Brazilian apparel chain Lojas Renner reports annual profit for the first time

New York - Brazilian apparel chain Lojas Renner SA reported an annual profit of over 1 billion reais (about 269 million dollars) for the first time last year, helped by double-digit revenue growth.

“We see good customer traffic and the same pace we had at the end of last year,” Chief Financial Officer Laurence Gomes said in a telephone interview with Reuters on Thursday. Additionally, Gomes said economic conditions seemed more favourable, despite uncertainty related to the approval of the new government’s economic reforms.

Fourth-quarter net profit rose 33 percent year on year reaching 440 million reais, practically in line with an average estimate compiled by Refinitiv of 434 million reais.

Annual net profit (1.02 billion reais) came in 39 percent higher than the previous year, with net margin improving by 2.5 percent to 13.6 percent. Earnings before interest, tax, depreciation, and amortisation (EBITDA) rose 20 percent to 1.773 billion reais.

“We had a challenging first half, with the truckers’ strike, the World Cup and not-so-favourable weather, but sales recovered in the second half,” Gomes said, reported Reuters.

Gomes said Renner was standing by plans to open three new shops in Argentina in the second half of 2019, as part of efforts to operate outside Brazil. “It is a volatile market, but we are starting there with only three shops, so the risk is low”, Gomes concluded.