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Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2017

Summary of Financial Assets and Liabilities Measured at Fair Value

fair value based on expected cash flows discounted to net present value. The following table summarizes the Company’s financial assets and liabilities measured at fair value, as of December 31, 2017 and 2016:

		December 31, 2017								December 31, 2016
		Level 1				Level 2				Level 1				Level 2
Derivative financial instrument (current asset)			22				211				374				1,543
Derivative financial instrument (non-current asset)			—				10,137				—				14,729
Derivative financial instrument (current liability)			26				3,921				—				264
Derivative financial instrument (non-current liability)			—				1,769				—				6,403

Fair Value of Company's Publicly Traded Debt

The fair value of the Company’s publicly traded debt is based on quoted market prices as of December 31, 2017 and 2016, which is considered to be level 1 in the fair value hierarchy.

		2017				2016
Carrying value		Ps.	131,348			Ps.	139,248
Fair value			136,147				140,284

Disclosure of Outstanding Interest Rate Swap Agreements

At December 31, 2017, the Company has the following outstanding interest rate swap agreements:

Maturity Date		Notional Amount				Fair Value Liability December 31, 2017				Fair Value Asset December 31, 2017
2019			4,089				(35	)			—
2020			3,669				(17	)			—
2021			3,709				(103	)			—
2022			875				(34	)			—
2023			13,328				(77	)			984

At December 31, 2016, the Company has the following outstanding interest rate swap agreements:

Maturity Date		Notional Amount				Fair Value Liability December 31, 2016				Fair Value Asset December 31, 2016
2017		Ps.	1,250			Ps.	—			Ps.	10
2019			77				(4	)			—
2021			727				(87	)			—
2022			929				(35	)			—
2023			13,261				(73	)			1,028

Disclosure of Outstanding Forward Agreements to Purchase Foreign Currency

At December 31, 2017, the Company had the following outstanding forward agreements to purchase foreign currency:

Maturity Date

Notional Amount

Fair Value Liability December 31, 2017

Fair Value Asset December 31, 2017

2018

Ps.

7,739

Ps.

(20)

Ps.

172

At December 31, 2016, the Company had the following outstanding forward agreements to purchase foreign currency:

Maturity Date

Notional Amount

Fair Value Liability December 31, 2016

Fair Value Asset December 31, 2016

2017

Ps.

8,265

Ps.

(247)

Ps.

364

At December 31, 2017, the Company paid a net premium of Ps. 7 millions for the following outstanding collar options to purchase foreign currency:

Maturity Date

Notional Amount

Fair Value Liability December 31, 2017

Fair Value Asset December 31, 2017

2018

Ps.

266

Ps.

(5)

Ps.

17

Disclosure of Outstanding Cross Currency Swap Agreements

At December 31, 2017, the Company had the following outstanding cross currency swap agreements:

Maturity Date		Notional     Amount				Fair Value Liability 2017				Fair Value Asset December 31, 2017
2018			24,760				(3,878	)			—
2019			6,263				(205	)			—
2020			18,428				(927	)			567
2021			4,853				(12	)			24
2023			14,446				—				8,336
2026			888				(192	)			—
2027			6,907				—				51

At December 31, 2016, the Company had the following outstanding cross currency swap agreements:

Maturity Date		Notional Amount				Fair Value Liability 2016				Fair Value Asset December 31, 2016
2017		Ps.	2,707			Ps.	(10)			Ps.	1,165
2018			39,262				(4,837	)			3,688
2019			7,022				(265	)			—
2020			19,474				(842	)			798
2021			5,076				(128	)			28
2023			12,670				—				9,057
2026			925				(131	)			—
2027			5,476				—				125

Disclosure of Fair Value of Commodity Price Contracts

At December 31, 2017, Coca-Cola FEMSA had the following sugar price contracts:

Maturity Date		Notional Amount				Fair Value Asset December 31, 2017
2018		Ps.	992			Ps.	(7	)
2019			150				3

At December 31, 2016, Coca-Cola FEMSA had the following sugar price contracts:

Maturity Date		Notional Amount				Fair Value Asset December 31, 2016
2017		Ps.	572			Ps.	370

At December 31, 2016, Coca-Cola FEMSA had the following aluminum price contracts:

Maturity Date		Notional Amount				Fair Value Liability December 31, 2016
2017		Ps.	74			Ps.	5

Disclosure of Net Effects of Expired Contracts Met Hedging Criteria

Net effects of expired contracts that met hedging criteria

Type of Derivatives		Impact in Consolidated Income Statement		2017				2016				2015
Cross currency swap (1)		Interest expense			2,102				—				2,595
Cross currency swap (1)		Foreign exchange			—				—				(10,911	)
Forward agreements to purchase foreign currency		Foreign exchange			1(40	)			160				(180	)
Commodity price contracts		Cost of goods sold			(6	)			(241	)			619
Options to purchase foreign currency		Cost of goods sold			—				—				(21	)
Forward agreements to purchase foreign currency		Cost of goods sold			689				(45	)			(523	)

(1) This amount corresponds to the settlement of cross currency swaps portfolio in Brazil presented as part of the other financial activities.

Disclosure of Net Effect of Changes in Fair Value of Derivative Financial Instruments Did Not Meet Hedging Criteria for Accounting Purposes

Net effect of changes in fair value of derivative financial instruments that did not meet the hedging criteria for accounting purposes

Type of Derivatives		Impact in Consolidated Income Statement		2017				2016				2015
Interest rate swaps		Market value		Ps.	—			Ps.	—			Ps.	—
Cross currency swaps		gain (loss) on			—				—				(20	)
Others		financial instruments			—				—				56

20.10 Net effect of expired contracts that did not meet the hedging criteria for accounting purposes

Type of Derivatives		Impact in Consolidated Income Statement		2017				2016				2015
Cross-currency swaps		Market value gain on financial instruments		Ps.	(438	)		Ps.	—			Ps.	204

Summary of Sensitivity Analysis of Interest Rate Risks Management

The following disclosures provide a sensitivity analysis of the interest rate risks management considered to be reasonably possible at the end of the reporting period, which the Company is exposed to as it relates to its fixed and floating rate borrowings, which it considers in its existing hedging strategy:

Interest Rate Swap (1)		Change in Bps.				Effect on Equity
2017
FEMSA(2)			(100 Bps.	)			Ps. (452	)
Coca-Cola FEMSA			(100 Bps.	)			(234	)
2016
FEMSA(2)			(100 Bps.	)			Ps. (550	)
2015
FEMSA(2)			(100 Bps.	)			Ps. (542	)

(1) The sensitivity analysis effects include all subsidiaries of the Company.

(2) Does not include Coca-Cola FEMSA.

Interest Effect of Unhedged Portion Bank Loans		2017				2016				2015
Change in interest rate		+100 Bps.				+100 Bps.				+100 Bps.
Effect on profit loss		Ps.	(251	)		Ps.	(354	)		Ps.	(192	)

Summary of Maturity Analysis for Non-derivative and Derivative Financial Liabilities

The amounts disclosed are undiscounted net cash outflows for the respective upcoming fiscal years, based on the earliest date on which the Company could be required to pay. Cash outflows for financial liabilities (including interest) without fixed amount or timing are based on economic conditions (like interest rates and foreign exchange rates) existing at December 31, 2017.

		2018				2019				2020				2021				2022				2023 and thereafter
Non-derivative financial liabilities:
Notes and bonds		Ps.	9,961			Ps.	7,828			Ps.	10,939			Ps.	3,574			Ps.	2,532			Ps.	97,602
Loans from banks			4,915				1,239				1,480				4,917				766				414
Obligations under finance leases			49				39				33				16				—				—
Derivative financial liabilities			(3,452	)			26				654				190				236				(4,831	)

Market risk [member]

Disclosure of Sensitivity Analysis of Market Risks Management

The following disclosures provide a sensitivity analysis of the market risks management considered to be reasonably possible at the end of the reporting period based on a stress test of the exchange rates according to an annualized volatility estimated with historic prices obtained for the underlying asset over a period of time, in the cases of derivative financial instruments related to foreign currency risk, which the Company is exposed to as it relates to in its existing hedging strategy:

Foreign Currency Risk		Change in Exchange Rate				Effect on Equity
2017
FEMSA (1)			+13% MXN/EUR			Ps.	(141	)
			+8% CLP/USD				2
			-13% MXN/EUR				141
			-8% CLP/USD				(2	)
Coca-Cola FEMSA			+12% MXN/USD				626
			+9% COP/USD				73
			+14% BRL/USD				234
			+10% ARS/USD				29
			-12% MXN/USD				(625	)
			-9% COP/USD				(73	)
			-14% BRL/USD				(234	)
			-10% ARS/USD				(29	)
2016
FEMSA (1)			-17% MXN/EUR			Ps.	293
			+17% MXN/EUR				(293	)
			+11% CLP/USD				12
			-11% CLP/USD				(12	)
Coca-Cola FEMSA			-18% BRL/USD				(203	)
			+18% BRL/USD				203
			-17% MXN/USD				(916	)
			+17% MXN/USD				916
			-18% COP/USD				(255	)
			+18% COP/USD				255
2015
FEMSA (1)			-14% MXN/EUR				319
			+14% MXN/EUR			Ps.	(319)
			+10% CLP/USD				9
			-10% CLP/USD				(9	)
			-11% MXN/USD				197
Coca-Cola FEMSA			+11% MXN/USD				(197	)
			+21% BRL/USD				(387	)
			+17% COP/USD				(113	)
			-36% ARS/USD				231
			+36% ARS/USD				(231	)
			-21% BRL/USD				387
			-17% COP/USD				113
			+17% COP/USD				(113	)

(1) Does not include Coca-Cola FEMSA.

Cross Currency Swaps (1) (2)		Change in Exchange Rate				Effect on Equity				Effect on Profit or Loss
2017
FEMSA (3)			+8% CLP/USD				—				373
			-8% CLP/USD				—				(373	)
			+12% MXN/USD				—				3,651
			-12% MXN/USD			Ps.	—			Ps.	(3,651)
			+9% COP/USD				—				304
			-9% COP/USD				—				(304	)
			+14% MXN/BRL				—				23
			-14% MXN/BRL				—				(23	)
Coca-Cola FEMSA			+12% MXN/USD				3,540				—
			+14% BRL/USD				7,483				—
			-12% MXN/USD				(3,540	)			—
			-14% BRL/USD				(7,483	)			—
2016
			-11% CLP/USD				—				(549	)
			+11% CLP/USD				—				549
			-17% MXN/USD				—				(3,836	)
FEMSA (3)			+17% MXN/USD			Ps.	—			Ps.	3,836
			-18% COP/USD				—				(448	)
			+18% COP/USD				—				448
Coca-Cola FEMSA			+17% MXN/USD				3,687				1,790
			+18% BRL/USD				9,559				—
			-17% MXN/USD				(3,687	)			(1,790	)
			-18% BRL/USD				(9,559	)			—
2015
FEMSA (3)			-11% MXN/USD			Ps.	—			Ps.	(2,043	)
			+11% MXN/USD				—				2,043
Coca-Cola FEMSA			-11% MXN/USD				—				(938	)
			+11% MXN/USD				—				938
			-21% BRL/USD				(4,517	)			(1,086	)
			+21% BRL/USD				4,517				1,086

(1) The sensitivity analysis effects include all subsidiaries of the Company.

(2) Includes the sensitivity analysis effects of all derivative financial instruments related to foreign exchange risk.

(3) Does not include Coca-Cola FEMSA.

Net Cash in Foreign Currency (1)		Change in Exchange Rate				Effect on Profit or Loss
2017
FEMSA (2)			+13% EUR/ +12% USD			Ps.	8,077
			-13% EUR/ -12% USD				(8,077	)
Coca-Cola FEMSA			+12% USD				(553	)
			-12% USD				553
2016
FEMSA (2)			+17% EUR/ +17% USD			Ps.	3,176
			-17% EUR/ -17% USD				(3,176	)
Coca-Cola FEMSA			+17% USD				(105	)
			-17% USD				105
2015
FEMSA (2)			+14% EUR/ +11%USD			Ps.	504
			-14% EUR/ -11%USD				(504	)
Coca-Cola FEMSA			+11%USD				(1,112	)
			-11%USD				1,112

(1) The sensitivity analysis effects include all subsidiaries of the Company.

(2) Does not include Coca-Cola FEMSA.

Commodity Price Contracts (1)		Change in U.S.$ Rate				Effect on Equity
2017
Coca-Cola FEMSA			Sugar - 30%			Ps.	(32	)
2016
Coca-Cola FEMSA			Sugar - 33%			Ps.	(310	)
			Aluminum - 16%				(13	)
2015
Coca-Cola FEMSA			Sugar - 31%			Ps.	(406	)
			Aluminum - 18%				(58	)

(1) Effects on commodity price contracts are only in Coca-Cola FEMSA.

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