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Cencosud Reports First Quarter 2017 Results


By Cencosud S.A.

– Revenues Driven by Sales in Chile, Brazil, and Argentina
– Gross Margin Up 105 Basis Points YOY, Excluding Brazil
– Adjusted EBITDA Down 7.7% and Adj. EBITDA Margin of 6.8% Impacted by One-Offs and Currency Depreciation
– Net Financial Debt / Adj. EBITDA Ratio of 3.5x

SANTIAGO, CHILE / ACCESSWIRE / May 25, 2017 / Cencosud S.A. (BCS: CENCOSUD; NYSE: CNCO), a leading South American retailer with operations in Chile, Argentina, Brazil, Peru, and Colombia, today announced its consolidated financial results for the first quarter of 2017. All figures are in Chilean pesos (CLP), except where indicated otherwise, and in accordance with IFRS.

  • For the first quarter, revenues were 1.7% higher to CLP 2,523,563 million reflecting growth in Department Stores in Chile (+5.9% and SSS +4,9%), Shopping Centers in Chile (+13.8%), and Financial Services in Peru and Argentina (+56.1% and 8.3%, respectively in CLP).
  • Adjusted EBITDA of 7.7 was affected by Argentine peso depreciation and several one-offs. Excluding these effects, Adjusted EBITDA rose 4.9% with Adjusted EBITDA margin of 7.3%.
  • Gross Profit grew 2.9% reflecting margin expansion of 36 bps. Gross margin expanded 105 bps excluding Brazil, demonstrating successful implementation of the Company’s commercial strategy.
  • Net Debt to Adjusted EBITDA of 3.5 times. Higher debt reflects a seasonal increase in drawdowns of short-term lines of credit as the Company manages its working capital cycle. Fitch Ratings has confirmed Cencosud’s Investment Grade Rating with a Stable Outlook.

Please visit to obtain the full first quarter earnings release, including financial results and tables.

Management Comment

Cencosud had a promising start to the year, strengthening our position as a leading retailer in South America as we progress in executing our “three strategic pillars” strategy for long-term profitable growth, despite a still-uncertain macro backdrop.

We continued to drive revenue growth across most of our businesses – underpinned by higher sales in Chile and Argentina – helped by our compelling value proposition. Gross margin was a highlight, expanding 105 basis points excluding Brazil, a dynamic which reflects more advantageous supplier agreements, the impact of our efficiency initiatives, and promotional activity from suppliers.

Adjusted EBITDA was affected by Argentine peso depreciation and several one-offs that impacted the comparability of our results. This includes the gain on sale of pharmacies in 1Q16, the loss related to the fire at our Wong Asia store in Peru, and gains from the sale of unproductive landbank in Chile, and in this quarter’s result, the impact from losses due to a fire at one of our Home Improvement distribution centers in Chile. Excluding these impacts, Adjusted EBITDA for the quarter would have grown 4.9%, with Adjusted EBITDA margin reaching 7.3%, versus 7.0% in 1Q16.

Cencosud recently had its Investment Grade Rating confirmed with a Stable Outlook, a recognition of our strong business position, financial discipline, and healthy balance sheet. We expect to continue strengthening our Net Debt to Adjusted EBITDA ratio as demand recovers, and benefits from our strategic initiatives flow into results, supported by non-core asset sales.

While consumption trends remain challenging, we expect a stronger macro backdrop during the second half, supported by our reinforced value proposition, enhanced shopping experience, and growing customer loyalty. Cencosud will continue to emphasize higher sustained profitability, helped by our ongoing efficiency and productivity initiatives, which should further boost margins as we reduce costs. Looking forward, we expect our diversified portfolio to benefit from an improvement in Argentina, Peru and Brazil, and healthy retail markets in Chile and Colombia.

Conference Call

The Company will host a conference call to discuss these results on Friday, May 26, 2017 at 12:00PM Chilean time / 12:00PM EST. To participate on the day of the call, dial (866) 682-6100 or (862) 255-5401 approximately ten minutes before the call and tell the operator you wish to join the Cencosud Conference Call. A webcast of the conference call will be available online at

The archived version of the webcast and a telephone replay of the conference call will be available until June 9, 2017. Callers can access the telephonic replay by dialing +1 (877) 344-7529 or +1 (412) 317-0088 and utilizing the passcode 10406 when prompted.

Forward-Looking Statements:

In addition to historical information, this release contains “forward-looking statements” that reflect management’s expectations for the future. The forward-looking statements included herein represent Cencosud’s views as of the date of this release. A variety of important factors could cause results to differ materially from such statements. These factors are laid out in Cencosud’s filings with the SVS in Chile and the SEC in the United States. The Company undertakes no obligation to revise or update publicly any forward-looking statement for any reason unless required by law.

Corporate Communications
Renato Fernandez
Phone +5622959 0905

Investor Relations
Maria Soledad Fernandez
Phone +5622959 0545

Natalia Nacif
Phone +5622959 0368

SOURCE: Cencosud S.A.

ReleaseID: 464249