Magazine Luiza 1Q17 Conference Call

May, 5 2017

Sales E-commerce

  • Sales growth of 23% reaching R$3.4 billion

  • SSS growth of 22% (+12% bricks and mortar)

  • Market-share gains (versus +2% market growth)

  • Growth of 56% versus market growth of 8% (E-bit)

  • Record share of 28% in total sales

Gross Profit Operational Expenses EBITDA Net Profit Working Capital Leverage

  • Gross profit grew 22%, reaching R $ 832 million

  • Solid sales growth with flat margins per channel

  • Dilution in 230bps to 22% of Net Revenue

  • Lower level of operating expenses in recent years

  • Operational Leverage, e-commerce, ZBB e EMM

  • Evolution of EBITDA from 61% to R $ 232 million (8,3% margin)

  • Evolution of net income to R$ 59 million (ROE of 32%)

  • Improvement in adjusted working capital need of R $ 381 million

  • Adjusted net debt/adjusted EBITDA down from 1.6x to 0.5x

    Luizacred

    • Reduction of NPL 90 by 360bps with Luiza Card growth

    • Net income of R $ 39 million with ROE of 28%

      2

      Number of Stores

      Capex

      # stores R$ million

      +18 stores

      36

      786 787 791 800 80411

      115 120 12023

      1114 1114

      1 1 106

      7

      671 672 675 679 683

      12 19

      4 0 10

      1Q16 2Q16 3Q16 4Q16 1Q17

      1T16 1T17

      Conventional Stores Site Virtual Stores

      New Stores

      Remodeling

      IT Logistics Other

      Average Age - Stores

      Comments

      17

      1427

      27

      24

      695

      • Opened 18 new stores in the last 12 months

      • Around 14% of our stores are in maturation process

      • Capex of R$36 million on 1Q17, and 52% of total investments went to IT projects due to our digital transformation strategy

        More than 5 years

        Up to 1 year

        Up to 2 years

        Up to 3 years

        Up to 4 years

        Up to 5 years

        3

        Gross Revenue - Consolidated

        Gross Revenue - Internet

        R$ billion R$ million

        2.6% 4.8% 10.8% 14.3% 8.3%

        23.0%

        27.8% 33.6% 24.3% 41.4% 32.2% 56.2%

        2,7

        2,6

        2,7

        3,4

        11,4

        3,3

        605

        660

        572

        887

        945

        2,724

        1Q 2Q 3Q 4Q 12M 1Q

        2016 2017

        Same-Store Sales Growth

        1Q 2Q 3Q 4Q 12M 1Q

        2016 2017

        Comments

        1T16

        27.8%

        0.0% 2.6%

        -6.1%

        56.2%

        21.6% 23.1%

        11.6%

        1T17

        Same Physical Store Sales Growth Ecommerce Growth SameStoreSales Growth

        Total Retail Sales Growth

        • Market share gains in main categories

        • Improved SSS in brick and mortar stores ( +12%) in 1Q17

        • E-commerce accounted for 28% of total sales

        • Market sales of furniture and domestic appliances +2%

          (PMC/IBGE)

        • E-commerce market growth of +8%

Growth over the same period of last year

4

Magazine Luiza SA published this content on 04 May 2017 and is solely responsible for the information contained herein.
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