Grupo Casas Bahia (BHIA3) Q4 2024 earnings summary

Executive summary

• Achieved five consecutive quarters of EBITDA margin improvement, reaching 8.0% in Q4'24, and record-high employee engagement, with strong market share and productivity gains driven by the Transformation Plan.

• Generated the best free cash flow in five years, with liquidity increasing to R$4.0 billion and operational profitability improving sequentially.

• Recognized as a top employer and for brand strength, with awards from Folha de São Paulo, Estadão, and GPTW.

• Transformation Plan focused on operational leverage, efficiency, and profitability, despite a challenging macroeconomic environment.

• Productivity gains and operational improvements are expected to set new benchmarks for profitability.

Financial highlights

• Q4'24 net revenue was R$7,981 million (+7.6% y/y); annual net revenue R$28,847 million (-5.7% y/y); consolidated gross revenue for 2024 was R$32,414 million (-5.9% y/y).

• Gross margin improved to 30.8% in Q4'24 (+3.2 p.p. y/y); annual gross margin at 30.8% (+2.9 p.p. y/y).

• Adjusted EBITDA reached R$640 million (8.0% margin) in Q4'24 and R$1,970 million (7.2% margin) for 2024, the highest in 21 months.

• Net loss in Q4'24 was R$452 million, a 54.8% improvement y/y; annual net loss R$1,045 million (-60.2% y/y), with net margin at -3.8%.

• Free cash flow in Q4'24 was R$1.2 billion (+70% y/y); annual free cash flow reached R$1.0 billion, the best in five years.

Outlook and guidance

• CapEx for 2025 is expected to remain at similar levels, focused on store refurbishments and technology, with expansion supported by industry partnerships and retail media.

• Management expects continued margin improvement and profitability growth through 2025, supported by operational efficiencies and Transformation Plan initiatives.

• Expansion of credit facilities and operationalization of a new FIDC are expected to support growth and diversify funding.

• If interest rates decrease, there may be an opportunity to increase CapEx, but current plans remain disciplined.