Lojas Renner (LREN3) Q1 2025 earnings summary

Executive summary

• Retail revenue grew 12% year-over-year in Q1 2025 to R$2,756.8 million, with apparel sales up 13.5% and digital GMV up 15% (16% penetration).

• Net income reached R$221 million, up 59% year-over-year, with EPS up 65% and ROIC at 13.3% (+1.9p.p.).

• Gross margin increased by 0.6 percentage points to 55.1%, with the lowest markdown levels in a decade.

• Adjusted EBITDA grew 55% to R$585.2 million (margin 21.2%, +5.8p.p.), driven by retail and financial services.

• Consumer finance business (RealEasy/Realize) operating result grew sevenfold year-over-year, with improved portfolio risk, excluding regulatory effects.

Financial highlights

• Retailing net revenue: R$2,756.8 million (+12.0% YoY); same store sales up 10.8%.

• Apparel net revenue: R$2,445.0 million (+13.5% YoY); Youcom sales up 28%.

• Gross profit: R$1,517.9 million (+13.3% YoY); gross margin 55.1% (+0.6p.p.).

• Operating expenses: R$1,143.6 million (+8.6% YoY), with 1.3p.p. dilution as % of net revenue.

• Recurring net income grew 71% to BRL 151 million.

Outlook and guidance

• Management expects stable or slightly higher gross margins for 2025, despite inflation and FX volatility.

• 2025 investments expected to reach R$850 million, focused on store refurbishments and 25-35 new store openings, with most Renner stores in new, high-profitability locations.

• No major new infrastructure investments anticipated; focus on leveraging existing assets for growth.

• RealEasy/Realize results expected to continue improving, with cautious credit granting amid macro uncertainty.

• Forward-looking statements are subject to market, economic, and sector performance.