EMPREENDIMENTOS PAGUE MENOS S.A. EARNINGS
RELEASE
4Q23 & 2023
Fortaleza, Ceará, March 4, 2024.
Empreendimentos Pague Menos S.A. ("Company" or "Pague Menos"), the main Health Hub for the expanded middle class in Brazil, present in every state in the country, and more 390 municipalities, announces its results for the 4th quarter of 2023 and for the year ended December 31, 2023.
HIGHLIGHTS 4Q23 & 2023
GROSS REVENUE
21.8% consolidated growth for
the year (7.7% in 4Q23)
MARKET SHARE
Market share gains in the N, NE and CW regions (full year and 4Q23)
SAME STORE SALES | HEALTH HUB |
6.8% growth in Extrafarma and 5.3% in Pague Menos in 4Q23
+3.5 million visits to Clinic Farma in the year (+66% vs 2022)
OMNICHANNEL SALES | ADJUSTED EBITDA |
12.5% share of total consolidated sales | 7.0% consolidated growth for |
in 4Q23 (+2.6 p.p. vs 4Q22) | the year (-2.5% in 4Q23) |
EXTRAFARMA SYNERGIES | INDEBTEDNESS |
Capture of BRL 130 million in | 2.4x Net Debt/EBITDA (Adj.) in 4Q23 |
4Q23 on an annualized basis | (0.2x reduction vs. 4Q22) |
Note:Starting with the 3rd quarter of 2023, we present the numbers in this earnings release using the IAS 17 / CPC 06 accounting standard. Reconciliation to IFRS 16 can be found in Annex 1 of this report.
02
EARNINGS RELEASE 4Q23 & 2023
DISCLOSURE CRITERIA
On August 1, 2022, the acquisition process of Imifarma Produtos Farmacêuticos e Cosméticos S.A. (Extrafarma) was completed with Ultrapar Participações S.A. (Ultrapar). With the completion of the conditions precedent and incorporation of the equity balances, Extrafarma was consolidated and became part of the consolidated financial statements of Empreendimentos Pague Menos S.A. (Company) in that same month.
In order to facilitate the analysis of the results, we will present in this release segregated operational data of Pague Menos and Extrafarma, while the financial information is presented as Pague Menos "standalone" (ex-Extrafarma) and Consolidated (Pague Menos including Extrafarma).
Since 2019 our financial Statements have been prepared in accordance with IFRS 16, which changed the criteria for the recognition of rental contracts. To better represent the economic reality of the business, the numbers in this report are presented under the old standard, IAS 17 / CPC 06. Reconciliation to IFRS 16 can be found in a dedicated section of this document.
PAGUE MENOS STANDALONE FINANCIAL HIGHLIGHTS
in BRL million and % of Gross Revenue | 4Q22 | 4Q23 | Δ | 2022 | 2023 | Δ |
Gross Revenue | 2,310.4 | 2,508.8 | 8.6% | 8,911.3 | 9,832.8 | 10.3% |
Gross Profit | 688.5 | 721.4 | 4.8% | 2,687.4 | 2,882.5 | 7.3% |
% Gross Margin | 29.8% | 28.8% | (1.0 p.p.) | 30.2% | 29,3% | (0.9 p.p.) |
Contribution Margin | 187.2 | 172.9 | (7.7%) | 713.7 | 693.6 | (2.8%) |
Contribution Margin % | 8.1% | 6.9% | (1.2 p.p.) | 8.0% | 7.1% | (0.9 p.p.) |
Adjusted EBITDA | 134.4 | 113.1 | (15.8%) | 465.0 | 452.2 | (2.7%) |
Adjusted EBITDA Margin % | 5.8% | 4.5% | (1.3 p.p.) | 5.2% | 4,6% | (0.6 p.p.) |
Adjusted Net Income | 79.5 | 55.9 | (29.7%) | 216.6 | 43.6 | (79.9%) |
Adjusted Net Margin % | 3.4% | 2.2% | (1.2 p.p.) | 2.4% | 0.4% | (2.0 p.p.) |
CONSOLIDATED FINANCIAL HIGHLIGHTS
in BRL million and % of Gross Revenue | 4Q22 | 4Q23 | Δ | 2022 | 2023 | Δ |
Gross Revenue | 2,843.4 | 3,062.1 | 7.7% | 9,818.7 | 11,960.9 | 21.8% |
Gross Profit | 854.6 | 893.4 | 4.5% | 2,955.5 | 3,545.2 | 20.0% |
% Gross Margin | 30.1% | 29.2% | (0.9 p.p.) | 30.1% | 29.6% | (0.5 p.p.) |
Contribution Margin | 215.0 | 201.7 | (6.2%) | 750.5 | 794.6 | 5,9% |
Contribution Margin % | 7.6% | 6.6% | (1.0 p.p.) | 7.6% | 6.6% | (1.0 p.p.) |
Adjusted EBITDA | 127.8 | 124.6 | (2.5%) | 444.9 | 476.0 | 7.0% |
Adjusted EBITDA Margin % | 4.5% | 4.1% | (0.4 p.p.) | 4.5% | 4.0% | (0.5 p.p.) |
Adjusted Net Income | 53.8 | 62.8 | 16.9% | 161.6 | 14.2 | (91.2%) |
Adjusted Net Margin % | 1.9% | 2.1% | 0.2 p.p. | 1.6% | 0.1% | (1.5 p.p.) |
|||UNTRANSLATED_CONTENT_S | ||||||
OPERATING HIGHLIGHTS | ||||||
TART|||DESTAQUES | ||||||
KPI | 4Q22 | 4Q23 | Δ | 4Q22 | 4Q23 | Δ |
#TEDof stores_CONTENT_END||| | 1,270 | 1,277 | 0.6% | 376 | 355 | (5.6%) |
Average Sale/store/month (BRL thousand) | 621 | 653 | 5.2% | 468 | 513 | 9.4% |
Average Ticket (BRL) | 77.20 | 82.31 | 6.6% | 67.88 | 73.03 | 7.6% |
# of Store Employees per store | 12.8 | 13.1 | 1.9% | 12.1 | 11.6 | (4.3%) |
% Digital channels | 11.4% | 13.1% | 1.7 p.p. | 3.4% | 9.9% | 6.5 p.p. |
Private Labels | 7.1% | 6.8% | (0.3 p.p.) | 2.9% | 7.1% | 4.1 p.p. |
# Pharmaceutical Clinics | 988 | 1,000 | 1.2% | 68 | 77 | 13.2% |
03
EARNINGS RELEASE 4Q23 & 2023
MESSAGE FROM THE MANAGEMENT
The year 2023 was particularly important in the Company's history, as it was marked by a critical phase of the Extrafarma integration, one of our most relevant strategic moves in recent years. In this context, we directed most of the the company's resources and focus towards three priorities: Extrafarma Integration, Debt Reduction, and Operational Efficiency.
In the operational front, we maintained a good level of sales growth, despite the market slowdown. As a result, we were able to increase our market share in the main regions in which we operate, even with a reduced number of store openings (20 stores).
The main headwind for the 2023 results was the gross margin. We recorded a decrease of 0.5 p.p. in the consolidated margin compared to the previous year, with a reduction of 0.9 p.p. in Pague Menos and 1.1 p.p. increase in Extrafarma, reflecting the significant synergies captured.
Much of the margin decline is more related to comparison base effects than to the challenges of 2023 itself. In 2022, we had a particularly high level of drug price increase, which generated inflationary gains with inventories well above those recorded in 2023, in addition to a period still affected by the pandemic. We observed, from 2023 to 2022, a drop in the volume of covid-19 tests even greater than that observed from 2021 to 2022, contributing negatively to the gross margin, given that testing margins are higher than the Company's average. These two effects combined pressured the gross margin by 0.7 p.p. when compared to 2022.
Additionally, the digital channels, which expanded approximately 50% compared to the previous year, negatively impacted margins in the short term, but are contributing to increase our market share and improving customer lifetime value (LTV). We consider the development of our omnichannel platform strategic, and we will continue in this long-term direction, despite the short-term impact on results.
Given the challenging gross margin scenario, we focused our efforts on expense management and operational efficiency, which partially offset the pressures on profitability. During the year, we reduced operating expenses, as a percentage of revenue, by 0.2 p.p. in the Pague Menos operation and a significant 2.2 p.p. in the Extrafarma operation.
Regarding the Extrafarma integration, the results have exceeded our expectations. Considering the complexity involved in any business combination of this magnitude and the challenge of the turnaround of the asset, which operated with negative margins before the acquisition, the milestones achieved in just one year and five months are significant.
In 4Q23, we reached an annualized synergy capture volume of BRL 130 million. The most acute part of the integration, evolving system migration, changes in the logistics network and organizational restructuring, was successfully completed, meaning that during 2024 the full focus will be on operational improvements, with an increase in average sales and greater operational leverage.
The results achieved in 2023 reinforce our conviction that the acquisition of Extrafarma was a correct strategic move, which, despite generating pressures on short-term earnings, will contribute to enhancing the Company's value generation. With this acquisition, we strengthened our leadership in the North and Northeast regions, which puts us in a favorable competitive position to continue as one of the most relevant candidates for market consolidation.
04
EARNINGS RELEASE 4Q23 & 2023
In the financial area, earnings were pressured by the leverage accumulated through the Extrafarma acquisition and due to the scenario of high interest rates and funding costs. Although the photograph of the year is negative, putting significant pressure on earnings, the film is more encouraging. With good operating cash generation accumulated throughout the year, normalization of working capital, reduction in the volume of investments and a successful private capital increase, we reduced our debt level from 3.1x net debt/EBITDA (ex-IFRS16) at the beginning of the year to 2.4x at the end of the year. In addition, the volume of prepayment of receivables, used to finance working capital needs, was reduced by half. As a result, we already present a less pressured financial result in 4Q23, a trend that should continue throughout 2024.
Our strategic pillars continued to advance consistently in 2023. In addition to the relevant growth in digital channels, our Health Hub has gained even more relevance in our business model, with verticals such as Clinic Farma, AME (Specialty Drugs) and the Sempre Bem content platform registering significant growth compared to the previous year. We highlight the volume of consultations at Clinic Farma, which exceeded the mark of 3.5 million consultations for the year (an increase of 66% compared to the previous year).
The loyalty front also gained traction in 2023. Our active customer base reached the mark of 20.7 million, representing growth of 6.3% compared to the previous year. Significant results, considering that we ended the year with a smaller store base than the previous year. The year was marked by a very assertive marketing activity, with high reach campaigns, traffic generation on digital channels and good execution of events, such as Black Friday. During the year we were able to attract a record volume of 3.7 million new customers to our brands.
We also highlight the advances in our ESG Journey. Our sustainability agenda, based on the goals of health for people, health for the environment and health for the business, has public commitments and short, medium and long-term goals that are directly integrated into our strategic plan.
In 2023, we achieved seven of the goals originally planned for 2025. We launched the Clinic Farma itinerant program, offering basic health services to disadvantaged communities, at no cost, realizing a total of more than 2 thousand consultations in 11 different cities. We also carried out, for the first time, the Waste Inventory, which contributed to the establishment of goals for the reduction of waste generation and increased recycling in the Company. We also carried out the Emissions Inventory, covering both brands, which allowed us to report, for the first time, the CDP (Carbon Disclosure Project), reinforcing our commitment to transparency regarding our environmental impact. We also highlight the fact that our efforts to promote diversity were awarded with inclusion in the B3 Diversity Index, IDIVERSA.
2023 was the first year, since our IPO, in which we registered a contraction in EBITDA margin. Nonetheless, due to the improvements made during the year, we started 2024 with the strong conviction that this will be a more positive year than the previous one. We are currently undergoing an important management transition, the most relevant one since 2016, with the change of the Company's CEO. The carefully planned transition marks the beginning of a new cycle in our trajectory. This year we will continue to focus on financial deleveraging, operational improvement and the completion of the Extrafarma integration.
Finally, we would like to thank all of our employees, suppliers and other partners who contributed to our 2023 results.
05
EARNINGS RELEASE 4Q23 & 2023
OPERATIONAL DATA
STORE PORTFOLIO
We ended the year with 1,632 stores. 20 openings and 34 closings were completed during the year, of which 21 are related to the footprint optimization foreseen in the scope of the Extrafarma integration. Since the beginning of the integration, 36 stores have been closed (about 9% of the original portfolio). When compared with 2021, prior to the acquisition, we have expanded our store base by 40.1%.
Still in the context of footprint optimization, we advanced with banner conversions in some markets. Throughout the year, 54 Extrafarma stores in the states of Pernambuco, Bahia, Rio Grande do Norte, Paraíba and São Paulo were converted to the Pague Menos banner. Due to good results in increased sales and limited cannibalization, another 47 stores are in the pipeline to be converted throughout 2024.
As published via a Material Fact on December 19, 2023, the projection of openings for 2024 is 30 new stores, which will mostly open in the first quarter of the year. We continue to see great potential for organic expansion with attractive returns, reinforced by the performance of the most recent store cohorts. Despite this, we remain focused on capital allocation by prioritizing, in the short term, the reduction of financial leverage and completion of the integration with Extrafarma.
EVOLUTION OF STORE BASE | AGE PROFILE OF STORES | ||||||||||||||||||||||||||||
1,646 | 1,647 | 1,652 | 1,648 | 1,632 | New | 1 to 2 years | 2 to 3 years | Mature | |||||||||||||||||||||
8.4% | 7.2% | 7.4% | 5.7% | 3.2% | |||||||||||||||||||||||||
6.4% | |||||||||||||||||||||||||||||
3.6% | 5.0% | 5.4% | 5.9% | ||||||||||||||||||||||||||
3.5% | |||||||||||||||||||||||||||||
0.1% | |||||||||||||||||||||||||||||
0.6% | 1.5% | ||||||||||||||||||||||||||||
0.4% | |||||||||||||||||||||||||||||
87.3% | 87.6% | 86.9% | 86.8% | 86.9% | |||||||||||||||||||||||||
4Q22 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 4Q22 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | ||||||||||||||||||||
BY REGION | STORE BASE | ORGANIC EXPANSION | CLOSINGS | ||||||||||||||||||||||||||
4Q23 | LTM | LTM | |||||||||||||||||||||||||||
N | 15% | ||||||||||||||||||||||||||||
NE | 14% | 5%10% | 18% | ||||||||||||||||||||||||||
3% | |||||||||||||||||||||||||||||
CW | 7% | 41% | |||||||||||||||||||||||||||
1,632 | 20 | 34 | |||||||||||||||||||||||||||
SE | |||||||||||||||||||||||||||||
S | 85% | 38% | |||||||||||||||||||||||||||
62% | 3% | ||||||||||||||||||||||||||||
BY INCOME CLASS¹ | |||||||||||||||||||||||||||||
A | 5% | 15% | |||||||||||||||||||||||||||
B1 | 20% | 18% | |||||||||||||||||||||||||||
34% | |||||||||||||||||||||||||||||
B2 | 28% | 20 | 34 24% | ||||||||||||||||||||||||||
1,632 | |||||||||||||||||||||||||||||
C/D | |||||||||||||||||||||||||||||
80% | 44% | ||||||||||||||||||||||||||||
33% |
¹ Predominant income class in the vicinity of each store (isochronous for 5 minutes travelling by car). Segmentation follows IBGE criteria.
06
EARNINGS RELEASE 4Q23 & 2023
OPERATIONAL DATA
SALES PERFORMANCE
In 4Q23, the growth pace in Pague Menos remained resilient, despite the absence of store openings and a decelerating trend observed in the pharmaceutical market in the last months of the year. The total growth recorded in the period was 8.6%, with same stores sales growing by 5.3% and mature stores by 4.1%. Growth for the year was 10.3%, in line with that recorded in the previous year, despite the lower level of inflation and organic expansion.
For Extrafarma, we observed a significant acceleration in 4Q23. The same store sales observed in the period was 6.8%, doubling the level achieved in the previous quarter, even with a strong basis of comparison (same- store sales of 12.0% in 4Q22). Full year same store sales was 4.9%, negatively impacted by sales performance in the first half of the year, when the critical migration of the supply and systems occurred.
The good performance of Extrafarma in 4Q23 reflects the operational synergies implemented throughout the year, such as assortment expansion, reduction of stockout, improvement in NPS and increase in digital channels, which has gradually contributed to the recovery of the brand's customers. In addition, the 43 banner conversions carried out in the quarter further impacted these good sales numbers. Even with little time after their reopening, this group of stores grew an average of 17.5% in 4Q23, compared to 4Q22, with limited cannibalization of stores in the Pague Menos portfolio.
TOTAL GROWTH (%)
SAME STORE SALES (%) | MATURE STORES (%) |
11.4 11.6 11.5
9.7 | 8.6 |
10.5 | 10.3 |
6.8 | 5.9 | 6.5 | 5.3 | 6.5 | 5.5 | 6.3 | 5.1 | 5.5 | 6.1 |
4.6 | |||||||||
4.3 | 3.6 | 4.1 | |||||||
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
4Q22 1Q23 | 2Q23 3Q23 4Q23 2022 | 2023 | 4Q22 1Q23 | 2Q23 2Q23 4Q23 2022 | 2023 |
TOTAL GROWTH² (%)
SAME STORE SALES (%)
MATURE STORES (%)
8.6
3.8
0.9
(0.1)
(1.6)
7.7 |
0.7 |
12.0
9.6 | ||
6.8 | ||
4.7 | 4.5 | 4.9 |
3.4 |
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
11.5
9.1 | ||
6.7 | ||
4.6 | 4.5 | 4.8 |
3.4 |
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
In the regional breakdown, we observed outstanding performance in the Center-West region, with same- store sales (SSS) of 11.6% in the quarter. We also observed a deceleration in the South and Southeast regions (SSS of 3.3%) and an acceleration in the North and Northeast regions (SSS of 5.6%). We attribute the weaker performance in the South and Southeast regions due to the warmer winter and the strong comparison base in 4Q22, when these regions grew 14.8%.
² Considers only retail operations, given that Extrafarma's wholesale operation was discontinued in October 2022.
07
EARNINGS RELEASE 4Q23 & 2023
OPERATIONAL DATA
We continue to reduce the gap in average sales per store between brands, with progressive improvement in the Extrafarma portfolio through acceleration in growth and cleanup of the store base. In 4Q23, average monthly sales reached BRL 513 thousand for Extrafarma stores, an increase of 9.4% compared to 4Q22. In relation to the pre-acquisition level, in 2Q22, the accumulated growth was 14.1%, approximately three times the inflation rate in that period. For Pague Menos stores, average monthly sales totaled BRL 653 thousand in 4Q23 (BRL 693 thousand when considering only mature stores).
AVERAGE SALES/STORE/ MONTH
(BRL thousands) | ||||||
+5.2% | +5.5% | |||||
621 | 608 | 644 | 660 | 653 | 610 | 643 |
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
AVERAGE SALES/STORE/MONTH
(BRL thousands)
+9.4% | +6.8% | |||||
468 | 441 | 481 | 491 | 513 | 454 | 485 |
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
The Pague Menos growth in the quarter was composed of a healthy combination of the evolution in the number of customers served and average ticket. The number of customers served grew 1.8%, leveraged by the maturation of new stores. The average ticket grew 6.6%, reflecting the inflation accumulated in the period. In the year, the composition of growth was similar to that observed in the quarter.
In Extrafarma there was a reduction in the volume of services, caused by the store closings carried out in the period and the still initial results of recovery of customers, which was lower in the same stores concept. Average ticket grew by 7.6% in the quarter, above inflation in the period, a result of the effect of a better mix and an increase in the basket, generated by the category management and logistics efficiency efforts carried out during the integration.
CUSTOMERS SERVED | +3.2% |
(In millions) |
AVERAGE TICKET
(in BRL)
+1.8% | 117.6 | 121.3 | ||||||||
30.7 | 30.6 | |||||||||
30.5 | ||||||||||
29.9 | 29.5 | |||||||||
+6.6%
77,20 78,49 80,32 83,03 82,31
+7.0%
75,79 | 81,06 |
4Q22 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 2022 | 2023 | ||||||
CUSTOMERS SERVED | ||||||||||||
(In millions) | -6.5% | |||||||||||
-3.5% | 31.9 | |||||||||||
29.8 | ||||||||||||
7.8 | 7.2 | 7.6 | 7.4 | 7.6 | ||||||||
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
AVERAGE TICKET
(in BRL)
+7.6%+7.7%
67,88 69,16 70,53 72,95 73,03 66,30 71,43
4Q22 1Q23 2Q23 3Q23 4Q23 2022 2023
08
EARNINGS RELEASE 4Q23 & 2023
OPERATIONAL DATA
We continue to expand our customer base, reaching the mark of 20.7 million active customers in 2023, an increase of 6.3% compared to the previous year. Through wide-ranging marketing campaigns, digital channels growth and good execution of events, such as Black Friday, we were able to attract a record volume of 3.7 million new customers in the year. The priority for 2024 is to keep these new customers in the base and progressively improve their buying behavior through CRM actions.
CATEGORY MANAGEMENT AND SUPPLY CHAIN
Following a market trend, the category with the highest level of growth was hygiene and beauty, which gained share in the mix of both brands. For Extrafarma, we see a relevant opportunity to increase the participation of branded drugs, which contribute positively to the average ticket and purchase recurrence.
For Pague Menos, we recorded above-market growth in virtually all areas of the pharmacy, with the exception of the convenience segment, which represents less than 2% of the market.
SALES MIX
% of Gross Revenue
10.7% | 26.1% | 22.4% | 40.1% | 4Q22 | ||||
0.6% | ||||||||
10.9% | 26.7% | 21.9% | 40.0% | 1Q23 | ||||
0.4% | ||||||||
11.4% | 25.4% | 22.7% | 40.0% | 2Q23 | ||||
0.4% | ||||||||
11.5% | 26.1% | 21.8% | 40.3% | 3Q23 | ||||
0.3% | ||||||||
11.2% | 27.1% | 21.3% | 40.1% | 4Q23 | ||||
0.4% | ||||||||
Services | Generics | H&B | OTC | Branded | ||||
35.2% | 21.9% | 29.5% | 0.2% | ||||
13.1% | |||||||
36.0% | 22.2% | 29.0% | 0.1% | ||||
12.7% | |||||||
35.3% | 23.3% | 28.4% | 0.0% | ||||
12.9% | |||||||
35.3% | 22.6% | 29.4% | 0.0% | ||||
12.7% | |||||||
34.7% | 22.8% | 29.9% | 0.1% | ||||
12.5% | |||||||
Private label products reached BRL 800 million in sales in 2023, growing by 22.6% in comparison to 2022. This strong performance is mainly the result of the good integration with Extrafarma, replicating the success story developed in Pague Menos. The private label share in Extrafarma, which was 2.6% of sales before integration, jumped to 7.1% in 4Q23.
Another important case in the context of the Extrafarma integration has been the consistent improvement of supply chain efficiency, guaranteeing customers greater availability of products. In 4Q23, the stockout rate was similar for both brands, while in 2Q22, before integration, Extrafarma operated with stockouts about twice that of Pague Menos.
PRIVATE LABEL
(% of total sales)
Pague Menos | Extrafarma | ||||
10% | 150 | ||||
8% | 7,1% | 6.7% | 6.8% | 7,1% | 7.1% |
6% | 100 | ||||
6,6% | 6,8% | ||||
4% | 5.6% | ||||
4,5% | 50 | ||||
2% | |||||
2,9% | |||||
0% | 4Q22 | 1Q23 | 2Q23 | 3Q23 | 0 |
4Q23 |
STOCKOUT
(Pague Menos 4Q22 = base 100)
Pague Menos | Extrafarma |
129119
100
100 99 65 57
80
53 56
4Q22 1Q23 2Q23 3Q23 4Q23
09
EARNINGS RELEASE 4Q23 & 2023
OPERATIONAL DATA
MARKET SHARE
In 2023, we grew above the market average, resulting in an increase in market share in the main regions in which we operate. According to IQVIA, the growth³ of pharmaceutical retail in the year was 8.2%, while our organic growth, excluding Extrafarma, was 9.8%.
In 4Q23, we observed a more pronounced slowdown in the pace of growth of competitors than that which we saw in our store portfolio. As a result, we expanded our market share, especially in the North, Northeast and Midwest regions.
MARKET SHARE BY REGION (%)
4Q22 4Q23
6.0 6.0
19.4 19.6
15.3 15.4
4.2 | 4.5 | |||||||
1.7 | 1.6 | 0.9 | 0.9 | |||||
BR | NE | N | CW | SE | S |
Source: IQVIA
We have observed a favorable competitive environment in recent quarters, with a reduction in the store base of competitors, especially independent pharmacies and regional players. This scenario has allowed us to increase our market share, even without store base expansion.
OMNICHANNEL PLATFORM
2023 was another record year for our digital channels, with significant advances in customer attraction and retention, increased profitability and rapid catch-up for Extrafarma. As a result, omnichannel sales reached the relevant mark of BRL 1.4 billion in sales, an increase of 49% compared to the previous year.
OMNICHANNEL SALES
(BRL million)
+49.3% | |||||||||||
1,413 | 14% | ||||||||||
+36,1% | 12% | ||||||||||
946 | 10% | ||||||||||
314 | 343 | 374 | 382 | 8% | |||||||
281 | 6% | ||||||||||
4% | |||||||||||
2% | |||||||||||
4Q22 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 2022 | 2023 |
OMNICHANNEL SHARE
(% of retail revenue)
Pague Menos | Extrafarma | Consolidated | |
12.5% | 12.2% | 12.8% | 13,1% |
11,4% | |||
11.2% | 11.4% | 12,1% | 12,5% |
9.9% | 9.1% | 9.9% | |
7.9% | |||
5.0% 3.4%
4Q22 1Q23 2Q23 3Q23 4Q23
We also highlight the successful integration of Extrafarma's digital channels, which continue to gain traction, reducing the gap to the Pague Menos brand. Over the last year, we have practically tripled the share of omnichannel sales, from 3.4% in 4Q22 to 9.9% in 4Q23.
³ IQVIA data normalizes sales prices between players, possibly causing growth to diverge from what was actually achieved.
10
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Empreendimentos Pague Menos SA published this content on 04 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 March 2024 23:44:05 UTC.
