3 rd Quarter 2015 Earnings Release

Transcription

1 3 rd Quarter 2015 Earnings Release October 29 th, 2015

2 Highlights of Results Net Sales totaled R$ billions in, down 22,7%, mainly due 1 to the market decline in consumption Adjustments in Cost structure, enabling to strengthen the 2 commercial competitiveness as from september Adjusted EBITDA margin of 4.0% and Net Income of R$ 33 3 millions, without considering the restructuring expenses Click & Collect implemented in all stores, allowing selling Via 4 Varejo s inventory through the websites Solid capital structure maintenance, enabling the financial 5 protection in a tough macro scenario 2

3 4Q15 and 2016 Perspectives Sales Growth Cost Structure Optimization Encouraging signs of sales elasticity combined with improvements in commercial competitiveness Headcount adjustment (reduction of approximately 11 thousands in 9M) Stores management model revision, based on internal benchmarking Renegotiation of 40% of all lease agreement Continuity of Crescer Mais project banner conversion, furniture category renovation and telephone store in store. Closure of unprofitable stores (36 store closures in 9M) Acceleration of Click & Collect Platform: Over 1,000 stores Closure of idle DC and warehouses (closure of 1 DC and 5 warehouses in 9M) Advertisement package of 2016 Soccer with the Rede Globo TV Adjustments of marketing expenses Focus on Sales Growth Cost structure adjustments in order to finance the sales growth 3

4 Sales and Expansion in Net Sales Stores Map (Total of 1016 stores) 5, % 4,095 16, % 13,807 North 5 Northeast 94 Middle West Same Store Sales: % 9M % 9M15 94 South 94 Southeast 729 Casas Bahia Banner with 1,000 bps better sales performance than Ponto Frio Banner Note: 1) As October, 28 th 5 stores openings in 86 stores openings in the last 12 months Renovation of 100 new concept telephony stores, 56 stores under the new furniture concept and 53 banner conversions¹ Ponto Frio to Casas Bahia. 4

5 Solid Gross Margin and pressure on fixed costs Gross Profit (R$ MM, % net revenue) Adjusted EBITDA (R$ MM, % net revenue) 1, % 1, % Stable Gross Margin, with a reduction of 150 bps in merchandise margin, offset by gains in services, freight and assembly revenues. 1,517 1, % 1, % SG&A Expenses (R$ MM, % net revenue) Decline in sales and inflation rise impacted the dilution of fixed expenses The current level of expenses doesn t fully +550 bps capture initiatives to reduce the cost structure % % 9.3% 9M % 9M15 5

6 Working Capital Improvement vs. Working Capital Need (gap between inventories and suppliers) (days of COGS) HIGHLIGHTS Solid financial structure and credibility with partners enabled the Company to deliver another quarter with an increase in the gap between inventories and suppliers Source: Via Varejo 6

7 Solid Financial Structure Cash and Cash Equivalents NET FINANCIAL RESULT (% net revenues, R$ MM) -2,087 3,528 1,441 Net Cash % 110 bps -1.7% -2.5% 40 bps -2.9% Loans and Financing¹ 1, , ,495 1, M M14 In, the net financial result improved 110 bps as a result of an efficient treasury strategy, allowing mitigate the impacts of the interest rate hike. The company delivered again a solid net cash position, and enters the fourth quarter well prepared to capture the best season for cash generation of the year Note: 1) Does not include payment book debt (CDCI) 7

8 3 rd Quarter 2015 Earning Release Adjusted Net Income and new initiatives Adjusted Net Income (R$ MM, % net sales) 593 Cost-reduction Initiatives Cost-reduction and expenses control mindset Store operational efficiency improvements Strengthen of sales growth initiatives Financial discipline, active working capital management, and solid cash position 4.3% % 3.6% 1.7% 9M14 9M15 Source: Via Varejo 8

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