PBG (PTBL3) Q3 2020 earnings summary

Executive summary

• Achieved the best quarter in history with three consecutive sales records and 39.9% net revenue growth compared to 3Q19.

• Outperformed retail and sector market growth, gaining market share.

• Strong performance in both domestic and international markets, especially in the US due to Portobello America ramp-up.

Financial highlights

• Net revenue grew 39.9% year-over-year in 3Q20, with domestic up 38% and international up 33.1%.

• Adjusted and recurring EBITDA reached R$61.2 million, up 156.9% from 3Q19, with margin improvement of 6.8 p.p.

• Adjusted and recurring net income was R$30.2 million, a 402.2% increase over 3Q19.

• Adjusted gross margin improved to 37.0%, up 5.0 p.p. from 3Q19, reaching 39.2% in September.

• Operating expenses as a percentage of net revenue reduced by 2.8 p.p. in 3Q20.

Outlook and guidance

• Strong demand for construction materials expected to continue, driven by low interest rates and increased financing.

• Inflationary pressures on costs remain a concern for margins in coming months.

• Gradual resumption of investments while preserving cash position.

• Continued focus on cash management, working capital, and debt reduction.