SANTIAGO, Chile--(BUSINESS WIRE)--Cencosud S.A. reported today its fourth quarter 2023 financial results, which reflects the strength and resilience of the supermarket business, despite the strong devaluation of the Argentine peso.
Revenues for the year totaled CLP $14,230,642 million, an increase of 0.2% year over year. This reflects the negative impact of the hyperinflation accounting adjustment in Argentina (IAS 29) and a challenging macroeconomic environment, resulting in lower consumption and growth in the countries where Cencosud operates. Excluding the hyperinflation accounting adjustment the Company revenues increased 6.6% year on year, due to the opening of 44 new stores, equivalent to 27,992m2 of new sales area, the opening of Cenco La Molina in Peru and the 11.2% growth in e-grocery sales, among other advances.
With respect to profitability the full year 2023 EBITDA margin was 9.7%. Excluding the hyperinflation accounting adjustment Cencosud's Adjusted EBITDA increased 3.0%, reaching CLP $1,634,048 million with a margin of 10.7%.
Reported Net Income was CLP $292,213 million, a decrease of 27.8% compared to the same period of the previous year. Excluding the hyperinflation accounting adjustment Net Income for the year grew increased 20.2%, reaching CLP $823,175 million.
"2023 was a year marked by a challenging macroeconomic environment in the countries in which Cencosud operates. Additionally, the Andean countries were impacted by the effects of the "El Niño" weather event and Argentina experienced a historic devaluation of the peso. Despite this, Cencosud reported slight growth in revenues and maintained a double-digit EBITDA margin, which is the result of a strategy focused on financial strengthening, profitable growth, and the consolidation of our digital ecosystem," commented Rodrigo Larraín, CEO of Cencosud.
A highlight of the last fiscal year was the strengthening of the regional private label Store Brands model, which has improved the value proposition for customers and positively impacted Cencosud's profitability. In 2023, this success was demonstrated in private label sales reaching US$2.5 billion, a record high and with a sales penetration of 15.5%.
Fourth-quarter results
In the last three months of the year, the Company's revenues were CLP $3,299,029 million, a decline of 15.9%. Excluding the hyperinflation accounting adjustment revenues reached CLP $4,424,735 million, an increase of 2.8% compared to the previous year.
Adjusted EBITDA for the quarter reached CLP $357,439 million with an Adjusted EBITDA Margin of 10.8%. Excluding the hyperinflation accounting adjustment, Cencosud's Adjusted EBITDA increased 8.7% in the quarter, and the Adjusted EBITDA margin expanded 64 basis points to 11.8%.
Net Income reported for the same period at CLP $108,359 million was negatively impacted by the devaluation of the Argentine peso. Excluding this impact, Net Income increase by 49.2%.
2024 Investment Plan
Cencosud will invest US$641 million in 2024, focusing on accelerating organic growth and innovation, strengthening the physical-digital ecosystem, and achieving greater operational efficiencies and profitability. The plan for the year includes the addition of 43 new stores and 50,171 square meters of selling space, approximately 80% higher than the square meters added in 2023. In addition, more than 33,000m2 of GLA are expected to be added to the shopping center business.
About Cencosud
Cencosud is one of the largest and most prestigious retailers in the Americas, with operations in Argentina, Brazil, Chile, Peru, Colombia, and the United States -in addition to a commercial office in China and a technological and digital Hub in Uruguay- where it develops a successful multi-format strategy that today employs more than 120 thousand people. Its operation encompasses several business lines, such as Supermarkets, Home Improvement, Department Stores, Shopping Centers and Financial Services.
Additionally, Cencosud operates complementary businesses such as Cencosud Media, Cencosud Ventures and CencoPay, all of which are known for their quality, excellent level of service, and focus on customer satisfaction. For more information, please visit www.cencosud.com
Contacts
Beatriz Monreal
beatriz.monreal@cencosud.cl
