Guararapes Confecções (GUAR3) Q4 2025 earnings summary

Executive summary

• Achieved record consolidated EBITDA of R$1.8 billion and net income of R$512 million in 2025, more than double the previous year, driven by disciplined execution, operational improvements, and efficiency across strategic pillars.

• Transformation initiatives included new leadership, strategic board creation, significant inventory reduction, cash generation, and lower leverage.

• Sale of Midway Mall for R$1.6 billion in December 2025, enabling record dividend distribution and aligning with a strategy to focus on core business and improve capital structure.

• Relaunch of Pool and Riachuelo brands, new store concept, and rebranding with ticker change from GUAR3 to REAL3/RIAA3.

• Focused on five strategic pillars: experience, footprint, fashion efficiency, financial services, and capital structure optimization.

Financial highlights

• Consolidated net revenue reached R$10.5 billion in 2025, up 9.0% from 2024; 4Q25 net revenue was R$3.2 billion, up 5.9% year-over-year.

• Q4 apparel same-store sales grew 7.2%, marking 10 consecutive quarters of growth; full-year apparel SSS up 10.3%.

• Apparel gross margin reached 56.7% in 2025, highest in seven years; consolidated gross margin was 60.8%.

• Q4 net income was R$322 million, up 28.8% year-over-year; full-year net income reached R$512 million, up 117.8% from 2024.

• Adjusted consolidated EBITDA for 2025 was R$1.8 billion, up 18.1% year-over-year; 4Q25 EBITDA margin was 20.6%, highest in five years.

Outlook and guidance

• Entering 2026 with confidence in strategic pillars, focusing on maximizing value per sqm, leveraging brand, supply chain, and financial services.

• Plan to open 15–20 new stores per year, with a long-term target of 150–200 new stores, focusing on high productivity and lower penetration regions.

• Continued focus on margin expansion, leveraging factory utilization, pricing, and product mix.

• Store renovations and omni-channel expansion expected to drive incremental same-store sales growth.

• Ongoing growth in financial services, with new products and conservative credit policies.