Iguatemi reverses loss and profits in the 3rd quarter

Shopping mall operator Iguatemi released this Tuesday (8) net income of R$64.8 million in the third quarter, reversing a loss of R$83 million in the same period in 2021.

Cash generation measured by earnings before interest, taxes, depreciation and amortization (Ebitda) was R$ 165.8 million between July and September, up 15% on an annual basis. The Ebitda margin dropped from 67.7% to 65.2%.

Analysts, on average, expected Ebitda of R$ 181.5 million, according to a survey by Refinitiv.

Same-store sales at the company’s malls increased 19.6%, and were about 30% above 2019 levels. Same-store rents were up 35.7% from a year earlier and 62% above 2019. total sales grew 22.8% to R$4 billion, a similar advance compared to the third quarter of 2019.

Thus, net revenue rose 19.5% in the quarter, to R$ 254.3 million, while costs and expenses increased 10.2%, to R$ 97 million.

The result came a few days after rival Multiplan reported that its third-quarter profit nearly doubled and that sales at the malls it manages rose 28.3% from a year earlier, with same-store sales up 23.9%.

Iguatemi highlighted the smaller impact on its balance sheet from the investment in Infracommerce, which had been putting pressure on its results in recent quarters, after reorganizing the share it holds in the e-commerce platform.

“As of September 30, 2022, the participation in the company was accounted for in permanent investments, reducing volatility in the financial result and starting to be treated by equity method”, said Cristina Betts, president of Iguatemi, in the balance sheet.

The executive also noted that the participation was diluted since Iguatemi did not enter into a capital increase of Infracommerce, being now 8.4%, from 11.2%. Infracommerce’s share rose 35.8% in the third quarter, after two quarters of decline.