Falabella (FALABELLA) Investor Day 2024 summary

Strategic direction and transformation

• Focused on five core business engines—retail, home improvement, supermarkets, shopping malls, and digital banking—supported by loyalty, technology, and logistics enablers, with no plans for new regions or businesses.

• Embraced simplicity, operational focus, and organizational agility, prioritizing customer experience, profitability, and balance sheet strength.

• Four key priorities: enhance core business value, refocus digital strategy, drive organizational effectiveness, and prioritize capital allocation for profitability.

• ESG leadership in LatAm, with a 20% reduction in Scope 1 and 2 emissions since 2021, 73% renewable energy use, and targets for diversity and social impact.

• Loyalty program is a central enabler, tripling participants in five years and driving customer engagement, data access, and incremental value.

Financial guidance and capital allocation

• Achieved four consecutive quarters of positive results, with all business units showing significant improvement.

• EBITDA margin improved to 10.6% (LTM Sep-24), targeting 12.5–13.5% by end of 2026, with mid- to high single-digit revenue growth.

• Efficiency plan saved $400 million in SG&A, surpassing the original $250 million target; SG&A expected to remain flat in real terms.

• CapEx for 2025 set at $650 million, up 30% from this year, prioritizing technology, logistics, store openings, and Mallplaza asset enhancements.

• Targeting 2.5x–3x net debt/EBITDA leverage, with sufficient cash to cover near-term maturities and e-commerce break-even by 2026.

Business unit strategies and growth plans

• Sodimac expects sales recovery in H2 2025, focusing on omnichannel growth, PRO client loyalty, private label expansion, and footprint growth in Mexico.

• Supermarkets (Tottus) are transforming with a focus on perishables, aggressive pricing, private label relaunch, discounter format expansion in Peru, and omnichannel experience.

• Mallplaza leverages Tier A assets for growth, prioritizing brownfield expansion in Chile and Peru, digital and phygital services, and M&A in the Andean region.

• Digital banking aspires to be #1 in its markets, leveraging ecosystem data for risk, acquisition, and personalized offers, with growth in consumer loans and profitability.

• Falabella Retail is transitioning to an omnichannel multi-specialist hub, leveraging exclusive brands, private labels, and 3P marketplace growth.