Éxito Posts Net Loss for 3Q 2023 on Higher Financial Expenses

Medellin-based multinational supermarket/dry goods retailer Almacenes Éxito on November 8 posted a third quarter (3Q) 2023 net loss of COP$31.7 billion (US$7.8 million) — a 163% year-on-year decline, as 3Q 2022 produced a net profit of COP$49.9 billion (US$12.3 million).

While higher financial expenses hurt the bottom line this year, recurring earnings before interest, taxes, depreciation and amortization (EBITDA) actually improved 17.6% year-on-year, to COP$328 billion (US$81 million), according to the company.

Net revenues also improved year-on-year, to COP$5.13 trillion (US$1.27 billion) — a 0.5% gain as measured in Colombian pesos (COP) or a 9.1% gain when excluding foreign-exchange effects, according to the company.

The revenue gains came from “strong international retail sales growth [in Uruguay and Argentina] as measured in local currencies and above inflation-indexing, along with solid real estate gains (+7.8%) and omni-channel sales growth (+17%),” according to the company.

Omni-channel sales include sales via websites, home deliveries, digital catalogues and business-to-business sales, the company explained.

But aside from the gains in international stores and omni-channel sales, “a slowdown in retail sales versus previous quarters relates mainly to a lower consumption trend seen in Colombia — affected by high inflation and interest rates, impacting non-food sales mainly,” according to Éxito.

“Gross profit reached COP$1.28 trillion [US$317 million] during 3Q 2023, with a 24.9% margin as percentage of net revenue — down 60 basis points — and reflected the solid contribution of recurring income in the real estate business (+16.5%) in Colombia and successful commercial strategies in Uruguay, offset by investment requirements,” according to the company.

Omni-channel sales grew 17% year-on-year and took a 10.7% share of all sales corporate-wide. In Colombia, those omni-channel sales accounted for 13.5% of total sales, while in Uruguay, omni sales took 2.5% and in Argentina, they took 4%, according to Éxito.

“Éxito” branded stores — which feature both dry goods and supermarket foods — accounted for approximately 67% of the sales mix in Colombia during 3Q 2023. This segment suffered from “the lower consumption trend mostly affecting the electro category (-5.3%), which partially offset the positive outcome of ‘Megaprima’ and ‘Special Prices Days’ events and growth of the ‘fresh’ category (+7.2%),” according to Éxito.

As for the 31 relatively new “Éxito Wow” super-giant retail stores, these stores took a 36% share of Colombia sales, up 107 basis points year-on-year, according to the company.

Meanwhile, the “Carulla” brand supermarket-segment here “represented approximately 17% of the sales mix in Colombia during 3Q 2023,” according to the company.

“Carulla” stores “posted solid double-digit sales growth during 3Q 2023, benefitting mainly from omni-channel sales (+46.2%, 25.7% share) — and boosted by a 120% growth of the ‘Turbo-Fresh’ service for deliveries within 10 minutes, via last-mile-delivery-specialist Rappi,” according to Éxito.