Guararapes Confecções (RIAA3) Q1 2026 earnings summary

Executive summary

• Achieved record net income of R$5 million in Q1 2026, reversing losses from prior years and marking 11 consecutive quarters of double-digit apparel same-store sales growth at 10.1% year-over-year.

• Apparel gross margin expanded for the 10th straight quarter, reaching 54.9%, up 1.2 percentage points year-over-year.

• Record retail EBITDA for Q1 at R$135 million (8.1% margin), up over 20% year-over-year; consolidated EBITDA reached R$268 million (11.5% margin), up 14.1%.

• Transformation initiatives included brand relaunch, new store formats, new leadership, and strategic board creation.

• Strategy focused on growth, efficiency, modernization, and strong execution across retail and financial operations.

Financial highlights

• Consolidated net revenue reached R$2.32 billion (+6.7% YoY); consolidated EBITDA was R$268 million (+14.1% YoY) with an 11.5% margin (+0.7 p.p.).

• Retail EBITDA was R$135 million (+23.7% YoY), with an 8.1% margin, the best in nine years.

• Apparel SSS grew 10.1% YoY for the 11th consecutive quarter; cumulative three-year growth near 40%.

• Financial Services EBITDA reached R$133 million (+5.8% YoY); credit portfolio up 12.9% YoY to R$6.0 billion.

• Net income was R$5 million (vs. loss of R$45.9 million in Q1 2025); net margin: 0.2%.

Outlook and guidance

• Guidance to open 15–20 new stores in 2026, with continued focus on modernization and apparel gross margin expansion.

• Midway financial operations expected to contribute ~30% of results, with net income growth projected to outpace EBITDA growth.

• Ongoing investments in logistics automation and digital/physical channel integration, with expected SG&A and gross margin gains from 2028.

• Disciplined capital allocation and expansion of the retail network, with 444 stores at quarter-end.