SANTIAGO, Chile, March 28, 2014 /PRNewswire/ -- Cencosud S.A. (BCS: CENCOSUD; NYSE: CNCO), a leading multi-format Latin American retailer with presence in five countries, announced today its consolidated financial results for the fourth quarter of 2013. All figures are in Chilean pesos (CLP), except where indicated otherwise, and in accordance with International Financial Reporting Standards (IFRS). Variations refer to the comparison between 4Q12 and 4Q13.
- Cencosud revenue increased 11% YoY in 4Q13. Full year 2013 revenue rose 13% to CLP 10,341,040 million, with the consolidation of supermarkets in Colombia, new openings in the supermarkets division and the launch of department store operations in Peru.
- Cencosud opened net 46 stores, with an increase of 4.7% in selling space versus 4Q12, totaling 4.3 million of m2. Larger growth in selling space was driven by 33 new supermarket stores in the region, which added 72,773 m2, 5 Home Improvement openings in Colombia, which added 38,672 m2, and the launch of department stores division in Peru, which added 6 new stores and 32,222 m2.
- Gross profit rose 13% in CLP, with a double-digit increase in every division except Department Stores which showed single digit growth. Gross margin improved from 29.0% in 4Q12 to 29.6% in 4Q13, despite the ongoing integration of the lower-margin Colombian supermarket business and the growth of Department Stores and Financial Services in Peru.
- Operating Income increased 23.1% in 4Q13 vs. 4Q12 due to double-digit growth in Home Improvement and in the Shopping Centers division in every country. This effect was partially offset by lower operating income from the Supermarket division in Brazil, Peru and Colombia, and Financial Services division.
- Net income increased 40% versus 4Q12, from CLP 112,876 million in 4Q12 to CLP 158,087 million in 4Q13. This was a result of higher operating result (+23%), partially offset by higher income taxes (+16%).
- Adjusted EBITDA[1] reached CLP 252,652 million, up 18.3% YoY due to higher adjusted EBITDA from the Others[2], Home Improvement and Shopping Centers divisions, partially offset by a lower contribution from the Peruvian, Colombian and Brazilian Supermarket operations and Financial Service division.
Management Comment
"Our results for the fourth quarter of 2013 highlight the strength of our position as a leading supermarket retailer in Chile and Argentina, as well as our expertise in Home Improvement, Department Stores, Shopping Centers and Financial Services right across South America. Together these areas represent 71% of our total revenues, and contributed to an 11% growth in revenues and an adjusted EBITDA margin that grew to 8.8%, from 8.3% in 4Q12.
Results from our Colombian and Brazilian supermarket divisions were below expectations, due to marketing and logistical reasons respectively. Plans are in place to improve these results, including a focus on same store sales, where we have already seen signs that we are on the right track.
In 2014, our focus will be on improving results in Colombia and Brazil while also lowering our leverage through operational excellence, reduced capex and the strategic monetization of non-core assets. We remain well-positioned in the South American retail market, with unique scale and diversity, and are confident that 2014 will be a successful year."
Consolidated Revenues
Consolidated revenues were CLP 2,863 billion in the fourth quarter of 2013, compared with CLP 2,581 billion in the fourth quarter of 2012, an 11% increase YoY. This increase was driven by higher revenues from all the business units, most notably Home Improvement and Department Stores. These factors were partially offset by the impact of currency movements, which reduced the CLP revenue from Argentina and Brazil.
- Supermarket revenues in 4Q13 increased 10.4% YoY, reaching CLP 2,081 billion, driven by the consolidation of the Colombian supermarket division (CLP 134,446 million of higher revenues vs. 4Q12), the net opening of 33 new supermarkets in the region since December 2012 and positive 3.3% SSS in Chile and 21.5% in Argentina. Total supermarket selling space rose 3.2% to 2.3 million m2.
- Home Improvement revenues increased 16.2% YoY, reaching CLP 335 billion in 4Q13. Cencosud saw stronger sales across various countries, with a 7.1% SSS increase in Chile, 38.6% SSS increase in Argentina, and the net opening of 7 Easy stores in the region compared to December 2012. These factors more than offset the negative effect of 17.6% currency devaluation in Argentina.
- Department Store revenues totaled CLP 316 billion, up 10.0% YoY, driven by the continued strong performance of the Chilean operation and the contribution from the Peruvian stores opened in 2013. In Chile, Paris and Johnson had sales growth of 5.8% and 16.3% respectively, with SSS growth of 4.4% in Paris and 21.6% in Johnson, demonstrating Cencosud's success in integrating this business with Paris stores. Paris Peru contributed CLP 6,920 million of sales in 4Q13, reflecting the sales of six stores, three of them opened in November and December.
- Shopping Center revenues expanded 10.9% YoY, reaching CLP 57,904 million, driven by higher revenues from Peru related to the opening of Cerro Colorado shopping center in Arequipa in May 2013, as well as higher revenues from Colombia due to the addition of the real estate operations which contributed CLP 2,232 million, and higher revenues from Chile and Argentina, despite currency devaluation.
- Financial Services revenues increased 4.4% YoY, to CLP 69 billion. This reflected higher revenues from the Peruvian operations (CLP 3,674 million of higher revenue vs. 4Q12), the integration of Colombian financial services (CLP 2,630 million of higher revenue vs. 4Q12) and higher revenues from Argentina, partially offset by lower revenues from Chile as a result of the reduction in the average portfolio over the last twelve months.
Please visit www.cencosud.com/inversionistas.htm to obtain the full fourth quarter earnings release.
The company will hold a conference call to review the 4Q13 results on Tuesday, April 1, 2014 at 12:00 pm Santiago/Eastern Time with a live webcast available through its website. Please use the following link to pre-register for this conference call. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. You may pre-register at any time, including up to and after the call start time.
To pre-register please go to: http://dpregister.com/10042476
To participate on the day of the call, dial (866) 652-5200 or (412) 317-6060 approximately ten minutes before the call and tell the operator you wish to join the Cencosud Conference Call. A webcast of the conference call will be available online at http://www.cencosud.com/eng/inversionistas.html.
About Cencosud S.A.
Cencosud is a leading multi-brand retailer in South America, headquartered in Chile and with operations in Chile, Brazil, Argentina, Peru and Colombia. The company, founded by Chairman Horst Paulmann, operates in supermarkets, home improvement stores, shopping centers and department stores', always aiming to deliver the right product at the right price to Latin America's growing middle class. In 2012, the Company listed American Depositary Receipts (ADRs) on the New York Stock Exchange.
CONSOLIDATED BALANCE SHEETS | |||
(In millions of Chilean pesos as of December 31st, 2013) | |||
Dec-13 | Dec-12 | ||
MM Ch$ | MM Ch$ | ||
Current Assets: | |||
Cash and cash equivalents | 171,712 | 237,721 | |
Other financial assets, current | 49,584 | 68,167 | |
Other non-financial assets, current | 11,605 | 10,474 | |
Trade receivables and other receivables | 1,133,448 | 1,058,627 | |
Receivables from related entities, current | 432 | 324 | |
Inventory | 1,044,907 | 910,230 | |
Current tax assets | 22,797 | 31,270 | |
TOTAL CURRENT ASSETS | 2,434,485 | 2,316,812 | |
Non-Current Assets | |||
Other financial assets, non-current | 92,405 | 41,007 | |
Other non-financial assets, non-current | 38,263 | 38,280 | |
Trade receivable and other receivables, non current | 155,840 | 142,306 | |
Equity method investment | 49,942 | 42,260 | |
Intangible assets other than goodwill | 571,622 | 555,284 | |
Goodwill | 1,696,041 | 1,728,263 | |
Property, plant and equiptment | 3,101,884 | 3,134,528 | |
Investment property | 1,568,432 | 1,471,344 | |
Current Tax assets, non-current | 53,727 | 4,826 | |
Deferred income tax assets | 302,594 | 268,680 | |
TOTAL NON-CURRENT ASSETS | 7,630,749 | 7,426,778 | |
TOTAL ASSETS | 10,065,234 | 9,743,590 | |
Current Liabilities: | |||
Other financial liabilities, current | 739,106 | 1,179,132 | |
Trade payables and other payables | 1,957,993 | 1,901,057 | |
Payables to related entities, current | 556 | 974 | |
Provisions and other liabilities | 46,406 | 31,552 | |
Current income tax liabilities | 63,131 | 46,798 | |
Current provision for employee benefits | 96,697 | 78,800 | |
Other non-financial liabilities, current | 47,809 | 84,317 | |
TOTAL CURRENT LIABILITIES | 2,951,699 | 3,322,630 | |
Non-current liabilities | |||
Other financial liabilities | 2,218,035 | 2,362,414 | |
Trade accounts payable | 8,955 | 7,411 | |
Provisions and other liabilities | 88,223 | 121,057 | |
Deferred income tax liabilities | 471,481 | 446,958 | |
Current tax liabilities | - | - | |
Other non-financial liabilities, non-current | 65,475 | 70,909 | |
TOTAL NON-CURRENT LIABILITIES | 2,852,168 | 3,008,748 | |
TOTAL LIABILITIES | 5,803,867 | 6,331,378 | |
Equity: | |||
Paid-in Capital | 2,321,381 | 1,551,812 | |
Retained earnings (accumulated losses) | 2,049,483 | 1,866,746 | |
Issuance premium | 526,633 | 477,341 | |
Other reserves | -636,231 | -484,364 | |
Net equity attributable to controlling shareholders | 4,261,267 | 3,411,534 | |
Non-controlling interest | 100 | 678 | |
TOTAL NET EQUITY | 4,261,367 | 3,412,212 | |
TOTAL NET EQUITY AND LIABILITIES | 10,065,234 | 9,743,590 | |
CONSOLIDATED INCOME DATA | |||||
(In millions of Chilean pesos as of December 31st, 2013) | |||||
Fourth Quarter | Twelve-Month, ended December 31st | ||||
2013 | 2012 | 2013 | 2012 | ||
CLP MM | CLP MM | CLP MM | CLP MM | ||
Net revenues | 2,863,289 | 2,580,648 | 10,341,040 | 9,149,077 | |
Cost of sales | -2,016,661 | -1,832,012 | -7,371,549 | -6,547,832 | |
Gross profit | 846,629 | 748,635 | 2,969,491 | 2,601,245 | |
Selling and administrative expenses | -664,276 | -581,140 | -2,480,441 | -2,101,821 | |
Other income by function | 64,497 | 45,183 | 108,714 | 107,110 | |
Other gain (Losses) | 16,086 | 938 | 26,382 | -7,369 | |
Operating income | 262,936 | 213,616 | 624,146 | 599,165 | |
Participation in profit or loss of equity method associates | 6,310 | 2,153 | 10,289 | 5,640 | |
Net Financial Income | -66,809 | -63,380 | -252,830 | -202,912 | |
Income (loss) from foreign exchange variations | -7,923 | -6,560 | -34,723 | -2,680 | |
Result of indexation units | -8,876 | -9,235 | -20,960 | -25,915 | |
Non-operating income (loss) | -77,298 | -77,022 | -298,224 | -225,867 | |
Income before income taxes | 185,638 | 136,594 | 325,923 | 373,297 | |
Income taxes | -28,184 | -24,276 | -96,158 | -100,488 | |
Profit (Loss) | 158,087 | 112,876 | 229,930 | 269,959 | |
Profit (Loss) Attributable to Equity Holders of Parent | 157,454 | 112,319 | 229,765 | 272,809 | |
Profit (Loss) Attributable to Minority Interest | 633 | 558 | 166 | -2,851 | |
Net income per share | 54.4 | 48.5 | 83.8 | 116.0 | |
Number of shares outstanding (in millions) | 2,743,483 | 2,327,519 | 2,743,483 | 2,327,519 | |
Cash Flow Data | |||||
Net cash provided by (used in): | |||||
Operating activities | 282,031 | 407,192 | 364,782 | 718,715 | |
Financing activities | -116,794 | 1,059,217 | -107,029 | 1,488,759 | |
Investing activities | -100,864 | -1,330,064 | -320,507 | -2,116,249 | |
Other Financial Information | |||||
Organic Capex | -68,733 | -114,163 | -318,597 | -584,817 | |
Acquisitions | 0 | 0 | 0 | -362,083 | |
Depreciation | 38,096 | 35,545 | 173,650 | 131,470 | |
Amortization | 5,085 | 2,961 | 15,387 | 9,980 | |
Revalue of Assets | -59,775 | -40,666 | -95,110 | -98,633 | |
EBITDA | 295,627 | 238,480 | 767,790 | 717,659 | |
Adjusted EBITDA | 252,652 | 213,609 | 728,363 | 647,621 | |
Financial Ratios | |||||
Gross margin | 29.6% | 29.0% | 28.7% | 28.4% | |
Operating margin | 9.2% | 8.3% | 6.0% | 6.5% | |
Net margin | 5.5% | 4.4% | 2.2% | 3.0% | |
EBITDA margin | 10.3% | 9.2% | 7.4% | 7.8% | |
Adjusted EBITDA | 8.8% | 8.3% | 7.0% | 7.1% | |
[1] Please see "Reconciliation of Non-IFRS measures" starting on page 4 for a reconciliation of EBIT, EBITDA and Adjusted EBITDA to Profit/Loss. EBIT represents profit attributable to controlling shareholders before net interest expense and income taxes. EBITDA is defined as EBIT plus depreciation and amortization expense. Adjusted EBITDA represents EBITDA as further adjusted to reflect foreign exchange differences, increases (decreases) on revaluation of investment properties and gains or (losses) from indexation. Adjusted EBITDA margin and Adjusted EBIT margin are calculated as a percentage of revenues.
[2] The "Others" segment was modified in 4Q12, mainly due to the separation of the Peruvian Corporation expenses from the Supermarket division, the separation between the supermarket, real estate and financial retail businesses in Colombia and the reclassification from "Other gains (losses)" to "Income Tax" of CLP 8,702 million. FUT disbursements have been wrongfully classified as "Other gains (losses)". This has been rectified and following IFRS rules are now included in "Income Tax".
SOURCE Cencosud S.A.
