Consorcio ARA, S. A. B. de C. V.

4Q25 total revenue was MXN 2.33 billion, up 30.5% YoY; housing revenue was MXN 2.23 billion, up 31.4%; operating income was MXN 220 million, up 23.1%; EBITDA was MXN 307.2 million, up 25.8%; and net income was MXN 354.9 million, up 93.3% due largely to a deferred tax credit. 4Q25 operating margin was 9.5% and EBITDA margin 13.2%, both down 50 bps YoY, while net margin was 15.2%, up 490 bps. For full-year 2025, total revenue was MXN 8.25 billion, up 16%; housing revenue was MXN 7.86 billion, up 15.4%; operating income was MXN 796.0 million, up 7.2%; EBITDA was MXN 1.16 billion, up 11%; and net income was MXN 906.2 million, up 31.9%. Full-year operating margin was 11.6% and EBITDA margin 14.0%, both lower YoY, while net margin was 11.0%. Cash and cash equivalents ended 2025 at MXN 2.10 billion, accounts receivable were MXN 709.7 million, and cost-bearing debt was MXN 2.66 billion, with net debt-to-EBITDA at 0.48x and debt-to-EBITDA at 2.3x. Management said it expects 2026 revenue growth to be similar to 2025 and aims to maintain its year-end leverage metrics; it also noted refinancing the MXN 1.2 billion ARA 23X note due November 25, 2026, and the board proposed a MXN 300 million dividend.

Management’s core message was that ARA is scaling revenue while keeping the balance sheet disciplined. The team said the strategy is to grow revenues, monetize inventories, and reduce the working-capital cycle, while managing debt prudently and sustainably. In Q&A, management also said it expects another reduction in the working-capital cycle this year and wants to keep leverage metrics near 2025 levels.

The CFO highlighted a year of stronger cash generation and healthier working capital, including a 113-day reduction in the working-capital cycle and MXN 400.9 million of free cash flow to the firm in 2025, or MXN 98.2 million after interest payment. Cash and cash equivalents were MXN 2.10 billion at year-end, debt was basically stable at MXN 2.66 billion, and leverage remained moderate at 2.3x debt-to-EBITDA and 0.48x net debt-to-EBITDA. He also noted the planned refinancing of the MXN 1.2 billion ARA 23X note and said the board proposed a MXN 300 million dividend, equal to 22.1% of 2025 net income.

Analysts focused on the drivers of higher volumes in middle-income and residential homes, the increase in SG&A, accounts payable days, and the company’s long-term strategy. Management said mix changes and new projects drove volume gains, and acknowledged some discounting in certain projects, though it said cost increases were largely passed through to prices. On SG&A, management said it does not expect a dramatic change ahead and believes revenue growth can outpace overhead growth; on payables, it said the longer payment days are sustainable thanks to a broader factoring program and that its target is 90 days.