Lojas Renner (LREN3) Q4 2024 earnings summary

Executive summary

• Achieved fifth consecutive quarter of sales growth, with Q4 2024 sales up 9.7% and FY 2024 up 8.2%, surpassing market averages, driven by increased transaction volume and pieces sold.

• Record free cash flow generation: R$613 million in Q4 and R$1.5 billion for the year, with a robust cash position of R$2.8 billion and net cash of R$1.8 billion at year-end.

• Completed the largest investment cycle in company history, shifting future investments toward growth, digitalization, and omni-channel expansion.

• 20 million active customers in the ecosystem, improved NPS across all business units, and recognized for sustainability leadership.

• Announced share buyback program of up to 75 million shares (~R$1 billion) and distributed R$633.6 million to shareholders (53% payout).

Financial highlights

• Retailing net revenue reached R$12.67 billion for FY 2024 (+8.2% YoY); Q4 revenue was R$4.17 billion (+9.7% YoY).

• Adjusted EBITDA grew 26% to R$2.65 billion for the year (margin 20.9%); Q4 adjusted EBITDA up 1.7% to R$1.02 billion (margin 24.5%).

• Net income rose 22.6% to R$1.2 billion for the year (net margin 9.4%), with Q4 net income at R$487.2 million, impacted by non-recurring items.

• Retailing gross margin improved by 0.9 p.p. to 55.4% for the year; SG&A as % of revenue reduced by 1.3 p.p.

• Digital GMV grew 17.7% in Q4, with digital sales penetration at 13.7% and strong omni-channel performance.

Outlook and guidance

• 2025 investment plan of R$850 million, focused on store remodeling and 25–35 new store openings, mainly in new cities and for Renner and Youcom brands.

• Management expects continued productivity gains and market share growth, but notes significant external challenges and muted industry performance in 2025.

• Ongoing digitalization and completion of e-commerce migration to the new distribution center by Q2 2025.

• Dividend payout ratio of 53% and share buyback program of approximately R$1 billion.