2024-04-24 21:29:20
Assaí has just reported strong sales growth in the first quarter, as well as an improvement in margins.
The net revenue of the company led by Belmiro Gomes increased 14.1% to R$17.2 billion from January to March – the Refinitiv consensus pointed to revenue of R$17.4 billion.
Same-store sales rose 5.2% year-on-year. Excluding the calendar effect (with an extra day in February and Easter celebrated in the first quarter), growth was 3.4%.
“As food inflation in the period was 2.4% at the end of March, same-store sales growth was above inflation,” vice-president of finance and investor relations Vitor Fagá told Brazil Journal.
The company’s gross revenue was R$18.8 billion, an increase of 13.6%. For comparison purposes, Atacadão, the cash & carry arm of Carrefour Brasil, had a 6.6% increase in revenue in the same period.
Assaí’s growth was also accompanied by an improvement in profitability.
EBITDA reached R$1.21 billion, an increase of 28% in the annual comparison. The EBITDA margin, in turn, rose 0.8 points to 7.1%. The Refinitiv consensus pointed to a margin of 6.8%.
Net profit, despite falling 16% year-on-year to R$60 million, was slightly above the consensus, which was R$55 million.
The increase in profitability and the improvement in cash generation, according to Fagá, made the company comfortable in improving the leverage guidance for the end of the year from 3.5x to 3.2x.
In the quarter, Assaí’s leverage reached 3.75x (reduction of 0.94x in the annual comparison and 0.05x sequentially).
Operating cash generation in the last twelve months increased 55% to R$4.8 billion.
On the other hand, free cash generation (what remains following the company makes its capex and pays for the Extra stores) was negative at R$876 million.
As the last installment related to the purchase of hypermarkets was paid in January, this number should improve in the coming quarters.
The CFO, who assumed the position in March replacing Daniela Sabbag, has one of his main missions to improve the company’s debt cost, which had an impact of R$1.8 billion in the last 12 months.
According to him, the first step has already been taken with the issuance of a debenture in March worth R$500 million at CDI + 1.25% – the average cost of Assaí’s debt is CDI + 1.47%.
Fagá also said that another priority for his management in front of the financial board is to structure a range of services for corporate entities – something that the company does not yet offer, despite serving several small businesses.
“We have a very clear objective of expanding these services, which increase customer loyalty and purchase frequency,” he said.
For 2024, Assaí continues with the plan to open fewer stores than last year. There were 4 openings in the first quarter, and the total for the year should not exceed 15. (In 2023, Assaí opened 27 stores.)
André Jankavski
1713994831
#Assaí #SSS #inflation #improves #leverage #guidance
