Grupo Multi (MLAS3) Q3 2024 earnings summary

Executive summary

• Achieved first positive net income since Q2 2023, with R$1.5M in Q3 2024, driven by margin recovery and exchange rate gains, despite revenue declines from logistics and supply chain delays.

• Gross profit reached R$199.3M (+2.6% vs. Q2 2024, +239.6% vs. Q3 2023), with gross margin at 24.6% (+2.7 p.p. vs. Q2 2024).

• Revenue from the ongoing portfolio grew 3.2% sequentially, but total net revenue dropped 8.5% due to supply chain and logistics disruptions.

• Cash consumption was significant (R$129.4M to R$282.7M), mainly for inventory replenishment and longer supplier payment cycles.

• Net cash position at R$175.6M, with cash covering 2.8x short-term debt.

Financial highlights

• Net revenue: R$809.9M in Q3 2024, down 8.5% from Q2 2024 and 8.4% year-over-year, impacted by supply chain delays.

• Gross margin improved to 24.6%, up 2.1–2.7 p.p. from Q2 2024, led by Office & IT Supplies.

• EBITDA: R$4.2M, marking the second consecutive positive quarter, though down from Q2 2024.

• Net income: R$1.5M, reversing losses in prior quarters.

• Cash and equivalents: R$739.9M at quarter-end, down 27.6% from Q2 2024.

Outlook and guidance

• Focus on increasing revenue, improving gross margin, and reducing selling expenses through portfolio optimization, pricing discipline, and logistics efficiency.

• Management expects continued margin recovery and operational improvements, despite ongoing supply chain and FX volatility.

• New distribution center to be rented in Manaus to expand logistics capacity.

• Wi-Fi 7 products in testing phase for providers, not yet commercialized.