GPA, in its third-quarter earnings call of 2023, reported a strong financial performance, with a 10% growth in gross revenue compared to the same period last year, largely driven by a 15% increase in food e-commerce sales. The company also noted significant progress in its strategic plan, with improvements in store operations, customer service, digital growth, expansion plans, and ESG initiatives.
Key takeaways from the call include:
- A 6.6% increase in same-store sales and a gain of 0.6 percentage points in market share.
- A 7% EBITDA margin growth, with a 10% increase in total turnover, and a 1.2 percentage point increase in adjusted EBITDA margin.
- Volume growth in perishables and gas stations, resulting in an 18.2% sales increase.
- Gross profit reaching BRL 1.2 billion with a margin of 25.1%, and adjusted EBITDA totaling BRL 333 million with a margin of 7%.
- A net income of BRL 809 million, excluding the impact of Cnova, and a net loss of BRL 2.1 billion from discontinued operations.
- A reduction of net debt to BRL 3 billion, following the sale of non-core assets and the agreement to sell their remaining stake in Éxito.
- A focus on reducing expenses, optimizing results, and deleveraging the company.
CEO Marcelo Pimentel and CFO Rafael Russowsky discussed the company's strategic pillars, highlighting improvements in store operations and customer service, as well as digital growth. They also emphasized the company's expansion plans and ESG initiatives.
Novo GPA Brasil, part of the GPA group, reported positive financial performance, with a focus on improving e-commerce operations and integrating them with store operations. The company has implemented initiatives to reduce expenses through zero-based budgeting. It also announced the sale of non-core assets and an agreement to sell their remaining stake in Éxito, as part of the company's efforts to deleverage and improve its financial performance.
The company is also focusing on reducing expenses and optimizing results. It expects to see continued sales growth and operational improvements, particularly in the fourth quarter due to seasonal trends. The assortment revision process has been completed for Pão de Açúcar and is ongoing for Proximity brands and Mercado Extra.
In the earnings call, the company emphasized that all projections for 2024 will be used for the company's deleveraging process. The company is committed to expanding and opening new Minuto Pão de Açúcar stores, and is cautious about opening new Pão de Açúcar stores, focusing on refining opportunities in the city of Sao Paulo. They use a build-to-suit strategy for new Pão de Açúcar stores to avoid balance sheet pressure.
The management of Pão de Açúcar discussed their expansion strategy and focus on store locations and assortment. They highlighted the success of their strategy with the opening of a store in Atibaia. They also mentioned their build-to-suit strategy, where the CapEx for opening new stores is invested by the landowner.
Finally, Marcelo Pimentel stated that they expect to sell and monetize their participation of 3.3% in Éxito, which has already been announced. In addition, they anticipate generating around BRL 500 million from the sale of other assets in the coming quarters.
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