SMU (SMU) Q4 2025 earnings summary

Executive summary

• Completed a 3-year strategic plan with 43 new store openings in Chile and 11 in Peru, surpassing performance expectations for new stores and achieving significant omnichannel growth.

• Accelerated conversion of Mayorista 10 stores to Alvi and Super 10, streamlining formats and expanding their footprints for greater operational efficiency and competitiveness.

• Launched new promotional strategies and improved private label penetration to 13%, with over 500 new products and 41% featuring eco-friendly packaging.

• Achieved recognition in the S&P Global Sustainability Yearbook, ranked #1 in Chile and #2 in Latam on the S&P Corporate Sustainability Assessment, and qualified for Dow Jones Best-in-Class indices.

• Strategic focus on profitability led to higher gross margins despite lower sales, driven by promotional optimization and elimination of low-margin volume sales.

Financial highlights

• Full-year revenue declined 2.4% year-over-year to CLP 2,819,055 million, but Q4 showed sequential improvement with only a 0.7% decrease and Unimarc revenue up 1.9%.

• Gross margin expanded 150 bps for the year to 32.2%, with gross profit up 2.5% for the year and 2.2% in Q4.

• Operating expenses rose 5.6% for the year, mainly due to higher labor, electricity, and regulatory costs.

• EBITDA decreased 6.1% for the year to CLP 217,721 million, with margin contraction due to extraordinary cost increases.

• Net income rose 29.5% for the year to CLP 63,123 million, driven by a CLP 60 billion non-operating gain from asset sales, but fell 27% in Q4.

Outlook and guidance

• The 2026–2028 strategic plan targets 60 new store openings, 80 upgrades, and expanded omnichannel reach, with CLP 370 billion in capex.

• Expense growth is expected to moderate, with EBITDA margin targeted at 8–8.5% for 2026 and 9% long-term.

• Converted stores expected to reach maturity and average sales levels within 12 months.

• Continued focus on top-line growth through store openings, upgrades, omni-channel expansion, and private label growth.

• Digital integration and cloud migration expected to yield CLP 6 billion in savings through 2028.