*Bloomberg calculations Source: Company reports/Bloomberg

4Q15 Results

Lojas Americanas’ 4Q15 net revenues increased by 6.3%, to R$5.8 billion, from R$5.5 billion in 4Q14. The company saw a 31.1% decrease in net income, to R$0.20 billion, from R$0.30 billion in the year-ago period. In order to respond to the challenging macroeconomic environment, the company deferred R$143.8 million in income tax related to B2W (its e-commerce division) until 2025. Thus, the company’s adjusted net income, which excludes the effects of this deferred income tax, was R$0.28 million, down 4.1% from 4Q14. Same-store sales grew by 8.6% in 4Q15 and by 8.8% in 2015. The company noted that it was awarded #1 retailer in Brazil by three different publications. The company’s gross merchandise volume increased by 12.8% year over year. Lojas Americanas opened its 1,000th store in 4Q15, and it plans to open an additional 800 stores by 2019. Bloomberg calculated the company’s adjusted EPS for 4Q15 at R$0.16, compared to the consensus estimate of R$0.23.

2015 Results

Revenues for 2015 were R$17.9 billion, up 11.0% from R$16.2 billion in 2014. Net income for the year was R$250.2 million, down 41.5% from R$430 million in 2014. Excluding the effects of the deferred income tax described above, net income would have been R$330.2 million. Adjusted EPS for 2015, as reported by Bloomberg, was R$0.21, down from R$0.36 in 2014 and lower than the consensus estimate of R$0.32. The company invested R$677.3 million in 2015 in order to continue its expansion and update its in-store technology. This expense added to the decrease in net income. Lojas Americanas opened 93 new stores in 2015.

Guidance

In 2016, Lojas Americanas intends to continue to expand by adopting measures that will mitigate increasing operating costs and macroeconomic instability. The company will focus on investing in its digital platform, B2W, which has more than doubled in size since 2012. Since the beginning of 2016, Lojas Americanas has opened three new stores, and it has more than 80 in advanced stages of negotiation. Two new distribution centers are set to open in the next four years, as well.