Mexican brewer and soft drinks group Femsa has reported a 22% drop in net income for the full-year, as currency charges and commodity costs offset rising sales revenues across its business.

Femsa said today (26 February) that net income for the 12 months of 2008 fell to MXN9.3bn (US$625m), down from MXN11.9bn in 2007. Fourth quarter earnings plummeted by 76%, to MXN868m.

The group blamed the fall on devaluation of the Mexican peso against the US$,  greater exposure to rising commodity prices and also write-down charges associated with restructuring the Coca-Cola Femsa business.

Femsa group sales revenue for the year increased by 14% to MXN168bn, with a stronger 15.4% rise in the fourth quarter. Operating income rose by 15% to MXN6.7bn for the year.

Chairman and CEO José Antonio Fernández said: "As we enter another tough year, the business environment continues to soften. Our products are defensive in nature and we expect the impact of the downturn to be relatively moderate, but clearly we are not immune and our consumers are going through difficult times."

He added that the group "are taking broad measures to rationalise costs, expenses and investments at every level of the organization, so that we are in a good position to weather the storm and come out in even better shape than we are today".

Femsa's beer unit, Femsa Cerveza, saw sales revenue rise by 7% for the year, despite fourth quarter volume declines of 3.5% and 0.7% in Brazil and Mexico respectively.

Fourth quarter export volumes increased by 12%, thanks to Dos Equis and Tecate brands in the US, as well as Sol in other key markets. The rise was slower than a 19% rise in the same period of 2007, however.

Sales revenue at Coca-Cola Femsa rose by nearly 20% to around MXN83bn during 2008, with a faster 24% increase in the fourth quarter. Volumes rose by nearly 6% to more than 2.2bn unit cases for the year, boosted by the Remil franchise in Brazil.