Brazilian retailer GPA narrowed its losses by 21.9% year on year in the second quarter, to 332 million reais (€55.2 million), while revenues climbed 2.5% to 4.49 billion reais (€746 million).
E-commerce sales accounted for 12.6% of total food sales, representing an increase of 1.5% year on year. This growth contributed to a significant boost in adjusted EBITDA, which soared 57.2% to 396 million reais (€66 million), boosting the EBITDA margin to 8.8% from 5.7%.
GPA also managed to reduce its net debt by 1.2 billion reais (€199 million) to 2.3 billion reais (€382 million) by the end of the quarter.
Breaking down total sales, Pão de Açúcar contributed 2.38 billion reais (€395 million), local stores added 554 million reais (€92 million), and Extra Mercados generated 1.55 billion reais (€258 million).
Turnaround Plan
GPA also announced a 22% reduction in net losses to 332 million reais (€55 million) in the second quarter as it nears the end of its three-year turnaround plan. The company attributed the improvement to cost-cutting measures and reduced interest expenses.
Market share grew by 0.7 percentage points in the state of São Paulo during the second quarter of 2024 compared to the same period last year, while the national market share remained unchanged. The proximity format, encompassing Minuto Pão de Açúcar and Mini Extra stores, continued to experience substantial growth, increasing its market share by 2.8%.
Capex for built-to-suit operations reached 158 million reais (€26 million) – a 20 million reais (€3 million) increase compared to the same period in 2023. This growth was primarily driven by investments in new stores and land acquisitions.
Despite challenges, such as increased competition and inflationary pressures, GPA expressed optimism about its ability to deliver a successful turnaround by the end of the year. However, the company also faced headwinds, including store closures and increased operating expenses related to restructuring.
Marcelo Pimentel, GPA CEO, added, "The second half of the year presents many opportunities for us to continue accelerating results. It is time to close the first cycle of the turnaround project and look to the future, consolidating our market position and the value proposition of our business."
GPA closed seven stores in the second quarter, 5 Extra Mercado and 2 Minuto Pão de Açúcar. In the same period, it opened 10 stores: six Minuto Pão de Açúcar and three Mini Extra outlets, as well as one under the Pão de Açúcar banner.
