# EDGAR Filing Document

**Accession Number:** 0001508478
**File Stem:** 0001508478-25-000005
**Filing Date:** 2025-8
**Character Count:** 83291
**Document Hash:** de8e5ca0439a0edb25f14e5097af9dea
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001508478-25-000005.hdr.sgml**: 20250813

**ACCESSION NUMBER**: 0001508478-25-000005

**CONFORMED SUBMISSION TYPE**: 6-K

**PUBLIC DOCUMENT COUNT**: 1

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250813

**DATE AS OF CHANGE**: 20250813

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Arcos Dorados Holdings Inc.
- **CENTRAL INDEX KEY:** 0001508478
- **STANDARD INDUSTRIAL CLASSIFICATION:** RETAIL-EATING PLACES [5812]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 000000000
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 6-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-35129
- **FILM NUMBER:** 251208984

**BUSINESS ADDRESS:**
- **STREET 1:** RIO NEGRO 1338, FIRST FLOOR
- **CITY:** MONTEVIDEO
- **STATE:** X3
- **ZIP:** 11300
- **BUSINESS PHONE:** 598 2626-3000

**MAIL ADDRESS:**
- **STREET 1:** RIO NEGRO 1338, FIRST FLOOR
- **CITY:** MONTEVIDEO
- **STATE:** X3
- **ZIP:** 11300

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 6-K**

**REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR**

**15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934**

For the month of August, 2025

**Commission File Number: 001-35129**

**Arcos Dorados Holdings Inc.**

**(Exact name of registrant as specified in its charter)**

**Río Negro 1338, First Floor**

**Montevideo, Uruguay, 11100**

**(Address of principal executive office)**

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F <u>X</u> Form 40-F 

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**ARCOS DORADOS HOLDINGS INC.**

**TABLE OF CONTENTS**

**ITEM**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Arcos Dorados Holdings Inc. Unaudited Condensed Consolidated Financial Statements as of June 30, 2025 and December 31, 2024 and for the six-month period ended June 30, 2025 and 2024 (Unaudited).

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**SIGNATURE**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
| **Arcos Dorados Holdings Inc.** | **Arcos Dorados Holdings Inc.** |
| By: | /s/ Juan David Bastidas |
|  | Name: Juan David Bastidas |
|  | Title: Chief Legal Counsel |

---

Date: August 13, 2025

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**Arcos Dorados Holdings Inc.**

**Condensed Consolidated Financial Statements**

As of June 30, 2025 and December 31, 2024 and for the six-month period ended June 30, 2025 and 2024 (Unaudited).

------

**Arcos Dorados Holdings Inc.**

**Consolidated Statements of Income** 

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| REVENUES |  |  |
| Sales by Company-operated restaurants | $2118644 | $2092131 |
| Revenues from franchised restaurants | 100244 | 100126 |
| **Total revenues** | **2218888** | **2192257** |
| OPERATING COSTS AND EXPENSES |  |  |
| Company-operated restaurant expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Food and paper | (763176) | (733913) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payroll and employee benefits | (404210) | (395498) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Occupancy and other operating expenses | (627811) | (614611) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Royalty fees | (129866) | (131364) |
| Franchised restaurants – occupancy expenses | (42072) | (42275) |
| General and administrative expenses | (150855) | (141612) |
| Other operating income, net | 6709 | 8786 |
| **Total operating costs and expenses** | **(2111281)** | **(2050487)** |
| **Operating income** | **107607** | **141770** |
| Net interest expense and other financing results | (35075) | (30579) |
| Gain from derivative instruments | 1454 | 1249 |
| Foreign currency exchange results | (5627) | (19115) |
| Other non-operating expenses, net  | (603) | (652) |
| **Income before income taxes** | **67756** | **92673** |
| Income tax expense, net | (30991) | (37106) |
| **Net income** | **36765** | **55567** |
| Less: Net income attributable to non-controlling interests | (248) | (426) |
| **Net income attributable to Arcos Dorados Holdings Inc.** | $**36517** | $**55141** |
| **Earnings per share information:** |  |  |
| Basic and Diluted net income attributable to Arcos Dorados Holdings Inc. per common share | $0.17 | $0.26 |

---

See Notes to the Condensed Consolidated Financial Statements.

------

**Arcos Dorados Holdings Inc.**

**Consolidated Statements of Comprehensive Income** 

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| **Net income** | $**36765** | $**55567** |
| **<u>Other comprehensive income (loss), net of tax</u>:** |  |  |
| Foreign currency translation | 87806 | (55105) |
| Cash flow hedges: |  |  |
| &nbsp;&nbsp;Net (loss) gain recognized in accumulated other comprehensive loss | (22767) | 15639 |
| &nbsp;&nbsp;&nbsp;&nbsp;Reclassification of net loss (gain) to consolidated statement of income | 21684 | (12181) |
| &nbsp;&nbsp;&nbsp;Cash flow hedges (net of deferred income taxes of $(1479) and $342) | (1083) | 3458 |
| Securities available for sale: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Unrealized (loss) gain on available for sale securities | (484) | 637 |
| &nbsp;&nbsp;&nbsp;Reclassification adjustment for loss included in net income |  | 438 |
| &nbsp;&nbsp;&nbsp;Securities available for sale (net of deferred income taxes of $(16) and $(145)) | (484) | 1075 |
| **Total other comprehensive income (loss)** | **86239** | **(50572)** |
| **Comprehensive income** | **123004** | **4995** |
| Less: Comprehensive income attributable to non-controlling interests | (286) | (370) |
| **Comprehensive income attributable to Arcos Dorados Holdings Inc.** | $**122718** | $**4625** |

---

See Notes to the Condensed Consolidated Financial Statements.

------

**Arcos Dorados Holdings Inc.**

**Consolidated Balance Sheet**

As of June 30, 2025 and December 31, 2024

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | |
|:---|:---|:---|
| | **As of**<br>**June 30, 2025**<br>**(Unaudited)** |<br>**As of**<br>**December 31, 2024** |
| **ASSETS** | | |
| **Current assets** | | |
| Cash and cash equivalents | $147052 | $135064 |
| Short-term investments | 86810 | 3529 |
| Accounts and notes receivable, net | 156314 | 119441 |
| Other receivables | 44839 | 42469 |
| Inventories | 56655 | 51650 |
| Prepaid expenses and other current assets | 130509 | 115834 |
| Derivative instruments | 1500 | 416 |
| **Total current assets** | **623679** | **468403** |
| **Non-current assets** |  |  |
| Miscellaneous | 116319 | 93581 |
| Collateral deposits | 2500 | 2500 |
| Property and equipment, net | 1238288 | 1127042 |
| Net intangible assets and goodwill | 144143 | 66644 |
| Deferred income taxes | 111215 | 90287 |
| Derivative instruments | 66462 | 79874 |
| Equity method investments | 15816 | 14346 |
| Lease right of use asset | 1053998 | 949977 |
| **Total non-current assets** | **2748741** | **2424251** |
| **Total assets** | $**3372420** | $**2892654** |
| **LIABILITIES AND EQUITY** |  |  |
| **Current liabilities** |  |  |
| Accounts payable | $313225 | $347895 |
| Royalties payable to McDonald's Corporation | 27208 | 20860 |
| Income taxes payable | 46611 | 39004 |
| Other taxes payable | 85108 | 79462 |
| Accrued payroll and other liabilities | 149555 | 113259 |
| Provision for contingencies | 1306 | 1199 |
| Interest payable | 18328 | 7798 |
| Short-term debt | 27836 | 60251 |
| Current portion of long-term debt | 6051 | 2624 |
| Derivative instruments | 3569 | 1292 |
| Operating lease liabilities | 99784 | 92280 |
| **Total current liabilities** | **778581** | **765924** |
| **Non-current liabilities** |  |  |
| Accrued payroll and other liabilities | 88841 | 20928 |
| Provision for contingencies | 31934 | 29157 |
| Long-term debt, excluding current portion | 944456 | 715974 |
| Derivative instruments | 899 |  |
| Deferred income taxes | 1956 | 2084 |
| Operating lease liabilities | 944111 | 849158 |
| **Total non-current liabilities** | **2012197** | **1617301** |
| **Total liabilities** | **2790778** | **2383225** |
| **Equity** |  |  |
| Class A shares of common stock | 389967 | 389967 |
| Class B shares of common stock | 132915 | 132915 |
| Additional paid-in capital | 8659 | 8659 |
| Retained earnings | 650347 | 664390 |
| Accumulated other comprehensive loss | (582283) | (668484) |
| Common stock in treasury | (19367) | (19367) |
| **Total Arcos Dorados Holdings Inc. shareholders' equity** | **580238** | **508080** |
| Non-controlling interests in subsidiaries | 1404 | 1349 |
| **Total equity** | **581642** | **509429** |
| **Total liabilities and equity** | $**3372420** | $**2892654** |

---

See Notes to the Condensed Consolidated Financial Statements.

------

**Arcos Dorados Holdings Inc.**

**Condensed Consolidated Statements of Cash Flows**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
| **Operating activities** |  |  |
| Net income attributable to Arcos Dorados Holdings Inc. | $36517 | $55141 |
| Adjustments to reconcile net income attributable to Arcos Dorados Holdings Inc. to cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash charges and credits: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 94208 | 88293 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on restaurant transactions | (6845) | (5501) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency exchange results | 10745 | 14499 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain from derivative instruments | (1454) | (1249) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Others, net | (11157) | (15271) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in assets and liabilities | (64308) | (72205) |
| **Net cash provided by operating activities** | **57706** | **63707** |
| **Investing activities** |  |  |
| Property and equipment expenditures | (104153) | (148927) |
| Purchases of restaurant businesses paid at acquisition date | (3475) | (5023) |
| Proceeds from sales of property and equipment, restaurant businesses and related advances | 290 | 4781 |
| Proceeds from short-term investments | 12600 | 45786 |
| Acquisition of short-term investments | (106385) | (30000) |
| Other investing activity | (1127) | (648) |
| **Net cash used in investing activities** | **(202250)** | **(134031)** |
| **Financing activities** |  |  |
| Dividend payments to Arcos Dorados Holdings Inc.'s shareholders | (25280) | (25278) |
| Cash Tender of 2027 Senior Notes | (379265) |  |
| Issuance of 2032 Senior Notes | 597498 |  |
| Short-term borrowings | 11437 | 36613 |
| Payment of short-term debt | (35710) | (25549) |
| Payments for debt issue costs | (6158) |  |
| Other financing activities | (3460) | (3352) |
| **Net cash provided by (used in) financing activities** | **159062** | **(17566)** |
| Effect of exchange rate changes on cash and cash equivalents | (2530) | (4555) |
| **Increase (decrease) in cash and cash equivalents** | **11988** | **(92445)** |
| Cash and cash equivalents at the beginning of the year | 135064 | 196661 |
| **Cash and cash equivalents at the end of the period** | $**147052** | $**104216** |
| **Supplemental cash flow information:** |  |  |
| Cash paid during the period for: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest | $25768 | $26881 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income tax, net of refunds | 50143 | 64745 |
| Non-cash investing and financing activities: |  |  |
| &nbsp;&nbsp;Dividend declared pending of payment | 25280 | 25279 |
| &nbsp;&nbsp;Seller financing pending of payment | 4125 | 1622 |
| &nbsp;&nbsp;&nbsp;&nbsp;Settlement of franchise receivables related to purchases of restaurant businesses |  | 510 |
| &nbsp;&nbsp;Receivable related to sales of restaurant businesses |  | 2448 |

---

See Notes to the Condensed Consolidated Financial Statements*.*

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**Arcos Dorados Holdings Inc.**

**Consolidated Statement of Changes in Equity**

For the six-month period ended June 30, 2025 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | | |
| | **Class A shares of<br>common stock** | **Class A shares of<br>common stock** | **Class B shares of<br>common stock** | **Class B shares of<br>common stock** | **Additional<br>paid-in<br>capital** | **Retained<br>earnings** | **Accumulated<br>other<br>comprehensive<br>loss** | **Common stock in treasury** | **Common stock in treasury** | **Total** | **Non-<br>controlling<br>interests** | **Total** |
| | **Number** | **Amount** | **Number** | **Amount** | **Additional<br>paid-in<br>capital** | **Retained<br>earnings** | **Accumulated<br>other<br>comprehensive<br>loss** | **Number** | **Amount** | **Total** | **Non-<br>controlling<br>interests** | **Total** |
| **Balances at beginning of fiscal year** | **132972119** | $**389967** | **80000000** | $**132915** | $**8659** | $**664390** | $**(668484)** | **(2309062)** | $**(19367)** | $**508080** | $**1349** | $**509429** |
| Net income for the period (Unaudited) |  |  |  |  |  | 36517 |  |  |  | 36517 | 248 | **36765** |
| Other comprehensive income (Unaudited) |  |  |  |  |  |  | 86201 |  |  | 86201 | 38 | **86239** |
| Cash Dividends to Arcos Dorados Holdings Inc.'s shareholders ($0.24 per share) (Unaudited) |  |  |  |  |  | (50560) |  |  |  | (50560) |  | **(50560)** |
| Dividends to non-controlling interests (Unaudited) |  |  |  |  |  |  |  |  |  |  | (231) | **(231)** |
| **Balances at end of period (Unaudited)** | **132972119** | $**389967** | **80000000** | $**132915** | $**8659** | $**650347** | $**(582283)** | **(2309062)** | $**(19367)** | $**580238** | $**1404** | $**581642** |

---

&nbsp;&nbsp;&nbsp;&nbsp;

See Notes to the Condensed Consolidated Financial Statements.

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**Arcos Dorados Holdings Inc.**

**Consolidated Statement of Changes in Equity**

For the six-month period ended June 30, 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | **Arcos Dorados Holdings Inc. Shareholders' Equity** | | |
| | **Class A shares of<br>common stock** | **Class A shares of<br>common stock** | **Class B shares of<br>common stock** | **Class B shares of<br>common stock** | **Additional<br>paid-in<br>capital** | **Retained<br>earnings** | **Accumulated<br>other<br>comprehensive<br>loss** | **Common stock in treasury** | **Common stock in treasury** | **Total** | **Non-<br>controlling<br>interests** | **Total** |
| | **Number** | **Amount** | **Number** | **Amount** | **Additional<br>paid-in<br>capital** | **Retained<br>earnings** | **Accumulated<br>other<br>comprehensive<br>loss** | **Number** | **Amount** | **Total** | **Non-<br>controlling<br>interests** | **Total** |
| **Balances at beginning of fiscal year** | **132964031** | $**389907** | **80000000** | $**132915** | $**8719** | $**566188** | $**(563081)** | **(2309062)** | $**(19367)** | $**515281** | $**1558** | $**516839** |
| Net income for the period (Unaudited) |  |  |  |  |  | 55141 |  |  |  | 55141 | 426 | **55567** |
| Other comprehensive loss (Unaudited) |  |  |  |  |  |  | (50516) |  |  | (50516) | (56) | **(50572)** |
| Cash Dividends to Arcos Dorados Holdings Inc.'s shareholders ($0.24 per share) (Unaudited) |  |  |  |  |  | (50557) |  |  |  | (50557) |  | **(50557)** |
| Issuance of shares in connection with the partial vesting of outstanding restricted share units under the 2011 Equity Incentive Plan (Unaudited) | 8088 | 60 |  |  | (60) |  |  |  |  |  |  |  |
| Dividends to non-controlling interests (Unaudited) |  |  |  |  |  |  |  |  |  |  | (749) | **(749)** |
| **Balances at end of period (Unaudited)** | **132972119** | $**389967** | **80000000** | $**132915** | $**8659** | $**570772** | $**(613597)** | **(2309062)** | $**(19367)** | $**469349** | $**1179** | $**470528** |

---

See Notes to the Condensed Consolidated Financial Statements.

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**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

**1.&nbsp;&nbsp;&nbsp;&nbsp;Organization and nature of business**

Arcos Dorados Holdings Inc. (the "Company") is a company limited by shares incorporated and existing under the laws of the British Virgin Islands. The Company's fiscal year ends on the last day of December. The Company has through its wholly-owned company Arcos Dorados Group B.V., a 100% equity interest in Arcos Dorados B.V. ("ADBV").

On August 3, 2007 the Company, indirectly through its wholly-owned subsidiary ADBV, entered into a Stock Purchase Agreement and Master Franchise Agreements ("MFAs") with McDonald's Corporation pursuant to which the Company completed the acquisition of the McDonald's business in Latin America and the Caribbean ("LatAm business"). Prior to this acquisition, the Company did not carry out operations. The Company's rights to operate and franchise McDonald's-branded restaurants in the Territories, and therefore the ability to conduct the business, derive exclusively from the rights granted by McDonald's Corporation in the MFAs through 2027. The initial term of the MFA for French Guiana, Guadeloupe and Martinique was ten years through August 2, 2017 with an option to extend the agreement for these territories for an additional period of ten years, through August 2, 2027. On July 20, 2016, the Company has exercised its option to extend the MFA for these three territories.

The Company, through ADBV's wholly-owned and majority owned subsidiaries, operates and franchises McDonald's restaurants in the food service industry. The Company has operations in twenty territories as follows: Argentina, Aruba, Brazil, Chile, Colombia, Costa Rica, Curaçao, Ecuador, French Guiana, Guadeloupe, Martinique, Mexico, Panama, Peru, Puerto Rico, Trinidad and Tobago, Uruguay, the U.S. Virgin Islands of St. Croix and St. Thomas (USVI) and Venezuela. All restaurants are operated either by the Company's subsidiaries or by independent entrepreneurs under the terms of sub-franchisee agreements (franchisees).

Effective from January 1, 2025, the Company entered into two new MFAs with McDonald´s Corporation that replaced the prior agreements. The term of the new MFAs is 20 years for all of the Territories other than French Guiana, Guadeloupe and Martinique (which are subject to 10 year terms with an option to extend such terms for an additional term of 10 years).

**2.&nbsp;&nbsp;&nbsp;&nbsp;Basis of presentation and principles of consolidation** 

The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("US GAAP") for interim financial information and include the accounts of the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The Company has elected to report its condensed consolidated financial statements in United States dollars ("$" or "US dollars").

The accompanying condensed consolidated financial statements do not include all the information and footnotes required by generally accepted accounting principles for a complete set of financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted for purposes of this presentation. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated annual financial statements of the Company as of December 31, 2024.

The accompanying condensed consolidated financial statements are unaudited and include, in the opinion of management, all adjustments, consisting only of normal recurring adjustments, which are considered necessary for the fair presentation of the information in the condensed consolidated financial statements.

Operating results for the six-month period ended June 30, 2025 are not necessarily indicative of results that may be expected for any future periods.

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**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

**3.&nbsp;&nbsp;&nbsp;&nbsp;Summary of significant accounting policies** 

The following is a summary of significant accounting policies followed by the Company in the preparation of the condensed consolidated financial statements.

<u>Use of estimates</u>

The preparation of the condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of these condensed financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

<u>Foreign currency matters</u>

The financial statements of the Company's foreign operating subsidiaries are translated in accordance with guidance in ASC 830 Foreign Currency Matters. Except for the Company's Venezuelan and Argentinian operations, the functional currencies of the Company's foreign operating subsidiaries are the local currencies of the countries in which they conduct their operations. Therefore, assets and liabilities are translated into US dollars at the balance sheet date exchange rates, and revenues, expenses and cash flow are translated at average rates prevailing during the periods. Translation adjustments are included in the "Accumulated other comprehensive loss" component of shareholders' equity. The Company includes foreign currency exchange results related to monetary assets and liabilities transactions, including intercompany transactions, denominated in currencies other than its functional currencies in its statements of income.

Since January 1, 2010 and July 1, 2018, Venezuela and Argentina, respectively, were considered to be highly inflationary, and as such, the financial statements of these subsidiaries are remeasured as if its functional currency was the reporting currency of the immediate parent company (US dollars). As a result, remeasurement gains and losses are recognized in earnings rather than in the cumulative translation adjustment, component of "Accumulated other comprehensive loss" within shareholders' equity.

In addition, in these territories, there are foreign currency restrictions. Since 2019, in Argentina several measures have been adopted including, among others: (i) taxes to increase the official exchange rate for certain services and goods, (ii) approvals required from the Central Bank of Argentina to access foreign currency to settle imports of goods or services, principal and interest from financial payables to foreign parties and dividends. Since 2024, deregulations were implemented, such as shortened payment deadlines of imports of goods and services, instruments available for the payment of past-due dividends and free access for future dividends payments, among others. Furthermore, Venezuela has currency restrictions which have been in place for several years under different currency exchange regulations. Although during 2019, the Central Bank of Venezuela loosened those restrictions by permitting financial institution to participate as intermediaries in foreign currency operations, the Company's ability to immediately access cash through repatriations continues to be limited. Additionally, the Venezuelan market is subject to price controls. Its government issued a regulation establishing a maximum profit margin for companies and maximum prices for certain goods and services. However, the Company was able to increase prices during the six-month period ended June 30, 2025.

As of June 30, 2025, Argentina's and Venezuela's net nonmonetary asset positions were $180.7 million and $20.8 million, respectively, mainly fixed assets.

<u>Intangible assets, net</u>

Intangible assets include computer software costs, initial franchise fees, reacquired rights under franchise agreements and letter of credit fees.

The Company follows the provisions of ASC 350-40-30 within ASC 350 Intangibles, Subtopic 40 Internal Use Software which requires the capitalization of costs incurred in connection with developing or obtaining software for internal use. These costs are amortized over a period of three years on a straight line basis.

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**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

The Company is required to pay to McDonald's Corporation an initial franchisee fee upon opening of a new restaurant. The initial franchise fee related to Company-operated restaurants is capitalized as an intangible asset and amortized on a straight-line basis over the term of the franchise. As a consequence of the renewal of the MFAs mentioned in Note 1, as of June 30, 2025, intangible assets included $67,592 related to the initial franchise fee for each franchised restaurant in operation as of January 1, 2025, payable from August, 2027. The related liability is included within Accrued payroll and other liabilities, non-current portion.

A reacquired franchise right is recognized as an intangible asset as part of the business combination in the acquisition of franchised restaurants apart from goodwill with an assigned amortizable life limited to the remaining contractual term (i.e., not including any renewal periods). The value assigned to the reacquired franchise right excludes any amounts recognized as a settlement gain or loss and is limited to the value associated with the remaining contractual term and operating conditions for the acquired restaurants. The reacquired franchise right is measured using a valuation technique that considers restaurant's cash flows after payment of an at-market royalty rate to the Company. The cash flows are projected for the remaining contractual term, regardless of whether market participants would consider potential contractual renewals in determining its fair value.

<u>Accounts payable outsourcing</u>

In the ordinary course of business, the Company looks to obtain extended payment terms during the negotiation process with suppliers, which payment terms can vary from 15 days to up to 180 days after the invoice date. In this context, the Company offers its suppliers access to an accounts payable services arrangement provided by third party financial institutions. Independent from the Company, the financial institutions offer suppliers to voluntarily sell their receivables to them in an arrangement separately negotiated by the supplier and the financial institution. This service also allows the Company's suppliers to view its scheduled payments online, enabling them to better manage their cash flow and reduce payment processing costs. The Company's responsibility is limited to making payment on the original due dates of the invoice negotiated with the supplier, regardless of whether the supplier sells its receivable. The Company is not permitted to remit payment to the financial institution or the supplier on a date later than the original due date of the invoice under any circumstances. The payment terms and purchase price of the original invoice do not change once the supplier elects to participate. Those payment terms vary from 45 days to up to 180 days after the invoice date. The Company has no economic interest in the sale of these receivables and no direct relationship with the financial institutions concerning the sale of receivables. As a result, the Company does not pay any fee to the financial institutions for purchasing the suppliers' receivables and it does not receive any fee, commission, refund or discount from the financial institutions for the accounts payable services arrangement. The Company retains the right to all early pay discounts offered by suppliers if they do not sell their receivables.

As of June 30, 2025 and December 31, 2024, the amounts under the accounts payable services arrangement and included in Accounts Payable in the Balance Sheet were $15,878 and $14,849, respectively.

<u>Recent accounting pronouncements</u>

*Income Taxes*

In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update ASU No. 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures". The pronouncement expands the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. We are currently in the process of determining the impact that ASU 2023-09 will have on the Company's consolidated financial statement disclosures.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

*Income Statement Expenses - Disaggregation*

In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update ASU No. 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses". The pronouncement expands the disclosure requirements for expenses, specifically by providing more detailed information about the types of expenses in commonly presented expense captions. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. We are currently in the process of determining the impact that ASU 2024-03 will have on the Company's consolidated financial statement disclosures.

No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on the Company's consolidated financial statements.

**4.&nbsp;&nbsp;&nbsp;&nbsp;Short-term debt**

Short-term debt consists of the following:

---

| | | |
|:---|:---|:---|
| | **As of**<br>**June 30, 2025**<br>**(Unaudited)** |<br>**As of**<br>**December 31, 2024** |
| Bank overdrafts |  | 686 |
| Short-term bank loans | $27836 | $55065 |
| Revolving Credit Facility |  | 4500 |
| **Total** | $**27836** | $**60251** |

---

<u>Short-term bank loans</u>

As of June 30, 2025, the Company had drawn short term bank loans in Chile, amounting to $27,836. As of December 31, 2024, short-term bank loans were comprised of short-term bank loans in Chile, Uruguay, Puerto Rico and Panama, amounting to $55,065.

The following table presents additional information related to short-term bank debt:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | | | | **Principal as of** | **Principal as of** | |
|<br>**Territories** |<br>**Entity** |<br>**Currency** |<br>**Annual interest rate** | **June 30, 2025 (Unaudited)** | **December 31, 2024** |<br>**Maturity** |
| Panama | Citibank N.A. | USD | SOFR + 2.10% |  | 5000 | February, 2025 |
| Puerto Rico | Citibank N.A. | USD | SOFR + 2.10% |  | 14000 | February, 2025 |
| Chile | Banco de Chile | CLP | 6.84% |  | 8677 | March, 2025 |
| Chile | Banco de Chile | CLP | 6.90% | 9266 |  | July, 2025 |
| Chile | Banco Itaú Chile | CLP | 7.53% |  | 17388 | June, 2025 |
| Chile | Banco Itaú Chile | CLP | 6.66% | 18570 |  | July, 2025 |
| Uruguay | Banco Itaú Uruguay S.A. | USD | 5.74% |  | 8000 | May, 2025 |
| Uruguay | Banco Bilbao Vizcaya Argentaria Uruguay S.A. | USD | 5.55% |  | 2000 | May, 2025 |
| **Total** |  |  |  | $**27836** | $**55065** |  |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

During July 2025, the Company paid the outstanding amount of the short-term bank loan with Banco de Chile and $8.9 million of its loan with Banco Itau Chile. Additionally, the Company renewed $9.7 million of its loan with Banco Itau Chile at an interest rate of 5.65%, now maturing in January, 2027.

<u>Revolving credit facilities</u>

As of June 30, 2025, the Company maintained the followings revolving credit facilities:

---

| | | | |
|:---|:---|:---|:---|
| **Bank** | **Maturity** | **Interest rate** | **Amount** |
| Itau Unibanco S.A. (i) | $April 14, 2026 | TERM SOFR + range between 2.80% to 4.90% | 25000 |
| J.P. Morgan | $February 17, 2026 | SOFR + 3.10% | 25000 |
| Banco Santander (Brasil) S.A. (ii) | $October 31, 2026 | TERM SOFR + range between 3.20% to 3.60% | 25000 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Maintained by its wholly-owned subsidiary ADBV.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Maintained by both, the Company and its wholly-owned subsidiary ADBV.

In addition, for the J.P. Morgan and Banco Santander agreements, the Company is required to comply, as of the last day of each quarter during the agreement, with a consolidated net indebtedness to EBITDA ratio. As of June 30, 2025, these ratio were as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Bank** | **Ratio** | **Required Maximum Ratio** | **June 30, 2025 (Unaudited)** |
| J.P. Morgan | Net Indebtedness to EBITDA | 3.00 | 1.44 |
| Banco Santander (Brasil) S.A. | Net Indebtedness to EBITDA | 3.00 | 1.44 |
| Banco Santander (Brasil) S.A. | Net Indebtedness to EBITDA (i) | 3.00 | 0.35 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Ratio maintained by its wholly-owned subsidiary ADBV.

As of June 30, 2025 the Company and ADBV were in compliance with all the ratios.

These revolving credit facilities permit the Company to borrow money from time to time to cover its working capital needs and for other general corporate purposes. Principal is due upon maturity. However, prepayments are permitted without premium or penalty.

The obligations of the Company, and ADBV for the Banco Santander agreement, under the revolving credit facilities are jointly and severally guaranteed by certain of the Company's subsidiaries on an unconditional basis. The revolving credit facilities include customary covenants including, among others, restrictions on the ability of the Company, the guarantors and certain material subsidiaries to: (i) incur liens, (ii) enter into any merger, consolidation or amalgamation; (iii) sell, assign, lease or transfer all or substantially all of the borrower's or guarantor's business or property; (iv) enter into transactions with affiliates; (v) engage in substantially different lines of business; (vi) engage in transactions that violate certain anti-terrorism laws.

The revolving credit facilities provide for customary events of default, which, if any of them occurs, would permit or require the lender to terminate its obligation to provide loans under the revolving credit facility and/or to declare all sums outstanding under the loan documents immediately due and payable.

No amounts are due at the date of issuance of these condensed consolidated financial statements in connection with these revolving credit facilities.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.&nbsp;&nbsp;&nbsp;&nbsp;Long-term debt** 

Long-term debt consists of the following:

---

| | | |
|:---|:---|:---|
| | **As of**<br>**June 30, 2025**<br>**(Unaudited)** |<br>**As of**<br>**December 31, 2024** |
| 2032 Notes | $600000 | $— |
| 2029 Notes | 334200 | 334200 |
| 2027 Notes |  | 379265 |
| Finance lease obligations | 11668 | 9087 |
| Long-term bank loans | 10000 |  |
| Other long-term borrowings | 6804 | 2791 |
| **Subtotal** | **962672** | **725343** |
| Discount on 2032 Notes | (2449) |  |
| Discount on 2029 Notes | (2911) | (3294) |
| Discount on 2027 Notes |  | (1753) |
| Premium on 2029 Notes | 270 | 308 |
| Premium on 2027 Notes |  | 783 |
| Deferred financing costs | (7075) | (2789) |
| **Total** | $**950507** | $**718598** |
| Current portion of long-term debt | 6051 | 2624 |
| **Long-term debt, excluding current portion** | $**944456** | $**715974** |

---

<u>2032, 2029 and 2027</u> <u>Notes</u>

On January 15, 2025, the Company announced the commencement of an offer to purchase for cash any and all of its outstanding 2027 Notes.

Furthermore, on January 29, 2025, the Company's subsidiary ADBV (the "Issuer") issued Senior Notes for an aggregate principal amount of $600 million which matures in 2032 (the "2032 Notes"). Interest on the notes will accrue at a rate of 6.375% per annum.

As a result, the proceeds from 2032 Notes were used to fund the cash tender offer redeemed on January 29, 2025 consisting of 35.27% of its outstanding principal of 2027 Notes for a total amount of $136,145 plus accrued and unpaid interest and were used on April 4, 2025 to redeem all of its outstanding 2027 Notes announced on February 28 ,2025 at a redemption price equal to 100% for a total amount of $243,120 plus accrued and unpaid interest, and for general corporate purposes. Periodic payments of principal are not required and interest is paid semi-annually commencing on July 29, 2025.

The 2032 Notes are guaranteed on a senior unsecured basis by the Company and certain of its subsidiaries.

The following table presents additional information related to the 2032, 2029 and 2027 Notes (the "Notes"):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | | **Principal as of** | **Principal as of** | |
| |<br>**Annual interest rate** |<br>**Currency** | **June 30, 2025 (Unaudited)** | **December 31, 2024** |<br>**Maturity** |
| 2032 Notes | 6.375% | USD | $600000 | $— | January 29, 2032 |
| 2029 Notes | 6.125% | USD | 334200 | 334200 | May 27, 2029 |
| 2027 Notes | 5.875% | USD |  | 379265 | April 4, 2027 |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

The following table presents additional information for the six-month period ended June 30, 2025 and 2024:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Interest Expense (i)** | **Interest Expense (i)** | **DFC Amortization (i)** | **DFC Amortization (i)** | **Amortization of Premium/Discount, net (i)** | **Amortization of Premium/Discount, net (i)** |
| | **2025 (Unaudited)** | **2024 (Unaudited)** | **2025 (Unaudited)** | **2024 (Unaudited)** | **2025 (Unaudited)** | **2024 (Unaudited)** |
| 2032 Notes | $16150 | $— | $354 | $— | $157 | $— |
| 2029 Notes | 10235 | 10235 | 235 | 235 | 345 | 345 |
| 2027 Notes | 4193 | 11141 | 886 | 229 | 866 | 232 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)These charges are included within "Net interest expense and other financing results" in the consolidated statements of income.

<u>Long-term bank loans</u>

On May 6, 2025, the Company renewed its short-term bank loans with Banco Itau Uruguay S.A. and Banco Bilbao Vizcaya Argentaria Uruguay S.A. for the same total amount of $8,000 and $2,000, respectively, now maturing both on November 6, 2026, at an annual interest of 3.90% and 3.95%, respectively.

During July 2025, the Company signed two long-term bank loans with Banco Itau Uruguay S.A. and Banco Bilbao Vizcaya Argentaria Uruguay S.A. for $9,500 and $5,500, at an annual interest rate of 4.31% and 4.10%, respectively, maturing both during January 2027.

**6.&nbsp;&nbsp;&nbsp;&nbsp;Derivative instruments** 

The Company's derivatives that are designated for hedge accounting consist of cross-currency interest rate swaps, foreign currency forwards, principal only swap, call spreads, interest coupon only swaps and sustainability linked ESG principal only swap. All these derivatives are classified as cash flow hedges. Further details are in "Derivatives designated as hedging instruments" section.

Additionally, the Company enters into certain derivatives that are not designated for hedge accounting. The Company has entered into foreign currency forwards and call spread to mitigate the foreign currency fluctuations on foreign currency denominated liabilities. Further details are explained in the "Derivatives not designated as hedging instruments" section.

The following table presents the fair values of derivative instruments included in the consolidated balance sheets as of June 30, 2025 and December 31, 2024:

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | | **Assets** | **Assets** | | **Liabilities** | **Liabilities** |
| **Type of Derivative** | **Balance Sheets Location** | | | **Balance Sheets Location** | | |
| **Type of Derivative** | **Balance Sheets Location** | **As of**<br>**June 30, 2025 (Unaudited)** | **As of**<br>**December 31, 2024** | **Balance Sheets Location** | **As of**<br>**June 30, 2025 (Unaudited)** | **As of**<br>**December 31, 2024** |
| ***Derivatives designated as hedging instruments*** | ***Derivatives designated as hedging instruments*** | ***Derivatives designated as hedging instruments*** | | | | |
| ***<u>Cash Flow hedge</u>*** | | | | | | |
| Forward contracts | Other receivables | $— | $2093 | Accrued payroll and other liabilities | $(2855) | $— |
| Principal only swap | Derivative instruments |  |  | Derivative instruments | (1596) |  |
| Call spread + coupon-only swap | Derivative instruments | 13027 | 16998 | Derivative instruments | (1263) | (179) |
| Sustainability-linked ESG principal only swap | Derivative instruments | 22999 | 25617 | Derivative instruments | (235) | (207) |
| Cross-currency interest rate swap | Derivative instruments | 30516 | 37627 | Derivative instruments | (1374) | (620) |
| **Subtotal** |  | $**66542** | $**82335** |  | $**(7323)** | $**(1006)** |
| ***Derivatives not designated as hedging instruments*** | ***Derivatives not designated as hedging instruments*** | ***Derivatives not designated as hedging instruments*** |  |  |  |  |
| Forward contracts | Derivative instruments | 1371 | 48 | Derivative instruments |  | (286) |
| Call spread | Derivative instruments | 49 |  | Derivative instruments |  |  |
| **Subtotal** |  | $**1420** | $**48** |  | $**—** | $**(286)** |
| **Total derivative instruments** | **Total derivative instruments** | $**67962** | $**82383** |  | $**(7323)** | $**(1292)** |

---

***Derivatives designated as hedging instruments***

***Cash flow hedge***

The Company has entered into various forward contracts in a few territories to hedge a portion of the foreign exchange risk associated with forecasted imports of goods. The effect of the hedges results in fixing the cost of goods acquired (i.e. the net settlement or collection adjusts the cost of inventory paid to the suppliers). As of June 30, 2025, the Company estimated that the whole amount of net derivative gains or losses related to its cash flow hedges included in accumulated other comprehensive loss will be reclassified into earnings within the next 12 months.

Moreover, the Company, through its Brazilian subsidiary, has entered into certain instruments designated as cash flow hedge to reduce the exposure to variability in expected future cash flows related to intercompany loans (principal and interest). The Company uses principal only swap, call spread, coupon-only swaps, cross-currency interest rate swap and a sustainability-linked ESG principal only swap. As of June 30, 2025, the Company estimated that the whole amount of net derivative gains or losses related to its cash flow hedges included in accumulated other comprehensive loss will be reclassified into earnings within the next 4 years.

The following table presents the notional amounts of the Company's outstanding derivative instruments classified as cash flow hedge:

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | |
|:---|:---|:---|
| | **Notional amount as of** | **Notional amount as of** |
| | **June 30, 2025 (Unaudited)** | **December 31, 2024** |
| Forward contracts | $55285 | $48799 |
| Call spread + coupon-only swap | 89000 | 89000 |
| Sustainability-linked ESG principal only | 50000 | 50000 |
| Cross-currency interest rate swap | 80000 | 80000 |
| Principal only swap | 15000 |  |

---

<u>Additional disclosures</u>

The following table presents the pretax amounts affecting income and other comprehensive income (loss) for the six-month period ended June 30, 2025 and 2024 for each type of derivative relationship:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Derivatives in Cash Flow<br>Hedging Relationships** | **(Loss) Gain Recognized in Accumulated OCI on Derivative (Unaudited)** | **(Loss) Gain Recognized in Accumulated OCI on Derivative (Unaudited)** | **Loss (Gain) Reclassified from Accumulated OCI into income<br> (Unaudited)** | **Loss (Gain) Reclassified from Accumulated OCI into income<br> (Unaudited)** |
| **Derivatives in Cash Flow<br>Hedging Relationships** | **2025** | **2024** | **2025** | **2024** |
| Forward contracts (i) | $(4702) | $1787 | $(246) | $1007 |
| Principal only swap (ii) | (1928) |  | 2093 |  |
| Cross-currency interest rate swaps (ii) | (12786) | 12592 | 11057 | (10283) |
| Call spread (ii) | (2363) | 1080 | 13389 | (2490) |
| Coupon-only swap (ii) | (4941) | 1213 | 141 | (260) |
| Sustainability linked ESG principal only swap (ii) | (5866) | 6103 | 6548 | (6949) |
| **Total** | $**(32586)** | $**22775** | $**32982** | $**(18975)** |

---

(i)The results recognized in income related to forward contracts were recorded as an adjustment to food and paper.

(ii)The net (loss) gain recognized in income is presented as follows:

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended June 30,** | **For the six-month period ended June 30,** |
| **Adjustment to:** | **2025 (Unaudited)** | **2024 (Unaudited)** |
| Net interest expense and other financing results | $(1527) | $(901) |
| Foreign currency exchange results | (31701) | 20883 |
| **Total** | $**(33228)** | $**19982** |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

***Derivatives not designated as hedging instruments***

The Company has entered into certain derivatives that are not designated for hedge accounting, therefore the changes in the fair value of these derivatives are recognized immediately within "Gain from derivative instruments".

The following table presents the notional amounts of the Company's outstanding derivative instruments not designed as hedging instruments:

---

| | | |
|:---|:---|:---|
| | **Notional amount as of** | **Notional amount as of** |
| | **June 30, 2025 (Unaudited)** | **December 31, 2024** |
| Forward contracts | $44980 | $5000 |
| Call spread | 24000 |  |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

**7.&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation** 

<u>Phantom RSU Award</u>

In May 2019, the Company implemented a long-term incentive plan (called Phantom RSU Award) to reward employees giving them the opportunity to share the success of the Company in the creation of value for its shareholders. In accordance with this plan, the Company granted units (called "Phantom RSU") to certain employees, pursuant to which they are entitled to receive, when vested, a cash payment equal to the closing price of one Class A share per unit on the respective day in which this benefit is due and the corresponding dividends per-share (if any) formally declared and paid during the service period. However, in the event of death, disability or retirement of the employee, any unvested portion of the annual award will be fully vested.

The following table provides information about the awards granted by the Company and pending of vesting as of June 30, 2025:

---

| | | |
|:---|:---|:---|
| **Grant** | **Units** | **Vesting period** |
| 2023 | 643,539 | May 2026 |
| 2024 | 547,544 | May 2027 |
| 2025 | 39,904 | April 2026 |
| 2025 | 805,720 | May 2028 |

---

The Company recognizes compensation expense related to these benefits on a straight-line basis over the requisite service period. As a consequence, when the award includes multiple vesting periods, it is considered as multiple awards.

The total compensation expense for the six-month period ended June 30, 2025 and 2024 amounts to $2,992 and $241 respectively, which has been recorded under "General and administrative expenses" within the consolidated statement of income. The accrued liability is remeasured at the end of each reporting period until settlement.

The following table summarizes the activity under the plan as of June 30, 2025:

---

| | | |
|:---|:---|:---|
| | **Units** | **Settlement** |
| **Outstanding at December 31, 2024** | 2178314 | $— |
| Grant 2025 | 845624 |  |
| Vesting and settlement of 2022 grant | (786293) | 6306 |
| Vesting and settlement of 2024 grant | (28800) | 220 |
| Forfeited | (172138) |  |
| **Outstanding at June 30, 2025** | **2036707** | **—** |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

The following table provides a summary of the plan as of June 30, 2025:

---

| | |
|:---|:---|
| | **Total Non-vested** |
| Number of units outstanding (i) | 2036707 |
| Share price as of June 30, 2025 | 7.89 |
| Total fair value of the plan | 16070 |
| Weighted-average accumulated percentage of service | 34.88% |
| Accrued liability (ii) | 5605 |
| Compensation expense not yet recognized (iii) | 10465 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)Related to awards that will vest between April 2026 and May 2028.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)Presented within "Accrued payroll and other liabilities" in the Company's current and non-current liabilities balance sheet.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)Expected to be recognized in a weighted-average period of 2.31 years.

**8.**&nbsp;&nbsp;&nbsp;&nbsp;**Commitments and contingencies** 

<u>Commitments</u>

The MFAs require the Company and its MF subsidiaries, among other obligations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)to agree with McDonald's on a restaurant opening plan. Under the terms of the plan the Company have agreed, the Company expects to open 90-100 restaurants in 2025. In addition, the Company have agreed to use its best efforts to reimage at least 10% of its eligible restaurants. The Company may also propose, subject to McDonald's consent, amendments to any restaurant opening plan and/or reinvestment plan to adapt to changes in economic or political conditions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)to pay to McDonald's Corporation an initial franchise fee for each new restaurant opened. In addition, the Company will pay an initial franchise fee for each franchised restaurant in operation as of January 1, 2025 (which will be payable in two installments of 50% each (one on August 1, 2027, and the other on August 1, 2037)).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)to pay monthly royalties commencing at a rate of 6% of gross sales of the restaurants, during the first 10 years. This percentage will increase to 6.25% and 6.5% for the subsequent two five-year periods of the agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)to commit to funding a specified Strategic Marketing Plan; that includes the expenditure of at least 5% of the Company's gross sales on Advertising and Promotion activities, unless otherwise agreed with McDonald's;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)to own (or lease) directly or indirectly, the fee simple interest in all real property on which any franchised restaurant is located; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)to maintain a minimum fixed charge coverage ratio (as defined therein) at least equal to 1.50 as well as a maximum leverage ratio (as defined therein) of 4.25.

If the Company would not be in compliance with these commitments under the MFA, it could be in material breach. A breach of the MFA would give McDonald's Corporation certain rights, including the ability to acquire all or portions of the business.

For the six-month period ended June 30, 2025, the Company was in compliance with the ratio requirements mentioned in point (vi) above. The ratios for the period mentioned, were as follows:

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| | | |
|:---|:---|:---|
| | **June 30, 2025 (Unaudited)** | **March 31, 2025 (Unaudited)** |
| Fixed Charge Coverage Ratio | 2.05 | 2.14 |
| Leverage Ratio | 3.53 | 3.80 |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

In addition, the Company, through its wholly-owned subsidiary ADBV, maintains standby letters of credit in favor of McDonald's Corporation as collateral for the obligations assumed under the MFAs, for a total aggregate drawing amount of $80 million. These letters of credit can be drawn if certain events occur, including the failure to pay royalties. No amounts have been drawn at the date of issuance of these financial statements. The following table presents information related to the standby letters of credit:

---

| | |
|:---|:---|
| **Bank** | **Amount** |
| Itaú | $15000 |
| Banco Bilbao Vizcaya Argentaria, S.A. | $45000 |
| J.P. Morgan | $20000 |

---

These letters of credit contain a limited number of customary affirmative and negative covenants, including a maximum indebtedness to EBITDA ratio, as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Bank** | **Ratio** | **Required Maximum Ratio** | **June 30, 2025 (Unaudited)** |
| Itaú | Net indebtedness to EBITDA (not including interest payable) | 4.50 | 0.35 |
| Banco Bilbao Vizcaya Argentaria, S.A. | Net indebtedness to EBITDA (including interest payable) | 4.00 | 0.31 |
| J.P. Morgan | Indebtedness to EBITDA | 4.50 | 0.80 |

---

For the six-month period ended June 30, 2025 all the ratios were in compliance.

<u>Provision for contingencies</u>

The Company has certain contingent liabilities with respect to existing or potential claims, lawsuits and other proceedings, including those involving labor, tax and other matters. As of June 30, 2025 and December 31, 2024, the Company maintains a provision for contingencies, net of judicial deposits, amounting to $33,240 and $30,356, respectively, presented as follows: $1,306 and $1,199 as a current liability and $31,934 and $29,157 as a non-current liability, respectively. The breakdown of the provision for contingencies is as follows:

---

| | | |
|:---|:---|:---|
| | **As of**<br>**June 30, 2025**<br>**(Unaudited)** |<br>**As of**<br>**December 31, 2024** |
| Tax contingencies in Brazil | $28430 | $22113 |
| Labor contingencies in Brazil | 9735 | 8821 |
| Others | 5464 | 5763 |
| **Subtotal** | **43629** | **36697** |
| Judicial deposits | (10389) | (6341) |
| **Provision for contingencies** | $**33240** | $**30356** |

---

As of June 30, 2025, there are certain matters related to the interpretation of tax, customs, labor and civil laws for which there is a reasonable possibility that a loss may have been incurred in accordance with ASC 450-20-50-4 within a range of $484 million and $530 million. In accordance with ASC 450-20-50-6, unasserted claims or assessments that do not meet the conditions mentioned have not been included.

As of June 30, 2025, there are certain matters related to the interpretation of income tax laws which could be challenged by tax authorities in an amount of $194 million, related to assessments for the fiscal years 2009 to 2017. No formal claim has been made for fiscal years within the statute of limitation by Tax authorities in any of the mentioned matters, however those years are still subject to audit and claims may be asserted in the future.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

**9.**&nbsp;&nbsp;&nbsp;&nbsp;**Segment and geographic information** 

The Company is required to report information about operating segments in annual financial statements and interim financial reports issued to shareholders in accordance with ASC 280.

The Company has determined that its reportable segments are those that are based on the Company's method of internal reporting. The Company manages its business as distinct geographic segments and its operations are divided into three geographic divisions, as follows: (i) Brazil, (ii) the North Latin American division, or "NOLAD," which is comprised of Costa Rica, Mexico, Panama, Puerto Rico, Martinique, Guadeloupe, French Guiana and the U.S. Virgin Islands of St. Croix and St. Thomas and (iii) the South Latin American division, or "SLAD," which is comprised of Argentina, Chile, Ecuador, Peru, Uruguay, Colombia, Venezuela, Trinidad and Tobago, Aruba and Curaçao. The accounting policies of the segments are the same as those described in Note 3 of the Consolidated Financial Statements as of December 31, 2024.

The Company's chief operating decision maker is the Chief Executive Officer ("CEO") and adjusted EBITDA is the measure of segment's profit or loss used to evaluate segment performance and resource allocation.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

The following tables present information about profit, or loss, significant expenses, other segment items and assets for each reportable segment:

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended** | **For the six-month period ended** |
| | **June 30,** | **June 30,** |
| | **2025**<br>**(Unaudited)** | **2024**<br>**(Unaudited)** |
| **<u>Revenues:</u>** |  |  |
| Brazil | $815689 | $890927 |
| NOLAD | 599529 | 612926 |
| SLAD | 803670 | 688404 |
| **Total revenues** | $**2218888** | $**2192257** |
| **<u>Significant expenses (a):</u>** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Company-operated restaurant expenses:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brazil | $(660312) | $(675606) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOLAD | (507139) | (527932) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SLAD | (683926) | (604692) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Company-operated restaurant expenses** | $**(1851377)** | $**(1808230)** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Franchised restaurants-occupancy expenses:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brazil | $(26723) | $(27945) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOLAD | (5201) | (5516) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SLAD | (5855) | (4277) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Franchised restaurants-occupancy expenses** | $**(37779)** | $**(37738)** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**General and administrative expenses:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brazil | $(29147) | $(28240) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOLAD | (27764) | (26374) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SLAD | (30027) | (26749) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total reportable segments** | **(86938)** | **(81363)** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporate | (48108) | (44075) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total General and administrative expenses** | $**(135046)** | $**(125438)** |
| **Other segment items:** |  |  |
| Brazil | $3016 | $2478 |
| NOLAD | 8053 | 1659 |
| SLAD | (4269) | 2626 |
| **Total reportable segments** | **6800** | **6763** |
| Corporate | (96) | 103 |
| **Total Other segment items (a) (b)** | $**6704** | $**6866** |
| **<u>Adjusted EBITDA:</u>** |  |  |
| Brazil | $102523 | $161614 |
| NOLAD | 67478 | 54763 |
| SLAD | 79593 | 55312 |
| **Total reportable segments** | **249594** | **271689** |
| Corporate and others (i) | (48204) | (43972) |
| **Total adjusted EBITDA** | $**201390** | $**227717** |

---

(a) Depreciation & amortization are not included within the significant expenses, such as Company-operated restaurant expenses, Franchised restaurants-occupancy expenses, Selling, general & administrative expenses and Other segment items.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

(b) Other segment items include results related to restaurant transactions, rental income of excess properties, accrual for contingencies, recovery of taxes, results from equity method investments, write-offs of inventory and other miscellaneous items.

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended** | **For the six-month period ended** |
| | **June 30,** | **June 30,** |
| | **2025**<br>**(Unaudited)** | **2024**<br>**(Unaudited)** |
| **<u>Adjusted EBITDA reconciliation:</u>** |  |  |
| **Total adjusted EBITDA** | $**201390** | $**227717** |
| **(Less) Plus items excluded from computation that affect operating income:** |  |  |
| Depreciation and amortization | (94208) | (88293) |
| Gains from sale and insurance recovery of property and equipment | 944 | 2614 |
| Write-offs of long-lived assets | (519) | (268) |
| **Operating income** | **107607** | **141770** |
| **(Less) Plus:** |  |  |
| Net interest expense and other financing results | (35075) | (30579) |
| Gain from derivative instruments | 1454 | 1249 |
| Foreign currency exchange results | (5627) | (19115) |
| Other non-operating expenses, net | (603) | (652) |
| Income tax expense, net | (30991) | (37106) |
| Net income attributable to non-controlling interests | (248) | (426) |
| **Net income attributable to Arcos Dorados Holdings Inc.** | $**36517** | $**55141** |

---

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended** | **For the six-month period ended** |
| | **June 30,** | **June 30,** |
| | **2025**<br>**(Unaudited)** | **2024**<br>**(Unaudited)** |
| **<u>Depreciation and amortization:</u>** |  |  |
| Brazil | $36560 | $36484 |
| NOLAD | 26998 | 24760 |
| SLAD | 26549 | 22119 |
| **Total reportable segments** | **90107** | **83363** |
| Corporate and others (i)  | 4101 | 4930 |
| **Total depreciation and amortization** | $**94208** | $**88293** |

---

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended** | **For the six-month period ended** |
| | **June 30,** | **June 30,** |
| | **2025**<br>**(Unaudited)** | **2024**<br>**(Unaudited)** |
| **<u>Property and equipment expenditures:</u>** |  |  |
| Brazil | $46282 | $46827 |
| NOLAD | 18314 | 41327 |
| SLAD | 39520 | 60769 |
| Others | 37 | 4 |
| **Total property and equipment expenditures** | $**104153** | $**148927** |

---

---

| | | |
|:---|:---|:---|
| | **As of** | **As of** |
| | **June 30,**<br>**2025**<br>**(Unaudited)** |<br>**December 31,**<br>**2024** |
| **<u>Total assets:</u>** |  |  |
| Brazil | $1380064 | $1164179 |
| NOLAD | 1037855 | 959403 |
| SLAD | 886352 | 822342 |
| **Total reportable segments** | **3304271** | **2945924** |
| Corporate and others (i) | 169564 | 40366 |
| Purchase price allocation (ii) | (101415) | (93636) |
| **Total assets** | $**3372420** | $**2892654** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)Primarily relates to corporate general and administrative expenses, corporate supply chain operations in Uruguay, and related assets. Corporate general and administrative expenses consist of corporate office support costs in areas such as facilities, finance, human resources, information technology, legal, marketing, restaurant operations, supply chain and training. As of June 30, 2025 corporate assets primarily include cash and cash equivalents and short-term investments. As of December 31, 2024, corporate assets primarily include cash and cash equivalents, short-term investments and lease right of use.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)Relates to the purchase price allocation adjustment made at corporate level, which reduces the accounting value of our long-lived assets (excluding Lease right of use) and goodwill. As of June 30, 2025 and December 31, 2024, primarily related with the reduction of goodwill.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.&nbsp;&nbsp;&nbsp;&nbsp;Shareholders' equity** 

<u>Authorized capital</u>

The Company is authorized to issue a maximum of 500,000,000 shares, consisting of 420,000,000 Class A shares and 80,000,000 Class B shares of no par value each.

<u>Issued and outstanding capital</u>

As of June 30, 2025 and December 31, 2024, the Company issued 212,972,119 shares with no par value, consisting of 132,972,119 Class A shares and 80,000,000 Class B shares for each period.

As of June 30, 2025 and December 31, 2024, the Company had 2,309,062 shares in treasury.

Therefore, as of June 30, 2025 the Company had 210,663,057 shares outstanding, consisting of 130,663,057 Class A shares and 80,000,000 Class B shares.

<u>Rights, privileges and obligations</u>

Holders of Class A shares are entitled to one vote per share and holders of Class B shares are entitled to five votes per share. Except with respect to voting, the rights, privileges and obligations of the Class A shares and Class B shares are *pari passu* in all respects, including with respect to dividends and rights upon liquidation of the Company.

<u>Distribution of dividends</u>

The Company can only make distributions to the extent that immediately following the distribution, its assets exceed its liabilities, and the Company is able to pay its debts as they become due.

On March 11, 2025, the Company approved a cash dividend distribution to all Class A and Class B shareholders of $0.24 per share to be paid in four installments, as follows: $0.06 per share in March 27, June 27, September 26 and December 26, 2025, respectively. As of June 30, 2025, the Company paid $25,280 of cash dividends.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

<u>Accumulated other comprehensive loss</u>

The following tables set forth information with respect to the components of "Accumulated other comprehensive loss" as of June 30, 2025 and 2024, respectively, and their related activity during the six-month period ended:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | <br>**Foreign currency translation** | <br>**Cash flow hedges** | <br>**Securities available for sale (i)** | **Total Accumulated other comprehensive loss** |
| **Balances at December 31, 2024** | $**(667652)** | $**3231** | $**(4063)** | $**(668484)** |
| Other comprehensive income (loss) before reclassifications (Unaudited) | 87768 | (22767) | (484) | 64517 |
| Net loss reclassified from accumulated other comprehensive loss to consolidated statement of income (Unaudited) |  | 21684 |  | 21684 |
| Net current-period other comprehensive income (loss) (Unaudited) | 87768 | (1083) | (484) | 86201 |
| **Balances at June 30, 2025 (Unaudited)** | $**(579884)** | $**2148** | $**(4547)** | $**(582283)** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | <br>**Foreign currency translation** | <br>**Cash flow hedges** | <br>**Securities available for sale (i)** | **Total Accumulated other comprehensive loss** |
| **Balances at December 31, 2023** | $**(555781)** | $**(3015)** | $**(4285)** | $**(563081)** |
| Other comprehensive (loss) income before reclassifications (Unaudited) | (55049) | 15639 | 637 | (38773) |
| Net (gain) loss reclassified from accumulated other comprehensive loss to consolidated statement of income (Unaudited) |  | (12181) | 438 | (11743) |
| Net current-period other comprehensive (loss) income (Unaudited) | (55049) | 3458 | 1075 | (50516) |
| **Balances at June 30, 2024 (Unaudited)** | $**(610830)** | $**443** | $**(3210)** | $**(613597)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(i)Related to unrealized results on available for sale securities. For the six-month period ended June 30, 2025 and 2024 the Company maintains Securities classified as available for sale in accordance with guidance in ASC 320 Investments – Debt and Equity Securities amounting to $3,060 and $5,140, respectively, included within "Short-term investments" in the Consolidated Balance Sheet. The amortized cost at acquisition amounted to $7,744 and $8,545 for the six-month period ended June 30, 2025 and 2024, respectively.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

**11.&nbsp;&nbsp;&nbsp;&nbsp;Earnings per share**

The following table sets forth the computation of basic and diluted net income per common share attributable to Arcos Dorados Holdings Inc. for all periods presented:

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended** | **For the six-month period ended** |
| | **June 30,** | **June 30,** |
| | **2025**<br>**(Unaudited)** | **2024**<br>**(Unaudited)** |
| Net income attributable to Arcos Dorados Holdings Inc. available to common shareholders | $36517 | $55141 |
| Weighted-average number of common shares outstanding - Basic and Diluted | 210663057 | 210658096 |
| **Basic and Diluted net income attributable to Arcos Dorados Holdings Inc. per common share** | $**0.17** | $**0.26** |

---

**12.&nbsp;&nbsp;&nbsp;&nbsp;Related party transactions** 

The Company has entered into a master commercial agreement on arm's length terms with Axionlog, a company under common control that operates the distribution centers in Argentina, Chile, Colombia, Ecuador, Mexico, Peru, Uruguay, Venezuela, French Guiana, Guadeloupe, Martinique, Aruba, Curaçao, the USVI and Trinidad and Tobago (the "Axionlog Business"). Pursuant to this agreement Axionlog provides the Company distribution inventory, storage and transportation services in the countries in which it operates.

The following table summarizes the outstanding balances between the Company and the Axionlog Business as of June 30, 2025 and December 31, 2024:

---

| | | |
|:---|:---|:---|
| | **As of** | **As of** |
| | **June 30,**<br>**2025**<br>**(Unaudited)** |<br>**December 31,**<br>**2024** |
| Other receivables | 4666 | 5995 |
| Miscellaneous | 4220 | 4031 |
| Accounts payable | (22682) | (27261) |

---

The following table summarizes the transactions between the Company and the Axionlog Business for the six-month period ended June 30, 2025 and 2024:&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | |
|:---|:---|:---|
| | **For the six-month period ended** | **For the six-month period ended** |
| | **June 30,** | **June 30,** |
| | **2025**<br>**(Unaudited)** | **2024**<br>**(Unaudited)** |
| Food and paper (i) | $(172108) | $(168216) |
| Occupancy and other operating expenses | (5805) | (5366) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)Includes $37,133 of distribution fees and $134,975 of supplier purchases managed through the Axionlog Business for the six-month period ended June 30, 2025; and, $32,251 and $135,965, respectively, for the six-month period ended June 30, 2024.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

The following table summarizes the outstanding balances between the Company and its equity method investments as of June 30, 2025 and December 31, 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025 (Unaudited)** | **June 30, 2025 (Unaudited)** | **December 31, 2024** | **December 31, 2024** |
| | **Lacoop II, S.C** | **Saile (i)** | **Lacoop II, S.C** | **Saile (i)** |
| Other receivables | $2718 | $1858 | $2091 | $978 |
| Accounts payable | (4696) |  | (5936) |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Operadora de Franquicias Saile S.A.P.I. de C.V.

**13.&nbsp;&nbsp;&nbsp;&nbsp;Disclosures about fair value of financial instruments**

<u>Assets and liabilities measured and recorded at fair value on recurring basis</u>

The Company's assets and liabilities measured and recorded at fair value on recurring basis were valued using:

Level 1 inputs: Valuations utilizing quoted, unadjusted prices for identical assets or liabilities in active markets that the Company has the ability to access.

Level 2 inputs: Valuations utilizing quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly for substantially the full term of the asset or liability.

Level 3 inputs: Valuations utilizing significant unobservable inputs provides the least objective evidence of fair value and requires a significant degree of judgment. Inputs may be used with internally developed methodologies and should reflect an entity's assumptions using the best information available about the assumptions that market participants would use in pricing an asset or liability.

As of June 30, 2025, and December 31, 2024, the Company had not changed the methodology, nor the assumptions used to estimate the fair value of the financial instruments.

There were no transfers to and from Levels 1, 2 and 3 during the six-month period ended June 30, 2025, nor during the year ended December 31, 2024.

------

**Arcos Dorados Holdings Inc.**

**Notes to the Condensed Consolidated Financial Statements**

For the six-month period ended June 30, 2025 and 2024 (Unaudited)

Amounts in thousands of US dollars, except for share data and as otherwise indicated

The following fair value hierarchy table presents information about the Company's assets and liabilities measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Quoted Prices in<br>Active Markets<br>For Identical Assets<br>(Level 1)** | **Quoted Prices in<br>Active Markets<br>For Identical Assets<br>(Level 1)** | **Significant Other<br>Observable Inputs<br>(Level 2)** | **Significant Other<br>Observable Inputs<br>(Level 2)** | **Significant<br>Unobservable Inputs<br>(Level 3)** | **Significant<br>Unobservable Inputs<br>(Level 3)** | | |
| | **As of**<br>**June 30, 2025 (Unaudited)** | **As of**<br>**December 31, 2024** | **As of**<br>**June 30, 2025 (Unaudited)** | **As of**<br>**December 31, 2024** | **As of**<br>**June 30, 2025 (Unaudited)** | **As of**<br>**December 31, 2024** | **Balance as of**<br>**June 30, 2025 (Unaudited)** | **Balance as of**<br>**December 31, 2024** |
| **Assets** | | | | | | | | |
| Cash equivalents | $48734 | $61579 | $— | $— | $— | $— | $48734 | $61579 |
| Short-term Investments | 79100 |  | 7710 | 3529 |  |  | 86810 | 3529 |
| Derivatives |  |  | 67962 | 82383 |  |  | 67962 | 82383 |
| **Total Assets** | $**127834** | $**61579** | $**75672** | $**85912** | $**—** | $**—** | $**203506** | $**147491** |
| **Liabilities** |  |  |  |  |  |  |  |  |
| Derivatives | $— | $— | $7323 | $1292 | $— | $— | $7323 | $1292 |
| **Total Liabilities** | $**—** | $**—** | $**7323** | $**1292** | $**—** | $**—** | $**7323** | $**1292** |

---

<u>Certain financial assets and liabilities not measured at fair value</u>

As of June 30, 2025, the fair value of the Company's short term and long-term debt was estimated at $969,573, compared to a carrying amount of $996,671. This fair value was estimated using various pricing models or discounted cash flow analysis that incorporated quoted market prices and is similar to Level 2 within the valuation hierarchy. The carrying amount for notes receivable approximates fair value.

<u>Non-financial assets and liabilities measured at fair value on a nonrecurring basis</u>

Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (e.g., when there is evidence of impairment). As of June 30, 2025, no material fair value adjustments or fair value measurements were required for non-financial assets or liabilities.

**14.&nbsp;&nbsp;&nbsp;&nbsp;Subsequent events**

*<u>Organization and nature of Business</u>*

During July 2025, the Company acquired three restaurants and the exclusive rights to operate or sub-franchise McDonald's restaurants in the territory of Saint Martin, which will be part of the NOLAD operating segment.

*<u>Financial Debt</u>*

During July 2025, the Company paid the outstanding amount of the short-term bank loan with Banco de Chile and $8.9 million of its loan with Banco Itau Chile. Additionally, the Company renewed $9.7 million of its loan with Banco Itau Chile at an interest rate of 5.65%, now maturing in January, 2027.

Moreover, the Company signed two long-term bank loans with Banco Itau Uruguay S.A. and Banco Bilbao Vizcaya Argentaria Uruguay S.A. for $9,500 and $5,500, at an annual interest rate of 4.31% and 4.10%, respectively, maturing both during January 2027.