Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Americanas SA (BSP:AMER3, Financial) successfully executed its Judicial Recovery Plan, significantly reducing its gross debt from BRL45.2 billion to BRL1.7 billion.
- The company achieved a positive equity of BRL5.7 billion by the end of September 2024, reversing a negative equity position from June 2024.
- Brick-and-mortar sales grew by 11.2% in Q3 2024, demonstrating resilience and contributing positively to the company's overall performance.
- Americanas SA reported a net profit of BRL10.3 billion, largely due to the successful execution of its Judicial Recovery Plan.
- The company has implemented strategic initiatives to improve commercial and operational efficiency, including store modulation projects and logistics restructuring.
Negative Points
- Total GMV for Q3 2024 declined by 4% compared to Q3 2023, primarily due to a 45.5% decrease in digital sales.
- Despite improvements, the adjusted EBITDA before rent payments was still negative when excluding extraordinary operational events.
- The digital segment continues to face challenges, with a significant decline in first-party digital retail sales.
- SG&A expenses, although reduced, still represent a significant portion of net revenue, indicating room for further cost optimization.
- The company is still in the process of stabilizing its cash flow dynamics post-Judicial Recovery, with no clear guidance on future cash generation.
Q & A Highlights
Q: Can you discuss the medium-term channel mix composition for Americanas and the value proposition for each channel, particularly brick-and-mortar and digital? Also, could you elaborate on the pilot for store remodulation mentioned in the release?
A: Leonardo Coelho, CEO: Americanas aims to offer omnichannel integration, leveraging both brick-and-mortar and digital channels. The value proposition is to solve customers' needs with a mix of traditional assortments and low-ticket items resilient to economic challenges. The store remodulation involves clustering stores based on size and customer needs, optimizing assortments to better serve local demands.
Q: This quarter showed a positive EBITDA, but there were nonrecurring impacts. How do you plan to achieve a positive EBITDA on a more recurring basis?
A: Camille Faria, CFO: Excluding extraordinary items, the EBITDA was still negative. However, we are seeing improvements in revenue, margin expansion, and cost optimization. The goal is to achieve a positive operational EBITDA by continuing these efforts, despite the current negative purely operational EBITDA.
Q: What is the maintenance CapEx for the company?
A: Camille Faria, CFO: The maintenance CapEx for the first half was below BRL100 million. We are efficiently using assets from closed stores for new openings, keeping CapEx low. The unification of our ERP system is a significant project, but it won't substantially impact CapEx.
Q: What was the cash position in Q3, and what are the expectations for the next quarter?
A: Camille Faria, CFO: Due to the Judicial Recovery Plan's stages, cash dynamics were complex in Q3. From Q4 onwards, cash movements will reflect operational activities without recovery effects. However, we do not provide future cash flow guidance.
Q: How is Americanas addressing the operational and financial efficiency pillars in its strategic plan?
A: Leonardo Coelho, CEO: We focus on ensuring the best capital allocation decisions and maintaining operational efficiency across our 1,600 stores. This includes standardized customer experiences and strategic financial management to sustain the improvements achieved in 2023 and 2024.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
