Allos (ALOS3) Q2 2024 earnings summary

Executive summary

• Q2 2024 delivered strong results with total sales of R$9.4 billion (+5.8% YoY), driven by portfolio optimization, organic growth, and operational improvements, with robust regional growth in the Southeast and South.

• Net revenue rose 3.8% YoY to R$622 million, supported by 25% growth in media and 40% in parking revenues.

• FFO grew 41.1% YoY to R$312.1 million, with FFO per share up 41% due to share buybacks.

• Major investments in mall revitalizations and expansions, with key projects set for completion by year-end and 2025.

• Continued focus on tenant mix, digitalization, and loyalty programs to enhance consumer experience, with 2.2 million app users and 55% more benefits redeemed.

Financial highlights

• Net revenue reached R$622 million, up 3.8% YoY, with tenant sales totaling R$9.4 billion (+5.8% YoY).

• Adjusted EBITDA was R$442.4 million (+3.4% YoY), and NOI reached R$547.7 million (+4.4% YoY).

• FFO per share rose 41% to R$0.58; net income was R$326.1 million with a 52% margin.

• Occupancy rate stable at 96.3%; net delinquency rate improved to 1.1%.

• Cost of occupancy at 10.5%, slightly below 2023.

Outlook and guidance

• Guidance for disinvestments remains at R$1 billion, with timing flexible based on market conditions.

• Dividend payout guidance maintained at 50%; share repurchase program ongoing with potential for further buybacks.

• NOI growth expected above inflation, with further synergies and efficiency gains anticipated post-merger.

• Construction for Shopping Tijuca's expansion begins in 2025, adding 2,165 sqm of GLA and 22 new operations.

• Loyalty program rollout to all malls by 2025, with significant increases in user engagement and benefits redeemed.