Companhia Brasileira (CBD) Q4 Earnings & Revenues Grow Y/Y
Companhia Brasileira de Distribuicao CBD or Grupo Pao de Acucar delivered fourth-quarter 2021 results. During the quarter, the company witnessed a withdrawal from the hypermarket activity, alongside seeing its repositioning as a premium, proximity and digital food retailer.
Companhia Brasileira’s consolidated net income amounted to R$777 million ($139.2 million), which increased significantly from R$374 million ($67 million) in the year-ago period. The upside was backed by solid increases in revenues.
Gross revenues in the quarter amounted to R$16,381 million ($2,934.4 million). Gross revenues rose 6.2% year over year in local currency. CBD saw strength in GPA Brazil as well as Grupo Exito. E-commerce sales surged 46.2% in the quarter, with online penetration coming at 8.4% in Grupo Brazil.
This Zacks Rank #2 (Buy) company has been benefiting from its delivery models, including same-day delivery — Express and Click & Collect, Traditional or next-day delivery, and Last Mile or next-hour delivery — James Delivery and Open Platform. Moreover, the company’s loyalty program and app development efforts have been yielding results. On the digital front, the company remains focused on expanding via its platform as well as building on its alliances.
Gross profit remained flat year over year in local currency at R$3,726 million ($667.55 million) and the gross margin contracted 170 basis points (bps) to 25%. Adjusted EBITDA decreased 9.8% to R$1,186 million ($212.5 million), with adjusted EBITDA margin decreasing 140 bps to 8%.
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Segment Details
GPA Brazil’s gross revenues dipped 3.9% in local currency to R$7,936 million ($1,421.6 million). Sales, excluding hiper and drugstores, amounted to R$4.7 billion ($0.8 billion). Same-store sales grew 2.3% despite a tough macroeconomic landscape and tough comparisons with the year-ago period. Online sales ascended 46.2% due to the omnichannel strength and expansion of alliances with last mile delivery providers.
The segment’s gross margin contracted 380 bps to 23.3%. SG&A expenses rose 50 bps (as a percentage of sales) to 18.4%. Adjusted EBITDA margin fell 360 bps to 5.4%.
The company had acquired 96.57% of Grupo Exito’s capital stock on Nov 27, 2019. Gross revenues in the unit increased 17.8% to R$8,419 million ($1,508.2 million). Same-store sales surged 15.3%. The segment benefited from a focus on innovation, omnichannel strength and higher gains from supplementary businesses. The gross margin expanded 30 bps to 26.5%. SG&A expenses, as a percentage of sales, rose 10 bps to 16.1%. Adjusted EBITDA margin stayed unchanged at 10.6%.
Other Details
Companhia Brasileira ended the quarter with cash and marketable securities of R$8,274 million ($1,484.6 million) and total shareholders’ equity of R$16,381 million ($2,939.2 million).
Shares of the company have declined 21.6% in the past six months compared with the industry’s decline of 7.7%.
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