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Chile’s Cencosud Sees Net Income Up 163% In Q2 2023

Chilean multi-format retail holding company Cencosud reported net income of US$ 179 million (€164 million) in the second quarter of 2023, registering year-on-year growth of 163%.

Revenue for the period grew by 12.9%, to US$ 4.51 billion (€4.14 billion), marking the ninth consecutive quarter of double-digit sales growth.

Chile accounted for 46.9% of revenues, followed by Argentina (18.1%), Brazil (11.1%), the USA (11.0%), Peru (7.5%), and Colombia (5.4%).

Adjusted EBITDA increased 17.2%, to US$ 474 million (€435 million), with double-digit adjusted EBITDA margin of 10.5%.

‘Strong’ Profitability

According to Cencosud, its performance reflected the ‘strong’ profitability in Chile, Argentina, and Peru as the countries achieved double-digit EBITDA margin once again.

CEO of Cencosud, Matías Videla, added, “This achievement is particularly notable considering the current economic environment in the countries in which we operate, where high interest rates persist due to inflationary pressures.

“This, coupled with weak economic growth in Latin America, a slowdown in consumption, and a challenged labour market makes this accomplishment even more remarkable.”

Six new stores were opened during the second quarter – four Spid stores in Chile, one The Fresh Market store in the United States, and one Prezunic store in Brazil.

Cencosud also remodelled 41 stores in the quarter, taking the total to 49.

Quarterly Highlights

Online accounted for 8.2% of total sales in the supermarket channel, down from 8.5% in the same quarter last year.

Private-label products generated 14.6% of total sales, or US$ 620 million (€569 million). The food and non-food categories captured 12.7% and 19.9% of total sales, respectively.

In July 2023, the retail group launched CencoPay, a new digital wallet that allows users to centralise all their payment methods in one app. In addition, it offers exclusive benefits, such as special promotions and Cencosud Points.

For the full year 2023, Cencosud is targeting revenues of US$ 17.5 billion (€16.1 billion), adjusted EBITDA of US$ 1.9 billion (€1.7 billion), adjusted EBITDA margin of 11.1%, and 49 store openings.

Cencosud operates stores of various formats, including supermarkets, shopping centres, home improvement, and department stores.

The group’s supermarket brands include Jumbo (Chile, Argentina, Colombia); SPID (Chile, Argentina, Brazil, Colombia, Peru); Santa Isabel (Chile); Disco and Vea (Argentina); The Fresh Market (USA); Prezunic, Bretas, GBarbosa, Mercantil Atacado, Perini and Giga Atacado (Brazil); Metro (Colombia, Peru); and Wong (Peru).

Source : ESM