In This Article:
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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C & A Modas SA (BSP:CEAB3) achieved a 15% growth in apparel same-store sales, even against a high comparison base from the previous year.
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The company reported a 71% increase in net revenue for the beauty category, significantly boosting overall sales.
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Adjusted EBITDA margin improved to 15.2%, up by 2.7 percentage points compared to the previous year.
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Strong cash generation was reported, totaling nearly 81 million, contributing to a reduction in total leverage to 0.5 times.
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The company saw a 6.4% increase in its active customer base and a 13-point improvement in its Net Promoter Score (NPS).
Negative Points
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The electronics category showed lower contribution, with electronics and beauty same-store sales at only 2.5%.
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C & A Modas SA (BSP:CEAB3) continues to face challenges in the electronics segment, with ongoing demobilization efforts.
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Despite improvements, the share of C & A Pay in retail sales decreased by 0.7 percentage points compared to the previous year.
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The company maintains a conservative credit granting strategy, which may limit growth in credit product penetration.
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There is a cautious approach to store expansion, with plans for only 5 to 10 new stores in 2025, potentially limiting rapid growth.
Q & A Highlights
Q: What are your plans for pricing, and is there room to further increase prices? How are you dealing with customer acceptance considering your mix? A: (Paulo Correa, CEO) Our strategy is to maintain competitiveness by evaluating category movements and using dynamic pricing tools. We see room for price increases, particularly in high-income stores, due to product mix, improvements, and price transfer. Our focus is on improving raw materials and models, which is reflected in our pricing. The improvement in our NPS indicates positive customer reception.
Q: Given the positive results and success of productivity improvement projects, will there be an acceleration in new store openings? A: (Paulo Correa, CEO) We plan to open between 5 and 10 new stores this year. However, expansion is a long cycle, and we will only open stores in locations that meet our criteria. Our focus remains on improving sales per square meter, which will continue to be our priority in 2025, with potential for stronger expansion in 2026.
Q: What are the trends for the start of Q2, and what is your level of optimism for this quarter? A: (Paulo Correa, CEO) Q2 is crucial due to last year's comparison base. We have favorable conditions with lower average temperatures and a comparison base due to last year's floods. We had a good start to Q2 and are well-prepared for upcoming events like Mother's Day and Valentine's Day in Brazil.