Grazziotin (CGRA4) Q1 2025 earnings summary

Executive summary

• Net revenue grew 5.7% year-over-year in 1Q25, despite macroeconomic pressures and higher credit costs impacting consumer purchasing power.

• Strategic focus on store modernization and brand repositioning, with 11 stores renovated and one relocated in the quarter.

• Pormenos and GZT brands contributed 42.47% and 32.17% of total revenue, respectively, highlighting their commercial importance.

• Grato Agropecuária completed soybean harvest with 71.3 sacks/ha, slightly below potential due to drought, but investments in irrigation preserved results.

• Grazziotin Financeira expanded its credit portfolio, reflecting changes in commercial policy and a focus on sustainable credit practices.

Financial highlights

• Gross merchandise revenue reached R$179.3 million, up 3.98% year-over-year; net revenue was R$127.1 million, up 5.93%.

• EBITDA fell 48.32% year-over-year to R$6.8 million, with EBITDA margin dropping to 5.37% from 11.01%.

• Net income decreased 19.86% year-over-year to R$4.4 million, with net margin at 3.47% (down 1.12 p.p.).

• Gross margin declined to 45.06% from 48.62% year-over-year.

• Same-store sales grew 1.94% year-over-year; new stores opened after 1Q24 contributed 4.25% of 1Q25 sales.

Outlook and guidance

• Management remains confident in the company's adaptability and strategic consistency amid market changes.

• Ongoing commitment to modernization, operational efficiency, and brand repositioning to drive future growth.