Falabella (FALABELLA) Q2 2024 earnings summary

Executive summary

• EBITDA and net profit more than doubled year-over-year in 2Q24, with EBITDA margin reaching 11.2% and net income rising 135% to $122 million.

• Retail operations showed topline growth recovery across all countries and segments, with Chilean retail returning to growth for the first time since 1Q22.

• E-commerce GMV grew, with 17% increase in home improvement sales, 12% growth among over 20,000 sellers, and online penetration reaching 25% in 2Q24.

• Strategic asset monetization included the $200 million sale of Open Kennedy and other non-core assets, reinforcing focus on core businesses.

• Operational efficiencies, customer-centric strategy, and financial strengthening plan advanced, reducing non-banking leverage to 4.7x from 5.7x in 1Q24.

Financial highlights

• Consolidated revenue increased 8% year-over-year to $3,074 million, with gross profit up 25% to $1,102 million.

• EBITDA grew 131% to $344 million, with an EBITDA margin of 11.2%, the highest since 2021.

• Net profit reached $122 million, or $87 million excluding asset revaluation effects.

• Online GMV increased 7% year-over-year to $682 million, with third-party GMV up 12%.

• Cash position (non-banking) increased 144% to $1,041 million; net financial debt (non-banking) down 13% to $3,538 million.

Outlook and guidance

• Expect loan book growth in Chile to solidify in the second half of the year, targeting 4% credit portfolio growth from June to December.

• Macro environment in Chile and Colombia remains challenging, with sales below historical levels; September expected to be a slow month due to holidays.

• Continued focus on omni-channel strategy, digital banking expansion, new insurance products, and selective physical expansion in Mexico and Colombia.