the legal principles of reciprocity and comity, consisting of the review in Mexico of the United States judgment, in order to ascertain, among other matters, whether Mexican legal principles of due process and public policy (orden público) have been complied with, without reviewing the merits of the subject matter of the case.
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As a “foreign private issuer” under the rules and regulations of the SEC, Betterware is permitted to, and is expected to, file less or different information with the SEC than a company incorporated in the United States or otherwise subject to these rules and is permitted to follow certain home country corporate governance practices in lieu of certain NYSE requirements applicable to U.S. issuers.
Betterware is considered a “foreign private issuer” under the Securities Exchange Act (the “Exchange Act”) and therefore exempt from certain rules under the Exchange Act, including the proxy rules, which impose certain disclosure and procedural requirements for proxy solicitations for U.S. and other issuers. Moreover, the Group is not required to file periodic reports and financial statements with the SEC as frequently or within the same time frames as U.S. companies with securities registered under the Exchange Act. We currently prepare our financial statements in accordance with IFRS. The Group is not required to file financial statements prepared in accordance with or reconciled to U.S. GAAP so long as our financial statements are prepared in accordance with IFRS. The Group is not required to comply with Regulation FD, which imposes restrictions on the selective disclosure of material information to shareholders. In addition, BWM’s officers, directors and principal shareholders are exempt from the short-swing profit recovery provisions of Section 16 of the Exchange Act and some of the rules under the Exchange Act with respect to their purchases and sales of Company securities.
In addition, as a “foreign private issuer” whose shares are listed on the NYSE, the Company is permitted to, and is expected to, follow certain home country corporate governance practices in lieu of certain NYSE requirements. A foreign private issuer must disclose in its annual reports filed with the SEC each NYSE requirement with which it does not comply followed by a description of its applicable home country practice. As a Mexican corporation listed on the NYSE, the Company is permitted to follow our home country practice with respect to the composition of the board of directors and nominations committee and executive sessions. Unlike the requirements of the NYSE, the corporate governance practices and requirements in Mexico do not require the Company to (i) have a majority of its board of directors to be independent, (ii) establish a nominations committee, and (iii) hold regular executive sessions where only independent directors shall be present. Such home country practices of Mexico may afford less protection to holders of Company shares than under U.S. standards.
We have not applied to register the Shares in Mexico with the National Securities Registry (Registro Nacional de Valores, or “RNV”) maintained by the Mexican National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores, or “CNBV”). The Shares have not been and will not be listed on any Mexican securities exchange or quoted in any automated interdealer quotation system in Mexico.
The Company could lose its status as a “foreign private issuer” under current SEC rules and regulations if more than 50% of the Company’s outstanding voting securities become directly or indirectly held of record by U.S. holders and one of the following is true: (i) the majority of the Company’s directors or executive officers are U.S. citizens or residents; (ii) more than 50% of the Company’s assets are located in the United States; or (iii) the Company’s business is administered principally in the United States. If the Company loses its status as a foreign private issuer in the future, it will no longer be exempt from the rules described above and, among other things, will be required to file periodic reports and annual and quarterly financial statements as if it were a company incorporated in the United States. If this were to happen, the Company would likely incur substantial costs in fulfilling these additional regulatory requirements and members of the Company’s management would likely have to divert time and resources from other responsibilities to ensuring these additional regulatory requirements are fulfilled.
In addition, in June 2025, the SEC issued a concept release soliciting public comment on potential changes to the definition of “foreign private issuer” under U.S. securities laws. If the SEC were to adopt changes to the “foreign private issuer” definition, we could potentially lose our status as a foreign private issuer. If we were to lose our foreign private issuer status, we would be required to comply with all of the disclosure and procedural requirements applicable to U.S. domestic issuers, including the preparation of financial statements in accordance with U.S. GAAP, more frequent periodic reporting and compliance with Regulation FD. Such compliance would increase our legal, accounting and other expenses and would require our management to devote substantial time and resources to comply with these additional regulatory requirements.
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Under current Section 16 of the Exchange Act, executive officers and directors of U.S. public companies, as well as beneficial owners of more than 10% of a public company’s equity securities (collectively, “insiders”), are required to publicly report transactions in company securities within two business days. We, as an FPI, were not covered by such requirements. However, the recently enacted “Holding Foreign Insiders Accountable Act” extends Section 16(a) reporting requirements to directors and officers of FPIs. As a result, our executive officers and directors are required to report transactions in respect of our equity securities as of March 18, 2026. Compliance with these disclosure requirements may result in increased expenses and require the Company’s management to devote time and resources to comply with such regulatory requirements. If our executive officers and directors fail to comply with such disclosure requirements, they may be subject to penalties, and their reputation may be harmed, which in turn may have a negative impact on our business, reputation and the market price of our common shares
If securities or industry analysts do not publish or cease publishing research or reports about Betterware, our business, or markets, or if they change their recommendations regarding the Company shares adversely, the price and trading volume of the Company’s shares could decline.
The trading market for the Company’s shares is influenced by the research and reports that industry or securities analysts may publish about the Company, our business, market, or competitors. Securities and industry analysts do not currently, and may never, publish research on the Company. If no securities or industry analysts commence coverage of the Company, the price and trading volume of the Company shares would likely be negatively impacted. If any of the analysts who may cover the Company change their recommendation regarding the Company’s shares adversely or provide more favorable relative recommendations about the Company’s competitors, the price of the Company’s shares would likely decline. If any analyst who may cover the Company were to cease coverage of the Company or fail to regularly publish reports on it, the Company could lose visibility in the financial markets, which in turn could cause our share price or trading volume to decline.
There can be no assurance that Betterware will be able to comply with the continued listing standards of the NYSE.
Betterware’s shares are listed on the NYSE under the symbol “BWMX.” If the NYSE delists the Company’s securities from trading on its exchange for failure to meet the listing standards, the Company and its shareholders could face significant material adverse consequences including:
If Betterware is characterized as a passive foreign investment company, or a PFIC, adverse U.S. federal income tax consequences may result for U.S. holders of Company shares.
If the Company is characterized as a PFIC for any year during which a U.S. Holder holds Company shares, certain adverse U.S. federal income tax consequences may apply to such holder. Based on the projected composition of our income and assets, including goodwill, it is not expected that the Company was a PFIC for our 2025 taxable year and will be a PFIC for the foreseeable future. However, the tests for determining PFIC status are applied annually after the close of the taxable year, and it is difficult to predict accurately future income and assets relevant to this determination. Accordingly, there can be no assurance that the Company will not be considered a PFIC for any taxable year.
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If the Company is a PFIC for any year during which a U.S. holder holds Company shares, a U.S. holder generally would be subject to additional taxes (including taxation at ordinary income rates and an interest charge) on any gain realized from a sale or other disposition of the Company shares and on any “excess distributions” received from the Company. Certain elections may be available that would result in alternative treatments of the Company shares. See “Passive Foreign Investment Company Rules” below.
We urge U.S. holders to consult their own tax advisors regarding the possible application of the PFIC rules to the ownership of Company shares.
The Amended and Restated Charter of Betterware provides for the exclusive jurisdiction of the federal courts in Mexico City, Mexico for substantially all disputes between the Company and its shareholders, which could limit Company shareholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers, other employees or shareholders.
The Amended and Restated Charter of the Company provides for the exclusive jurisdiction of the federal courts located in Mexico City, Mexico for the following civil actions:
This exclusive jurisdiction provision may limit a shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company or any of its directors, officers, other employees or shareholders, which may discourage lawsuits with respect to such claims, although the Company’s shareholders will not be deemed to have waived the Company’s compliance with U.S. federal securities laws and the rules and regulations thereunder applicable to foreign private issuers. Alternatively, if a court were to find the exclusive jurisdiction provision contained in the Amended and Restated Charter to be inapplicable or unenforceable in an action, the Company may incur additional costs associated with resolving such action in other jurisdictions, which could harm the Company’s business, operating results and financial condition. The exclusive jurisdiction provision would not prevent derivative shareholder actions based on claims arising under U.S. federal securities laws from being raised in a U.S. court and would not prevent a U.S. court from asserting jurisdiction over such claims. However, there is uncertainty whether a U.S. court would enforce the exclusive jurisdiction provision for actions for breach of fiduciary duty and other claims.
The anti-takeover protections included in our Bylaws and others provided under Mexican Law may deter potential acquirors.
Our bylaws provide that, subject to certain exceptions as explained below, prior written approval from the board of directors shall be required for any person, or group of persons to acquire, directly or indirectly, any of our common shares or rights to our common shares, by any means or under any title whether in a single event or in a set of consecutive events, such that its total shares or rights to shares would represent 20% or more of our outstanding shares.
These provisions could make it substantially more difficult for a third party to acquire control of us. These provisions in our bylaws may discourage certain types of transactions involving the acquisition of our securities. These provisions could discourage transactions in which our shareholders might otherwise receive a premium for their shares over the then current market price. Holders of our securities who acquire shares in violation of these provisions will not be able to vote, or receive dividends, distributions or other rights in respect of, these securities and would be obligated to pay us a penalty. For a description of these provisions, see “Item 10. Additional Information—Bylaws—Anti-takeover Protections.”
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ITEM 4. INFORMATION ON THE COMPANY
Betterware de México, S.A.P.I. de C.V. (formerly Betterware de México, S.A.B. de C.V.), is a Mexican sociedad anónima promotora de inversión de capital variable that was incorporated under the laws of Mexico in 1995. The company’s headquarters are located in the city of Jalisco, Mexico, and its main registered office is located at Gdl-Ameca-Huaxtla km-5, El Arenal Jalisco, 45350, México, and the telephone number is +52 (33) 3836-0500. Our agent for service of process in the United States is Corporate Services Company (“CSC”), located at 251 Little Falls Drive, Wilmington, Delaware 19808-1674. The Company’s shares are listed on the New York Stock Exchange (“NYSE”) under the trading symbol “BWMX.”
The Company makes its filings in electronic form under the EDGAR filing system of the SEC. Our filings are available through the EDGAR system at www.sec.gov. The Company’s filings are also available to the public through the Internet at our website at https://investors.betterware.com.mx. Such filings and other information on our website are not incorporated by reference in this annual report. Interested parties may request a copy of this filing, and any other report, at no cost, by writing to the following email address: ir@better.com.mx.
History and Recent Developments
All amounts in this section marked with “Ps.” are in thousands of Mexican pesos, unless otherwise noted
The Business Formation, Combination and Mergers
The Initial Public Offering
On October 16, 2018, DD3 Acquisition Corp., a British Virgin Islands company (“DD3”), consummated its initial public offering of 5,000,000 units and on October 23, 2018, the underwriters for DD3’s initial public offering purchased an additional 565,000 units pursuant to the partial exercise of their over-allotment option. The units in DD3’s initial public offering were sold at an offering price of US$10.00 per unit, generating total gross proceeds of US$55,650,000.
The DD3 Merger
On August 2, 2019, DD3 entered into a Combination and Stock Purchase Agreement (as amended, the “Combination and Stock Purchase Agreement”) with Campalier, S.A. de C.V., a Mexican sociedad anónima de capital variable (“Campalier”), Promotora Forteza, S.A. de C.V., a Mexican sociedad anónima de capital variable (“Forteza”), Strevo, S.A. de C.V., a Mexican sociedad anónima de capital variable (“Strevo”, and together with Campalier and Forteza, “Sellers”), Betterware, BLSM, and, solely for the purposes of Article XI therein, DD3 Mex Acquisition Corp, S.A. de C.V., pursuant to which DD3 agreed to merge with and into Betterware (the “Merger”) in a Business Combination that resulted in Betterware surviving the Merger and BLSM becoming a wholly-owned subsidiary of Betterware.
As part of the Combination and Stock Purchase Agreement, and prior to the closing of the Merger, DD3 was redomiciled out of the British Virgin Islands and continued as a Mexican corporation pursuant to Section 184 of the Companies Act and Article 2 of the Mexican General Corporations Law.
Betterware’s Restructure
Following the execution of the Combination and Stock Purchase Agreement, on February 21, 2020, Betterware’s shareholders approved, a corporate restructure in Betterware (the “Betterware Restructure”) which implied, among other things (i) Betterware’s by-laws amendment in order to issue Series C and Series D non-voting shares, and (ii) a redistribution of Betterware’s capital stock as follows: (a) fixed portion of Betterware’s capital stock represented by 3,075,946, Series A, ordinary voting shares, and (b) the variable portion of Betterware’s capital stock represented by (x) 1,961,993, Series B, ordinary voting shares, (y) 897,261, Series C, ordinary non-voting shares (“Series C Shares”), and (z) 168,734, Series D, ordinary non-voting shares (“Series D Shares”). In addition, Strevo transferred one Series A ordinary voting share of Betterware to Campalier (the “Campalier Share”), which remained under certain Share Pledge Agreement, dated July 28, 2017, entered between Strevo, as pledgor, MCRF P, S.A. de C.V. SOFOM, E.N.R. (“CS”), as pledgee, and Betterware.
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Immediately after consummation of Betterware Restructure and the transfer of the Campalier Share to Campalier, Forteza indirectly, through Banco Invex, S.A., Invex Grupo Financiero (“Invex”), as trustee of the irrevocable management and security trust No. 2397 (the “Invex Security Trust”), dated March 26, 2016, owned approximately 38.94% of the outstanding common stock of Betterware, and Campalier indirectly, through the Invex Security Trust, owned approximately 61.06% of the outstanding common stock of Betterware.
On March 9, 2020, the Invex Security Trust released the Series C Shares and the Series D Shares to Campalier and Forteza, respectively, that were held under the Invex Security Trust.
On March 10, 2020, CS, as pledgee, entered into a Termination of the Share Pledge Agreement over the Campalier Share with Campalier, as pledgor, and Betterware. In addition, CS, as beneficiary, Invex, as trustee, and Campalier, as settlor, entered into a Transfer Agreement, where Campalier transferred the Campalier Share to the Invex Security Trust.
Upon such transfer to the Invex Security Trust, Betterware’s shareholders approved (i) the sale of all or a portion of such Betterware’s Series C and Series D shares to DD3 Acquisition Corp., S.A. de C.V. (the “DD3 Acquisition”), (ii) the Merger, (iii) the amendment of Betterware’s by-laws to become a sociedad anónima promotora de inversion de capital variable, (iv) the increase of Betterware’s capital stock by Ps. 94,311,438.00, through the issuance of 2,211,075 ordinary shares, without nominal value, subscribed by the shareholders of DD3 Acquisition Corp., S.A. de C.V., and (v) the increase of Betterware’s capital stock by Ps.872,878,500.00 through the issuance of 4,500,000 ordinary treasury shares without nominal value, offered for subscription and payment under Betterware’s public offering in the U.S. completed and filed with the SEC under our Registration Statement on Form F-1, which became effective on January 22, 2020. On March 10, 2020, Betterware’s corporate name changed from Betterware de México, S.A. de C.V. to Betterware de México, S.A.P.I. de C.V.
The DD3 Acquisition was closed on March 13, 2020, and as a result, all of Betterware shares that were issued and outstanding immediately prior to the closing date were canceled and new shares were issued. The DD3 Acquisition was accounted as a capital reorganization, whereby Betterware issued shares to the DD3 shareholders and obtained US$22,767 (Ps.498,445) in cash through the acquisition of DD3 and, simultaneously settled liabilities and related transaction costs on that date, for net cash earnings of US$7,519 (Ps.181,734) on such date. In addition, Betterware assumed the obligation of the warrants issued by DD3, a liability inherent to the transaction, equivalent to the fair value of Ps.55,810 of the warrants. No other assets or liabilities were transferred as part of the transaction that required adjustment to fair value as a result of the acquisition.
On the same date, a total of 2,040,000 of Betterware shares, that were offered for subscription and payment under its public offering were subscribed and paid for by various investors.
For purposes of this annual report, the Merger, the Betterware Restructure and all related actions undertaken in connection thereto are referred to as the “Business Combination.”
Closing of the DD3 Business Combination
Upon satisfaction of certain conditions and covenants as set forth under the Combination and Stock Purchase Agreement, the Business Combination was consummated and closed on March 13, 2020 (the “Closing”). At Closing, the following actions occurred:
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On the Closing date, 2,040,000 shares of Betterware offered for subscription and payment under Betterware’s public offering in the U.S. were subscribed and paid for by various investors.
As part of the Merger, Betterware assumed an obligation that granted existing warrant holders the option to purchase (i) a total of 5,804,125 Betterware shares at a price of US$11.50 per share that would expire on or before March 25, 2025, and (ii) a total of 250,000 units that automatically became an option to issue 250,000 Betterware shares and warrants to buy 250,000 additional Betterware shares. Betterware registered the warrants to be traded on OTC Markets, which had an observable fair value. The following events occurred in 2020 as part of the warrants agreement:
On August 2, 2021, Betterware’s corporate name changed from Betterware de México, S.A.B. de C.V. to Betterware de México, S.A.P.I. de C.V.
The Forteza Merger
On December 14, 2020, Betterware and Forteza (Betterware’s shareholder), entered into a merger agreement pursuant to which Forteza agreed to merge with and into Betterware, surviving Betterware as the acquiror (the “Forteza Merger”). On December 16, 2020, the merger was consummated. Consequently, shares in Betterware were delivered to Forteza’s shareholders in proportion to their shareholding in Betterware, without implying an increase in our share capital or in the total number of outstanding shares of Betterware.
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Transactions during 2021
On March 12, 2021, Betterware entered into an agreement to acquire 60% of GurúComm, S.A.P.I. de C.V. (“GurúComm”), for Ps.45 million. GurúComm is a mobile virtual network operator and communications software developer, with an enterprise value of Ps.75 million (approximately US$3.5 million). On March 28, 2022, the shareholders of GurúComm approved, and Betterware agreed to, the redemption of the shares owned by Betterware in GurúComm. Therefore, the 55,514 shares that had been previously fully subscribed and paid by Betterware were redeemed. The additional 37,693 shares that were subscribed but not yet paid, were canceled. GurúComm’s redemption and Betterware’s investment withdrawal was mainly due to the fact that the business was not growing according to shareholders expectations, and consequently, Betterware’s investment return would take longer than anticipated. The financial impact that the redemption transaction had at a consolidated level was a loss in sale of shares of Ps.16.6 million.
Until June 30, 2021, BLSM (formerly a related party of Betterware) provided administrative, technical, and operational services to Betterware. On July 1, 2021, all of BLSM’s employees were transferred to Betterware, without having a material impact on a consolidated basis.
On July 22, 2021, Betterware entered into an agreement to acquire 70% of Innova Catálogos, S.A. de C.V. (“Innova”), for Ps.5 million. Innova focuses on purchase and sale of clothing, footwear and accessories. On November 18, 2022, we withdrew our investment and cancelled all of the 238 subscribed and paid shares that we held in Innova. The investment withdrawal and the redemption of Betterware’s shares in Innova was mainly due to the fact that the business was not growing according to shareholders expectations. The financial impact that the redemption transaction had at a consolidated level was a loss in sale of shares of approximately Ps.5 million.
Transactions during 2022
On March 25, 2022, Betterware and Programa Lazos, S.A acquired 2% and 98%, respectively, of the shares of Finayo, S.A.P.I. de C.V. (“Finayo”), a Mexican sociedad anónima promotora de inversión de capital variable for the aggregate purchase price of Ps.1.1 million. Finayo focuses on granting loans, financial leasing and factoring operations. In June 2023, Betterware acquired additional shares of stock in Finayo for Ps.5 million, increasing its participation from 2% to 99.05%, and at the same time Programa Lazos decreased its participation in Finayo from 98% to 0.95%.
The JAFRA Acquisition
On January 18, 2022, Betterware entered into a stock purchase agreement to acquire the operations of Jafra Cosmetics International, Inc. and Jafra Mexico Holding Company, B.V. in Mexico and the United States from the Vorwerk Group based in Germany for a total cash consideration of US$255 million (equivalent to Ps.5,355 million), on a debt and cash-free basis (the “JAFRA Acquisition”). See “Company Information—Organizational Structure.”
JAFRA is a global company in direct sales in the beauty and personal care (B&PC) industry with strong presence in Mexico and the United States through independent leaders and consultants who sell JAFRA’s unique products. The JAFRA Acquisition was approved by the Federal Economic Competition Commission on March 24, 2022, and consummated on April 7, 2022. The funds necessary to pay the purchase price, and other associated expenses, under the JAFRA Acquisition were obtained from (i) a long-term syndicated loan of Ps.4,499 million, and (ii) US$30 million from available cash of Betterware. See “Indebtedness—Long Term Syndicated Credit Line.”
Events during 2024
On April 16, 2024, the Group officially launched Betterware USA, locating the headquarters in Dallas, Texas and going live with a website. Our initial focus remains the U.S.’s large and rapidly growing Hispanic market, starting with Texas. It is important to note that we are entering the U.S. home solutions market with an entirely new business model, one that targets the e-commerce as well as direct selling verticals. This model was designed from the customer up and enables Betterware to take a customer-first, digitally connected approach to the U.S. market.
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As part of the Company’s strategy to obtain liquidity and divest from properties that were not expected to yield maximum future benefits, Jafra Mexico completed several significant property transactions in 2024. These sales aimed to enhance liquidity while streamlining operations and focusing on core business activities:
Sale Jafra’s land and building:
Of the sales price, Ps.156.5 million was collected; the remaining Ps.245.7 million will be collected semiannually without interest, maturing in 2027. In addition, a loss of Ps.34.1 million was recognized when determining the fair value of the long-term receivable.
Assets held for sale:
Events during 2025 and Subsequent events during 2026
The home organization segment launched in Latin America, identified as the Andean region. On April 18, 2024, January 20, 2025 and November 13, 2025, Betterware Perú, Ecuador and Colombia were established, respectively; and they began operations on January 1, 2025, May 5, 2025, and March 2, 2026, respectively. Due to the tariff reform imposed by the United States government, in April 2025, the Group’s management decide to close the operations of our Betterware America subsidiary in the United States and focus on our expansion in Central America.
On January 19, 2026, Betterware entered into a definitive purchase agreement (“SPA”) to acquire Tupperware’s operating assets in Latin America (the “Tupperware Acquisition”), primarily in Mexico and Brazil, the region’s core markets. As part of the Tupperware Acquisition, we will also obtain a perpetual, royalty-free, and exclusive license for the “Tupperware” brand for the entire LatAm region (subject only to a license previously granted in Argentina and that expires per its own terms on the third quarter of 2026). The transaction is expected to close during the first half of 2026. The closing of the acquisition is subject to standard closing conditions, including the approval of our shareholders and country regulators, including the antitrust commission in Mexico (La Comisión Nacional Antimonopolio), and to certain termination provisions under the purchase agreement.
The agreed consideration amounted to US$215 million in debt-financed cash and US$35 million in BeFra shares, on a debt-free and excess cash basis. BeFra will grant certain registration rights with respect to the BeFra shares to be issued in the transaction and certain shares will be subject to lock-up for up to nine months after the closing of the transaction.
Tupperware Latin America has historically been a profitable regional business within the global Tupperware organization. Backed by more than 140 distributors and more than 200,000 independent sales representatives, its vertically integrated operations with world-class manufacturing plants in Mexico (65% utilization) and Brazil (50% utilization) have driven consistently high EBITDA margins and strong free cash flow generation. BeFra hopes to renew Tupperware’s previous focus on consumer-driven product innovation and an elevated value proposition, supported by the deep industry experience of BeFra executives. Tupperware will also contribute to the expansion of the Betterware homewares brand in the region.
On March 17, 2026, the Ordinary General Shareholders’ Meeting approved the capital increase of US$35 million equivalent to Ps.619 million pesos agreed under the SPA. In addition, the cancellation of the 72,626 treasury shares held as of December 31, 2025 was approved and on the other hand, 2,241,133 new shares issuance was approved and will be kept in the Company’s treasury until they are subscribed on the closing date of the Tupperware Acquisition and delivered on said date in compliance with the payment obligation assumed by the Company in the SPA. If the Tupperware Acquisition is not completed, the capital increase and the issuance of new treasury shares will be automatically canceled without the need for corporate resolution.
Due to the Tupperware Acquisition, the total number of outstanding shares of the Company as of the date of this Annual Report is 39,485,053.
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We are a company in the consumer product goods industry, focused on building meaningful brands that the consumer appreciates. We commercialize directly to the customer through a modern form of person to person selling. We operate two segments divided into home organization and beauty personal care products, as follows:
Home Organization Segment (BWM):
We believe Betterware is a leading direct-to-customer company in Mexico. Our home organization segment is focused on creating innovative products that solve specific needs regarding organization, practicality, space-saving and hygiene within the household, with a wide product portfolio including home solutions, kitchen and food preservation, technology and mobility, bedroom, bathroom, laundry and cleaning, well-being and other categories that include products and solutions for every corner of the household.
Our home organization segment’s products are sold through monthly catalogues published throughout the year where we exhibit:
-During 2025, BWM increased the number of products per catalogue compared to 2024 and 2023, due to internally the marketing area carried out a historical study of products which resulted in sales increasing when there were more products exhibited within the catalogue.
-During 2025, BWM decreased the number of new products and bring backs in order to focus on offering the historical best-selling products, recover customers and promote an increase in sales.
-During 2024, BWM decreased the number of new products overall but increased the number of new developments in order to promote sales by focusing on market trends and to attract and maintain a diverse customer base.
For 2025, 2024 and 2023, all our home organization’s products feature distinctive brand attributes and manufactured by more than 350 certified manufactures in China and México, and then delivered to BWM’s warehouse in El Arenal, Jalisco where we process and pack the products.
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We sell our home organization segment’s products through a unique two-tier sales model, by distributors and associates as follows:
Distributors:Product consumer, sales promoter and lead a group of Associates that earn commissions by sales from the Associates lead (“Distributor”).
Associates:Product consumer and sales promoter (“Associate”), which purchase transactions through a Distributor and do not earn commissions.
EOP Base: Associate or Distributor base at the end of the period.
Avg. Weekly Order: Average weekly data. Total Revenue divided by number of active Associates or Distributors.
As of December 31, 2025, 2024 and 2023 our distributors and associates have approximately 22%, 22% and 24.5% household penetration in Mexico. The market penetration study consists of face-to-face surveys of households randomly selected by socioeconomic status and located in cities with more than 100,000 households currently in Mexico, with the aim of determining the number of households that have purchased a Betterware product in the past 12 months.
We achieve distribution cost efficiencies by delivering products exclusively through direct-to-distributor channels. The distributor and associates deliver our products to final consumers, which means that our state-of-the-art infrastructure allows us to safely deliver products to every part of the country in a timely and efficient manner. Our infrastructure is backed by the strategic location of our distribution center in Jalisco, Mexico.
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Beauty and Personal Care Segment (JAFRA)
Our beauty and personal care segment has a portfolio of products within four main categories: fragrances, color, skin care and toiletries. We believe JAFRA is a leader in the Mexican fragrance market and in 2025, our beauty and personal care segment’s products were sold through 12 promotional catalogues published monthly offering its products as follows:
-Jafra declined the number of new products in 2025 compared to 2024, this decline in new products in 2025 compared to 2024 is due to the launch of 58 new commemorative products celebrating Jafra’s 45th anniversary in October 2024.
Almost all of our beauty and personal care segment’s products are produced in our facility located in Queretaro, México and distributed across Mexico and in some cities of the United States through our distribution center located in Lerma, Mexico. Our beauty and personal care segment’s products are sold through a generational multilevel model, reaching penetration sales in Mexico during 2025, 2024 and 2023:
We sell our beauty and personal care segment’s products through a unique two-tier sales model, by leaders and consultants as follows:
Leaders:Product consumer, sales promoter and lead a group of Consultants that earn commissions by sales from the Consultants (“Leader”).
Consultants:Product consumer and sales promoter (“Consultant”) that purchase transactions through a Leader and do not earn commissions.
EOP Base: Leader or Consultant base at the end of the period
Avg. Monthly Order (Leaders): Average monthly data. Total Leader revenue divided by number of Leaders orders.
Avg. Monthly Order (Consultants): Average monthly data. Total catalog revenue divided by number of Consultants orders.
Our beauty and personal care segment has one of the biggest distribution networks of leaders and consultants in Mexico reaching more than 9,600 cities in 2025 and 2024 and reaching more than 7,500 cities in 2023.
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Our distributors, associates, leaders and consultants are monitored tightly through an in-house developed business intelligence platform that tracks weekly and monthly performance and has a detailed mapping system of the country to identify potential areas to penetrate and increase our network.
Our home organization and personal care segment business model is tailored mainly Mexico’s geographic, demographic and economic dynamics, where communities are small and scattered across the country, with very low retail penetration and difficult to fulfill last mile logistics. Management is working to extend its business model to the rest of countries where we have started operations such as Guatemala, the United States and Andean Region (Ecuador, Peru and Colombia). Additionally, our business model is resilient to economic downturns and seasonal fluctuations given low average sales prices to consumers.
Supported by our top-notch product innovation, business intelligence and technology units, which provide daily monitoring of key metrics and product intelligence.
Industry Overview
We operate under “Direct selling” retail industry. The direct selling industry differs from broader retail mainly in the avenue where entrepreneurial-minded individuals can work independently to build a business with low start-up and overhead costs.
Our direct selling representatives, distributors, leaders and consultants, are not employees of the Company and work on their own, retaining their freedom to run a business and have other sources of income.
Our independent distributors, leaders and consultants earn sales commissions as freelancers. They set their own hours, create their own marketing plans, determine whether to build a sales team and how to mentor those within it and how to serve their customers.
Revenue by geographic market
The income recognized during the years 2025, 2024 and 2023, national and foreign, is shown below:
Note: Please see the section of “Results of Operations — Net Revenue” for the increases, decreases by business segment.
The Groups’ revenue in United States represented as of December 31, 2025, 2024 and 2023: 6.7%, 6.6% and 7.1%, respectively, and corresponds to Beauty and personal care (B&PC) segment (JAFRA).
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Competitive Strengths
Innovation and Product Development
Our innovation journey has been a disciplined, evolutionary process that transformed a traditional catalog sales company into a scalable direct sales platform supported by strong technological and logistical capabilities.
The Company focuses on developing attractive, functional products that enhance everyday life, while integrating technology through smart product solutions. At the same time, the deployment of digital tools across the sales network has enabled distributors to manage their businesses remotely, significantly improving productivity and supporting sustained, exponential growth.
The Company consolidated a hybrid business model that combines personalized customer engagement with digital capabilities. A key milestone was the launch of “Your Digital Store,” which allows distributors to connect with customers online, expand market reach, and strengthen sales efficiency.
In parallel, the Company expanded its product portfolio and geographic presence.
Today, the Company leverages an extensive physical distribution network alongside a robust digital strategy, creating a differentiated value proposition. This integrated approach enhances customer experience, drives operational efficiency, and positions the Company for sustainable long-term growth.
Brand Building
BeFra is building a diversified brand portfolio through a disciplined acquisition strategy focused on iconic direct-selling brands with strong market recognition, including Jafra (acquired in 2022) and Tupperware (acquisition in process, expected in 2026). This strategy is aimed at consolidating operational synergies and accelerating expansion across Latin America.
The Group also seeks to increase plastic production in Mexico by partnering with local suppliers, strengthening domestic manufacturing capabilities and supporting the development of its branded products.
BeFra manages its portfolio of brands in a coordinated and efficient manner, with a strategic focus on entering and expanding into new markets, reinforcing its long-term growth and value creation strategy.
Unique Business Intelligence and Data Analytics Unit
The business intelligence unit has been in place since 2013 and provides continuous monitoring of key performance indicators. This enables accurate analysis of product performance and sales force effectiveness. Over time, the unit has strengthened its analytical capabilities, supported more informed decision-making and driven operational efficiencies.
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Our in-house business intelligence unit plays a crucial role within the operations and strategy of the Company. The unit’s team is comprised of geographers, anthropologists, actuaries, among others, in order to diversify the way of thinking and create the best analyses and business strategies.
The main functions of the business intelligence unit are:
Person to person channel Management
The Company has accumulated many years of experience in managing its sales channel, including the design and execution of rewards programs, the deployment of dedicated channel technology, and the ease of doing business with the organization. This experience is complemented by a strong focus on maintaining close relationships with the sales force.
Reward Programs
Technology
The Company continuously invests in technology across all our operations, digitizing our processes to drive the commercial growth of the Group’s companies, seeking to streamline our operations and capture operational synergies. As part of this evolution, the digital transformation department focused on accelerating growth by maximizing every interaction between the Company and its customers. The main strategic pillars from this area are to grow our clients’ businesses, strengthen our digital capabilities, and turn our data into a competitive advantage.
Unparalleled Logistics and Supply Chain Platform
Our home organization segment’s products are manufactured by more than 350 third-party certified factories located in China and Mexico following BWM’s quality standards. Approximately 84.3% of our beauty and personal care segment’s products are internally manufactured in our facility located in Queretaro, Mexico.
Experienced Management & Meritocratic Culture
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Expansion Strategy
We have a plan for growth, which includes organic and inorganic initiatives. The main strategies divided by timeline are the following:
Customers
Distributor and Associate Profile
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Sales & Marketing
Seasonality
We have not experienced and do not expect to experience, any material seasonal fluctuations which could affect our business and results of operations.
Raw Materials
Betterware manufactures a significant portion of its products in China across categories including plastics, textiles, and small appliances.
In Jafra, our manufacturing activity relies heavily on a consistent supply of various materials, such as glass, fragrance oils, plastics, folding boxes, and alcohol. The prices of these materials are subject to considerable volatility due to energy price fluctuations, geopolitical tensions, and supply chain disruptions. Glass represents 27% of our input purchases and the largest share of our materials, followed by plastics with 25%, fragrance oils with 21%, folding boxes with 11%, alcohol with 3%, and the remaining 13% distributed among other ingredients for our products.
Jafra has experienced volatility in raw material costs such as glass with 6% increase in 2025 vs 2024. For 2026 it expects a 4.5% increase due to geopolitical tensions. However, Jafra continues to implement cost-saving initiatives to offset the impact and improve sourcing efficiency, but it cannot be assured that such efforts will fully compensate for future cost pressures.
Recent Government Regulation Impacts and Costs
The Company is subject to numerous regulatory regimes under Mexican federal, state, and municipal laws and similar laws in other countries for companies engaged in the manufacturing, sourcing, marketing, distribution, and sale of consumer products. While these regulatory regimes and laws are subject to changes, no recent changes have had a material impact on the Company. Increases of import tariff impact the Company’s cost structure, but the Company has implemented mitigation actions, including supplier renegotiations, product mix adjustments, and partial nationalization of production. The estimated impact of tariffs on gross margin is less than 0.6%. The Company has also had to raise minimum wages over 10% for unionized personnel in Mexico in order to remain competitive in the industry and improve employee retention. Other than the import tariff changes and wage increases, no recent legal or regulatory requirements or trends have posed a material impact on the costs or profits of our business.
Other Sources of Cost Fluctuations
Recent geopolitical developments in Iran have led to temporary increases in fuel and certain input costs, including freight and resins. To date, these effects have not been significant to the Company’s cost structure and conditions are expected to normalize as markets stabilize.
For Jafra, in addition to the price of our materials and labor costs, the costs of our products are subject to two important factors: 1) currency fluctuations and 2) changes in production volumes.
1) Approximately 30% of our raw materials are priced in US dollars, which presents a latent risk of currency fluctuations. This risk can be minimized with hedging contracts that allow us to reduce or eliminate volatility.
2) Variations in demand can translate into variations in product cost. We have worked to reduce errors in forecasted demand to ensure we have accurate product cost estimates within our budgets.
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Environmental and Sustainability Matters
The Group is committed to managing its environmental, social, and governance impacts. In 2025, the Company launched a comprehensive overhaul of its management by establishing a Sustainability Committee that will report to the Group’s Board of Directors and appointing a Sustainability Director to closely monitor these issues. Based on the framework of the United Nations Sustainable Development Goals (SDGs), the Global Reporting Initiative (GRI), International Financial Reporting Standards (IFRS), the sectoral indicators of the Sustainability Accounting Standards Board (SASB), and regulatory compliance in the locations where it operates, BeFra defined its environmental and sustainability strategy for the 2026–2029 period (the “Environmental and Sustainability Strategy”).
In late 2025, the Company conducted a double materiality analysis (the “Double Materiality Analysis”) through an independent consultant, in accordance with best practices in sustainability. In this way, it identified the sustainability and climate risks and opportunities for both entities. BeFra is currently in the process of implementing the ISSB Standards (IFRS S1 and S2) in its financial sustainability reporting.
Environmental Management
With the aim of allocating material, human, and financial resources to its Environmental and Sustainability Strategy, BeFra invested Ps.450 thousand-MXN in 2025 in a Double Materiality Analysis and sustainability reporting, in addition to Ps.290 thousand-MXN to measure its carbon footprint.
Based on the results of the Double Materiality Analysis, an action plan was designed around two strategic pillars: 1) eco-efficiency and 2) decarbonization. In 2026, the focus will be on deepening both strategies by defining specific objectives and metrics for the Group.
The Group’s philosophy is based on lean operations that aim to maximize productivity and profitability through operational efficiency and the careful management of strategic resources and inputs. There are three national operational centers: the Betterware campus in Jalisco, the Jafra plant in Querétaro, and the Jafra Distribution Center (“CEDIS”) in the State of Mexico.
In 2025, electricity was the primary energy source used for automating operations. This was followed by natural gas for the Jafra production plant boiler, gasoline for transportation vehicles, and other uses.
7,467,512 kWh of electricity were consumed: 60% by Jafra for filling, packaging, and packing line processes, and 40% by Betterware, primarily for the sorting tower. Additionally, Jafra’s manufacturing process required 14,209.3 MCF of natural gas for the boiler, at a cost of Ps.3.5 million pesos.
The Group has invested in clean energy sources through infrastructure that promotes natural lighting, the installation of LED lighting systems, timers throughout the facilities, and solar panels.
In 2024, with an investment of Ps.3.3 million pesos, 300 solar panels were installed on the Betterware campus, generating 277,855.3 kWh of renewable energy, equivalent to 12% of the company’s electricity consumption. An expansion to add 600 more panels is being evaluated for 2026-2027. Meanwhile, Jafra plans to achieve 100% LED lighting across all its facilities and, through a Ps.10 million pesos investment in solar panels for its Querétaro plant and Toluca distribution center, reach its goal of 10% renewable energy by 2028. The corporate offices of Jafra and BeFra (in Guadalajara, Jalisco) are located in newly constructed smart buildings, featuring technological advancements such as reduced energy consumption through HVAC (Heating, Ventilation, and Air Conditioning) efficiency, LED lighting with automatic control, and extended equipment lifespan through predictive maintenance.
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BeFra is aware that its operational centers are located in areas with high water stress. The two main facilities the Betterware Campus and the Jafra plant—operate using a closed-loop system and have their own water treatment plants. Consumption in 2025 was 89,424 m³ of fresh water, 20% from Betterware and 80% from Jafra.
Betterware: draws fresh water from a well and reduced its consumption by 0.65% compared to 2024, through a rainwater harvesting system and the use of treated water for irrigating green areas.
Jafra: receives water via the municipal network as part of an industrial park and increased its consumption by 10% compared to the previous year due to increased production and sales. For 2026, it budgeted Ps.12.8 million pesos for the redesign of the water treatment plant in Querétaro, an investment that will achieve an approximate 10% reduction in water use by 2028.
Due to the nature of its operations and sales volume, the environmental impact of BeFra’s product delivery is considerable.
For Betterware, environmental risks and opportunities are linked to improved purchasing, logistics, and packaging practices, as most of its products are manufactured in China.
For Jafra, they are linked to responsible sourcing practices, safe production, and packaging, as 90% of its inputs are of national origin.
The Group promotes the recycling of inputs related to storage and shipping, especially corrugated cardboard, paper, and stretch wrap. It also promotes the certification of materials, such as the paper used for catalogs and the cardboard used for packaging and storage. Jafra’s production processes also require materials such as glass, plastic, solvents, and other substances.
Decarbonization Strategy
Since 2023, the Company has measured its carbon footprint in accordance with international commitments and Mexican government regulations. In 2025, this measurement and analysis was deepened through the engagement as an external consultant. Opportunities for reduction in Scope 1 and 2 emissions were identified using science-based targets (SBTis), and Scope 3 emissions were calculated by category using an expenditure-based methodology. A specific measurement system for the value chain will be implemented in 2026.
Developed in partnership with Sin Carbono, the plan is being implemented in three phases:
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Scope 1 emissions (“Scope 1”) include those from operations, the vehicle fleet, and fugitive emissions. The main fuel is natural gas used in the boiler at the Jafra plant. Gasoline or diesel consumption at operational centers is low, as it is only used in the event of power outages at power generation and water treatment plants. For employee transportation, bus routes are used, and carpooling is encouraged through gasoline vouchers.
It is estimated that vehicles used by staff commuting to work generated 2,275 tCO2e, and 1,144 tCO2e for business travel. A plan to integrate electric vehicles over the next five years is being prepared for 2026.
Regarding equipment maintenance and upgrades and their impact on GHG emissions, Jafra invested $5.8 million pesos to upgrade equipment, replace forklift batteries and 10 HP 800k screw compressors for Logistics, install capacitor banks at the plant’s substation, and replace the chiller.
Regarding Scope 2 emissions (“Scope 2”), which are indirect emissions resulting from Betterware’s purchase of electricity, heating, cooling, and other resources in operations, Betterware achieved a 20% reduction compared to 2024, due to energy generated by solar panels (88%) and best practices (12%). Of BeFra’s 3,199 tCO2e of emissions from electricity consumption, 80% came from market-based electricity and 20% from location-based electricity.
As noted above, a more in-depth analysis of Scope 3 emissions (“Scope 3”), which are broad, indirect emissions that occur both upstream and downstream of a company’s value chain, for BeFra will be conducted in 2026. A software extension of the Transport Management System (TMS) is being evaluated to measure delivery distances more accurately, identifying opportunities to reduce the carbon footprint throughout the value chain. We are considering evaluating carrier selection (Clean Transportation program or energy efficiency plans). Other actions to consider: environmental clauses with suppliers, reducing incentives that involve energy consumption, last-mile electrification, eco-design in products, and inputs with lower environmental impact or recycling options.
Of the total GHG emissions at A3 based on the previous study, it is estimated that the Company’s total transportation and logistics generated 45,243 tCO2e, with 15% being upstream emissions and 85% downstream emissions.
In 2025, Mexico experienced several extreme weather events: record-breaking rainfall in June; Hurricane Erick in the Pacific in June; and flooding and landslides caused by torrential rains in several states in October and November. These events did not materially affect the Company’s financial situation, beyond the payment of insurance claims totaling Ps.37.7 million pesos.
Both Betterware and Jafra achieved a 98% on-time delivery rate with 24- and 48-hour delivery windows. As part of a prevention plan for 2026, risk maps are being developed for each workplace in collaboration with strategic partners. This will enable the implementation of Business Continuity Plans in the event of weather-related incidents, which are expected to reduce emergency repair costs, lower the risk of missed deliveries, and yield benefits regarding insurance premiums.
Jafra is evaluating structural reengineering projects to prevent rainwater leaks at both the plant and the Toluca CEDIS. The Group plans to renew the insurance policy for 2026.
No financed issuances were generated for the Decarbonization Strategy during the reporting year. However, we have in the past issued sustainability bonds. A transaction originated by Betterware in 2021 to finance the construction of the Guadalajara Campus—based on an environmental impact analysis —was monitored for environmental impacts, and two sustainable bonds were issued to finance the facility. See “Indebtedness.”
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The state of Querétaro is among the most advanced in the country in terms of environmental regulation, imposing taxes on carbon emissions and waste generation. For the 2024 fiscal year, Jafra paid $288,766 MXN in carbon taxes and Ps.29 thousand in waste-related environmental taxes in 2025. The Company offset 804.59 tCO2e of CO2e emissions in 2024 through carbon credits, representing 23% of the total.
Thanks to its emissions management results and eco-efficiency practices, Jafra was awarded the QRO-3 State Low Carbon Emissions Seal and Level 1 Clean Industry Certification in 2025.
Value Chain Management
With a social mission focused on empowering people, BeFra provides an income opportunity for independent merchants—the vast majority of whom are women (90%)—through the direct sale of consumer goods using physical catalogs and digital tools. This model is based on a discount scheme that allows sellers to earn points for their orders, which they can redeem for rewards. The income generated by these independent associates and distributors depends not only on their own sales but also on the creation and management of a team or network of sellers.
Eco-friendly products.
Betterware: All plastic products related to food and beverage storage are BPA-free. Approximately 8.2% of sales are products geared towards reducing environmental impacts, across three lines:
Jafra: The products comply with the European cosmetic regulatory framework and do not use D4, D5, and D6 silicone, but rather other silicones and siloxanes that are approved for use. Regarding the properties of their products, the exfoliating formulas do not include microplastics as physical agents; instead, they use salt, silica sand, and activated charcoal. No product contains or uses talc, and only two SKUs in the line contain palm oil, which are being replaced with other ingredients to reduce dependence on this component, in accordance with international best practices. None of their product lines are tested on animals, and they have also launched two product lines promoting vegan formulas for their cosmetic products.
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The following diagram depicts the organizational structure of the Group as of the date of this annual report:
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We own the following properties in Mexico:
Of the sales price, (i) Las Flores was paid in full in the amount of Ps.16.5 million as of December 31, 2024, and (ii) San Angel as of December 31, 2024 and 2025, was collected Ps.140.0 and Ps.135.6 million, respectively, and the remaining balance of Ps.110.1 million will be collected semiannually without interest, maturing in 2027.
In addition, as of December 31, 2024, a loss of Ps.34.1 million was recognized when determining the fair value of the long-term receivable. As of December 31, 2025 and 2024, the Management decided not to recognize an expected credit loss effect on San Ángel’s account receivable because it was considered that the probability of non-collection is low and the payments are secured with the mortgage of the same property.
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Jafra México classified the O’Farril as assets held for sale in accordance with the accounting policy current assets held for sale. As of December 31, 2025 and 2024, the Company shown as current assets in its statement of financial position the asset held for sale for a value of Ps.40 million.
At the end of 2024, the carrying amount of O’Farril was Ps.206.6 million and an impairment loss of Ps.166.6 million was recognized, reducing the carrying amount to Ps.40 million.
As of the date of this annual report, we do not have plans to build, expand or improve any new or existing facilities. We have not identified any environmental issues that may affect our assets.
ITEM 4A. UNRESOLVED SEC STAFF COMMENTS
We have no unresolved comments from the staff of the SEC with respect to its periodic reports under the Exchange Act.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
Our discussion and analysis of our results of operations and financial condition are based upon our Audited Consolidated Financial Statements, which have been prepared in accordance with IFRS. Our operating and financial review and prospects should be read in conjunction with our Audited Consolidated Financial Statements, the accompanying notes thereto and other financial information appearing elsewhere in this annual report.
Factors Affecting Our Results of Operations of the Group
A number of factors have a significant impact on our business and results of operations, the most important of which are regulations, fluctuations in exchange rates in the currencies in which we operate, external factors and our capital investment plans.
Betterware’s distributors and associates
BWM sells its products through a unique two-tier sales model that is comprised of distributors and associates. Distributors act as link between BWM and the associates. BWM distributes products on a weekly basis to distributors’ domicile, who in turn deliver the products to the associates. BWM provides distributors a two-week credit line for them to pay BWM back the price for the products.
JAFRA’s leaders and consultants
JAFRA sells its products through a multilevel program with 10 levels of leaders and consultants, which are JAFRA’s marketing terms for its distributors and associates. Leaders and consultants are the link between JAFRA and final customers. JAFRA provides a 30-day credit line to leaders and consultants to pay JAFRA back for the price of the products.
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Net Revenue
We generate revenue mainly through sale of products within two main segments:
For the year ended December 31, 2025, 2024 and 2023, JAFRA contributed 60.1%, 57.5% and 56.0%, respectively of our consolidated net revenue and BWM contributed 39.9%, 42.5% and 44.0%, respectively.
We report net revenue, which represents its gross revenue less sales discounts, adjustments and allowances. We also have deferred revenue due to undelivered performance obligations related to the promotional points program as per IFRS 15 “Revenue from Contracts with Customers.” Deferred revenue relates to the accumulated points than distributors, associates, leaders and consultants have gained from their purchases and recruitment of new sales force. They can redeem these points for rewards (furniture, electronics, domestic appliances, among others). Revenue from the points program is recognized when points are actually redeemed and exchanged by distributors, associates, leaders and consultants.
Our revenue is recognized using a five-step model:
Cost of Sales
Our cost of sales consists of the purchase of raw materials, finished goods, air and maritime freight costs, land freight costs, customs costs, provisions for defective inventory, among others.
Selling Expenses
Our selling expenses include all costs related to the sale of products, such as printing and design of sales catalogues, packaging materials, events, marketing and advertising, promotional points program expenses, and employee compensation and social contributions. Costs related to sales catalog and rewards or points program products account for most of the weight of total selling expenses.
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Administrative Expenses
Administrative expenses primarily include employees’ compensation, social contributions and associated expenses. Also, includes research and development, leases, professional services relating to our statutory corporate audit and tax advisory fees, legal fees, outsourcing fees relating to information technology, and corporate site and insurance costs.
Distribution Expenses
Distribution expenses include the cost to carry the products from distribution centers to the final distributors.
Financing Income (Cost)
Our financing income (cost) consists primarily of: (i) interest expense and charges in connection with financings, (ii) income derived from investments of excess cash, (iii) loss/gains from foreign exchange changes, and (iv) loss /gains in valuation of derivative financial instruments.
Income Taxes
We are subject to (i) a 30% income tax rate under Mexican Income Tax Law, (ii) 25% income tax rate under Guatemalan law, (iii) 21% income tax rate under U.S. law; and (iv) 29.5% income tax rate under Peruvian law. See “Taxation” section below for more information.
Fluctuations in Exchange Rates in the Currencies in which We Operate
Our primary foreign currency exposure gives rise to market risks associated with exchange rate movements of the, Mexican Peso against the U.S. dollar See “—Quantitative and Qualitative Disclosure about Market Risk—Exchange Rate Risk.”
Goodwill and Other Intangible Assets
Goodwill and intangible assets recognized in our financial statements arise from past business combinations completed by the Group. Further information regarding goodwill and intangible assets is provided in Notes 11 and 12 to the consolidated financial statements included in this annual report.
Goodwill and indefinite-lived intangible assets are allocated to those cash-generating units (“CGUs”) or group of CGUs that are expected to benefit from the synergies of the related business combination. These CGUs or group of CGUs represent the lowest level within the Group at which goodwill is monitored for internal purposes. The determination of CGUs or group of CGUs is based on a manner in which management monitors and manages the operating business.
Group of CGUs to which goodwill has been allocated are tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that an impairment may have occurred. All other assets or groups of CGUs are tested for impairment whenever such indicators exist and suggest that their carrying amounts may not be recoverable.
As of December 31, 2025, 2024 and 2023, the estimated recoverable amount of the group of CGUs exceeded their respective carrying amounts and therefore no impairment of goodwill was recognized for those periods.
Certain material weaknesses related to controls over goodwill are further described in in “Item 15—Controls and Procedures— Management´s annual report on internal control over financial reporting.”
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Results of Operations — For the Year 2025 Compared to the Year 2024:
All amounts in this section marked with “Ps.” are in thousands of Mexican pesos unless otherwise noted
GROUP
Net revenue increased by 1.0%, or Ps.142,257, reaching Ps.14,243,015 for the year 2025 compared to Ps.14,100,758 for the year 2024. This increase was primarily driven by higher net revenue generated by Jafra, which contributed positively to the Group’s consolidated net revenue.
BWM:
Net revenue decreased by 5.1%, or Ps. (303,175), reaching Ps.5,688,659 for the year 2025 compared to Ps.5,991,834 for the year 2024. This decrease primarily reflects a weak start to the year, driven by softer national consumption levels, as well as lower percentage of associates placing an order per week (to 26.3% in 2025 from 27.1% in 2024), causing a decline in contribution to net revenue.
JAFRA:
Net revenue increased by 5.5%, or Ps.445,432, reaching Ps.8,554,356 for the year 2025 compared to Ps.8,108,924 for the year 2024. This increase was primarily driven by higher average monthly sales orders per consultant and per leader rising from 2,246 to 2,425 (+8%) sales orders, mainly supported by promotional plans, which increased by 0.3 percentage points, from 51.5% to 51.8%.
GROUP:
Cost of sales increased by 5.4%, or Ps. 242,537, to Ps.4,762,760 for the year 2025 compared to Ps.4,520,223 for the year 2024. This increase was primarily driven by higher raw material costs at Jafra by 6%, mainly attributable to the increase in glass prices.
Cost of sales increased by 1.8% or Ps.46,130, to Ps.2,615,212 for the year 2025 compared to Ps.2,569,082 for the year 2024. This increase was mainly driven by external factors, including temporary foreign exchange losses attributable to the purchase of inventory in a foreign currency and losses from derivative positions resulting from a strengthening of the Mexican peso and an increase in the slow-moving and damaged inventory allowance.
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Cost of sales increased 10.1%, or Ps.196,407, to Ps.2,147,548 for the year 2025 compared to Ps.1,951,141 for the year 2024. This increase was primarily driven by higher raw material prices, particularly glass, which accounted for approximately 6% of the increase, a higher provision for inventory obsolescence arising from image renewal initiatives (mainly related to fragrances), higher production volumes, and foreign-exchange losses attributable to purchase of inventory in a foreign currency.
Administrative expenses by item are as follows:
Administrative expenses decreased 9.5%, or Ps.(256,526), to Ps.2,446,350 for the year 2025 compared to Ps.2,702,876 for the year 2024. The decrease of Ps.256,526 was mainly driven by (i) the absence in 2025 of a Ps.166,581 impairment charge on assets held for sale recognized in 2024, (ii) a Ps.49,309 reduction in impairment losses on trade accounts receivable, (iii) a Ps.39,769 decrease in professional and consulting fees, (iv) and a Ps.16,351 decrease in depreciation expense related to fully amortized software of Betterware. These decreases were partially offset by a Ps.17,051 increase in warehouse rental expenses due to additional storage capacity required as a result of higher inventory levels during the first half of 2025. As a percentage of net revenues, administrative expenses represented 17.2% and 19.2% for the years 2025 and 2024, respectively.
Administrative expenses decreased 3.8%, or Ps.(43,685), to Ps.1,092,763 for the year 2025 compared to Ps.1,136,448 for the year 2024. The decrease was mainly driven by a Ps.46,029 reduction in impairment losses on trade accounts receivable accounted for in 2024 and a Ps.14,275 decrease in depreciation expense related to property, plant and equipment and intangible assets, primarily from software that reached the end of its useful life. These reductions were partially offset by a Ps.17,051 increase in warehouse rental expenses due to additional storage space required due to higher volume of inventory during the first half of 2025. As a percentage of net revenues, administrative expenses represented 19.2% and 19.0% for the years 2025 and 2024, respectively.
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Administrative expenses decreased 13.6%, or Ps.(212,841), to Ps.1,353,587 for the year 2025 compared to Ps.1,566,428 for the year 2024. The decrease was mainly driven by an impairment charge of Ps.166,581 on assets held for sale recognized in 2024, a Ps.32,519 reduction in fees in 2025, and a Ps.10,055 commission fee related to the sale of Jafra property, plant and equipment recognized in 2024 (see “—Item 4 —Property, Plant and Equipment”). As a percentage of revenues, administrative expenses represented 15.8% and 19.3% for the years 2025 and 2024, respectively.
The selling expenses major line items include:
Selling expenses increased by 2.0%, or Ps. 81,224, to Ps.4,079,141 for the year 2025 compared to Ps.3,997,917 for the year 2024. The increase was mainly driven by a Ps.66,596 increase in sales commissions, resulting from a 5.5% increase in Jafra’s revenues, and a Ps.33,038 increase related to promotional expenses including an allowance on obsolete promotional products. Selling expenses represented 28.6% and 28.4% of net revenues for the years 2025 and 2024, respectively.
Selling expenses decreased by 15.3%, or Ps.130,678, to Ps.723,330 for the year 2025 compared to Ps.854,008 for the year 2024. The decrease was mainly attributable to a Ps.103,169 reduction in promotional sales programs, and lower salaries and benefits of Ps.13,219 due to a decrease in the number of sales personnel. Additional decrease of Ps.4,446 was driven by reduction in the cost of selling catalogs distributed to sales personnel and reduced materials costs of Ps.4,460. Selling expenses represented 12.7% and 14.3% for the years 2025 and 2024, respectively.
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Selling expenses increased 6.7%, or Ps.211,902, to Ps.3,355,811 for the year 2025 compared to Ps.3,143,909 for the year 2024. The increase was primarily driven by a Ps.79,112 increase in the allowance for obsolete inventory of promotional products. Additional increases included higher promotional expenses of Ps.33,421 and e-commerce platform costs of Ps.16,711. Selling expenses also increased by Ps.66,596 due to sales commissions, resulting from a 5.5% increase in revenues. Selling expenses represented 39.2% and 38.8% for the years 2025 and 2024, respectively.
Distribution expenses increased 5.0%, or Ps.33,439 to Ps.697,251 for the year 2025 compared to Ps.663,812 for the year 2024 due to increases in freight costs by 6% in BWM and 8% in Jafra.
Distribution expenses increased 2.7%, or Ps.7,285, to Ps.280,539 for the year 2025 compared to Ps.273,254 for the year 2024. This increase was mainly driven by an increase of 6% in freight prices agreed with our carriers during 2025.
Distribution expenses increased 6.7%, or Ps.26,154, to Ps.416,712 for the year 2025 compared to Ps.390,558 for the year 2024. This increase was mainly driven by an increase of 8% in freight prices agreed with our carriers during 2025.
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To mitigate the risks associated with fluctuation in the U.S. dollar exchange rate, the Group uses derivative financial instruments, primarily forward contracts, to hedge foreign currency exposure arising from inventory purchases denominated in U.S. dollars. As of December 31, 2025, the loss from the valuation of derivative financial instruments amounted to Ps.108,846, primarily related to the settlement of U.S.$57,400 in forward contracts outstanding as of December 31, 2024.
In February 2025, the Company adopted hedge accounting. For further information, see Note 2 “Material accounting policies — Derivative financial instruments and hedge accounting” and Note 18 “Derivative financial instruments and hedge accounting” to the Audited Consolidated Financial Statements.
Financing Cost increased 12.9%, or Ps.61,936, to Ps.540,623 for the year 2025 compared to Ps.478,687 for the year 2024. The increase was primarily driven by Ps.265,612 unfavorable change in the valuation of derivative financial instruments, from a gain in 2024 to a loss in 2025, due to exchange rate fluctuations. This increase was partially offset by a Ps.103,506 decrease in interest expense due to payment of debt, and due to a Ps.114,111 foreign exchange gain on accounts payable to suppliers as of December 31, 2025.
Financing Income increased 118.3%, or Ps.31,634, to Ps.4,895 for the year 2025 compared to Ps.(26,739) for the year 2024, due to a gain on interest of Ps.26,326, related to an account receivable from Jafra’s property sale in 2024 (See “—Item 4 —“Property, Plant and Equipment”).
Income Tax Expense
The Group’s effective income tax rate was 38.4% in 2025 and 40.0% in 2024, mainly explained by the two following paragraphs of BWM and Jafra. In Mexico, United States, Guatemala, Perú, Ecuador and Colombia, the Group’s statutory income tax rate in 2025, was 30%, 21%, 25%, 29.5%, 25% and 25%, respectively.
Income taxes decreased 31.4% or Ps.74,101 to Ps.162,205 for the year 2025 compared to Ps.236,306 for the year 2024. The decrease was primarily attributable to lower taxable income, due to a decrease in net revenue by 5.1%, and tax deductions for inventory write-offs in the amount of Ps.22 million.
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Income taxes increased 114.1% or Ps.265,822 to Ps.498,776 for the year 2025 compared to Ps.232,954 for the year 2024. The increase was primarily attributable to a decrease in deferred income tax benefits, mainly resulting from the tax effects of the asset sale completed in 2024, with a total transaction value of approximately Ps.282 million (See “—Item 4 —“Property, Plant and Equipment”).
Reconciliation of Non-IFRS Measures
Non-IFRS Financial Measures
We define “EBITDA” as profit for the year adding back the depreciation of property, plant and equipment and right-of-use assets, amortization of intangible assets, financing cost, net and total income taxes. We define “Adjusted EBITDA” as the same ratio with the elimination of non-concurrent transactions, non-current events. EBITDA and adjusted EBITDA are not measures required by or presented in accordance with IFRS. EBITDA and Adjusted EBITDA are non-IFRS financial measures that do not follow generally accepted accounting principles or IFRS. These non-IFRS measures do not have standardized meanings and may not be directly comparable to similarly titled measures adopted by other companies. Potential investors should not rely on information not recognized under IFRS as a substitute for the measures of earning or liquidity required by IFRS in making an investment decision.
EBITDA and Adjusted EBITDA Reconciliation to Net Income/(Loss) from Continuing Operations
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For the year 2025, EBITDA increased 27.4% or Ps.568,654, to Ps.2,647,048 compared to Ps.2,078,394 in 2024, mainly due to the asset sale loss of Ps.529 million and impairment loss of assets held for sale in the amount of Ps.167 million in 2024 (See “—Item 4 —“Property, Plant and Equipment”), offset by the decrease in BWM’s net revenue by 5.1% in 2025 and temporary FX-related impacts on inventory valuation and losses from derivative positions, due to a stronger-than-expected peso.
For the year 2025, Adjusted EBITDA decreased 4.6% or Ps.127,649, to Ps.2,647,048 compared to Ps.2,774,697 in 2024, mainly due to the decrease in BWM’s net revenue by 5.1% in 2025 and temporary FX-related impacts on inventory valuation and losses from derivative positions, due to a stronger-than-expected peso, offset by the growth by 5.5% in Jafra’s net revenue driven by higher purchase orders and improved consultant productivity.
For the year 2025, EBITDA decreased 15.2% or Ps.196,502, to Ps.1,100,036 compared to Ps.1,296,538 in 2024, due to revenue decreased by 5.1% and temporary FX-related impacts on inventory valuation and losses from derivative positions, due to a stronger-than-expected peso. BWM does not have adjustments to its EBITDA and does not contribute any adjustments in the Group’s total Adjusted EBITDA calculation.
For the year 2025, EBITDA increased 4.7% or Ps.68,853, to Ps.1,547,012 compared to Ps.1,478,159, in 2024, mainly due to the growth by 5.5% in Jafra’s net revenue driven by higher purchase orders and improved consultant productivity.
For the year 2025, Adjusted EBITDA increased 97.9% or Ps.765,156, to Ps.1,547,012 compared to Ps.781,856 in 2024, mainly due to the asset sale loss of Ps.529 million and impairment loss of assets held for sale in the amount of Ps.167 million in 2024 (See “—Item 4 —“Property, Plant and Equipment”), and the growth by 5.5% in Jafra’s net revenue driven by higher purchase orders and improved consultant productivity.
Results of Operations — For the Year 2024 Compared to the Year 2023:
For a discussion of results of operations for fiscal year 2024 compared to fiscal year 2023, see our Annual Report on Form 20-F for the year ended December 31, 2024 incorporated by reference herein.
Our primary source of liquidity is cash flow generated from our two main operating segments, sales of home organization products and beauty and personal care (B&PC). Variation in sales of our products directly affects our cash flow. We have historically met our short- and long-term working capital and capital expenditure requirements through net cash flow provided by operating activities. Our capital expenditures requirements are mainly related to investment in technology, and, in prior years, to the construction of our distribution center. We financed the JAFRA Acquisition through a long-term debt instrument, and despite the current inflationary environment, we believe we will have sufficient resources to meet our debt service obligations in a timely manner.
In order to maintain sufficient liquidity, we strive to maintain an average cash and cash equivalent monthly balance of approximately Ps.200,000. As of December 31, 2025, 2024 and 2023 our cash and cash equivalents were Ps.328,344, Ps.296,558, and Ps.549,730 respectively. During 2023 the cash balance was higher than our minimum expected cash balance, however, during 2025 and 2024 management decided to use cash available in order to pay debt. The cash balance at the end of 2025 compared to 2024 was higher, mainly driven by a decrease of interest expense associated with payment of debt by Ps.101 million. (See “—Liquidity and Capital Resources—Indebtedness” and Note 15 — “Debt and borrowings” to the Audited Consolidated Financial Statements).
One of our management’s objectives is to prepay long-term debt in order to achieve a leverage index lower than 2x. We currently finance our long-term debt with sources of cash flow generated mainly by JAFRA.
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During 2025, 2024 and 2023, the Group had maintained revolving credit facilities with banks BBVA, HSBC, and Banamex, which provide a continuous source of working capital that management believes can meet any required immediate funding (For further detail on the Company’s available liquidity, see “—Liquidity and Capital Resources—Indebtedness” and Note 15 — “Debt and borrowings” to the Audited Consolidated Financial Statements).
During 2025, BWM imported approximately 87.2% of its products in contrast to JAFRA importing approximately 36.5%. Such imports are paid in dollars. To reduce the risk related to fluctuations in exchange rates, BWM uses derivative financial instruments as “forwards” to moderate the exchange risks resulting from future inventory and purchases in dollars. At the end of 2025, the hedging forward contracts cover 100% of the product needs until May 2026. In accordance with the policy and market conditions, the Company enters into derivative contracts in order to cover needs for the coming months. As of the date of this Annual Report, the hedging forward contracts covered our inventory purchases until December 2026. For further information on our hedging and derivatives use, see —Note 2 “Material accounting policies — Derivative financial instruments and hedge accounting” and Note 18 “Derivative financial instruments” to the Audited Consolidated Financial Statements.
Jafra Mexico continues to be one of the Group’s most resilient growth engines, despite beauty market headwinds. Brand strength, innovation cadence, and consistent field engagement are what position the business for sustainable growth and margin stabilization. Management remains focused on further strengthening the brand, improving merchandise planning, product innovation, and rolling out enhanced technology.
Cash Flow
Year Ended December 31, 2025, Compared with Year Ended December 31, 2024
Cash Flows from Operating Activities
Cash flows provided by operating activities increased 24.5%, or Ps.439,597, to Ps.2,236,727 for the year ended December 31, 2025, compared to Ps.1,797,130 for the year ended December 31, 2024, mainly due to: (i) a decrease in inventories of Ps.507,896 to control excess inventory mainly in BWM. Historically, the Group did not invest in working capital because it is financed by the days payable to suppliers (sales are higher, cash collection from sales is faster than payments made to suppliers). Our inventory turnover improved from 183 days for the year ended December 31, 2024, to 173 days for the year ended December 31, 2025, our days of payables decreased from 159 for the year ended December 31, 2024, to 151 for the year ended December 31, 2025, and our days of receivables were slightly increased from 29 days for the year ended December 31, 2024, to 30 days for the year ended December 31, 2025.
Cash Flows from Investing Activities
Cash flows provided by investing activities increased by Ps.35,783 to Ps.35,317 for the year 2025 compared to cash used in investing activities of Ps.(466) for year ended December 31, 2024, mainly due to a 37% decrease of payments of capital expenditures in technological platform, equipment, and property, offset by a 31% decrease in cash received from non-recurrent disposals of property.
Cash Flows from Financing Activities
Cash flows used in financing activities increased by 9.3%, or Ps.190,422 to Ps.(2,240,258) for the year 2025 compared to Ps.(2,049,836) for the year 2024. During 2025, we received proceeds of Ps.5,540,700 under our short-term financing agreements as follows: (i) Ps.1,629,600 from HSBC, and (ii) Ps.3,911,100 from BBVA. As of December 31, 2025, we repaid an aggregate amount of Ps.5,842,700 under these short-term financing agreements as follows: (i) 1,409,600 to HSBC, and (ii) Ps.3,933,100 to BBVA (iii) 500,000 for bond liquidity. Additionally, we repaid an aggregate amount of Ps.415,000 under our long-term financing agreements, as follows: (i) Ps.225,000 to BBVA, and (ii) Ps.190,000 to HSBC. For the years ended December 31, 2025, and 2024, we paid dividends in the amount of Ps.850,000 and Ps.998,054, respectively. For the year ended December 31, 2025, we paid interest of Ps.502,458, or 16.8% less compared to Ps.603,921 paid for the year ended December 31, 2024, mainly due to bond settlement and prepayment of long-term debt mentioned above; (See “—Liquidity and Capital Resources—Indebtedness”).
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Year Ended December 31, 2024, Compared with Year Ended December 31, 2023
For a discussion of results of cash flow for fiscal year 2024 compared to fiscal year 2023, see our Annual Report on Form 20-F for the year ended December 31, 2024 incorporated by reference herein.
Indebtedness
Long-term credit facility with HSBC
On September 12, 2023, Betterware signed an agreement with HSBC to acquire a simple line of credit with joint obligation, up to Ps.950,000, valid until September 13, 2029, and payment of monthly interest at the TIIE rate (the of interbank interest rate) at 28 days published in BANXICO plus 1.3bp. Such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days. In addition, in case of a default, interest will be paid at the ordinary interest rate multiplied by 2.0pp between the 360 days and the result of using the unpaid and past-due balances.
On September 13, 2023, Betterware used the Ps.950,000 of the credit line with HSBC to pay our revolving lines.
As of December 31, 2025 and 2024, the amount paid to the principal of this credit line amounts to Ps.190,000 and Ps.47,500, respectively.
As of December 31, 2025, the current portion of this long-term simple line amounted to Ps.190,000 and portion of this long-term amounted to Ps.522,500.
Bond issuances listed on the Mexican Stock Exchange (BWMX 23 and BWMX 23-2)
On July 7, 2023, Betterware successfully concluded the offering of a two-tranche bond issuance for a total of Ps.813,974, with maturities of 4 and 7 years, offered in the Mexican Market. The third offer of bonds for Ps.313,374 started paying interest at 12.41% rate and for the subsequent monthly payments, the rate will be based on the 28-day TIIE rate issued by Banxico plus 0.90%, and the fourth offer of Ps.500,000 will pay interest semi-annually at a fixed rate of 11.23% during the bond term. Principal payments are at the end of every bond maturity.
On July 10, 2023, Betterware used the bond amount net of issuance costs of Ps.810,197, to pay the syndicated credit line.
Long-term credit facility with BBVA
On July 5, 2023, Betterware entered into a credit agreement with BBVA, up to Ps.1,500,000, with a term of 60 months and monthly interest payment at 28-day TIIE rate published in BANXICO, on non-working days, the TIIE rate could be at 26, 27 or 29 days, plus the applicable margin. Such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days. In addition, in case of a default, interest will be paid at the ordinary interest rate multiplied by 2.0 between the 360 days and the result of using the unpaid and past-due balances.
On July 10, 2023, Betterware used the Ps.1,500,000 of the credit line with BBVA to pay the syndicated credit line.
As of December 31, 2025 and 2024, the amount paid to the principal of this credit line amounts to Ps.225,000 and Ps.145,000, respectively.
As of December 31, 2025, the current portion of this long-term simple line amounted to Ps.375,000 and portion of this long-term amounted to Ps.755,000.
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Former syndicated credit facility
On March 31, 2022, Betterware entered into a credit agreement with Banamex, HSBC, BBVA, BanBajio, BanCoppel, and Scotiabank, as syndicated lenders, for a credit line of up to Ps.4,498,695 (the “Syndicated Loan”). The funds under the credit line were entirely allocated to the Jafra Acquisition in Mexico and the United States. The credit line had a maturity of 5 years from the date of signing the contract in March 2022, which paid monthly interest at the 28-day TIIE rate plus the applicable margin established in the contract. The first 24 months the credit line had no principal payments, and from month 25 principal payments began in an increasing manner, with a global payment of 30% in month 60. Jafra subsidiaries were jointly responsible for this credit.
During the months of March and June 2023, Betterware made two principal payments for Ps.1,000,000 and Ps.250,000, respectively. On July 10, 2023, the remaining principal of the Syndicated Loan for Ps.3,248,695 was prepaid. The resources used came from long-term debt: Ps.1,500,000 from BBVA and Ps.810,197 from the new bond issue; and short-term loans: Ps.550,000 from the revolving line with BBVA, Ps.150,000 from the revolving line with Santander, Ps.50,000, from the revolving line with HSBC, and the remaining amount for Ps.188,498 was taken from available cash of Betterware and Jafra on the settlement date.
The Management considered the transaction as an extinguishment of the original debt and a new debt was recognized for the long-term simple credit lines with BBVA and HSBC, mainly due to substantial differences in financial obligations. As a result of the extinguishment of the debt from July to December 2023, the Company cancelled in profit or loss the outstanding remainder of the initial issuance costs for the original debt, which amounted to Ps.50,447.
Sustainability bond issuances listed on the Mexican Stock Exchange (BWMX 21X and BWMX 21-2X)
On August 30, 2021, Betterware successfully concluded the offering of a two-tranche sustainability bond issuance for a total of Ps.1,500,000, with maturities across 4 and 7 years, offered in the Mexican Market and issued at favorable conditions for the Company. The first offer of sustainability bonds for Ps.500,000 started paying interest at 5.15% rate plus 0.40% and for the subsequent monthly payments, the rate will be based on the 29-day TIIE rate issued by Banxico plus 0.40%, and the second offer of Ps.1,000,000 will pay interest semi-annually at a fixed rate of 8.35% during the sustainability bond term. Principal payments are at the end of every bond maturity.
On August 25, 2025, the BWMX 21-X bond with 4-year maturity expired and the capital by Ps.500,000 was settled.
Revolving credit facility with BBVA – Jafra
On August 11, 2025, Jafra entered into a current account credit agreement with BBVA México, S.A, Institución de Banca Múltiple, for an amount of Ps.200,000. The line of credit accrues ordinary interest at the TIIEF annualized rate for 28 days plus the percentage points determined in the system at the time of its drawdown. The validity of the contract is 36 months from the date of signing the original contract. During 2025, Jafra made several drawdowns of the revolving line that together amounted to Ps.874,100, and at the end of the year they were paid in full.
Revolving credit facility with HSBC – Jafra
On May 3, 2024, Jafra entered into a current account credit agreement with HSBC México, S.A., Institución de Banca Múltiple, for an amount of Ps.70,000. The term of the agreement is 24 (twenty-four) months from the date of execution of the agreement and accrues interest at the 28-day TIIE reference base rate plus a margin applicable to the reference rate. During 2025 and 2024, Jafra used the revolving line in the amount of Ps.1,364,600 and Ps.184,100, and at the end of the year were paid in full.
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Revolving credit facility with BBVA – Betterware
On April 5, 2022, the Group entered into a credit line with BBVA for up to Ps.400,000 and as of May 31, 2022, through an amending agreement, the amount was strengthened for up to Ps.800,000. The line of credit bearing interest at the 28-day TIIE rate plus 100 basis points, payable monthly, with a term of 36 months from the date of signing the original contract.
On March 4, 2025, Betterware renewed the contract for this line of credit with BBVA for up to Ps.800,000. The line of credit accrues ordinary interest at the TIIEF annualized rate for 28 days plus the percentage points determined in the system at the time of its drawdown. The validity of the contract is 36 months from the date of signing the original contract.
During the years 2025, 2024 and 2023, Betterware received several deposits of this revolving line which together amounted to Ps.3,037,000, Ps.1,723,000 and Ps.1,855,020, respectively, which, as of December 31, 2025, 2024, and 2023, were paid Ps.3,059,000, Ps. 1,903,000 and Ps.1,555,020, respectively
As of December 31, 2025, 2024 and 2023, the total balance of this short-term line closed at Ps.98,000, Ps.120,000 and Ps.300,000, respectively.
Revolving credit facility with Santander – Betterware
On May 30, 2022, Betterware entered into a current account credit agreement with Santander México, S.A., for an amount of Ps.200,000. BLSM is jointly and severally liable for this credit. The maturity date of this line of credit is May 31, 2024, and accrues interest at the TIIE rate plus 190 basis points. During fiscal year 2023, Betterware has used Ps.380,000 under such revolving credit line and which has been reimbursed to Santander. During 2025 and 2024, BWM did not receive cash from this credit line.
Revolving credit facility with HSBC – Betterware
On March 10, 2020, Betterware entered into a current account credit line agreement with HSBC México, S.A., for an amount of Ps.50,000, with provisions by means of promissory notes specifying payment of principal and interest. BLSM is jointly liable for this credit. On May 4, 2020, the first amendment agreement was signed, in which the amount of the credit line was increased to Ps.150,000. On June 17, 2022, the fourth modifying agreement was signed, which increased the available funds to Ps.300,000; and it bears interest at the TIIE rate plus 100 basis points. During the years 2025, 2024 and 2023, Betterware received several deposits of this revolving line which together amounted to Ps.265,000, Ps.1,120,000 and Ps.300,000, respectively, which, as of December 31, 2025, 2024 and 2023, were paid Ps.45,000, Ps.1,040,000 and Ps.300,000, respectively.
As of December 31, 2025, the balance of this short-term line closed at Ps.300,000.
Unsecured revolving credit facility with Banamex – Betterware
Betterware has an unsecured credit line with Banamex since July 2016, for up to Ps.900,000, at a rate based on the 28-days TIIE plus 110 basis points. As of January 1, 2023, the line of credit had a payable balance of Ps.200,000. During fiscal year 2023, Betterware used this line of credit for Ps.700,000 and Ps.900,000 were paid. During fiscal years 2025 and 2024, BWM did not receive cash from this credit line. As of December 31, 2025, this line of credit is no longer active.
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Our debt instruments contain the following financial ratios and covenants.
The long-term and current debt of the credit line with HSBC and the current account credit line with Banamex of Betterware contains the following financial obligations:
The Betterware long-term BBVA facility contains the following financial covenants:
The Betterware revolving BBVA facility contains the following financial covenants:
The Jafra revolving BBVA facility contains the following financial covenants:
The short and long-term debt of credit lines with banks contain the following covenants, among others:
The bond issuances require the Group to comply with the following obligations:
The Group was in compliance with all financial obligations as of December 31, 2025, 2024 and 2023. The Management determined that there is no uncertainty regarding compliance with covenants in the next 12 months.
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The Group leases cars, computers, servers, printers, warehouses and buildings (Jafra distribution center and commercial venues) with different expiration dates, with the latest expiration date in 2034. As of December 31, 2025, 2024 and 2023, the leases balances amounted to Ps.336,588, Ps.314,023 and Ps.361,561, respectively. For further explanation see —Note 13 “Leases” to the Audited Consolidated Financial Statements.
Our research and development efforts consist of constant product innovation with the objectives of refreshing our catalogue content and attracting clients’ repeated purchases and data analytics unit technology in order to improve product development processes. For further details, see “Item 4.B. Information on the Company-Business Overview-Research and Development.”
New Tariffs.
Import tariffs implemented in Mexico on Chinese-manufactured products—particularly plastic-based goods—had a limited impact from Betterware business, reducing gross margin by approximately 0.6%. These measures mainly affected categories with high dependency on Chinese imports.
The Company mitigated this impact through proactive actions across sourcing, design, and pricing. These included supplier renegotiations, selective price adjustments, and progress toward production nationalization. These initiatives are expected to further reduce exposure to tariff-related pressures while supporting margin stability.
Slow Consumption.
During 2025, the Company operated in a subdued consumption environment, driven by macroeconomic volatility, socio-political uncertainty, and softer consumer spending across core markets. This resulted in slower-than-expected revenue growth, primarily due to reduced consumer activity.
As 2026 begins, consumption trends are stabilizing at normalized—but still soft—levels, rather than showing a strong rebound.
Strong Peso.
During the year, the Mexican peso remained relatively strong against the U.S. dollar, providing certain cost benefits given the Company’s exposure to dollar-denominated imports. However, exchange rate volatility continues to represent a potential risk.
To mitigate this exposure, the Company maintains a disciplined hedging strategy, with foreign exchange hedges in place. This approach enhances cost visibility, reduces short-term volatility, and supports financial planning.
Other than as discussed above and disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2025 that are reasonably likely to have a material and adverse effect on our revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information in this annual report to be not necessarily indicative of our future results of operations or financial condition.
See —Note 4 “Material accounting judgments and key sources of estimation uncertainty” to the Audited Consolidated Financial Statements.
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ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
Set forth below is information concerning our officers and directors as of the date of this annual report. Our executive officers are appointed by the board of directors to serve in their roles. Each executive officer is appointed for such term as may be prescribed by the board of directors or until a successor has been chosen and qualified or until such officer’s death, resignation or removal. Unless otherwise indicated, the business address of all of our executive officers and directors is Gdl-Ameca-Huaxtla km-5, El Arenal Jalisco, 45350, México.
BOARD MEMBERS:
EXECUTIVE OFFICERS:
Background of Our Officers and Directors
The Group’s board of directors is composed of the following members and a non-member Secretary:
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For the year ended December 31, 2025, we paid our top management a fixed aggregate compensation of approximately Ps.41,923 plus a variable aggregate compensation for bonuses of approximately Ps.17,202. The amounts payable under the performance bonus depend on the results achieved and include certain qualitative and/or quantitative objectives. Overall, the total executive compensation for 2025 was Ps.59,125.
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Board Committees
The Group’s Audit and Corporate Practices Committee has the following specifications:
Composition
Olga Botero is the founder and Chair of SECCURI, and founder and CEO of C&S Customers and strategy. She currently serves as independent director of ALTIPAL, the largest consumer goods distribution and marketing company in Colombia, she is a member of the Audit Committee of Grupo Coppel, a Mexican retail and financial company, and has joined the Advisory Board of the Montoya Group, a group with companies in sectors such as Automotive, Music and Real Estate. Additionally, she serves as an independent director at Evertec Inc, is a member of the Audit Committee and Chair of the IT Committee.
Ms. Botero has a Bachelors and Masters degree in computer science from Iowa State University, focused specially on Cyber Security and Encryption. She also has a diploma in Finance from EAFIT University in Colombia, and a diploma in E-Business from EIA University. Ms. Botero has a Scholars Award in General Management from the Kellogg School of Business and has studied various counselors’ programs from Stanford, HBS, IESE and Kellogg.
Olga was member of the Audit and Corporate Practices Committee during 2025 and left at the beginning of 2026.
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Sessions Frequency
Functions
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The following table provides information regarding the number of our employees for the years 2025, 2024 and 2023, respectively:
For information regarding the share ownership of our directors and senior management, see “Item 7.A Major Shareholders and Related Party Transactions—Major Shareholders.”
During the preparation of this Annual Report, the Company revised the 2024 comparative diluted earnings per share disclosure to correct an error as disclosed in Note 22 of the financial statements. The Company performed the recovery analysis required by Rule 10D-1(b) and concluded that this revision does not have an impact on any compensation-based incentive programs, nor on any other performance indicators of the Group. No recovery of incentive-based compensation was required because no executive officer received incentive-based compensation based on the affected financial reporting measure.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
The following table sets forth information with respect to the beneficial ownership of our shares as of the date of this annual report:
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As of April 6, 2026, we had 37,243,920 issued and outstanding ordinary shares. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes any shares over which a person exercises sole or shared voting and/or investment power. Except as otherwise indicated, we believe the beneficial owners of the shares listed below, based on information furnished by them, have sole voting and investment power with respect to the number of shares listed opposite their names.
Other than as disclosed in this annual report and the Audited Consolidated Financial Statements attached hereto and other than in the ordinary course of business, since the beginning of our preceding three financial years, we do not have significant transactions or loans with the Group’s related parties. Please see Note 23 of the Audited Consolidated Financial Statements to see non-significant transactions with related parties.
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ITEM 8. FINANCIAL INFORMATION
Our Audited Consolidated Financial Statements are included in Item 18. The Audited Consolidated Financial Statements were audited by independent registered public accounting firm and are accompanied by their audit reports.
Legal Proceedings
We are not involved in or threatened by any material proceeding that we are not adequately insured or indemnified or which, if determined adversely, would have a material adverse effect on our consolidated financial position, results of operations and cash flows.
Dividend Distribution Policy
We have created an Investment Committee which evaluates and recommends the Board of Directors whether or not to pay dividends. As of the date of this annual report, we have not implemented a dividend policy.
Except as otherwise disclosed in our Audited Consolidated Financial Statements and elsewhere in this annual report, there have been no significant changes in our business, financial condition or results of operations since December 31, 2025 and until the date of this Annual Report (See Note 1 — “Nature of business and significant” and Note 27— “Subsequent events” of the Audited Consolidated Financial Statements).
ITEM 9. THE OFFER AND LISTING
Our ordinary shares are listed on the NYSE under the symbol “BWMX.”
Our ordinary shares began trading on the Nasdaq under the symbol “BWMX,” in connection with our initial public offering, on March 13, 2020. In 2024, we voluntarily de-listed from the Nasdaq and transferred our listing to the NYSE where our shares began trading on June 7, 2024.
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ITEM 10. ADDITIONAL INFORMATION
The following is a summary of some of the terms of our ordinary shares, based on our articles of association in place. The following summary is not complete and is subject to, and is qualified in its entirety by reference to, the provisions of our articles of association, and applicable Mexican law, including Mexican corporate law.
General
Betterware is a company incorporated under the Mexican General Corporations Law on June 20, 1995, as a stock corporation with variable capital or “Betterware de México, S.A. de C.V.” (Sociedad Anonima de Capital Variable for its acronym in Spanish) with the initial register file number 195,312 in the Public Registry of Property and Commerce (“Registro Publico de la Propiedad y del Comercio” in Spanish). On August 2, 2021, Betterware adopted the form of Sociedad Anonima Promotora de Inversion de Capital Variable as a requirement of National Banking and Stock Commision (Comision Nacional Bancaria y de Valores) due to an issuance of bonds. As Betterware is a Mexican corporation, the rights of holders of Betterware’s shares will be governed directly by Mexican law and the Amended and Restated Charter.
Purposes
The Company’s purpose is (i) to establish and manage all types of commercial or civil companies; (ii) purchase and sale, negotiation, marketing, promotion of all types of products, solutions, home accessories, personal use, cleaning, and personal care products, direct or indirect through third parties and (iii) purchase and sale of real estate, among other things.
Shareholder Meetings
Shareholders’ Voting Rights
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Directors
Fiduciary Duties
Shareholders’ Derivative Actions
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Indemnification of Directors and Officers
Inspection of Books and Records
Anti-takeover Protections
The Board of Directors needs to approve, with at least 66% of its members present in a duly conveyed meeting and with at least 66% of its members favorable vote, any change in Control of the Betterware or the transfer of 20% or more of Betterware’s shares. Such change of Control or transfer must be notified to Betterware and Betterware’s shareholders.
The Board of Directors must approve the transfer within the following 90 calendar days after having all documentation the Board deems necessary for its consideration and approval.
In the event the Board of Directors authorizes the transaction, in addition to the Board approval, prior to the closing of the transaction, the person asking for the Board’s approval shall make a tender offer for 100% of the outstanding capital stock of the Company, at a price payable in cash, not less than the highest of the following:
In each of these cases (items (i) to (iii) above), a premium equal to or greater than 15% shall be paid in respect of the price per share payable in connection with the requested transaction, it the understanding that the Board of Directors may modify, upwards or downwards, the amount of such premium, taking into account the opinion of a reputable investment bank.
The public tender offer must be completed within 90 days of the date of the Board of Directors’ authorization, on the understanding that such term may be extended for an additional period of 60 days if the applicable governmental authorizations continue to be pending on the date of expiration of the initial term referred to above.
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In the event that the Board of Directors receives on or before closing, an offer from a third party, requesting to make the acquisition of at least the same number of shares, on better terms for the stockholders or holders of shares of Betterware, the Board of Directors shall have the capacity to consider and, if applicable, authorize such second request, revoking the authorization previously granted.
If the transaction is not (i) an acquisition representing the 20% of the capital stock of Betterware, or (ii) a change of Control, it shall be registered in Betterware’s Shares Registry Book once authorized by the Board of Directors.
In the event the Board of Directors rejects the transaction, the Secretary of the Board shall summon, within a period of 10 calendar days following such rejection (or within 20 calendar days prior to the termination of the term for the Board of Directors to decide on such request), to a General Ordinary Stockholders’ Meeting at which the shareholders may, by the simple majority of the votes of the outstanding shares, ratify the decision of the Board of Directors or revoke such decision. In such case, the shareholders’ resolution shall be deemed as final and shall replace any prior rejection by the Board of Directors.
“Control” means in respect of any person, through a person or group of persons, (i) the power to impose, directly or indirectly, by any means, resolutions or decisions, or to veto or prevent such resolutions or decisions from being taken, in any sense, at General Shareholders Meetings, or to appoint or remove the majority of the directors, administrators, managers or their equivalents of said person; (ii) maintain the ownership of any class of shares or rights related thereto which permit, directly or indirectly, the exercise of voting rights in respect of more than 50% of the shares, of whatever nature, with voting rights of such person, and/or (iii) the power to direct, determine, influence, veto or impede, directly or indirectly, the policies and/or decisions of the Board of Directors or of the management, strategy, activities, operations or principal policies of such person, whether through ownership of shares, by contract or agreement, written or oral, or by any other means, regardless of whether such control is apparent or implied.
A copy of the Articles of Association, as amended, is furnished under Item 19. “Exhibits”.
On April 7, 2026, the Company entered into a syndicated revolving credit agreement for Ps.3,805.5 million pesos with BBVA Mexico, HSBC Mexico, Banco del Bajío, and Banco Ve por Más, in which Jafra Cosmetics, S.A. de C.V., Distribuidora Comercial Jafra, S.A. de C.V., and Jafra Cosmetics International, S.A. de C.V. act as joint and several obligors. The financing was arranged to fund the Tupperware Acquisition agreed upon on January 19, 2026. The financing matures on April 7, 2031; provides for a 24-month grace period for principal repayment; accrues interest at a variable rate based on the TIIE plus the applicable margin; and establishes certain other financial obligations.
Other than the syndicated loan and the Tupperware Acquisition itself, we do not have any material contracts to disclose.
Mexico has had a free market for foreign exchange since 1991, and the Mexican federal government has allowed the peso to float freely against the U.S. dollar since December 1994. However, Mexico has imposed foreign exchange controls in the past, and pursuant to the provisions of the USMCA, if Mexico experiences serious balance of payment difficulties or the threat thereof in the future, Mexico would have the right to impose foreign exchange controls on investments made in Mexico, including those made by U.S. and Canadian investors. We have no control over or influence on this exchange rate policy, and there is no guarantee that the Mexican federal government will not change this policy.
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Material U.S. Federal Income Tax Considerations
The following is a summary of the material U.S. federal income tax consequences to U.S. Holders (as defined below) of the ownership and disposition of our ordinary shares. This summary is based upon U.S. federal income tax laws (including the U.S. Internal Revenue Code of 1986, as amended (the “Code”) final, temporary and proposed Treasury regulations, rulings, judicial decisions and administrative pronouncements), all as of the date hereof and such authorities may be repealed, revoked or modified, possibly with retroactive effect, so as to result in United States federal income tax consequences different from those discussed below.
As used herein, the term U.S. Holder means a beneficial owner of one or more of our ordinary shares:
This summary does not address all of the tax considerations that may apply to holders that are subject to special tax rules, such as U.S. expatriates or former long-term residents of the United States, insurance companies, individual retirement accounts and other tax-deferred accounts, tax-exempt organizations, certain financial institutions, dealers and certain traders in securities, (including those that elect to use the mark-to-market method of accounting), banks, regulated investment companies, real estate investment trusts, persons holding ordinary shares as part of a straddle, hedging, conversion or other integrated transaction, controlled foreign corporations or passive foreign investment companies, persons who are required to accelerate the recognition of any item of gross income with respect to the shares of the Company as a result of such income being recognized on an applicable financial statement, persons who acquired their ordinary shares pursuant to the exercise of employee shares options or otherwise as compensation, persons who are liable for the alternative minimum tax, entities or arrangements classified as partnerships for U.S. federal income tax purposes or persons whose functional currency is not the U.S. dollar. Such holders may be subject to U.S. federal income tax consequences different from those set forth below.
If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds ordinary shares, the tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. An entity or arrangement treated as a partnership for U.S. federal income tax purposes, or partner in a partnership, is urged to consult its own tax advisor regarding the specific tax consequences of owning and disposing of the ordinary shares.
Except as otherwise noted, this summary assumes that the Company is not a passive foreign investment company (a “PFIC”) for U.S. federal income tax purposes, which the Company believes to be the case. The Company’s possible status as a PFIC must be determined annually and therefore may be subject to change or an IRS challenge. If the Company were to be a PFIC in any year, materially adverse consequences could result for U.S. Holders.
This summary does not contain a detailed description of all the U.S. federal income tax consequences to you in light of your particular circumstances and does not address U.S. federal estate and gift taxes or the effects of any state, local or non-U.S. tax laws. Potential investors in our ordinary shares should consult their own tax advisors concerning the specific U.S. federal, state and local tax consequences (including U.S. estate and gift tax consequences) of the ownership and disposition of our ordinary shares in light of their particular situations as well as any consequences arising under the laws of any other taxing jurisdiction.
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Taxation of distributions
Subject to the PFIC rules discussed below under “Passive Foreign Investment Company Rules”, distributions received by a U.S. Holder on ordinary shares, including the amount of any Mexican taxes withheld, generally will constitute foreign source dividend income to the extent paid out of the Company’s current or accumulated earnings and profits (as determined for U.S. federal income tax purposes). Distributions in excess of current and accumulated earnings and profits will be treated as a non-taxable return of capital to the extent of the U.S. Holder’s basis in the ordinary shares and thereafter as capital gain. Because the Company does not maintain calculations of its earnings and profits under U.S. federal income tax principles, it is expected that any distributions on ordinary shares (including any Mexican taxes withheld) will be reported to U.S. Holders as foreign source dividend income. U.S. Holders should consult their own tax advisers with respect to the appropriate U.S. federal income tax treatment of any distribution received from the Company.
Corporate U.S. Holders who own less than 10% of the share capital or voting shares of the Company will not be entitled to claim the dividends received deduction with respect to dividends paid by the Company. Subject to the PFIC rules discussed below under “Passive Foreign Investment Company Rules,” a non-corporate U.S. Holder recipient of dividend income will generally be subject to U.S. federal income tax on such dividend income at a reduced capital gains tax rate rather than the marginal tax rates that generally apply to ordinary income, if the dividend qualifies as “qualified dividend income” for U.S. federal income tax purposes. Dividends on our ordinary shares would qualify as “qualified dividend income” if the Company qualifies as a “qualified foreign corporation” and certain other requirements are met (including certain holding period requirements. A non-U.S. corporation generally will be considered to be a qualified foreign corporation with respect to any dividend it pays on stock which is readily tradable on an established securities market in the United States. The ordinary shares are listed on the NYSE and should qualify as readily tradable on an established securities market in the United States so long as they are so listed. Therefore, the Company believes it will be a qualified foreign corporation for purposes of the reduced tax rate on dividend income from distributions on our ordinary shares, although no assurance can be given that it will continue to be treated as a qualified foreign corporation in the future. However, non-corporate U.S. Holders will not be eligible for reduced tax rates on any dividends received from us if we are a PFIC (as discussed below under “Passive Foreign Investment Company Rules”) in the taxable year in which such dividends are paid or in the preceding taxable year. Non-corporate U.S. Holders should consult their own tax advisors to determine whether they are subject to any special rules that limit their ability to be taxed at this favorable rate.
If you are a U.S. Holder, the amount of any cash dividend paid in Pesos will be included in your gross income for U.S. federal income tax purposes in an amount equal to the U.S. Dollar value of the gross amount of the Pesos received (i.e., before deduction of any Mexican withholding tax), calculated by reference to the spot exchange rate in effect on the date the dividend is actually or constructively received by you, regardless of whether the Pesos are in fact converted into U.S. Dollars at that time. If the Pesos received as a dividend are converted into U.S. Dollars on the date of receipt, you generally should not recognize foreign currency gain or loss with respect to such Pesos. If the Pesos received as a dividend are not converted into U.S. Dollars on the date of receipt, you will have a tax basis in the Pesos equal to their U.S. Dollar value on the date of receipt and you will generally recognize foreign currency gain or loss with respect to such Pesos when such Pesos are converted or otherwise disposed of. Any foreign currency gain or loss recognized on a subsequent conversion or other disposition of the Pesos will be treated as U.S. source ordinary income or loss. U.S. Holders should consult their own tax advisors regarding whether any disposition of Pesos giving rise to foreign currency loss constitutes a reportable transaction for U.S. federal income tax purposes.
Dividends received on ordinary shares will be treated, for United States foreign tax credit purposes, as foreign source income. A U.S. Holder may be eligible, subject to a number of complex limitations, to claim a foreign tax credit in respect of any non-United States withholding taxes imposed on dividends received on ordinary shares.
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The limitations on foreign taxes eligible for credit is calculated separately with respect to specific classes of income (e.g., foreign source income). For purposes of the U.S. foreign tax credit limitation, foreign source income is separated into different “baskets,” and the credit for foreign taxes on income in any basket is limited to the U.S. federal income tax allocable to such income. Thus, for example, if a U.S. Holder’s federal income tax rate on dividends paid by us is less than the Mexican withholding taxes imposed on such dividends, the U.S. Holder would not be able to use any excess Mexican withholding taxes as a credit against its U.S. federal income tax liability unless the holder is able to use such credit to offset U.S. federal income taxes payable on other foreign source income in the same basket. For these purposes, dividends paid by us generally will constitute “passive category income.” The rules governing foreign tax credits are complex. Therefore, U.S. Holders should consult their own tax advisors regarding the availability of foreign tax credits in their particular circumstances.
Instead of claiming a credit, a U.S. Holders may elect to deduct foreign taxes (including any Mexican taxes) in computing its taxable income, subject to generally applicable limitations. An election to deduct foreign taxes (instead of claiming foreign tax credits) applies to all taxes paid or accrued in the taxable year to foreign countries and possessions of the United States.
Taxation upon sale or other disposition of ordinary shares
Subject to the PFIC rules discussed below, a U.S. Holder generally will recognize capital gain or loss on the sale or other disposition of ordinary shares, which will be long-term capital gain or loss if the U.S. Holder has held such ordinary shares for more than one year. The amount of the U.S. Holder’s gain or loss will generally be equal to the difference between such U.S. Holder’s adjusted tax basis in the ordinary shares sold or otherwise disposed of and the amount realized on the sale or other disposition. Net long-term capital gains of non-corporate U.S. Holders, including individuals, may be eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations. Any gain or loss that a U.S. Holder recognizes generally will be treated as gain or loss from sources within the United States for U.S. foreign tax credit limitation purposes.
If a Mexican tax is withheld on a sale or other disposition of ordinary shares, the amount realized by a U.S. Holder will include the gross proceeds of the sale or other disposition (i.e., before deduction of the Mexican tax). In the case of a gain from the disposition of ordinary shares that is subject to Mexican tax, the U.S. Holder may not be able to claim as a foreign tax credit any Mexican tax paid, against such U.S. Holder’s U.S. federal income tax liability, unless such U.S. Holder elects to treat the gain as foreign source pursuant to Article 24(3) of the Tax Treaty (provided the U.S. Holder is eligible for, and properly elects to claim, the benefits of the Tax Treaty). Instead of claiming a credit, a U.S. Holder may elect to deduct foreign taxes (including any Mexican taxes) in computing its taxable income, subject to generally applicable limitations. An election to deduct foreign taxes (instead of claiming foreign tax credits) applies to all taxes paid or accrued in the taxable year to foreign countries and possessions of the United States. The rules governing foreign tax credits are complex. Therefore, U.S. Holders should consult their own tax advisors regarding the availability of foreign tax credits in their particular circumstances.
Additional tax on net investment income
Subject to certain limitations and exceptions, an additional 3.8% federal income tax may be assessed on net investment income (including dividends, other distributions, and gain realized on the sale of ordinary shares) earned by certain U.S. Holders who are individuals, estates, or trusts. U.S. Holders should consult their own tax advisors regarding the effect, if any, of the net investment tax on their ownership and disposition of ordinary shares.
Passive foreign investment company rules
The Company believes that it was not a PFIC for its 2025 taxable year and does not expect to be a PFIC for its 2026 taxable year or in the foreseeable future based on the market price of our ordinary shares and the composition of our income and assets, including goodwill. However, the application of the PFIC rules is subject to uncertainty in several respects, and therefore, the IRS may assert that, contrary to our belief, we were a PFIC for a taxable year on the past or will be for a taxable year in the future.
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A non-U.S. corporation will be a PFIC in any taxable year in which, after taking into account the income and assets of the corporation and certain subsidiaries pursuant to applicable “look-through rules,” either (i) at least 75% of its gross income for a taxable year is “passive income” or (ii) at least 50% of the average value of its assets (based on an average of the quarterly value of the assets during such year) is attributable to assets, including cash, which produce passive income or are held for the production of passive income. However, because PFIC status depends upon the composition of the Company’s income and assets and the market value of its assets (including, among others, less than 25% owned equity investments) from time to time, there can be no assurance that the Company will not be considered a PFIC for any taxable year.
If the Company were a PFIC for any taxable year during which a U.S. Holder held ordinary shares, unless the U.S. Holder makes a mark-to-market election as discussed below, gain recognized by a U.S. Holder on a sale or other disposition of an ordinary shares would be allocated ratably over the U.S. Holder’s holding period for the ordinary shares. The amounts allocated to the taxable year of the sale or other disposition and to any year before the Company became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, and an interest charge at the rates generally applicable to underpayments of tax payable in those years would be imposed on the resulting tax liability. The same treatment would apply to any distribution in respect of ordinary shares to the extent such distribution exceeds 125% of the average of the annual distributions on ordinary shares received by the U.S. Holder during the preceding three years or the U.S. Holder’s holding period, whichever is shorter. Certain elections may be available that would result in alternative treatments (such as mark-to-market treatment) of the ordinary shares.
In addition, if the Company were treated as a PFIC in a taxable year in which it pays a dividend or in the prior taxable year, the reduced rate discussed above with respect to dividends paid to certain non-corporate U.S. Holders would not apply.
In certain circumstances, instead of being subject to the excess distribution rules discussed above, a U.S. Holder may make an election to include gain on the ordinary shares of a PFIC as ordinary income under a mark-to-market method, provided that the ordinary shares are regularly traded on a qualified exchange. Under current law, the mark-to-market election is only available for ordinary shares that are regularly traded within the meaning of U.S. Treasury regulations on certain designated U.S. exchanges and foreign exchanges that meet trading, listing, financial disclosure and other requirements to be treated as a qualified exchange under applicable U.S. Treasury regulations. The NYSE is a qualified exchange, and therefore the mark-to-market election should be available for U.S. Holders of our ordinary shares.
If a U.S. Holder makes a mark-to-market election, the U.S. Holder will include each year as ordinary income, rather than capital gain, the excess, if any, of the fair market value of the U.S. Holder’s ordinary shares at the end of the taxable year over such U.S. Holder’s adjusted basis in the ordinary shares and will be permitted an ordinary loss in respect of the excess, if any, of the adjusted basis of these ordinary shares over their fair market value at the end of the taxable year, but only to the extent of the net amount previously included in income as a result of the mark-to-market election. A U.S. Holder’s basis in the ordinary shares will be adjusted to reflect any such income or loss amounts. Any gain or loss on the sale of the ordinary shares will be ordinary income or loss, except that this loss will be ordinary loss only to the extent of the previously included net mark-to-market gain.
If we are a PFIC and we have any direct, and in certain circumstances, indirect subsidiaries that are PFICs (each a “Subsidiary PFIC”), a U.S. Holder will be treated as owning its pro rata share of the stock of each such Subsidiary PFIC and will be subject to the PFIC rules with respect to each such Subsidiary PFIC. A U.S. Holder may not make a mark-to-market election with respect to the shares of any Subsidiary PFIC. Thus, the mark-to-market election is not available to mitigate the adverse tax consequences attributable to any Subsidiary PFIC.
If a non-U.S. corporation is a PFIC, a holder of shares in that corporation may avoid taxation under the PFIC rules described above regarding excess distributions and recognized gains by making a “qualified electing fund” election to include in income its share of the corporation’s income on a current basis. However, you may make a qualified election fund election with respect to our ordinary shares only if we agree to furnish you annually with certain tax information. And we currently do not intend to prepare or provide such information.
A U.S. Holder who owns, or is treated as owning, PFIC stock during any taxable year in which the Company is a PFIC would generally be required to file IRS Form 8621 annually. U.S. Holders should consult their tax advisors regarding the requirement to file IRS Form 8621 and the potential application of the PFIC regime.
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Information reporting and backup withholding
Under U.S. federal income tax law and the Treasury regulations, certain categories of U.S. Holders must file information returns with respect to their investment in, or involvement in, a foreign corporation. For example, U.S. Holders that hold certain specified foreign financial assets in excess of U.S.$50,000 on the last day of the taxable year or US$ 75,000 at any time during the taxable year are generally subject to U.S. return disclosure obligations (and related penalties). The definition of specified foreign financial assets includes not only financial accounts maintained in foreign financial institutions, but also, unless held in accounts maintained by a financial institution, any stock or security issued by a non-U.S. person, any financial instrument or contract held for investment that has an issuer or counterparty other than a U.S. person and any interest in a foreign entity. U. S. Holders may be subject to these reporting requirements unless their ordinary shares are held in an account at a domestic financial institution. Penalties for failure to file certain of these information returns are substantial.
Payments of dividends and sales proceeds with respect to ordinary shares by a U.S. paying agent or other U.S. intermediary will be reported to the IRS and to the U.S. Holder as may be required under applicable regulations. Backup withholding may apply to these payments if the U.S. Holder fails to provide a correct taxpayer identification number or certification that it is not subject to backup withholding. Certain U.S. Holders are not subject to backup withholding. The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a credit against the U.S. Holder’s U.S. federal income tax liability and may entitle such U.S. Holder to a refund, provided that the required information is timely furnished to the Internal Revenue Service.
U.S. Holders should consult their tax advisors about these rules and any other reporting obligations that may apply to the ownership or disposition of ordinary shares, including requirements related to the holding of certain foreign financial assets.
Material Mexico Income Tax Considerations
The following is a summary of the material Mexican federal income tax consequences to U.S. holders and other non-Mexican holders of the purchase, ownership and disposition of our shares. The summary of Mexican tax considerations does not purport to be a comprehensive description of all the Mexican tax considerations that may be relevant to a decision to purchase, own or dispose of shares and does not address all of the Mexican tax consequences that may be applicable to specific holders of the shares (including a holder that controls the Company, an investor that holds 10% or more of shares by vote or value or holders that constitute a group of persons for purposes of Mexican law that controls the Company or that holds 10% or more of the shares by vote or value, or a holder that is a resident of Mexico or that is a corporation resident in a tax haven (as defined in the Mexican Income Tax Law)). In addition, the summary does not address any U.S. or Mexican state or local tax considerations that may be relevant to a U.S. holder or to other non-Mexican holders.
The summary is based upon the federal income tax laws of the United Mexican States (hereinafter “Mexico”) as in effect on the date of this annual report on Form 20-F, including the provisions of The Convention between the Government of the United States of America and the Government of the United Mexican States for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, together with related Protocols and Competent Authority Agreements (hereinafter “U.S.-Mexico Tax Treaty”), all of which are subject to change, possibly with retroactive effect. Prospective investors in our shares should consult their own tax advisors as to the U.S., Mexican or other tax consequences of the purchase, ownership and disposition of shares, including, in particular, the effect of any foreign, state or local tax laws and their entitlement to the benefits, if any, afforded by the U.S.-Mexico Tax Treaty.
For purposes of this summary, the term “non-Mexican holder” shall mean a holder that is not a resident of Mexico for federal tax purposes and that does not have a permanent establishment or fixed base in Mexico.
For purposes of Mexican taxation, the definition of residency is highly technical and residency results in several situations. Generally, an individual is a resident of Mexico if he or she has established his or her home in Mexico, an individual who has a home in Mexico and another country will be considered to be a resident of Mexico if he or she has his or her center of vital interest in Mexico. A legal entity is a resident if it has established its principal administration of its business or its place of effective management in Mexico. However, any determination of residence should take into account the particular situation of each person or legal entity. If a legal entity or an individual is deemed to have a permanent establishment in Mexico for Mexican tax purposes, all income attributable to that permanent establishment will be subject to Mexican income taxes, in accordance with applicable tax laws.
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Taxation of Dividends
Under the Mexican Income Tax Law, dividends paid to individuals that are Mexican residents, or to any non-Mexican holders are subject to a 10.0% withholding tax if paid from earnings generated during and after 2014 but are not subject to Mexican withholding tax if paid from earnings generated before 2014. Non-Mexican holders may be subject to withholding tax at reduced rates or exempt if they are eligible for benefits under an applicable tax treaty with Mexico. U.S. holders that are eligible to claim the benefits of the U.S.-Mexico Tax Treaty may be exempt or subject to a lower withholding tax rate on dividends when they meet the corresponding requirements and are qualified to apply such benefits.
Taxation of Dispositions of Shares
Subject to Mexican Income Tax Law, any gain on the sale of our shares by any non-Mexican holders is subject to a 10.0% withholding tax in Mexico on the net gain from the sale if the transaction is carried out through the Mexican Stock Exchange. These taxes are paid through withholdings made by the financial intermediary. However, if the transaction is carried out through the Mexican Stock Exchange or other recognized securities market as determined by Mexican tax authorities, these withholdings will not be applicable to a non-resident holder that demonstrates (before the relevant financial intermediary) residence in a country with which Mexico holds a tax treaty to avoid double taxation. The non-Mexican holder must provide the financial intermediary with a signed document stating that the non-Mexican holder is a foreign resident and that their country of residence has a tax treaty to avoid double taxation with Mexico and provide their Tax ID.
Subject to Mexican Income Tax Law, the sale or transfer of shares outside of the Mexican Stock Exchange or other recognized securities market as determined by Mexican tax authorities, made by non-Mexican holders will give rise to a 25.0% Mexican withholding tax on the gross proceeds realized from the transaction. Subject to certain exceptions and requirements, a non-Mexican holder may elect to pay taxes on the gains realized from the sale of shares on a net basis at a rate of 35.0%. U.S. holders that are eligible to claim the benefits of the U.S.-Mexico Tax Treaty, may be exempt on the gains realized from the sale of our shares if they meet the corresponding requirements and are qualified to apply such benefits when such U.S. holder did not own, directly or indirectly, 25.0% or more of our outstanding shares during the 12-month period preceding such sale or disposition and the gains are not attributable to a permanent establishment in Mexico. U.S. holders should consult their own tax advisors as to their possible eligibility under the U.S.-Mexico Tax Treaty. Non-U.S. holders should consult their own tax advisors as to their possible eligibility to tax benefits under other treaties to avoid double taxation.
Other Mexican Taxes
There are no Mexican inheritance, gift, succession or value-added taxes applicable to the ownership, transfer or disposition of the Shares by non-Mexican holders; provided, however, that gratuitous transfers of shares may in certain circumstances cause a Mexican federal tax to be imposed upon the recipient. There are no Mexican stamp, issue, registration or similar taxes or duties payable by non-Mexican holders of shares.
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We make our filings in electronic form under the EDGAR filing system of the SEC. Our filings are available through the EDGAR system at www.sec.gov. Our filings are also available to the public through the Internet at our website at https://investors.betterware.com.mx/. Such filings and other information on our website are not incorporated by reference in this annual report. Interested parties may request a copy of this filing, and any other report, at no cost, by writing to the following email address: ir@better.com.mx.
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES REGARDING MARKET RISK
We are exposed to market risks arising from our normal business activities, which mainly consists of exchange rate risk and interest rate risk. These market risks principally involve the possibility that fluctuations in exchange rates and interest rates will adversely affect the value of our financial assets and liabilities, or future cash flows and earnings. Market risk is the potential loss arising from adverse changes in market rates and prices. The Company uses derivatives and other financial instruments to manage the impact of such market risks on its financial assets and liabilities or future cash flows and earnings, not for speculative purposes.
Market risk
Our activities expose it primarily to the financial risks of changes in exchange rates and interest rates (see below). We entered into a variety of derivative financial instruments to manage its exposure to interest rate and foreign currency risk, including:
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Exchange risk management
We undertake transactions denominated in foreign currencies, mainly U.S. dollars; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters as follows:
Our carrying amounts of U.S. dollars and Euro (“€”) denominated financial assets and financial liabilities at the reporting date are as follows:
We carry out transactions denominated in foreign currencies, mainly in US dollars. Our home organization segment’s primary exposure to currency fluctuations arises from the highly probable purchases of USD-denominated inventory. To manage this risk, we use forwards and exchange rate options, and beginning in February 2025, certain instruments were designated as cash flow hedges under IFRS 9.
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Instruments used to manage currency risk:
The effectiveness of hedging relationships is evaluated based on formal documentation prepared at the beginning of each relationship and updated during the year. The main sources of ineffectiveness identified by Management include differences between the notional amount of the hedging instrument and the actual volume of the hedged item, the timing of the hedged item and the credit risk of the counterparties.
Exchange rate sensitivity analysis
We are mainly exposed to variations in the Mexican Peso / the U.S. Dollar exchange rate. For sensitivity analysis purposes, we have determined a 10% increase and decrease in Ps. currency units against the U.S. dollar (“relevant currency”). A 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated financial assets/liabilities and adjusts their translation at the year-end for a 10% change in foreign currency rates. A positive number below indicates an increase in profit where currency units strengthen 10% against the relevant currency. For a 10% weakening of currency units against the relevant currency, there would be a comparable impact on the net income, and the balances below would be negative.
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Foreign exchange forward and options contracts
We enter into foreign exchange forward and options contracts to manage the foreign currency risk associated with anticipated purchase transactions up to 12 months.
See Note 18 to our Audited Consolidated Financial Statements for details on foreign currency forward contracts outstanding at the end of the reporting period. Foreign currency forward contract assets and liabilities are disclosed in the line item ‘Derivative financial instruments’ within the consolidated statement of financial position.
We have entered into contracts to purchase raw materials from suppliers in China, with such purchases denominated in U.S. dollars. We have entered into foreign exchange forward contracts to hedge the exchange rate risk arising from future payments in US dollars.
Interest rate risk management
We are exposed to interest rate risk from borrowings at variable interest rates (59% of long-term debt uses variable rates and 41% uses fixed rates). We manage the risk by maintaining an appropriate balance between fixed and variable rate borrowings.
Our exposures to interest rates on financial liabilities are detailed in the section of liquidity risk management in our Audited Consolidated Financial Statements. (See Note 20 — “Liquidity risk management” to the Audited Consolidated Financial Statements.)
Credit risk management
Our credit risk arises mainly from cash and cash equivalents, derivative financial instruments with favorable positions, and trade accounts receivable.
Regarding cash and cash equivalents and derivative financial instruments with a favorable position, we operate only with financial institutions of recognized solvency, which is why we consider the risk of non-compliance of these counterparties to be low.
For the commercial accounts receivable, our exposure to credit risk concentration is not significant as no customer represents more than 10% of sales and receivables. Our concentration of credit risk is limited due to the fact that the customer base is large and unrelated, spread across diverse geographical areas. Credit policy has been implemented for each customer establishing purchase limits. Customers who do not satisfy the credit references set out by us, can only carry out transactions with the Group through prepayment.
See Note 6 in our Audited Consolidated Financial Statements, for further details on trade account receivables and the expected credit loss estimate.
Collateral held as security and other credit enhancements
We do not hold any collateral or other credit enhancements to cover its credit risks associated with its financial assets.
Our exposure to credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss/gain to us. As of December 31, 2025, our maximum exposure to credit risk without taking into account any collateral held or other credit enhancements, which will cause a financial loss to us due to failure to discharge an obligation by the counterparties, arises from the carrying amount of the respective recognized financial assets as stated in our consolidated statement of financial position.
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For trade receivables, we have applied the simplified approach to measure the loss allowance at lifetime ECL. We determine the expected credit losses on these items by using a provision matrix, estimated based on historical credit loss experience based on the past due status of the debtors, determined by the last 3 years plus the current period, adjusted as appropriate to reflect current conditions and estimates of future economic conditions. Accordingly, the credit risk profile of these assets is presented based on their past due status in terms of the provision matrix.
Our Note 6 in our Audited Consolidated Financial Statements includes further details on the loss allowance for these assets.
Liquidity risk management
The ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for management of our short, medium and long-term funding and liquidity management requirements. We manage liquidity risk by maintaining adequate reserves, banking facilities, and reserve borrowing facilities, by continuously monitoring the forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. Details of additional undrawn facilities that we have at our disposal to further reduce liquidity risk are set out below.
Our financing agreements with suppliers that are mentioned in Note 14 — “Accounts payable to suppliers” to the Audited Consolidated Financial Statements are made to seek efficiency in the payment to suppliers, and we have concentrated Ps.756,623 Ps. 848,192 and Ps. 957,576, for the years 2025, 2024 and 2023, respectively, of accounts payable to suppliers of the Group with 5 local banks (Banamex, BBVA, HSBC, Santander y Sabadell) rather than with a diverse group of suppliers, allowing for better payment planning. Our Management has assessed that we do not rely on extended payment terms and suppliers generally have not become accustomed to or do not rely on advance payment under the financing agreement. If the financial institutions were to withdraw the agreement, such withdrawal would not affect our ability to settle liabilities when due.
Liquidity maturity analysis
We manage our liquidity risk by maintaining adequate reserves of cash and bank credit lines available and consistently monitoring its projected and actual cash flows. The maturity analysis of lease liabilities and long-term debt maturities effectives in 2025, 2024 and 2023 are presented in Note 13 and 15, respectively in our Audited Consolidated Financial Statements. We have access to financing facilities as described below.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
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PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
ITEM 15. CONTROLS AND PROCEDURES
Our Chief Executive Officer (CEO) and Chief Corporate Financial Officer (CCFO) are responsible for implementing disclosure controls and procedures to ensure that the information required to be disclosed by the Group in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Such information is necessary for our officers who certify our financial reports and for other members of senior management and the CEO and CCFO as appropriate to allow timely decisions regarding required disclosure. Because of these inherent limitations, our disclosure controls and procedures may not prevent or detect misstatements. Additionally, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
The CEO and CCFO oversee and review all materials for which there is a disclosure requirement, together with all data required to support the documents mentioned above. These executives meet at regular intervals in order to review all data. Our CEO and CCFO conducted an evaluation of the effectiveness of our disclosure controls and procedures (pursuant to Rule 13a-15(e) under the Exchange Act) as of December 31, 2025. Based on that evaluation, our CEO and CCFO have concluded that the Company’s disclosure controls and procedures were not effective as of December 31, 2025, due to the existence of material weaknesses in our internal controls over financial reporting.
See Exhibits 12.1 and 12.2 for the certifications required by this Item.
Betterware’s management is responsible for establishing and maintaining adequate internal control over financial reporting for Betterware as defined in Exchange Act Rule 13a-15(f) and 15d-15(f). Our internal control over financial reporting was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. Internal control over financial reporting includes those policies and procedures that:
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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements due to the possibility that a control can be circumvented or overridden or that misstatements due to error or fraud may occur that are not detected. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that a reasonable possibility exists that a material misstatement of our annual or interim financial statements would not be prevented or detected on a timely basis.
As of December 31, 2025, our management assessed the effectiveness of our internal control over financial reporting based on the criteria of Internal Control - Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
Our assessment concluded the following material weaknesses.
The Company did not design and maintain an effective control environment, risk assessment process, and monitoring activities at a precise enough level to identify and timely assess new and evolving risks of material misstatement in the Company’s consolidated financial statements. Specifically, there was a lack of controls to address (a) significant changes in the business, (b) the experience and training of personnel, (c) sufficient oversight of the design and effectiveness of the internal control over financial reporting, and (d) the monitoring that the components of the Company’s internal controls are present and functioning. These material weaknesses contributed to the following additional material weaknesses:
These material weaknesses resulted in audit adjustments to the consolidated financial statements for the year ended December 31, 2025, which were identified and recorded prior to their issuance and also in the revision of certain information previously disclosed in the consolidated financial statements for the year ended December 31, 2024. Additionally, these material weaknesses could result in further misstatements of substantially all account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.
We are in the process of implementing several measures to strengthen our internal control over financial reporting such as the deployment of IT applications to enable and automate the consolidation, creation and updating of policies and procedures for internal control reporting, creation of an internal control area which shall be responsible of monitoring the internal control, and IT General Control process as implementation of new tools for managing IT system changes such as ITSM.
Notwithstanding the material weaknesses in our internal control over financial reporting, we have concluded that the Consolidated Financial Statements included in this annual report present fairly, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with IFRS.
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We are actively implementing several measures designed to remediate these material weaknesses, including deploying advanced IT applications for financial consolidation, standardizing accounting policies and procedures, and enhancing our internal control oversight through dedicated governance structures and increased involvement from our Audit Committee. Additionally, we have engaged external advisory experts to strengthen key control areas, mainly IT General Controls.
In 2026, we will execute a comprehensive rollout of the COSO framework, placing particular emphasis on enhancing our Risk Assessment, Control Activities, and Monitoring processes to ensure a sustainable and effective internal control environment.
Although significant progress has been made, not all remediation efforts have been fully completed as of December 31, 2025. Management has established clear timelines, anticipating substantial advancement in remediation during 2026, and expects these actions will fully address the identified material weaknesses by year-end. In the interim, management continues performing supplemental manual controls and additional monitoring activities to ensure accurate financial reporting.
Management conducted an evaluation of the effectiveness of Betterware’s internal control over financial reporting based on the framework in Internal Control – Integrated Framework 2013 issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO 2013”). Based on its evaluation, Management concluded that Betterware’s internal control over financial reporting was not effective as of December 31, 2025.
PricewaterhouseCoopers, S.C., the Company’s independent registered public accounting firm, has audited the effectiveness of the Company’s internal controls over financial reporting as of December 31, 2025, as stated in their report which appears in “Item 18. Financial Statements.”
During 2025, we implemented certain changes in our internal control over financial reporting to address our material weaknesses identified in 2024, 2023 and 2022, which include:
Our ICFR program emphasizes the identification, documentation, and testing of the controls intended to mitigate the risk of material financial statement misstatements and is the basis to assess the effectiveness of our ICFR as of the end of each fiscal year.
Despite these improvements, we acknowledge that certain material weaknesses in our ICFR have not yet been fully remediated. We remain committed to ongoing enhancements to achieve the required maturity level and eliminate these material weaknesses.
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ITEM 16. Reserved
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
See “Directors, Senior Management and Employees—Board Practices—Board Committees—Audit Committee.” Our Board of Directors has determined that Federico Clariond qualifies as an “audit committee financial expert” under applicable SEC rules.
ITEM 16B. CODE OF ETHICS
We have a Code of Ethics that applies to all directors, officers and employees of the Group, including our Chief Executive Officers, Chief Financial Officers, principal accounting officers, controller and persons performing similar functions. Our Code of Ethics is included as an exhibit to this annual report on Form 20-F.
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Fees Paid to the Company’s Principal Accountant
The following table sets forth the fees for the years 2025 and 2024, respectively:
Audit Fees
Audit fees were paid for professional services rendered by the auditors for the audit of the Consolidated Financial Statements and the statutory financial statements of the Group.
Audit-Related Fees
Audit-related fees are typically services that are reasonably related to the performance of the audit or review of the Consolidated Financial Statements and are not reported under the audit fee item above. This item includes fees for attestation services on financial information of the Group included in the Group’s registration statements on Form F-1 and Form F-4 as well as its listing process in Bolsa Mexicana de Valores (“BMV”) in 2023.
Other Fees
Other fees were paid for transfer pricing services and social security compliance.
Audit Committee’s Pre-approval Policies and Procedures
The Group’s audit committee is responsible for, among other things, the oversight of the Group’s independent auditors. The audit committee has adopted a policy of pre-approval of audit and permissible non-audit services provided by its independent auditors in its charter.
Under the policy, the audit committee makes its recommendations through the Board of Directors to the shareholders’ meeting concerning the continuing appointment or termination of the Group’s independent auditors. On a yearly basis, the audit committee reviews together with management and the independent auditor, the audit plan, audit related services and other non-audit services and approves the related fees. Any changes to the approved fees must be reviewed and approved by the audit committee. In addition, the audit committee delegated to its Chairman the authority to consider and approve, on behalf of the Audit Committee, additional non-audit services that were not recognized at the time of engagement, which must be reported to the other members of the audit committee at its next meeting. No services outside the scope of the audit committee’s approval can be undertaken by the independent auditor.
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ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
ITEM 16G. CORPORATE GOVERNANCE
As a Mexican company listed on the NYSE, we are subject to the NYSE corporate governance listing standards. However, the NYSE rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in Mexico, which is our home country, may differ significantly from the NYSE corporate governance listing standards. Currently, we rely on home country practice. As a result, our shareholders could be subject to less protection than they would otherwise enjoy under the NYSE corporate governance listing standards applicable to U.S. domestic issuers.
A foreign private issuer must disclose in its annual reports filed with the SEC each NYSE requirement with which it does not comply followed by a description of its applicable home country practice. As a Mexican corporation listed on the NYSE, the Company is permitted to follow our home country practice with respect to the composition of the board of directors and nominations committee and executive sessions. Unlike the requirements of the NYSE, the corporate governance practices and requirements in Mexico do not require the Company to (i) have a majority of its board of directors to be independent, (ii) establish a nominations committee or a compensation committee, and (iii) hold regular executive sessions where only independent directors shall be present. Such home country practices of Mexico may afford less protection to holders of Company shares than under U.S. standards.
See “Risk Factors—As a “foreign private issuer” under the rules and regulations of the SEC, Betterware is permitted to, and is expected to, file less or different information with the SEC than a company incorporated in the United States or otherwise subject to these rules and is expected to follow certain home country corporate governance practices in lieu of certain NYSE requirements applicable to U.S. issuers.”
ITEM 16H. MINE SAFETY DISCLOSURE
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
ITEM 16J. INSIDER TRADING POLICIES
Our board of directors has adopted an Insider Trading Policy that governs the purchase, sale, and other dispositions of our securities by directors, senior management, and employees that is reasonably designed to promote compliance with applicable insider trading laws, rules and regulations, and any listing standards applicable to us. A copy of the Company’s Insider Trading Policy is filed as Exhibit 11.1 to this Annual Report.
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ITEM 16K. CYBERSECURITY
We have built and continue to evolve processes for assessing, identifying, and managing material risks from cybersecurity threats. We have embedded the oversight and management of cybersecurity risk within our enterprise risk management framework to help drive a company-wide culture of cybersecurity risk management, and we have established policies and procedures as well as a reporting line of governance that guide our cybersecurity risk management program.
We maintain a cybersecurity infrastructure to safeguard our operations, networks and data through comprehensive security measures including our technology tools, internal management and external service providers. Our processes for assessing, identifying and managing material risks from cybersecurity threats are integrated into our risk management framework. We use a variety of tools and processes to collect relevant data and identify, monitor, assess and manage material cybersecurity risks. The Group has adequate management of security incidents, a strategy for dealing with and governing cybersecurity risks through the following elements:
Our Corporate Chief Information Officer, Mauricio Alvarez (“CIO”) is also responsible for assessing, identifying, and managing the risks from cybersecurity threats. Our CIO has significant experience in information technology and many of our information technology team members hold qualifications in technology security positions. Our CIO, together with our security team members, reviews emerging threats, controls, and procedures as part of assessing, identifying, and managing risks. Risks identified by our cybersecurity program are analyzed to determine the potential impact on us and the likelihood of occurrence. Such risks are continuously monitored to ensure that the circumstances and severity of such risks have not changed.
The team in charge of the Group’s Cybersecurity is made up of:
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We provide cybersecurity awareness training to our employees which is designed to provide guidance for identifying and reporting cybersecurity risks and to promote familiarity with our cybersecurity policies. We also use internal communications to promote awareness and conduct phishing exercises and provide training to employees. In addition, we engage independent third parties on an as-needed basis to assess our cybersecurity capabilities. The results of these assessments are shared with our Information Security Committee.
Our board of directors oversees management’s approach to managing cybersecurity risks as part of its risk management oversight. Our board of directors holds periodic discussions with management regarding our guidelines and policies with respect to cybersecurity risks and receives regular reports from the CIO regarding such risks and the steps management has taken to monitor and control any exposure resulting from such risks.
During 2025, we experienced a number of phishing attacks where some users executed links or attachments. These activities were mitigated in a timely manner. None of these incidents has significantly affected, nor is it reasonably likely to significantly affect, the Group or our business strategy, operating results, or financial condition.
Third-party vendor agreements include confidentiality obligations and specify data elements that the third party has access to, how the third party protects the data, and procedures for the return or destruction of protected data. The vendors/third parties also must report all cybersecurity incidents immediately to the Company’s responsible functional manager and to the Director of Information Technology. All relevant third parties are required to provide a SOC 1 Type II report which is monitored and reviewed by the Company. We evaluate any potential risks or deviations communicated within these reports.
However, we cannot guarantee any future events will not affect our operations or customers. We are constantly seeking to improve and strengthen our security strategy by aligning it with Security Frameworks and Best Practices such as NIST CSF and ISO 27000.
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PART III
ITEM 17. FINANCIAL STATEMENTS
The Group has responded to Item 18 in lieu of responding to this item.
ITEM 18. FINANCIAL STATEMENTS
Betterware de México, S.A.P.I. de C.V.
Audited Consolidated and Combined Financial Statements
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ITEM 19. EXHIBITS
The following exhibits are filed or incorporated by reference as part of this annual report:
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SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
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Betterware de México, S.A.P.I. de C.V. (subsidiary of Campalier, S.A. de C.V.) and subsidiaries
Consolidated financial statements as of December 31, 2025, 2024 and 2023 and for the years ended December 31, 2025, 2024 and 2023, and Report of Independent Registered Accounting Firm dated April 30, 2026
Betterware de México, S.A.P.I. de C.V. and subsidiaries
Consolidated financial statements as of December 31, 2025, 2024 and 2023 and for the years ended December 31, 2025, 2024 and 2023 and Report of Independent Registered Accounting Firm
F-1
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated statements of financial position of Betterware de México, S. A. P. I. de C. V. and its subsidiaries (the “Company”) as of December 31, 2025, 2024 and 2023, and the related consolidated statements of profit or loss and other comprehensive income, of changes in stockholders’ equity, and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established inInternal Control - Integrated Framework (2013) issued by the COSO because material weaknesses in internal control over financial reporting existed as of that date related to the lack of (i) effective control environment, risk assessment process and monitoring activities at a precise enough level to identify and timely assess the new and evolving risks of material misstatement in the Company’s consolidated financial statements, (ii) effective controls over the business combination process, specifically the lack of controls over the determination and ongoing impairment assessment of goodwill and long lived intangible assets, (iii) effective controls over substantially all accounts and disclosures in the period-end financial reporting and consolidation process, and (iv) effective information and technology general controls relevant to the preparation of the consolidated financial statements.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses referred to above are described in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 15. We considered these material weaknesses in determining the nature, timing, and extent of audit tests applied in our audit of the 2025 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in management’s report referred to above. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
F-2
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Goodwill and Indefinite-lived Intangible Assets Impairment Assessment – Jafra Mexico Group of Cash Generating Units
As described in Notes 11 and 12 to the consolidated financial statements, the Company annually tests the recoverable amount of its goodwill and indefinite-lived intangible assets which amounts Ps.1,600 million and Ps.1,102 million, respectively, of which Ps.1,250 million and Ps.849 million respectively relates to the Jafra Mexico group of cash generating units (CGU). Management’s cash flow projections for the group of CGU included significant judgments and Management’s cash flow projections included significant assumptions relating to the average revenue growth rate; as well as the discount rate used to discount future cash flows.
The principal considerations for our determination that performing procedures relating to the goodwill and indefinite-lived intangible assets impairment assessment of the Jafra Mexico group of CGU is a critical audit matter are (i) the significant judgment used by management when developing the fair value of the Jafra Mexico group of CGU; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to the average revenue growth rate, as well as the discount rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge. As described in the “Opinions on the Financial Statements and Internal Control over Financial Reporting” section, material weaknesses were identified related to this matter.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others, i) evaluating and determining the nature and extent of audit procedures performed and evidence obtained that are responsive to the material weaknesses identified; ii) evaluating management’s process for developing the fair value of the Jafra Mexico group of CGU; iii) testing the completeness and accuracy of the underlying data used in the discounting cash flow model, and iv) comparing the actual results of the current year with the respective budget, to identify if any assumption included in the cash flow projections could be considered too optimistic. Professionals with specialized skill and knowledge were also used to assist in a) evaluating the appropriateness of the discounted cash flow model, b) comparing the average revenue growth rate based on current and past performance of the group of CGU and the consistency with independent market sources from comparable entities in the industry, and c) comparing the discount rate based on industry knowledge and the consistency with estimated external market rates.
/s/ PricewaterhouseCoopers, S. C.
/s/ C.P.C. Fabián Mateos Aranda
Audit Partner
Mexico City, Mexico
April 30, 2026
We have served as the Company’s auditor since 2022.
F-3
Consolidated statements of financial position
As of December 31, 2025, 2024 and 2023
(In Thousands of Mexican pesos)
(Continued)
F-4
See accompanying notes to consolidated financial statements.
(Concluded)
F-5
Consolidated statements of profit or loss and other comprehensive income
For the years ended December 31, 2025, 2024 and 2023
(In Thousands of Mexican pesos, except earnings per share amounts)
F-6
F-7
Consolidated statements of changes in stockholders’ equity
F-8
Consolidated statements of cash flows
F-9
Non-cash transactions (notes 1d and 6).
F-10
Notes to consolidated financial statements
As of December 31, 2025, 2024 and 2023, and for the years ended December 31, 2025, 2024 and 2023
(In Thousands of Mexican pesos, Ps., except the number of shares and earnings per share expressed in Mexican pesos)
Betterware de México, S.A.P.I. de C.V. (“Betterware or BWM”) and its subsidiaries are hereinafter jointly referred to as the “Group”, the “Company”, “BeFra” or “BeFra Group”. The Group’s business is direct-to-consumer sales, which operates through two business segments: the home organization products (“Betterware segment” or “BWM segment”) and the beauty and personal care products (B&PC) (“Jafra segment”). The Betterware segment is divided into seven categories of the home organization: (i) Kitchen and food preservation, (ii) Home solutions, (iii) Bedroom, (iv) Bathroom, (v) Laundry & Cleaning (vi) Tech & mobility and (vii) wellness. The Jafra segment is divided into four categories of the beauty and personal care: (i) fragrance, (ii) color (cosmetics), (iii) skin care and (iv) toiletries. The Group’s business segment products are sold through twelve catalogs published throughout the year. The Group operates mainly in Mexico and the United States. The Group’s address, registered as its office and primary place of business, is Gdl-Ameca-Huaxtla Km-5, El Arenal, Jalisco, Mexico, and Zip Code 45350. The holding entity of Betterware is Campalier, S.A. de C.V. (“Campalier”).
Significant events and transactions –
2025
On January 20, 2025 and November 13, 2025, Betterware Ecuador and Betterware Colombia were established, and they began operations on May 5, 2025, and March 2, 2026, respectively.
2024
The Group, through subsidiary (Distribuidora Venus, S.A. de C.V.), (which is part of Jafra’s companies in Mexico), entered into two contracts for the sale: 1) “Las Flores” land and 2) “San Ángel” land and building in March and August 2024, respectively. The sales price for these transactions was Ps. 402,200, and as a result, the company recognized a loss in the income statement as other expenses of Ps. 529,722.
Of the sales prices collected, Ps.156,500; the remaining Ps. 245,700 will be collected semiannually without interest, maturing in 2027. When determining the fair value the long-term receivable, an additional loss of Ps. 34,078 was recognized.
Jafra Mexico classified the O’Farril as assets held for sale in accordance with the accounting policy “current assets held for sale.” The Company recognized an impairment loss of Ps. 166,581 recognized in administrative expenses based on the use given to land.
F-11
2023
The Group’s management reviewed the material accounting policies and made some updates to the disclosed information, as follows:
The Group’s consolidated financial statements for 2025 include the financial statements of Betterware de México, S.A.P.I. de C.V., and subsidiaries as described in note 2d (the “consolidated financial statements”).
The preparation of the consolidated financial statements in accordance with International Financial Reporting Standards requires the use of critical accounting estimates. In addition, it requires Management to exercise judgment in the process of applying the Group’s accounting policies. The areas that involve a high level of judgment or complexity, as well as areas where the judgments and estimates are significant to the consolidated financial statements are disclosed in note 4.
The Group’s consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS Accounting Standards) issued by the International Accounting Standards Board (IASB) and the Interpretations issued by the Interpretations of IFRS (IFRIC) applicable to entities reporting under IFRS Accounting Standards.
The Group’s consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments measured at fair value.
Functional and presentation currency
These consolidated financial statements are presented in Mexican pesos (“Ps or $”), which is the Group presentation currency. The amounts included in the consolidated financial statements of each of the Group’s subsidiaries must be measured using the currency of the primary economic environment in which the entity operates (“functional currency”). All financial information presented in Mexican pesos has been rounded to the nearest thousand (except where otherwise specified). References to U.S. dollars (“US$”) indicate thousands of United States dollars.
F-12
Consolidated statement of profit or loss and other comprehensive income
The Group opted to present a single consolidated statement of profit or loss and comprehensive income, consolidating the presentation of profit and loss, including an operating profit line item, and comprehensive income in the same statement. Due to the commercial activities of the Group, costs and expenses presented in the consolidated statements of profit or loss and other comprehensive income were classified according to their function. Accordingly, cost of sales and operating expenses were presented separately.
The Group’s consolidated financial statements, incorporate the financial statements of the entities controlled by Betterware.
Betterware de México, S.A.P.I. de C.V., has control over its subsidiaries as it holds the majority of substantive voting rights regarding the relevant activities these entities undertake, which provides it with rights over the variable returns from the subsidiaries, and has the ability to influence those returns through its power over them.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in profit or loss from the date the Group gains control until the date when the Group ceases to control the subsidiary.
For consolidation purposes, the Group ensures that the accounting policies used are consistent.
All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between the entities of the Group are eliminated on consolidation.
Non-controlling interests in subsidiaries are identified separately from the Group’s equity. When a business is acquired but not the entire equity interest, the Group may initially measure the non-controlling interest at its fair value or as a portion of the acquiree’s identifiable net assets. The choice of measurement is made on an acquisition-by-acquisition basis. Subsequent to acquisition, the carrying amounts of non-controlling interests consider the initial value plus the non-controlling interests’ share of subsequent changes in the subsidiaries’ equity.
Profit or loss and each component of other comprehensive income are attributed to the owners of the Group and to the non-controlling interests. The total income of the subsidiaries is attributed to the owners of the Group and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.
When the Group loses control of a subsidiary, the gain or loss on disposal recognized in profit or loss is calculated as the difference between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), less liabilities of the subsidiary and any non-controlling interests. All amounts previously recognized in other comprehensive income in relation to that subsidiary are accounted for as if the Group had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as required/permitted by applicable IFRS Standards). The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under IFRS 9, Financial Instruments when applicable, or the cost on initial recognition of an investment in an associate or a joint venture.
F-13
As of December 31, 2025, 2024 and 2023 the percentage of participation that it maintains over its subsidiaries is as follows:
As of December 31, 2025, 2024 and 2023, there are no significant restrictions for investment in shares of the subsidiary companies previously mentioned.
Cash and cash equivalents consist mainly of bank deposits and short-term investments in securities, highly liquid and easily convertible into cash with original maturities of three months or less, which are subject to insignificant risks of value change. Cash is presented at nominal value and cash equivalents are valued at fair value. Any cash or cash equivalent that cannot be disposed of in less than three months is classified as restricted cash.
Accounts receivable from customers are initially recognized at the amount of consideration, which is unconditional, unless they contain significant financial components when they are recognized at fair value.
The fair value of a non-interest bearing long-term receivable is measured as the present value of all future cash receipts discounted using a market interest rate for similar instruments; that is, with a similar currency, term, interest rate type and credit ratings. The difference between the expected principal amount of the receivable and its fair value is recognized as an expense in the income statement and amortized over the collection period using the effective interest method.
They are subsequently valued at amortized cost using the effective interest rate method, less the provision for losses. See note 6 for more information on the recording of accounts receivable from the Group’s customers and note 2n for a description of the Group’s impairment policies.
Financial assets and liabilities are recognized in the Group’s consolidated statement of financial position, when the Group enters into a contract that gives it the right to receive cash or another financial asset or generates the obligation to pay cash or another financial asset, except for the rights or obligation related to taxes.
F-14
Financial assets and liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and liabilities are added to or deducted from the fair value of the financial assets or liabilities, as appropriate, on initial recognition.
Financial assets
All recognized financial assets are measured subsequently in their entirety at either amortized cost or fair value, depending on the classification based on the business model of the financial assets.
Classification of financial assets
Financial assets that meet the following conditions are measured subsequently at amortized cost:
For its part, if the objective of the financial asset is to collect cash flows for subsequent sale, its classification would be as measured at fair value through other comprehensive income (“FVTOCI”); and, if none of the above characteristics are met, then the financial asset will be classified as measured at fair value through profit or loss (“FVTPL”). As of December 31, 2025, 2024 and 2023, the Group only maintains financial assets measured at amortized cost and at fair value through profit or loss.
Amortized cost and effective interest method
The effective interest method is a method of calculating the amortized cost of loans receivable and of allocating interest income over the relevant period.
The amortized cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortization using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance. The gross carrying amount of a financial asset is the amortized cost of a financial asset before adjusting for any loss allowance.
Impairment of financial assets
The Group recognizes impairment of receivable accounts based on a model of its expected credit losses (“ECL”), and those are estimated using the simplified approach by using a provision matrix, estimated based on historical credit loss experience based on the past due status of the debtors, adjusted as appropriate to reflect current conditions and estimates of future economic conditions.
Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument.
Write-off policy
Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and the group has transferred substantially all the risks and rewards inherent in ownership.
Financial assets written off may still be subject to enforcement activities under the Group’s recovery procedures, taking into account legal advice where appropriate. Any recoveries made are recognized in profit or loss.
F-15
Financial liabilities
All financial liabilities are measured subsequently at amortized cost using the effective interest method or at fair value through profit or loss (FVTPL) in the case of derivative financial instruments.
Financial liabilities measured subsequently at amortized cost
The effective interest method is a method of calculating the amortized cost of financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the amortized cost of a financial liability.
Derecognition of financial liabilities
The Group derecognizes financial liabilities when, and only when, the Group’s obligations are discharged, canceled or have expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss.
When the Group exchanges with the existing lender one debt instrument into another one with the substantially different terms, such exchange is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, the Group accounts for substantial modification of terms of an existing liability or part of it as an extinguishment of the original financial liability and the recognition of a new liability. It is assumed that the terms are substantially different if the discounted present value of the cash flows under the new terms, including any fees paid using the original effective rate is at least 10 per cent different from the discounted present value of the remaining cash flows of the original financial liability. If the modification is not substantial, the difference between (1) the carrying amount of the liability before the modification; and (2) the present value of the cash flows after modification should be recognized in profit or loss as the modification gain or loss within other gains and losses.
The Group enters into a variety of forward-type derivative financial instruments and options to manage its exposure to foreign exchange rates, which are detailed in note 18.
Derivative financial instruments are initially recognized at their fair value on the date the contract is entered into and their fair value is subsequently recalculated on each reporting date; Changes in said fair values are recognized depending on whether the Group designates the derivative financial instruments as accounting hedges or as trading instruments. Derivative financial instruments are recorded as financial assets when their fair value is positive and as financial liabilities when the fair value is negative. This measurement is classified at Level 2 of the fair value hierarchy established by IFRS.
In all cases, the Group enters into derivative financial instruments to hedge a financial risk; however, when not all the requirements set forth in accounting standards for the application of hedge accounting are met, the instruments are classified as held for trading. Changes in the fair value of derivative financial instruments classified as trading were recognized directly in the Group’s consolidated results within the line of effects of gain (loss) on valuation of derivative financial instruments. As of December 31, 2024 and 2023, the Group held only derivative financial instruments for forward trading.
F-16
Furthermore, for hedge accounting purposes: a) a fair value hedge is considered when the exposure to changes in the fair value of a recognized asset or liability, or an unrecognized firm commitment, is hedged; and b) it is considered a cash flow hedge when it hedges the exposure to variability in cash flows that is attributed to a particular risk associated with a recognized asset or liability, or a highly probable forecast transaction, or the foreign currency risk in an unrecognized firm commitment. As of December 31, 2025, the Group only maintains cash flow hedges through derivative financial instruments, forwards and options, which corresponds to forecasted purchases of highly probable inventory denominated in dollars.
At the beginning of the hedging relationship, the Group documents the relationship between the hedging instrument and the hedged item, the nature of the hedged risk and how it will evaluate whether the hedging relationship is effective, including the analysis of the sources of ineffectiveness and how the hedging ratio is determined. In addition, at the beginning of the hedge and on an ongoing basis, it is documented whether the hedging instrument is highly effective in the changes in cash flow or fair value of the hedged item attributable to the hedged risk.
A hedging relationship qualifies for the application of hedge accounting if it meets all of the following effectiveness requirements: a) “an economic relationship” exists between the hedged item and the hedging instrument; b) the effect of credit risk does not dominate the value changes that result from that economic relationship; c) the hedging ratio of the hedging relationship is the same as that resulting from the amount of the hedged item that the Group actually hedges and the amount of the hedging instrument that it actually uses to hedge that amount of the hedged item. Hedges that meet all qualification criteria for hedge accounting are accounted for, as described below.
Derivatives designated as cash flow accounting hedges recognize changes in fair value as follows: the effective portion is temporarily recognized in other comprehensive income (OCI) and reclassified to profit or loss when the hedged item affects profit or loss for the period; when the hedged item results in the recognition of inventory, a direct reclassification is made from the hedging reserve to the initial cost of inventory; on the other hand, any ineffective portion of the hedge is recognized immediately in the consolidated statement of profit or loss.
When forwards are used to hedge forecast transactions, the Group designates 100% of the change in the fair value of the forward contract as a hedging instrument.
When option contracts are used to hedge forecast transactions, the Group designates only the intrinsic value of the options as a hedging instrument.
Gains or losses related to the effective portion of the change in the intrinsic value of the forwards and options are recognized in the cash flow hedge reserve within equity (OCI) and are reclassified directly to the hedge reserve to the cost of the inventory at the time it is received. Changes in the time value of options that relate to the hedged item (aligned time value) are recognized within other comprehensive income in the costs of the hedging reserve within equity and are reclassified directly to the hedge reserve to the income statement at the time the inventory is recognized.
The time value of the options will be recorded through the income statement within the Financing income (cost).
The Group suspends hedge accounting when the derivative has expired, is canceled or exercised, when the derivative is not highly effective in offsetting changes in the fair value or cash flows of the hedged item, or when it is decided to cancel the hedge designation.
F-17
By suspending hedge accounting in the case of cash flow hedges maintained by the Group, the amounts that have been recorded in stockholders’ equity as part of comprehensive income remain in equity until the moment the hedged item impacts results.
Derivatives are not offset in the consolidated financial statements unless the Group has the legal right and intention to offset. A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realized or settled within 12 months; Otherwise, they are presented as current assets or liabilities.
Inventories are measured at the lower of cost and net realizable value. The costs comprise direct materials, direct labor, and an appropriate proportion of variable and fixed overhead costs, the latter being allocated on the basis of normal operating capacity. The cost of inventories is based on the standard cost method. The net realizable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in administration (marketing), selling and distribution.
Current assets (and disposal groups) classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell. Current assets and disposal groups are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale which should be expected to qualify for recognition as a completed sale within one year from the date of classification.
An impairment loss is recognized for any initial or subsequent reduction of the asset to fair value less costs to sell. A gain is recognized for any subsequent increase in the fair value less costs to sell of an asset that does not exceed any previously recognized accumulated impairment loss. A gain or loss not previously recognized at the date of sale of the current asset is recognized at the date of derecognition.
Current assets are not amortized or depreciated while classified as held for sale. Interest and other expenses attributable to liabilities of a disposal asset classified as held for sale continue to be recognized.
Other assets mainly include inventory of rewards related to the rewards program offered to our distributors, associates, leaders and consultants, recoverable taxes and rent security deposits. They are presented in current or non-current assets in accordance with the classification of the destination item.
The inventory for the rewards program (see note 2.u and 2.w) is acquired based on exchange estimates from distributors, associates, leaders and consultants; and is reduced at the time the points are redeemed, and the reward is sent. Rewards inventory is recognized at acquisition cost.
Items of property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses.
If significant parts of an item have different useful lives, then they are accounted for as separate items (major components).
F-18
Depreciation is recognized using the straight-line method. The estimated useful lives and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.
The following useful lives, considering separately each of the asset’s components, are used in the calculation of depreciation:
Property, plant and equipment are derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.
Intangible assets are recognized used when they meet the following characteristics: they are identifiable, they obtain future economic benefits, and there is control over said benefits.
Intangible assets are classified as follows:
Indefinite useful life:
Defined useful life:
The estimated useful lives of intangible assets with a defined useful life are summarized as follows:
Derecognition of Group’s intangible assets
An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss when the asset is derecognized.
F-19
At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the group or cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise, they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less disposal costs and value in use. In assessing the estimated future cash flows, they are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. For impairment testing purposes, assets are grouped at the lowest levels for which there are separately identifiable cash flows that are largely independent of the cash flows of other assets or Groups of assets (cash generating units).
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. Any impairment is recognized immediately in profit or loss.
Goodwill represents the excess of the acquisition cost of a subsidiary over the Group´s interest in the fair values of the net assets acquired determined at the date of acquisition and is not subject to amortization.
Goodwill is not amortized but is tested annually for impairment and whenever there is any indication that the asset may be impaired. Goodwill arising from a business combination is allocated to the cash generating unit or group of units (“CGU”) receiving a benefit from the synergies of the combination and based on the level at which management monitors goodwill, which cannot be higher than an operating segment. An impairment loss is recognized if the carrying amount of an asset, CGU or group of CGUs exceeds its recoverable amount. Impairment losses are recognized in profit or loss and for goodwill they are not reversible.
Businesses acquisitions are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated by the sum of the assets transfer fair values by the Company, less the liabilities incurred by the Company to the previous owners of the acquiree entity and equity shares issued by the Company in exchange for control over the acquiree equity. The cost related to the acquisition are generally recognized in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired, and the liabilities assumed are recognized at their fair value, except for:
F-20
Non-controlling interests that are equity interests and that give to their holders a proportionate share of the Company’s net assets in the event of liquidation, may initially be measured at either fair value or at the value of the non-controlling interest’s proportionate interest in the recognized amounts of the identifiable net assets of the acquired company. The measurement base is made on every transaction. Other types of non-controlling interest are measured at fair value, or where applicable, based on what other IFRS specifies.
The Group as lessee
The Group evaluates whether a contract is or contains a lease agreement at inception of a contract. A lease is defined as an agreement or part of an agreement that conveys the right to control the use of an identified asset for a period of time in exchange for a consideration. The Group recognizes an asset for right-of-use and the corresponding lease liability, for all lease agreements in which it acts as lessee, except in the following cases: short-term leases (defined as leases with a lease term of less than 12 months); leases of low-value assets (defined as leases of assets with an individual market value of less than US$5 (five thousand dollars)). For these agreements, which exempt the recognition of an asset for right-of-use and a lease liability, the Group recognizes the rent payments as an operating expense in a straight-line method over the lease period.
The right-of-use asset comprises all lease payments discounted at present value; the direct costs to obtain a lease; the advance lease payments; and the obligations of dismantling or removal of assets. The Group depreciates the right-of-use asset over the shorter of the lease term or the useful life of the underlying asset; therefore, when the lessee will exercises a purchase option, the lessee shall depreciate the right-of-use asset from the commencement date to the end of the useful life of the underlying asset. Depreciation begins on the lease commencement date.
The lease liability is initially measured at the present value of the future minimum lease payments that have not been paid at that date, using a discount rate that reflects the cost of obtaining funds for an amount similar to the value of the lease payments, for the acquisition of the underlying asset, in the same currency and for a similar period to the corresponding contract (incremental borrowing rate). To determine the lease term, the Group considers the non-cancellable period, including the probability to exercise any right to extend and/or terminate the agreement.
Subsequently, the lease liability is measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest method) and reducing the carrying amount to reflect the lease payments made.
When there is a modification in future lease payments resulting from changes in an index or a rate used to determine those payments, the Group remeasures the lease liability when the adjustment to the lease payments takes effect, without reassessing the discount rate. However, if the modifications are related to the lease term or exercising a purchase option, the Group reassesses the discount rate during the liability’s remeasurement. Any increase or decrease in the value of the lease liability subsequent to this remeasurement is recognized as an adjustment to the right-of-use asset to the same extent.
F-21
Finally, the lease liability is derecognized when the Group fulfills all lease payments. When the Group determines that it is probable that it will exercise an early termination of the contract that leads to a cash disbursement, such disbursement is accounted as part of the liability’s remeasurement mentioned in the previous paragraph; however, in cases in which the early termination does not involve a cash disbursement, the Group cancels the lease liability and the corresponding right-of-use asset, recognizing the difference immediately in the consolidated statement of profit or loss and other comprehensive income.
In preparing the consolidated financial statements, transactions in currencies other than the Mexican Peso, which is the reporting currency of the consolidated entities (see table in note 2d), those are recognized at the exchange rates as of the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Non-monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of transaction.
Exchange differences on monetary items are recognized as foreign exchange profit or loss in the period in which they arise.
For the purpose of presenting consolidated financial statements, the assets and liabilities in foreign currency are translated in Mexican pesos, using the exchange rates prevailing at the end of the period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates are used at the date of transactions. Exchange differences arising, if any, are recognized in the case in other comprehensive income and accumulated in a foreign exchange translation reserve (attributed to non-controlling interests as appropriate).
The adjustments related to goodwill and to the fair value of the identifiable assets acquired and the liabilities assumed generated in a foreign transaction, are recognized as assets and liabilities of that operation and will be translated, as appropiate, at the closing rate at the end of the reporting period. Exchange differences arising are recognized in other comprehensive income.
Retirement benefits – Defined benefit obligations and post-employment (pension plan applicable to Jafra)
The Group’s defined benefit obligations cover seniority premiums which consist of a lump sum payment of 12 day’s wage for each year worked, calculated using the most recent salary, not to exceed twice the legal minimum wage established by law. The post-employment benefits that Jafra offers are cumulative remunerations that generate future benefits for employees, during their employment relationship and are acquired by the employee and/or beneficiary at the time of retirement from the entity and/or upon reaching retirement or retirement age or other eligibility condition. The Company provides one-time payments from a formal pension plan. The right to access these benefits depends on the employee having worked until retirement age and completing a period of years of service. The related liability and annual cost of such benefits are calculated with the assistance of an independent actuary on the basis of formulas defined in the plans using the projected unit credit method at the end of each annual reporting period.
The Group’s net obligation with respect to the defined-benefit plan is calculated separately for each plan, estimating the amount of future benefit accrued by employees in return for their services in ongoing and past periods; that benefit is discounted to determine its present value, and the costs for the services that have not been recognized and the fair value of the plan assets are deducted. The present value of the defined benefit obligation is determined by discounting the estimated future cash flows using discount rates in accordance with IAS 19 that are denominated in the currency in which the benefits will be paid, and that have maturities that approximate to the terms of the pension liability.
F-22
Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:
Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if applicable), are recognized immediately in the liability against other comprehensive income in the period in which they occur. Remeasurement recognized in other comprehensive income is never reclassified to profit or loss. Past service cost is recognized in profit or loss in the period in which a plan amendment or curtailment occurs, or when the Group recognizes the related restructuring costs or termination benefits, if earlier.
Short-term and other long-term employee benefits and statutory employee profit sharing (“PTU”)
A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service. Likewise, a liability is recognized for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the Group in respect of services provided by employees up to the reporting date.
PTU is recorded in the results of the year in which it is incurred and is presented in operating expenses line item in the consolidated statement of profit or loss and other comprehensive income.
Termination benefits
Termination benefits are paid when employment is terminated before the normal retirement date, or to provide benefits as a result of an offer made to encourage voluntary termination of employment. The Company recognizes termination benefits on the earlier of the following dates: (a) the date the Company is committed to terminating the employment of the employees in accordance with a detailed formal plan without having the possibility of avoiding its obligation, and (b) when the entity recognizes restructuring costs in accordance with the provisions of IAS 37 and involves payments of termination benefits. In the case of an offer that promotes voluntary termination, termination benefits will be valued based on the expected number of employees who will accept the offer. If compensation is payable no later than 12 months after the reporting period, then they are discounted to present value.
F-23
Income tax expense represents the sum of the tax currently payable and deferred tax.
Current income tax (“ISR” in Mexico, United States, Guatemala, Peru, Ecuador and Colombia) is determined at the level of each entity of the Group and is recognized in the results of the year in which it is incurred.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in profit or loss because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
For those situations in which the tax determination is uncertain, but payment to the tax authority is considered probable. An analysis of the derived effects and possibility of recording a provision is carried out. The provisions are calculated with the best estimate of the amount expected to be paid. The assessment is based on the judgment of tax professionals within the Group supported by previous experience with respect to such activities see contingency note 26.
Deferred tax is recognized at the level of each entity that makes up the Group, by determining the temporary differences between the carrying amounts of assets and liabilities and their corresponding tax values. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Such deferred tax assets and liabilities are not recognized if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. In addition, deferred tax liabilities are not recognized if the temporary difference arises from the initial recognition of goodwill.
Deferred tax liabilities and assets are calculated at the tax rates that are expected to apply in the period in which the liability is settled or the asset is realized, based on the tax rates (and applicable tax laws) that have been enacted or have been substantially enacted as of the last reporting date.
Deferred income tax assets are recognized only if it is probable that future taxable amounts will exist to utilize those temporary differences and losses.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Current and deferred tax for the year are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively.
Deferred income tax assets and liabilities are offset when there is the legal right to offset current tax assets and liabilities, and when deferred income tax balances are related to the same tax authority. Current tax assets and liabilities are offset when the entity has the legal right to offset and intends to settle on a net basis, or to realize the asset and settle the liability simultaneously.
F-24
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The provisions mainly include incentives given to distributors, associates, leaders and independent consultants, in the form of reward points, discounts and others, such as employee compensation (bonuses) not paid as of the date of the report, professional services fees, other services, among others.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).
Rewards program for distributors, associates, leaders and independent consultants:
The Group has a reward program, which is offered through its business segments, to distributors and associates in Betterware, and to consultants, including leaders, in Jafra. Its objective is to promote the fulfillment of specific objectives in the development of commercial activities of the business but considered separate and distinct services from sales. In the case of Distributor and Associate Rewards, Betterware rewards its Distributors for enrolling new Associates and appointing new Distributors, while Associates receive such rewards for referring new Associates and staying active. In the case of rewards to Consultants, including Jafra leaders, they are awarded for sponsorship when they manage to hire a new direct sponsor or based on the commercial activities carried out by the group or lineage to which they are related. In this way, the members of this independent sales force help expand the organization and sales channels, and at the same time commit to developing their network of contacts and vendors.
These rewards can be in:
The Group evaluates the performance of distributors, partners, and consultants, including their leaders at each reporting date based on an estimate of their achievement of the program’s established objectives, and recognizes the corresponding expense, presenting it as a selling expense with a provision recorded as the offsetting entry. The provision is reduced when points are redeemed for available products (rewards). The value of the rewards program and the related expense are determined based on the fair value of the services received, taking into account management’s analysis of similar services in the market.
Current liabilities, such as accounts payable to suppliers and other accrued expenses (accrued or not), whether for personnel costs or other operating costs, make up the working capital used in the entity’s normal operating cycle. These balances represent liabilities for goods and services provided to the Group before the end of the year that have not been paid. Suppliers and other accrued expenses are presented as current liabilities, unless payment is not payable within 12 months of the reporting period. They are initially recognized at fair value and subsequently valued at amortized cost using the effective interest rate method.
Trade accounts payable to the Group’s suppliers principally comprise amounts outstanding for trade purchases, raw material and ongoing costs.
F-25
The Company, for the ease and benefit of its suppliers, has entered into supplier financing agreements with financial institutions and banks (collectively Bank), under which the Bank pays the Company’s obligations with the supplier in advance. The Company pays the Bank within the period originally specified in the invoices and the costs arising from these agreements are absorbed by the suppliers. This way, there is no extension of payment terms or changes to the original conditions. of liabilities (amount, nature, function and maturity), therefore, their terms are not substantially different from those of trade payables Given the conditions of the agreement described above, the Company presents the balance of the suppliers that are part of the agreement in the “Accounts payable to suppliers” item in the statement of financial position. The Bank acts as an agent, therefore, it is considered an extension of the Company’s operations. Therefore, for the purposes of the consolidated statement of cash flows, when the bank pays to the supplier it is considered an operating cash outflow and a financing cash inflow, when the Company subsequently makes the payment to the bank, it is classified as a financing cash outflow.
The Group’s main business is direct-to-consumer sales, carried out through two business segments home organization products (“Betterware segment” or “BWM segment”) and beauty and personal care products (“Jafra segment”), these products are sold to its main customers: BWM distributors and Jafra leaders and consultants. To this end, the Group enters into contracts in each business with its distributors, consultants and leaders for the purchase and sale of products (without there being a permanent contract link).
The Group has identified two performance obligations:
Both performance obligations are detailed below:
The income recognized by the Group includes the fair value of the consideration received or to be received for the sale of products from the home organization and beauty and personal care segments, as well as services in the ordinary course of the transactions, and are presented in the consolidated statement of profit or loss, net of the amount of variable considerations (discounts and product returns). To recognize revenues from contracts with its distributors, leaders and independent consultants, the Group applies a comprehensive model, which is based on a five-step approach consisting of the following: (1) identify the contract (verbal or written); (2) identify performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when the Group satisfies a performance obligation. The Group recognizes revenue at a point in time, when it transfers control over a product to a customer, which occurs when the customers take delivery of the products and formally accept them.
The Group sends the invoices for the sale of home organization and beauty and personal care products to its distributors, leaders and independent consultants at shipment date with payment terms between 15 and 30 days. Distributors, leaders and independent consultants are allowed to request a product return only if the product has quality, technical issues, or physical damages. However, this right qualifies as an assurance-type warranty (and not a performance obligation) related to the functionality of the products sold.
Betterware’s discounts to distributors and associates are included in the invoice price and are presented in the net sales line item from the moment in which the customer acquires control of the products sold. Therefore, the management does not perform estimates over discounts to be taken by the customers. Jafra does not give discounts to leaders and consultants on the invoice price.
Loyalty program (The Group’s reward points program):
The Group operates loyalty programs (Reward points program) through Betterware’s distributors and associates, and Jafra’s leaders and consultants accumulate points on sales of goods that entitle them to exchange the points for products the Group acquires from different suppliers. Since these points provide a benefit to Betterware distributors and associates and Jafra leaders and consultants that they would not receive without purchasing the Group’s products, this loyalty program and points system represent a separate performance obligation.
F-26
Therefore, the price of the sales transaction in which points are generated is allocated between the Betterware or Jafra product sold and the points awarded in the transaction, on a separate sales price basis. The stand-alone selling price per point is estimated based on the fair value of the product to be given when the points are redeemed by the distributors and associates and the likelihood of redemption, as evidenced by the Group’s historical experience. Considering the above, in the accounting record of the sale, the Group recognizes a contractual liability (liability for contract with customers) that is presented in the consolidated statement of financial position, for the revenue related to points earned at the time of the initial sales transaction, reducing the income recognized in the initial sale of the goods. Subsequently, revenue from the loyalty points is recognized when the points are redeemed by the customer and exchanged for the related products. Revenue for points that are not expected to be redeemed is recognized in proportion to the pattern of rights exercised by customers.
Based on contractual agreements, income from loyalty program points is recognized in the income statement item in the income statement net of the cost corresponding to the rewards inventory when the Group acts as an intermediary between its client and the third-party supplier;
Variable considerations
The Group adjusts the transaction price according to the estimations that may result in a variable consideration. These estimates are determined according to the terms and conditions of the contracts with the customer, the history or the customer’s performance.
Contract costs
The Group recognizes the incremental costs to obtain a contract with a client in the consolidated results of the period because they correspond to contracts with a duration of less than one year, in line with the revenue recognition model concerning the transfer of the goods related to the cost.
The amount of basic earnings per share is calculated by dividing the net income for the period attributable to shareholders of the Group’s ordinary shares by the weighted average of the ordinary shares outstanding during the period.
The amount of diluted earnings per share is calculated by dividing the net income attributable to shareholders of the Group’s common shares (after adjusting for interest on convertible preferred shares, if applicable) by the weighted average of the common shares outstanding during the period plus the weighted average number of ordinary shares that would have been issued at the time of converting all diluted potential ordinary shares into ordinary shares.
Significant obligations or losses related to contingencies are recognized when it is probable that their effects will materialize and there are reasonable elements for their quantification. If these reasonable elements do not exist, their disclosure is included qualitatively in the notes to the consolidated financial statements. Income, profits or contingent assets are recognized until such time as there is certainty of their realization.
The Group’s ordinary shares are classified as share capital within stockholders’ equity and are expressed at their historical cost.
When any entity of the Group purchases shares issued by the company (treasury shares), the consideration paid, including the costs directly attributable to said acquisition (net of taxes), is recognized as a decrease in the Group’s capital until the shares are canceled or reissued. When these shares are reissued, the consideration received, including incremental costs directly attributable to the transaction (net of tax) is recognized in the Group’s capital.
F-27
The Group’s share repurchases have been carried out through the stock exchange on which they are listed (previously on Nasdaq and beginning in June 2024, on the New York Stock Exchange “NYSE”) and are carried out with a charge to the Group’s stockholders’ equity; The maximum repurchase amount is approved by the Board of Directors for each fiscal year, without said repurchases exceeding the company’s net profits (including retained profits).
In accordance with the Mexican General Corporate Law, the Group has its legal reserve of 20% of the historical capital, in order to maintain a minimum amount of capital in the reserve in the event of an unforeseen need for funds, which is recognized in retained earnings.
Retained earnings correspond to the accumulated results of previous year’s net of dividend payments.
Application of new and revised International Financial Reporting Standards (“IFRSs” or “IAS”) that are mandatorily effective for the current year
In the current year, the Group has applied a number of new and amended IFRS and interpretations issued by the International Accounting Standards Board (“IASB”) that are mandatorily effective for an accounting period that begins on or after January 1, 2025. The conclusions related to their adoption are described as follows:
New and amended IFRS Standards that are effective for the current year
The Group adopted the following amendments in the current year:
New and revised IFRS Standards in issue but not yet effective
As of the date of issuance of these financial statements, the Group has not applied the following new and revised IFRS, nor improvements issued by the IASB that have been published but are not yet effective.
Management is currently assessing the detailed implications of applying the new standard on the Group’s consolidated financial statements. From the high-level preliminary assessment performed, the following potential impacts have been identified:
F-28
The Group will apply the new standard from its mandatory effective date of January 1, 2027. Retrospective application is required, and so the comparative information for the financial year ending December 31, 2026, 2025 and 2024, will be restated in accordance with IFRS 18.
In addition, the Group does not see potential impacts from its adoption, of the following standards and amendments considering that some are not of significant applicability and others are totally not applicable to the balances and transactions carried out by the Group.
F-29
In the application of the Group’s accounting policies, which are described in note 2, management of the Group is required to make judgments, estimates, and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The judgments, estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The significant estimates impacting the Group’s consolidated financial statements are as follows:
The Group annually carries out, and when there are indications of impairment, evaluations to identify possible losses due to impairment in goodwill, brands with indefinite useful life and other long-lived assets, for which key assumptions are used in the calculation of the recovery value (see note 11). For the purposes of these impairment tests, goodwill and brands with an indefinite useful life are assigned to the group of cash-generating units (“CGU”) with respect to which the Group considers that corresponding economic and operational synergies are generated. The recoverable imports of the CGU group have been determined based on calculations of their fair value less disposal costs, which requires the use of significant estimates and judgments. The assumptions most significant are the following:
As of December 31, 2025, 2024 and 2023, the payment period granted to customers is 14 and 30 days for Betterware and Jafra, respectively. No interest is charged on outstanding accounts receivable.
F-30
The Group measures the loss reserve for commercial accounts receivable in an amount equal to the expected lifetime credit loss. Expected credit losses in accounts receivable are estimated using a provisions matrix with reference to the debtor’s previous default history and an analysis of the debtor’s current financial situation, adjusted for factors specific to the debtors and the general economic conditions of the industry in which the debtors operate, and assessing both current and predicted conditions as of the reporting date.
The Management has applied significant estimation to determine the estimated expected credit losses as of December 31, 2025, 2024 and 2023. The expected credit loss calculation is adjusted to reflect forward-looking information on macroeconomic factors that could affect customers’ ability to repay their debts.
The Group cancels an account receivable when there is information that indicates that the debtor is experiencing serious financial difficulties and there is no realistic prospect of recovery, e.g. when the debtor has been placed in liquidation or has entered bankruptcy proceedings, or when a commercial account receivable is more than one year old, whichever occurs first. For the years ended December 31, 2025, 2024 and 2023, Ps. 299,945, Ps. 321,399 and Ps. 94,194 have been canceled, respectively.
The following tables show the expected lifetime credit loss recognized for commercial trade accounts receivable, in accordance with the simplified approach established in IFRS 9.
F-31
The following tables show the movement in lifetime expected credit loss that has been recognized for commercial trade account receivables, in accordance with the simplified approach set out in IFRS 9.
Long term account receivable from the sale of the “San Angel” property
As of December 31, 2024, the Company recognized an account receivable derived from the sale of the San Ángel Jafra property, the sale was agreed for a total price of Ps. 385,700, of which as of December 31, 2025 and 2024, the amount of Ps. 134,397 and Ps. 140,000 was collected, respectively. As of December 31, 2025, the balance of Ps. 111,303 will be collected in three semiannual payments ending in 2027. The account receivable was initially recognized at fair value, which was determined as the present value of future cash flows using an effective rate of 10.1%. As of December 31, 2025 and 2024, the Management decided not to recognize an expected credit loss effect on San Ángel’s account receivable because it was considered that the probability of non-collection is low and the payments are secured with the mortgage of the same property.
Inventories recognized within the cost of sales less the amount of depreciation assigned to the cost of the product in the consolidated statement of income amounted to Ps. 4,708,578, Ps. 4,479,741 and Ps. 4,230,600 for the years of 2025, 2024, and 2023, respectively.
The cost of inventories recognized as an expense includes Ps. 133,579, Ps. 78,932 and Ps. 81,913, for the years 2025, 2024 and 2023, respectively, in respect of write-downs of inventory to net realizable value. Such write-downs have been recognized to account for obsolete inventories.
Meanwhile, the effect of derivative financial instruments designated as accounting hedges recognized in other comprehensive income during 2025 amounted to Ps. (26,238). During the year, the Company transferred Ps. 56,127 directly to the cost of inventories; Of this amount, Ps. 39,294affected cost of sales during the year and Ps. 16,833 remain capitalized in inventories as of December 31, 2025.
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F-33
As of
December 31,2025
December 31,2024
F-34
Depreciation expense is included in administrative expenses and cost of sales line in the consolidated statement of profit or loss and other comprehensive income.
The Group built a distribution center, which was ready to use in 2021 and it was started to capitalization began to be capitalized in that year, however, the construction remainder was completed until 2023. As of December 31, 2023, the total payments related to this construction amounted to Ps. 2,349. The total investment amounted to Ps. 1,110,807. The Group did not capitalize interest of loans incurred in the construction of the distribution center as of December 31, 2023.
As of December 31, 2024, the Group carried out the sale of the properties “Las Flores” and “San Ángel” for the price of Ps. 16,500and Ps. 385,700, respectively. As a result of the sale of said properties, the Group recognized an accounting loss of Ps. 60,614 and Ps. 469,108, respectively, as described in note 1b.
As of December 31, 2025 and 2024, the Company shown in its statement of financial position, the O’Farril land in Jafra Mexico as assets classified as held for sale for a value of Ps. 40,000. At the end of 2024, the carrying amount of O’Farril was Ps. 206,581 (value recorded in the acquisition of Jafra businesses), which was impaired to its fair value of Ps. 166,581 due to the decrease in the market value of the properties in Mexico City.
As ofDecember 31, 2025
As ofDecember 31,2024
Goodwill and indefinite-lived intangible assets are allocated to those cash-generating units or group of cash-generating units that are expected to benefit from the synergies of the related business combination, and these represent the lowest level within the Group at which management monitors goodwill. The level of cash-generating units or group of cash-generating units is based on management’s monitoring of the operating business.
The Group’s goodwill balances were allocated as follows:
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Jafra Mexico’s goodwill corresponds to the resulting excess between the consideration paid and the fair values of the net assets acquired on the date of acquisition by Betterware de México, S.A.P.I. de C. V., about the companies Jafra Cosmetics International S.A. de C.V., Jafra México Holding B.V., and Jafra Cosmetics International Inc.
Betterware goodwill corresponds to the excess between the consideration given and the fair values of the net assets acquired on the acquisition date by Betterware Latinoamerica Holding México, S.A. de C.V. (BLHM) and Strevo Holding, S.A. de C.V.
Finayo’s goodwill corresponds to the resulting excess between the consideration paid and the fair values of the net assets acquired on the date of acquisition by Betterware de México, S.A.P.I. de C. V., on Finayo, S.A.P.I. of C.V. SOFOM ENR.
Impairment tests
The Company annually tests the recoverable amount of its goodwill and indefinite-lived intangible assets that amount to Ps. 1,599,718 and Ps. 1,102,106, respectively, of which Ps. 1,250,132 and Ps. 849,106, respectively, relates to the Jafra Mexico group of cash generating units (CGU).
Cash-generating units where goodwill is allocated are tested for impairment at least annually. All other individual assets or cash-generating units are tested for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable.
The recoverable value of CGUs or group of CGUs was based on fair value less costs of disposal, estimated using discounted cash flows. The fair value measurement was classified as Level 3 fair value based on the inputs to the valuation technique used.
The values assigned to the key assumptions represent the administration’s assessment of future trends in relevant industries and are based on historical data from external and internal sources.
As of December 31, 2025, 2024 and 2023, the estimated recoverable amount of the group of CGUs exceeded its carrying amount.
The key assumptions used in the estimation of the recoverable amount are set out below:
The discount rate was based on the historical industry average, weighted-average cost of capital and a market interest rate.
The average revenue growth rate is derived from management plans that are in line with industry behavior.
Other assumptions:
F-36
The cash flow projections included specific estimates for 5 years and a terminal growth rate thereafter. The terminal growth rate was determined based on management’s estimate of the long-term compound annual EBITDA growth rate, consistent with the assumptions that a market participant would make. For Betterware, a terminal growth rate of 1.0% was used to corroborate that even then there would be no impairment of the assets.
Budgeted EBITDA was estimated taking into account past experience and a revenue growth rate projected taking into account the average growth levels experienced over the past 5 years and the estimated sales volume and price growth for the next five years. It was assumed that the sales price would increase in line with forecast inflation over the next five years.
There are no reasonably possible changes in any of the key assumptions that would result in potential impairment.
F-37
Brands:
Brands are not amortized. The Company annually tests the recoverable amount of its goodwill and indefinite-lived intangible assets that amount to Ps. 1,599,718and Ps. 1,102,106, respectively, of which Ps.1,250,132 and Ps. 849,106, respectively, relates to the Jafra Mexico group of cash generating units (CGU).
Customer relationships:
F-38
The customer relationships balance of the Group is described below:
Brands and logo rights
At each reporting date, the Group reviews the carrying amounts of its intangible assets with a definitive life to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. As of December 31, 2025, 2024 and 2023, the Group has not identified indications of impairment.
In relation to impairment of intangible assets with indefinite useful life (brand), the Group estimates the recoverable amount of the intangible asset which is based on fair value less costs of disposal, estimated using discounted cash flows. The fair value measurement was categorized as a Level 3 fair value based on the inputs in the valuation technique used (see note 11).
Right-of-use assets, net
The Group leases cars, computers, servers, printers, warehouses and buildings (Jafra distribution center and commercial venues) with different expiration dates, with the latest expiration date in 2034. These leases were recorded as right of use assets as follows:
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F-40
The depreciation of assets for rights of use for the years ended December 31, 2025, 2024 and 2023 amounted to Ps. 134,150, Ps. 120,985 and Ps. 119,930, respectively, of which the amount of Ps. 130,192, Ps. 116,939, and Ps. 117,546, respectively, are presented in operating expenses and the remainder in cost of sales in the consolidated statement of income and other comprehensive income.
As of December 31, 2025, 2024 and 2023, the Group has master lease contracts for computers, servers, cars, BWM’s corporate office, Jafra Mexico’s distribution center, office equipment (printers), and premises in different regions.
As of December 31, 2025, 2024 and 2023, Betterware leased warehouses, offices, commercial space, and equipment, used in normal operations of the Group’s companies, to which the short-term exemption was applied, considering that the lease term was for less than one year. The rental expense for the years ended December 31, 2025, 2024 and 2023, amounted to Ps. 51,162, Ps. 34,111 and Ps. 15,295, respectively.
F-41
Lease liability
The lease liabilities as of December 31, 2025, 2024 and 2023 are described below.
The maturity analysis of total future minimum lease payments, including non-accrued interest, is as follows:
Trade accounts payables to the Group’s suppliers principally comprise amounts outstanding for trade purchases, raw material, and ongoing costs.
The Group has financial risk management policies (see note 20) to ensure that all accounts payable are paid within the previously agreed credit terms.
F-42
Supplier finance arrangements:
Supplier financing agreements are characterized by one or more banks offering to pay the amounts a company owes its suppliers. The company subsequently pays the banks according to the original terms and conditions agreed upon with the suppliers. These agreements provide the entity’s suppliers with early payment terms, compared to the payment due date of the related invoice.
The Group has established certain supplier financing agreements with five local banks (Banamex, BBVA, HSBC, Santander, and Sabadell), through which suppliers can discount their invoices before the payment period originally agreed upon with the Company. The Group is not involved in suppliers’ decisions to join these programs, and there is no substantial impact on the payment terms, amounts payable, or their liquidity. Each supplier bears the financial cost of the discount. The Group has no financial interest in suppliers’ decisions to participate in the program and does not provide any guarantees in connection with the agreements.
As of December 31, 2025, 2024, and 2023, the average payment period to Betterware’s suppliers is 4 months mainly for its commercial purchases and to Jafra’s suppliers is 30 days for the commercial area and 90 days for the manufacturing area, which is consistent both for suppliers that participate in financing agreements and for comparable ones that are not part of said programs, consequently, the Group liquidates the financial institution within the period originally agreed with the supplier.
There were no impacts on liabilities under supplier financing arrangements in any of the periods as a result of business combinations or exchange rate differences, nor were there any transfers of trade payables to financial debt.
The carrying amounts of liabilities under supplier financing arrangements are considered to reasonably approximate their fair values due to their short-term nature.
The existing financial arrangements are described below:
The Company pays banks an annual fee for supplier financing agreements. At the end of 2025, 2024 and 2023, this amounted to Ps. 6,888, Ps. 13,060 and Ps. 13,389, respectively.
Accrued expenses:
The Group’s accrued expenses mainly comprise outstanding payment amounts (retention of income taxes and VAT) and social security’s contributions (IMSS, SAR and INFONAVIT) expenses among other accrued expenses.
F-43
The following table presents the Group’s outstanding revolving credit facilities and long-term debt as of December 31, 2025, 2024 and 2023:
F-44
Long-term credit facility with HSBC- (see letter “d” previous table)
On September 12, 2023, Betterware signed an agreement with HSBC to acquire a simple line of credit with joint obligation of Jafra Mexico, up to Ps. 950,000, valid until September 13, 2029 and payment of monthly interest at the TIIE rate (the of interbank interest rate) at 28 days published in BANXICO plus 1.3bp, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days, in addition, in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and the result will be applied to the unpaid and past-due balances.
On September 13, 2023, Betterware used the Ps. 950,000 of the credit line with HSBC to pay our revolving lines.
As of December 31, 2025 and 2024, the amount paid to the principal of this credit line amounts to Ps. 190,000 and Ps. 47,500, respectively.
As of December 31, 2025, the current portion of this long-term simple line amounted to Ps. 190,000 and portion of this long-term amounted to Ps. 522,500.
Bond issuances listed on the Mexican Stock Exchange (BWMX 23 and BWMX 23-2) - (see letter “c” initial table)
On July 7, 2023, Betterware successfully concluded the third and fourth bond issuance for a total of Ps. 813,974, with maturities of 4 and 7 years, offered in the Mexican Market. The third offer of bonds for Ps. 313,374 started paying interest at 12.41% rate and for the subsequent monthly payments, the rate will be based on the 28-day TIIE rate issued by Banxico plus 0.90%, and the fourth offer of Ps. 500,000 will pay interest semi-annually at a fixed rate of 11.23% during the bond term. Principal payments are at the end of every bond maturity.
On July 10, 2023, Betterware used the bond amount net of issuance costs of Ps. 810,197, to pay the syndicated credit line.
Long-term credit facility with BBVA - (see letter “a” initial table)
On July 5, 2023, Betterware entered into a credit agreement with BBVA, up to Ps. 1,500,000, with a term of 60 months and monthly interest payment at 28-day TIIE rate published in BANXICO, on non-working days, the TIIE rate could be at 26, 27 or 29 days, plus the applicable margin, such ordinary interest will be calculated by the number of days effectively elapsed over the base of a year 360 days, in addition, in case of default, interest will be paid at the ordinary interest rate multiplied by 2.0pp divided by 360 days and the result will be applied to the unpaid and past-due balances.
On July 10, 2023, Betterware used the Ps. 1,500,000 of the credit line with BBVA to pay the syndicated credit line.
As of December 31, 2025 and 2024, the amount paid to the principal of this credit line amounts to Ps. 225,000 and Ps. 145,000, respectively.
As of December 31, 2025, the current portion of this long-term simple line amounted to Ps. 375,000 and portion of this long-term amounted to Ps. 755,000.
F-45
On March 31, 2022, Betterware entered into a credit agreement with Banamex, HSBC, BBVA, BanBajio, BanCoppel, and Scotiabank, as syndicated lenders, for a credit line of up to Ps. 4,498,695. The funds under the credit line were entirely allocated to the Jafra Acquisition in Mexico and the United States. The credit line had a maturity of 5 years from the date of signing the contract in March 2022, which paid monthly interest at the 28-day TIIE rate plus the applicable margin established in the contract. The first 24 months the credit line had no principal payments, and from month 25 principal payments began in an increasing manner, with a global payment of 30% in month 60. Jafra subsidiaries were jointly responsible for this credit.
During the months of March and June 2023, Betterware made two principal payments for Ps. 1,000,000 and Ps. 250,000, respectively. On July 10, 2023, the remaining principal of the syndicated loan for Ps. 3,248,695 was prepaid. The resources used came from long-term debt: Ps. 1,500,000 from BBVA and Ps. 810,197 from the new bond issue; and short-term loans: Ps. 550,000 from the revolving line with BBVA, Ps. 150,000 from the revolving line with Santander, Ps. 50,000, from the revolving line with HSBC, and the remaining amount for Ps. 188,498 was taken from available cash of Betterware and Jafra on the settlement date.
The Management considered the transaction as an extinguishment of the original debt (Syndicated Loan) and a new debt was recognized for the long-term simple credit lines with BBVA and HSBC, mainly due to substantial differences in financial obligations. As a result of the extinguishment of the debt from July to December 2023, the Company cancelled in profit or loss the outstanding remainder of the initial issuance costs for the original debt (syndicated credit), which amounted to Ps. 50,447.
Sustainability bond issuances listed on the Mexican Stock Exchange (BWMX 21X and BWMX 21-2X) - (see letter “b” initial table)
On August 30, 2021, Betterware successfully concluded the offering of a two-tranche sustainability bond issuance for a total of Ps. 1,500,000, with maturities across 4 and 7 years, offered in the Mexican Market and issued at favorable conditions for the Company. The first offer of sustainability bonds for Ps. 500,000 started paying interest at 5.15% rate plus 0.40% and for the subsequent monthly payments, the rate will be based on the 29-day TIIE rate issued by Banxico plus 0.40%, and the second offer of Ps. 1,000,000 will pay interest semi-annually at a fixed rate of 8.35% during the sustainability bond term. Principal payments are at the end of every bond maturity.
On August 25, 2025, the BWMX 21-X bond with 4-year maturity expired and the capital by Ps. 500,000 was settled.
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Revolving credit facility with BBVA – Betterware - (see letter “f” initial table)
On March 4, 2025, Betterware renewed the contract for this line of credit with BBVA for up to Ps. 800,000. The line of credit accrues ordinary interest at the TIIEF annualized rate for 28 days plus the percentage points determined in the system at the time of its drawdown. The validity of the contract is 36 months from the date of signing the original contract.
During the years 2025, 2024 and 2023, Betterware received several deposits of this revolving line which together amounted to Ps. 3,037,000, Ps. 1,723,000 and Ps. 1,855,020, respectively, which, as of December 31, 2025, 2024, and 2023, were paid Ps. 3,059,000, Ps.1,903,000 and Ps. 1,555,020, respectively.
As of December 31, 2025, 2024 and 2023, the balance of this short-term line closed at Ps. 98,000, Ps. 120,000 and Ps. 300,000, respectively.
Revolving credit facility with HSBC – Betterware - (see letter “e” initial table)
As of December 31, 2025, the balance of this short-term line closed at Ps. 300,000.
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Unsecured revolving credit facility with Banamex
As of December 31, 2025, 2024 and 2023, the fair value of the debt (borrowings and long-term bond) amounted to Ps. 4,111,769, Ps. 4,784,355, and Ps. 5,145,691, respectively. The fair value of the long term bond in 2025, 2024 and 2023, was calculated based on level 1 of the value hierarchy, since its price is quoted in an active market on that date, meanwhile the fair value of borrowings in 2025, 2024 and 2023 was calculated based on level 2 of the fair value, using the discounted cash flow method and the Interbank Equilibrium Interest Rate (“TIIE”, for its acronym in Spanish), adjusted for credit risk, and used to discount future cash flows.
Interest expenses related to the borrowings presented above are included in the interest expense item in the consolidated statement of earnings and other comprehensive income.
Reconciliation of movements of liabilities to cash flows arising from financing activities
F-48
The previous table details the changes in the Group’s liabilities derived from financing activities corresponding to debt and borrowings, including both monetary and non-monetary changes. Liabilities arising from financing activities are those for which cash flows are classified, or future cash flows will be classified, in the consolidated statement of cash flows as cash flows from financing activities.
The Group’s long-term debt and interest maturities as of December 31, 2025, including non-accrued interest, are as follows:
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As of December 31, 2025, 2024 and 2023, and at each quarterly reporting date during those years, the Group was in compliance with all applicable financial covenants. Management has concluded that there is no material uncertainty regarding compliance with these covenants during the next twelve months.
The subsidiaries of the Group in México and abroad are individually subject to the payment of income taxes. These taxes are not determined based on the consolidated figures of the Group but are calculated individually at the level of each company declaration and each of these presents its taxes separately.
According to the specific requirements of each country, the statutory rates for the years 2025, 2024 and 2023 years, were 30% for México, 25% for Guatemala, 21% for United States, 29.5% for Perú, 25% for Ecuador and 25% for Colombia and will continue as such in future years.
Income tax recognized in profit or loss for the years of 2025, 2024 and 2023 was comprised of the following:
F-50
Income tax expense recognized at the effective ISR rate differs from income tax expense at the statutory tax rate. Reconciliation of income tax expense recognized from statutory to effective ISR rate is as follows:
Realization of deferred tax assets depends on the future generation of taxable income during the period in which the temporary differences will be deductible. Management considers the reversal of deferred tax liabilities and projections of future taxable income to make its assessment on the realization of deferred tax assets. Based on the results obtained in previous years and in future profit and tax projections, management has concluded that it is probable the deferred tax assets will be realized.
Composition of the deferred tax asset (liabilities) is presented below, along with the reconciliation of changes in deferred tax balances as of December 31, 2025, 2024, and 2023:
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Unrecognized deferred tax assets:
Derived from the acquisition of Jafra, the Group did not recognize deferred tax assets in the consolidated statement of financial position with respect to the following tax loss carryforwards of the subsidiaries:
The decrease in the balance presented is mainly due to the application of tax losses of Jafra Cosmetics International, S.A. of C.V., in 2025.
The Group does not recognize taxes for deferred assets with respect to tax loss carryforwards to be amortized, on which it is not probable that future taxable profits will be generated against which the Group can use tax loss carryforwards.
As of December 31, 2025, 2024 and 2023, the tax balances to be recovered mainly consist of favor balances of ISR pending application.
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Temporary differences related to investments in subsidiaries for which deferred income tax liabilities have not been recognized:
The Company has undistributed profits for the years 2025, 2024 and 2023 of Ps. 261,469, Ps. 252,164 and Ps. 241,977 which generate unrecognized deferred income tax liabilities of Ps. 78,441, Ps. 75,649 and Ps. 72,593, respectively, since the Company is able to control the timing of distributions to its subsidiaries and is not expected to distribute these benefits in the foreseeable future.
Commissions, promotions and other
Commissions, promotions, and other include commissions payable to the sales force of distributors, associates, leaders and consultants on the last week of the period, which are paid in the first week of the year or of the following period. In addition, it includes the liability of reward points and loyalty program obtained by distributors, associates, leaders and consultants. See notes 2.u and 2.w.
Bonuses and other employee benefits
Bonuses and other employee benefits include annual performance bonuses as well as vacation provisions, vacation bonuses, savings funds, among others.
Fees for professional services
Fees for professional services include fees for services such as external audits, legal services, among others.
Other provisions
Provisions that represent estimates of future payment obligations arising from the acquisition of goods or services for operational purposes and other minor provisions.
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Exchange rate derivatives:
As part of the Management of risks related to fluctuations in the exchange rate of the US dollar, the Group enters into derivative financial instruments such as forwards and options to adjust the exchange rate risks resulting from inventory purchases in US dollars.
Instruments entered into on or after February 2025, were formally designated as cash flow hedges in accordance with IFRS 9. Instruments entered into in 2024 and 2023 were accounted for as held for trading.
The impact of the derivative financial instruments on results for the years 2024 and 2023 amounted to a gain (loss) of Ps. 156,766, and Ps. (32,591), respectively, in gain (loss) in valuation of derivative financial instruments. During 2025, a loss of Ps. 108,846 was generated from the forwards contracted in 2024 and settled in 2025.
Additionally, for the year ended December 31, 2025, no effects of ineffectiveness were recognized in the income statement.
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The Group recognizes the liability and corresponding impacts to profit and loss as well as comprehensive income regarding the seniority premiums to be paid to its employees. This benefit is determined considering the years of service and the compensation from the employees.
The components of the defined benefit liability for the years 2025, 2024 and 2023, are as follows:
The following table shows a reconciliation from the opening balances to the closing balances for the defined benefit liability and its components:
The conditions of the pension plan (Jafra) are described below:
As of September 30, 2023, Jafra modified the conditions of its pension plan, which generated a past service benefit effect of Ps. (29,615) in Jafra’s pension plan as described below:
Conditions before October 2023:
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Conditions after October 2023:
Employee groups:
a) Normal retirement:
b) Early retirement:
The following were the principal actuarial assumptions at the reporting date (expressed as weighted averages):
Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation considering a change of ±0.50% in the discount rate.
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Below is the categorization of the financial instruments, excluding cash and cash equivalents, held by the Group as of December 31, 2025, 2024 and 2023, as well as the indication of fair value hierarchy level, when applicable:
Accounting classification and fair values
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Measurements of fair values
The exchange rate forwards were valued using discounted cash flow techniques, using observable market forward curves and market discount rates, it also incorporates the credit risk of the counterparties through market quotes of CDS (Credit Default Swaps). Exchange rate options were valued using the Black-Scholes model, using relevant observable market inputs, including the spot exchange rate, implied volatility, maturity and the risk-free rate. There are no significant unobservable inputs in the valuation of these instruments; therefore, the measurements are classified as Level 2 of the fair value hierarchy. There were no transfers between levels during 2025, 2024 and 2023.
Fair value hierarchy levels 1 to 3 are based on the degree to which the fair value is observable:
As previously disclosed, some of the Group’s derivative financial instruments are measured at fair value at the end of each reporting period. The following table gives information about how the fair values of these derivative financial instruments are determined (in particular, the valuation technique(s) and inputs used).
Financial risk management
The Group’s Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Group through internal risk reports that analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk, interest rate risk, and price risk), credit risk, liquidity risk.
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The Group seeks to minimize the effects of these risks by using derivative financial instruments to hedge these risk exposures. The use of financial derivatives is governed by the Group’s policies approved by the board of directors, which provide written principles on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the Management on a continuous basis. The Group does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.
The Group’s activities expose it primarily to the financial risks of changes in exchange rates and interest rates (see below). The Group uses derivative financial instruments to manage its exposure to interest rate and foreign currency risk, including:
See note 18 for disclosure of the derivative financial instruments entered into for the years of 2025, 2024 and 2023.
The Group undertakes transactions denominated in foreign currencies, mainly U.S. dollars; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters as follows:
The carrying amounts of financial assets and liabilities denominated in foreign currencies (U.S. dollars “US$” and EU euro “€”) as of the reporting date are as follows:
The Group carries out transactions denominated in foreign currencies, mainly in US dollars. The Betterware segment’s primary exposure arises from highly probable forecasted purchases of USD-denominated inventory. To manage this risk, the Group uses forwards and exchange rate options; Beginning in February 2025, certain instruments were designated as cash flow hedges under IFRS 9.
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Instruments used to manage currency risk
The Group is mainly exposed to variations in the Mexican Peso / the U.S. Dollar exchange rate. For sensitivity analysis purposes, the Group has determined a 10 percent increase and decrease in Ps. currency units against the U.S. dollar (“relevant currency”). The 10 percent is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated financial assets/liabilities and adjusts their translation at the year-end for a 10 percent change in foreign currency rates. A positive number below indicates an increase in profit where currency units strengthen 10 percent against the relevant currency. For a 10 percent weakening of currency units against the relevant currency, there would be a comparable impact on the net income, and the balances below would be negative.
It is the policy of the Group to enter into foreign exchange forward and options contracts to manage the foreign currency risk associated with anticipated purchase transactions up to 12 months.
See note 18 with details on foreign currency forward and options contracts outstanding at the end of the reporting period. Foreign currency forward contract assets and liabilities are presented in the line ‘Derivative financial instruments’ within the consolidated statement of financial position.
The Group has entered into contracts to purchase raw materials from suppliers in China, with such purchases denominated in U.S. dollars. The Group has entered into foreign exchange forward contracts to hedge the exchange rate risk arising of future payments in US dollars.
The Group is exposed to interest rate risk from the borrowings at a variable interest rate (59% of long-term debt uses variable rate and 41% fixed rate). The risk is managed by the Group by maintaining an appropriate balance between fixed and variable rate borrowings.
The Group’s exposures to interest rates on financial liabilities are detailed in the liquidity risk management section of this note.
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Interest rate sensitivity analysis
The sensitivity analysis presented in 2025, 2024 and 2023 was determined based on exposure to the interest rates used. For variable rate liabilities, the analyzes were prepared assuming that the amount of the liability outstanding at the reporting date was outstanding during the review period. A one percent increase or decrease was used to internally report interest rate risk to Management and in turn represent the assessment of the reasonably possible change in interest rates.
The total amount paid for interest at a variable rate as of December 31, 2025, 2024 and 2023, was Ps. 356,553, Ps. 458,848 and Ps. 592,051, respectively; If the interest rates had been 1% higher, the payment would have amounted to Ps. 392,274, Ps. 496,276 and Ps. 637,049 and 1% lower, the payment would have amounted to Ps. 320,832, Ps. 421,419 and Ps. 547,054, respectively, that is, all other variables would have remained constant, the Group’s net income could decrease/increase Ps. 35,721, Ps. 37,429 and Ps. 44,998, respectively.
The Group’s credit risk arises mainly from cash and cash equivalents, derivative financial instruments with favorable positions and trade accounts receivable.
Regarding cash and cash equivalents and derivative financial instruments with a favorable position, the Group operates only with financial institutions of recognized solvency, which is why it considers the risk of non-compliance of said counterparties to be low.
For the commercial accounts receivable, the Group’s exposure to credit risk concentration is not significant as no customer represents more than 10% of sales and receivables. The concentration of credit risk is limited due to the fact that the customer base is large and unrelated, spread across diverse geographical areas. Credit policy has been implemented for each customer establishing purchase limits. Customers who do not satisfy the credit references set out by the Group, can only carry out transactions with the Group through prepayment.
See note 6 for further details on trade account receivables and the expected credit loss estimate.
The Group does not hold any collateral or other credit enhancements to cover its credit risks associated with its financial assets.
Overview of the Group’s exposure to credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss/gain to the Group. As of December 31, 2025, the Group’s maximum exposure to credit risk without taking into account any collateral held or other credit enhancements, which will cause a financial loss to the Group due to failure to discharge an obligation by the counterparties, arises from the carrying amount of the respective recognized financial assets as stated in the consolidated statement of financial position.
For trade receivables, the Group has applied the simplified approach to measure the loss allowance at lifetime instruments. The Group determines the expected credit losses on these items by using a provision matrix, estimated based on historical credit loss experience based on the past due status of the debtors, determined by the last 3 years plus the current period adjusted as appropriate to reflect current conditions and estimates of future economic conditions. Accordingly, the credit risk profile of these assets is presented based on their past due status in terms of the provision matrix. The note 6, includes further details on the loss allowance for these assets.
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The ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for management of the Group’s short, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities, and reserve borrowing facilities, by continuously monitoring the forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. Details of additional undrawn facilities that the Group has at its disposal to further reduce liquidity risk are set out below.
The financing agreements with suppliers that are mentioned in notes 2.v and 14, are made to seek efficiency in the payment to suppliers, and the Company has concentrated Ps. 756,623 Ps. 848,192 and Ps. 957,576, for the years 2025, 2024 and 2023, respectively, of accounts payable to suppliers of the Group with 5 local banks (Banamex, BBVA, HSBC, Santander y Sabadell) rather than with a diverse group of suppliers, allowing for better payment planning. The Management has assessed that the Company does not rely on extended payment terms and suppliers generally have not become accustomed to or do not rely on advance payment under the financing agreement. If the financial institutions were to withdraw the agreement, such withdrawal would not affect the Company’s ability to settle liabilities when due.
The Group manages its liquidity risk by maintaining adequate reserves of cash and bank credit lines available and consistently monitoring its projected and actual cash flows. The maturity analysis of lease liabilities is presented in note 13 and long-term debt maturities effectives in 2025, 2024 and 2023 are presented in note 15.
The Group has access to financing facilities as described below. The Group expects to meet its other obligations from operating cash flows and proceeds of maturing financial assets.
Capital management
The Group manages its capital to ensure it will be able to continue as a going concern, while it maximizes returns for its shareholders through the optimization of its capital structure. The Group’s management reviews the capital structure when presenting its financial projections to the Board of Directors and stockholders as part of the annual business plan. When performing its review, the Board of Directors considers the cost of equity and its associated risks.
The capital structure of the Group consists of net debt (debt and borrowings disclosed in note 15 after deducting cash and bank balances) and stockholders’ equity of the Group.
Stockholders’ equity as of December 31, 2025, 2024 and 2023 by number of shares, is as follows:
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Capital movements for the years 2025, 2024 and 2023:
The capital stock is represented by fully subscribed and paid common shares with no par value. The fixed minimum capital, without withdrawal rights, is Ps. 50 and is represented by 10,000 shares. The variable capital stock is unlimited.
As of December 31, 2025, 2024, and 2023 the Group had 72,626 treasury shares, on which no dividends are paid.
Dividends
On March 7, 2025, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 250,000, which were paid on March 25, 2025. Part of this amount (Ps. 131,295) was paid to Campalier based on its shareholding. The dividend per share was Ps. 6.7.
On April 30, 2025, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 200,000, which were paid on May 22, 2025. Part of this amount (Ps. 105,035) was paid to Campalier based on its shareholding. The dividend per share was Ps. 5.4.
On July 31, 2025, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 200,000, which were paid on August 28, 2025. Part of this amount (Ps. 105,035) was paid to Campalier based on its shareholding. The dividend per share was Ps. 5.4.
On October 21, 2025, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 200,000, which were paid on November 20, 2025. Part of this amount (Ps. 105,035) was paid to Campalier based on its shareholding. The dividend per share was Ps. 5.4.
On March 6, 2024, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 250,000, which were paid in cash on March 14, 2024. Part of this amount (Ps. 131,295) was paid to Campalier based on its shareholding. The dividend per share was Ps. 6.70.
On May 13, 2024, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 250,000, which were paid in cash on May 23, 2024. Part of this amount (Ps. 131,295) was paid to Campalier based on its shareholding. The dividend per share was Ps. 6.70.
On July 19, 2024, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 250,000, which were paid in cash on August 9, 2024. Part of this amount (Ps. 131,295) was paid to Campalier based on its shareholding. The dividend per share was Ps. 6.70.
On October 28, 2024, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 250,000, which were paid in cash on November 15, 2024. Part of this amount (Ps. 131,295) was paid to Campalier based on its shareholding. The dividend per share was Ps. 6.70.
On March 8, 2023, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 100,000, which were paid in cash on March 21, 2023. Part of this amount (Ps. 52,518) was paid to Campalier based on its shareholding. The dividend per share was Ps. 2.67.
On May 15, 2023, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 150,000, which were paid in cash on May 26, 2023. Part of this amount (Ps. 78,777) was paid to Campalier based on its shareholding. The dividend per share was Ps. 4.02.
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On August 9, 2023, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 200,000, which were paid in cash on August 24, 2023. Part of this amount (Ps. 105,036) was paid to Campalier based on its shareholding. The dividend per share was Ps. 5.36.
On November 9, 2023, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 200,000, which were paid in cash on November 24, 2023. Part of this amount (Ps. 105,036) was paid to Campalier based on its shareholding. The dividend per share was Ps. 5.36.
Legal reserve
Retained earnings include the statutory legal reserve. The Mexican General Corporate Law requires that at least 5% of net income of the year be transferred to the legal reserve until the reserve equals 20% of common stock at par value (historical pesos). The legal reserve may be capitalized but may not be distributed unless the Group is dissolved. The legal reserve must be replenished if it is reduced for any reason.
At the Ordinary General Shareholders’ Meeting held on 30 April 2025, it was approved to transfer from the Company’s net profit the amount of Ps.35,586 to be applied to the accumulated legal reserve. As of 31 December 2025, the Company’s legal reserve amounts to Ps. 46,265, and for 2024 and 2023 it was Ps. 10,679.
The IFRS requires that the calculation of basic and diluted earnings per share (“EPS”) for all years presented be adjusted retrospectively when the number of ordinary shares or potential ordinary shares outstanding increases as a result of a capitalization, bond issue, or share split, or decreases as a result of a reverse share split, EPS calculations for the reporting period and the comparative period should be based on the new number of shares.
As of December 31, 2025, 2024 and 2023, Betterware had 37,316,546 outstanding shares.
The following table shows the income and share data used in the calculation of basic and diluted earnings per share for the periods of 2025, 2024 and 2023:
As of December 31, 2025 and 2024, the Company had no potentially dilutive instruments.
As of December 31, 2025, the Group does not have any payable with related parties. As of December 31, 2024, and 2023, the balances receivable amounted to Ps. 250 and Ps. 104 respectively, and the balance payable as of December 31, 2024, amounted to Ps. 1,237 and closed 2023 with no payable balance.
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Remuneration of key management personnel –
Key management personnel compensation comprised short-term employee benefits of Ps. 59,125, Ps. 67,297, and Ps. 62,574, for the years 2025, 2024 and 2023, respectively. At the end of each period, there are no outstanding balances.
Revenue –
Revenue recognized in the 2025, 2024 and 2023 was generated mainly in Mexico and the United States.
The Group’s revenue by product category is shown below:
As of December 31, 2025, 2024 and 2023, the Group did not identify significant costs to obtain/fulfill a contract that are required to be capitalized as an asset. Consequently, the Group did not perform any analysis in order to identify possible impairment losses. See note 6 about the expected credit loss model applicable to all financial assets measured at amortized cost.
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Operating expenses –
Operating expenses by nature, for the years of 2025, 2024 and 2023 are as follows:
The information by operating segments is presented consistently with the information included in the internal reports provided to the highest authority in making operating decisions (Chief Operating Decision Maker or “CODM”).
The Board of Directors evaluates the Group’s financial performance the situation of the Group and makes strategic decisions. It has been identified as the highest authority in operating decision-making, and it is integrated by seven independent members, two members and the Executive Board Chairman.
As discussed in note 1, the Group has identified the reportable business segments as follows:
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EBITDA is reconciled to income before income taxes as follows:
The segment information of the Group is detailed in the following table:
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The Group considers that there are no concentration risks given the nature of the business and the sale of its products through a significant number of distributors, leaders and consultants.
The percentage of consolidated non-current assets by geographic area at the end of 2025, 2024 and 2023, are shown below:
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The Group is a subject to various legal actions in the normal course of its business. The Group is not involved in or threatened by proceedings for which the Group believes it is not adequately insured or indemnified or which, if determined adversely, would have a material adverse effect on its consolidated financial position, results of operations and cash flows.
In addition, taxes payable could arise in transactions with related parties if the tax authority, during a review, believes that prices and amounts used by the Group are not similar to those used with or between independent parties in comparable transactions.
In accordance with the current tax legislation, the authorities have the power to review up to five fiscal years prior to the last income tax return filed.
On August 12, 2014, the International Inspection Administration “4” (“AFI”, for its acronym in Spanish), under the Central Administration of International Control, in relation to the General Administration of Large Taxpayers of the Tax Administration Service (“SAT” for its acronym in Spanish), requested information regarding the Group’s 2010 income tax filing, which was provided at that time. On February 20, 2017, the final agreement was signed with the Taxpayer Advocacy Office (“PRODECON”, for its acronym in Spanish) regarding the SAT’s review. On March 2, 2017, the SAT notified the Group about certain issues on which an agreement was not reached. As a result, the Group filed a lawsuit for annulment before the SAT’s resolution. On January 31, 2023, the Group discontinued the lawsuit for annulment and ratified it on February 8, 2023. The tax credit was finally paid on April 26, 2023, in the amount of Ps. 9,026 (historical) plus updates and surcharges.
In the preparation of the consolidated financial statements, the Group has evaluated the events and transactions for their recognition or disclosure subsequent to December 31, 2025, and at the date of issuance of the consolidated financial statements, and has not identified subsequent adjustable significant events.
On January 19, 2026, BeFra entered into a definitive agreement to acquire Tupperware’s operations in Mexico and Brazil, as well as to obtain a perpetual, exclusive, royalty-free license to the Tupperware brand in Latin America. The agreed consideration amounted to US$250 million, consisting of US$215 million in cash and US$35 million in BeFra shares, on a debt-free and excess cash basis. At the date of these financiers, the acquisition is in the process of authorization by the National Antitrust Commission (La Comisión Nacional Antimonopolio) in Mexico (“CNA”).
On February 20, 2026, the General Shareholders’ Meeting approved a payment of dividends from retained earnings in the amount of Ps. 200,000, which were paid in cash on March 24, 2026. Part of this amount (Ps. 105,036) was paid to Campalier based on its shareholding. The dividend per share was Ps. 5.36.
On March 17, 2026, the Ordinary General Shareholders’ Meeting approved the capital increase of US$35 million equivalent to Ps. 619 million pesos agreed under the share purchase and sale agreement “SPA” with Tupperware Services México, S. de R.L. de C.V., In addition, the cancellation of the 72,626 treasury shares held as of December 31, 2025 was approved and on the other hand, 2,241,133 new shares issuance was approved and will be kept in the Company’s treasury until they are subscribed on the closing date of the transaction and delivered on said date in compliance with the payment obligation assumed by the Company in the SPA. If the Tupperware purchase transaction is not completed, the capital increase and the issuance of new treasury shares will be automatically canceled without the need for corporate resolution.
On April 7, 2026, the Company entered into a syndicated simple credit agreement for Ps. 3,805.5 million pesos with BBVA Mexico, HSBC Mexico, Banco del Bajío, and Banco Ve por Más, in which Jafra Cosmetics, S.A. de C.V., Distribuidora Comercial Jafra, S.A. de C.V., and Jafra Cosmetics International, S.A. de C.V. act as joint and several obligors. The financing was arranged to fund the acquisition agreed upon on January 19, 2026; it matures on April 7, 2031; provides for a 24-month grace period for principal repayment; accrues interest at a variable rate based on the TIIE plus the applicable margin; and establishes certain financial obligations.
The Group’s consolidated financial statements were authorized and proposed for issuance to the Board of Directors on April 30, 2026, by Andrés Campos, Chief Executive Officer, and Raúl del Villar, Corporate Finance Director of Betterware de México, S.A.P.I de C.V.
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