Vivara Participações (VIVA3) Q2 2024 earnings summary

Executive summary

• Revenue grew 19.2% year-over-year to R$836.6 million, driven by strong performance in Jewelry (+18.0%) and Life (+20.6%) categories, and improved inventory allocation.

• Net income surged 91.8% to R$211.0 million, with net margin expanding to 32.1%.

• Adjusted EBITDA rose 23.9% to R$164.1 million, with margin up 135 bps to 25.0%.

• Same-store sales rose 11.6% year-over-year, with Life stores up 16.7% and Vivara stores up 12.6%.

• Free cash generation reached R$73.3 million, reversing a cash burn in 2Q23.

Financial highlights

• Net revenue was R$656.3 million, up 17.2% from 2Q23.

• Gross profit increased 15.8% to R$451.8 million, with gross margin at 68.8%.

• SSS (physical stores + digital) grew 11.6% year-over-year; physical stores SSS up 12.9%.

• Digital sales grew 5.2% to R$110.1 million, representing 13.2% of total sales.

• CAPEX was R$38.2 million, down 19.2% year-over-year, representing 5.8% of net revenues.

Outlook and guidance

• Management is optimistic for 2H24, expecting continued growth, profitability expansion, and strong cash generation.

• Plans to open 70–80 stores in 2024, surpassing 2023's expansion pace.

• Focus on product assortment, inventory allocation, and operational efficiencies to drive further gains.

• Launch of new store layouts to boost customer circulation and sales agility.

• Market share in Brazil's jewelry market reached 20.6% at quarter-end.