Grupo SBF (SBFG3) Q4 2023 earnings summary

Executive summary

• 4Q23 net revenue rose 7.4% YoY to R$2.13B; adjusted EBITDA ex-IFRS increased 31.7% to R$211.4M and adjusted net profit ex-IFRS more than doubled to R$141.3M.

• FY23 net revenue increased 11.6% to R$6.99B; adjusted EBITDA ex-IFRS rose 29.4% to R$606.9M.

• Record 4Q23 operating cash generation of R$949.6M supported year-end leverage of 1.35x.

• 2024–25 priorities: safe, responsible growth, margin recovery, working-capital optimization, higher profitability and structural leverage reduction.

Financial highlights

• 4Q23 adjusted gross profit was R$979.2M, up 3.7% YoY; adjusted gross margin declined 1.6 pp to 46.0%.

• FY23 adjusted net profit ex-IFRS increased 10.3% to R$227.8M; adjusted net margin was 3.3%, unchanged YoY.

• FY23 IFRS operating income rose 32.1% to R$530.8M, while IFRS net income declined 17.5% to R$168.8M.

• 4Q23 adjusted operating expenses ex-IFRS decreased 2.0% YoY to R$767.8M; expenses/net revenue improved 3.5 pp to 36.0%.

Outlook and guidance

• Priorities include safe, responsible growth, gross-margin recovery, working-capital optimization, higher profitability and structural leverage reduction.

• Centauro aims to increase gross profit per store area, improve pricing and resume digital growth through better assortment, 3P curation and omnichannel investment.

• Fisia plans to restore profitability through lower markdowns and structurally reduce working-capital needs through improved inventory management.