Grupo Exito Full-Year 2019 Net Profit Drops Following Sale of Brazil Ops
Medellin-based multinational retail grocery and dry-goods marketer Grupo Exito announced February 19 that its full-year 2019 net profits came-in at COP$57.6 billion (US$16.9 million), down sharply from the COP$253 billion (US74$ million) in 2018 when the company still included Brazil operations (since sold).
“The result was impacted by variations in the tax [regimes], the contribution of international operations and performance of the units registered as discontinued,” according to Exito.
While profits (as measured in total pesos) dipped, operating income rose 6.3% year-on-year, to COP$15.3 trillion (US$4.5 billion) in 2019, versus COP$14.8 trillion (US$4.3 billion) in 2018, with electronic commerce, large-format sales and home-delivery sales representing 75% of the sales growth.
Recurring earnings before interest, taxes, depreciation and amortization (EBITDA) rose slightly year-on-year, at COP$1.28 trillion (US$376 million).
Colombia sales were the best in three years, up 4.8% year-on-year, according to the company, to COP$11.75 trillion (US3.4$ billion), according to the company.
“The results of Colombia are due to the cost-effective implementation of innovative value formats (Exito Wow, Carulla Freshmarket and Surtimayorista) and the execution of the omnichannel strategy (electronic commerce and domiciles),” according to Exito.
“E-commerce sales channels grew 37% in 2019 and represent 4.5% of sales in Colombia, compared to 3.4% in 2018,” the company added.
“The positive results of the Grupo Éxito operation in Colombia show the assertiveness in the development of strategies leveraged in innovation and transformation:
“1. Expansion of value formats: Éxito Wow closed 2019 with nine stores under this format, growing 13.4% of its sales and representing 17.5% of the total sales of the Éxito brand.
“2. Carulla FreshMarket, the concept of the group’s premium brand that offers customers multiple experiences, fresh, healthy products and superior service, ended 2019 with 13 points of sale in the country, which grew sales by 12. 7% compared to the previous year and represented 17% of Carulla’s total sales.
“3. Carulla SmartMarket, the smart commerce laboratory that opened its doors last December, offers its customers new experiences that reduce their shopping time, also integrating the concept of Carulla FreshMarket and important sustainability initiatives such as plastic use reduction. This proposal had an investment of COP$4 billion (US$1.17 million) and has about 20 technological formats.
“4. Surtimayorista, the format designed for professional customers and final consumers, completed 30 stores and consolidated in the central area of he country. Sales of the cash and carry format brand grew 17.8% in 2019 compared to the previous year.
“The e-commerce platforms exito.com and carulla.com had more than 86 million visits, 40.4% more than in 2018. Orders for these channels achieved 441,000 shipments in 2019.
“The ‘market place’ (virtual platform at the service of other companies) increased its sales by 29.4% in 2019 compared to the previous year.
“The ‘last- mile’ [home delivery] service had double-digit growth in the number of shipments in the year, and digital catalogs of 42%. For its part, the ‘Click & Collect’ service (purchase and pick up) increased the number of its orders by 25%,” the company added.
