Lojas Renner (LREN3) Q1 2026 earnings summary

Executive summary

• Achieved record first-quarter net income of R$257.3 million, up 16.4% year-over-year, with record gross margin, gross profit, and free cash flow, driven by strong operational execution and margin expansion across all segments.

• Retail net revenue grew 4.3% to R$2,875.9 million, with apparel revenue up 5.1% and digital GMV up 7.4%, reaching 16.6% penetration.

• Retail EBITDA rose 23.5% to R$487.5 million, with margin expanding 2.7 p.p. to 17.0%.

• Margin expansion was supported by higher share of full-price sales, improved inventory management, and supply chain efficiency.

• Maintained robust cash position and disciplined capital allocation, including share repurchases and Interest on Capital payments.

Financial highlights

• Retail gross profit reached R$1,630.0 million (+7.4% YoY), with gross margin at 56.7% (+1.6 p.p. YoY); apparel gross margin hit 58.0% (+1.9 p.p. YoY).

• Free cash flow hit a record R$258.0 million, supported by higher EBITDA and efficient working capital management.

• ROIC (LTM) improved to 15.2% (+1.9 p.p. YoY), above the cost of capital.

• Net income: R$257.3 million (+16.4% YoY), EPS: R$0.2621 (+23.5% YoY).

• Financial cycle reduced to 105 days, down 8 days year-over-year.

Outlook and guidance

• Maintained annual net revenue growth guidance of 9–13% for 2026–2030, with focus on disciplined expansion, digital penetration, and omnichannel productivity.

• Guidance to reduce operating expenses (ex-IFRS 16) as a percentage of retail net revenue by 2.5–3.5 p.p. by 2030.

• Capital distribution guidance of 50–80% of net income for 2026–2030.

• Store expansion plan targets 50–60 new stores in 2026, aiming for 570–600 Renner and 260–290 Youcom stores by 2030.

• Targeting annual retail EBITDA margin (ex-IFRS 16) of 18–20% by 2030.