PBG (PTBL3) Q3 2024 earnings summary

Executive summary

• Net revenue reached R$662 million in 3Q24, up 10.6% year-over-year, with growth in all business units and international markets representing 22.8% of total revenue.

• EBITDA rose 8.9% to R$103 million (15.6% margin), reflecting higher business volume and cost optimization.

• Net income was R$2.6 million, down from R$4.0 million in 3Q23, impacted by higher financial and depreciation expenses.

• Working capital improved, decreasing 21.9% to R$215 million, with a 12-day reduction in the cash conversion cycle.

• CapEx investments dropped 59.7% to R$26.6 million, focused on retail expansion, plant maintenance, and internationalization.

Financial highlights

• Gross profit increased 5.2% to R$253 million, with a gross margin of 38.3%, down 2 p.p. year-over-year.

• Adjusted and recurring EBITDA was R$103.4 million, up 9.5% year-over-year, with a margin of 15.6%.

• Net debt stood at R$978 million, with net leverage at 2.9x EBITDA, improving from 3.1x in 3Q23.

• Share price closed at R$4.60, with a market cap of R$648.5 million and free float of 35.2%.

• Cash conversion cycle: 29 days, improved by 12 days year-over-year.

Outlook and guidance

• Management expects continued profitability and growth, focusing on operational efficiency, cost discipline, and international expansion, especially in the US.

• Strategic projects in integrated retail and internationalization remain priorities, despite reduced CapEx.

• Ongoing deleveraging and financial discipline remain priorities.

• Portobello America to advance ramp-up for profitability; Portobello Shop to resume higher growth, especially in B2B.

• Continued discipline in expense management and sequential leverage reduction expected.