Sendas Distribuidora S A : FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) (Form 6-K)
July 28, 2021 at 06:14 am EDT
Share
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Index
Corporate Information / Capital Composition
2
Consolidated and Individual interim financial information
Individual Statements
Balance Sheet - Assets
3
Balance Sheet - Liabilities
4
Statements of Operations
5
Statements of Comprehensive Income
6
Statements of Changes in Shareholder' Equity 1/1/2021 to 6/30/2021
7
Statements of Changes in Shareholder' Equity 1/1/2020 to 6/30/2020
8
Statements of Cash Flows
9
Consolidated Statements
Balance Sheet - Assets
10
Balance Sheet - Liabilities
11
Statements of Operations
12
Statements of Comprehensive Income
13
Statements of Changes in Shareholder' Equity 1/1/2021 to 6/30/2021
14
Statements of Changes in Shareholder' Equity 1/1/2020 to 6/30/2020
15
Statements of Cash Flows
16
Notes to the consolidated and individual interim financial information
17
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)
ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Corporate information / Capital composition
Number of Shares
Current quarter
(Thousands)
6/30/2021
Share Capital
Common
268,896
Preferred
0
Total
268,896
Treasury Shares
Common
0
Preferred
0
Total
0
2
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Balance Sheet - Assets
R$ (in thousands)
Current quarter
Prior period
Code
Description
6/30/2021
12/31/2020
1
Total Assets
20,481,000
18,821,000
1.01
Current Assets
9,371,000
8,349,000
1.01.01
Cash and Cash Equivalents
4,511,000
3,532,000
1.01.03
Accounts Receivable
264,000
216,000
1.01.03.01
Trade Receivables
230,000
182,000
1.01.03.02
Other Receivables
34,000
34,000
1.01.04
Inventories
3,688,000
3,739,000
1.01.06
Recoverable Taxes
683,000
768,000
1.01.08
Other Current Assets
225,000
94,000
1.01.08.01
Non-current Assets Held for Sale
147,000
-
1.01.08.01.01
Assets Held for Sale
147,000
-
1.01.08.03
Other
78,000
94,000
1.01.08.03.01
Derivative Financial Instruments
-
57,000
1.01.08.03.03
Other Current Assets
78,000
37,000
1.02
Non-current Assets
11,110,000
10,472,000
1.02.01
Long-Term Assets
1,105,000
1,190,000
1.02.01.09
Receivable From Related Parties
179,000
178,000
1.02.01.10
Other Non-current Assets
926,000
1,012,000
1.02.01.10.04
Recoverable Taxes
771,000
866,000
1.02.01.10.05
Restricted Deposits for Legal Proceedings
132,000
134,000
1.02.01.10.06
Derivative Financial Instruments
2,000
11,000
1.02.01.10.07
Other Non-current Assets
21,000
1,000
1.02.02
Investments
798,000
769,000
1.02.02.01
Investments in Associates
798,000
769,000
1.02.03
Property, Plant and Equipment
8,160,000
7,476,000
1.02.03.01
Property, Plant and Equipment in Use
5,456,000
5,043,000
1.02.03.02
Right of Use on Leases
2,704,000
2,433,000
1.02.04
Intangible Assets
1,047,000
1,037,000
1.02.04.01
Intangible Assets
1,047,000
1,037,000
1.02.04.01.02
Intangible Assets
1,047,000
1,037,000
3
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Balance Sheet - Liabilities
R$ (in thousands)
Current quarter
Prior period
Code
Description
6/30/2021
12/31/2020
2
Total Liabilities
20,481,000
18,821,000
2.01
Current Liabilities
8,006,000
8,786,000
2.01.01
Payroll and Related Taxes
408,000
371,000
2.01.02
Trade Payables
4,505,000
5,058,000
2.01.03
Taxes and Contributions Payable
282,000
528,000
2.01.04
Borrowings and Financing
2,191,000
2,120,000
2.01.04.01
Borrowings and Financing
260,000
280,000
2.01.04.02
Debentures
1,931,000
1,840,000
2.01.05
Other Liabilities
620,000
709,000
2.01.05.01
Payables to Related Parties
104,000
41,000
2.01.05.02
Others
516,000
668,000
2.01.05.02.01
Dividends and Interest on Own Capital
-
85,000
2.01.05.02.08
Financing Related to Acquisition of Assets
51,000
34,000
2.01.05.02.09
Deferred Revenue
139,000
227,000
2.01.05.02.12
Other Current Liabilities
113,000
150,000
2.01.05.02.17
Lease Liability
213,000
172,000
2.02
Non-current Liabilities
10,558,000
8,688,000
2.02.01
Borrowings and Financing
7,344,000
5,711,000
2.02.01.01
Borrowings and Financing
984,000
952,000
2.02.01.02
Debentures
6,360,000
4,759,000
2.02.02
Other Liabilities
2,890,000
2,612,000
2.02.02.02
Others
2,890,000
2,612,000
2.02.02.02.07
Property Tax
12,000
8,000
2.02.02.02.09
Other Accounts Payable
2,878,000
2,604,000
2.02.03
Deferred Taxes
72,000
82,000
2.02.03.01
Deferred Income Tax and Social Contribution
72,000
82,000
2.02.04
Provision for Legal Proceedings
251,000
282,000
2.02.06
Deferred Revenue
1,000
1,000
2.03
Shareholders' Equity
1,917,000
1,347,000
2.03.01
Share Capital
779,000
761,000
2.03.02
Capital Reserves
11,000
4,000
2.03.04
Earnings Reserve
1,127,000
582,000
4
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Statements of Operations
R$ (in thousands)
Current Quarter
Year to date current period
Previous Quarter
Year to date previous period
Code
Description
4/1/2021 to 6/30/2021
1/1/2021 to 6/30/2021
4/1/2020 to 6/30/2020
1/1/2020 to 6/30/2020
3.01
Net Operating Revenue
10,049,000
19,497,000
8,242,000
16,080,000
3.02
Cost Of Sales
(8,327,000)
(16,268,000)
(6,904,000)
(13,525,000)
3.03
Gross Profit
1,722,000
3,229,000
1,338,000
2,555,000
3.04
Operating Income / Expenses
(1,126,000)
(2,150,000)
(948,000)
(1,855,000)
3.04.01
Selling Expenses
(804,000)
(1,560,000)
(647,000)
(1,267,000)
3.04.02
General and Administrative Expenses
(152,000)
(289,000)
(104,000)
(198,000)
3.04.05
Other Operating Expenses
(184,000)
(330,000)
(203,000)
(380,000)
3.04.05.01
Depreciation and Amortization
(154,000)
(299,000)
(121,000)
(238,000)
3.04.05.03
Other Operating Expenses, Net
(30,000)
(31,000)
(82,000)
(142,000)
3.04.06
Share of Profit of Associates
14,000
29,000
6,000
(10,000)
3.05
Profit from Operations Before Net Financial Expenses
596,000
1,079,000
390,000
700,000
3.06
Net Financial Expenses
(145,000)
(279,000)
(131,000)
(286,000)
3.06.01
Financing Revenues
52,000
69,000
66,000
129,000
3.06.02
Financing Expenses
(197,000)
(348,000)
(197,000)
(415,000)
3.07
Income Loss Before Income Tax and Social Contribution
451,000
800,000
259,000
414,000
3.08
Income Tax and Social Contribution
(146,000)
(255,000)
(84,000)
(139,000)
3.08.01
Current
(164,000)
(265,000)
(184,000)
(261,000)
3.08.02
Deferred
18,000
10,000
100,000
122,000
3.09
Net Income from Continued Operations
305,000
545,000
175,000
275,000
3.11
Net Income for the Period
305,000
545,000
175,000
275,000
3.99
Earnings per Share - (Reais/Share)
3.99.01
Basic Earnings per Share
3.99.01.01
Common
1.13758
2.02854
0.67829
1.06589
3.99.02
Diluted Earnings per Share
3.99.02.01
Common
1.13758
2.02854
0.67829
1.06589
5
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Statements of Comprehensive Income
R$ (in thousands)
Current Quarter
Year to date current period
Previous Quarter
Year to date previous period
Code
Description
4/1/2021 to 6/30/2021
1/1/2021 to 6/30/2021
4/1/2020 to 6/30/2020
1/1/2020 to 6/30/2020
4.01
Net income for the Period
305,000
545,000
175,000
275,000
4.02
Other Comprehensive Income
-
-
1,069,000
1,553,000
4.02.02
Foreign Currency Translation
-
-
1,072,000
1,563,000
4.02.04
Fair Value of Expected Credit Loss
-
-
(1,000)
-
4.02.05
Hedge Operations
-
-
(2,000)
(6,000)
4.02.06
Income Taxes over Other Comprehensive Income
-
-
-
(2,000)
4.02.08
Other Comprehensive Income
-
-
-
(2,000)
4.03
Total comprehensive Income for the Period
305,000
545,000
1,244,000
1,828,000
6
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Satatements of Cash Flows - Indirect method
R$ (in thousands)
Yeat to date current period
Year to date previous period
Code
Description
1/1/2021 to 6/30/2021
1/1/2020 to 6/30/2020
6.01
Net Cash Operating Activities
496,000
1,788,000
6.01.01
Cash Provided By the Operations
1,347,000
863,000
6.01.01.01
Net Income for the Period
545,000
275,000
6.01.01.02
Deferred Income Tax and Social Contribution
(10,000)
(123,000)
6.01.01.03
Loss of Disposal of Property, Plant and Equipment
68,000
27,000
6.01.01.04
Depreciation and Amortization
324,000
252,000
6.01.01.05
Interest and Monetary Variations
401,000
295,000
6.01.01.07
Share of Profit (Loss) of Subsidiaries and Associates
(29,000)
10,000
6.01.01.08
(Reversal) Provision for Legal Proceedings
(24,000)
(3,000)
6.01.01.10
Provision for Share Purchase Options
7,000
3,000
6.01.01.11
Provision (Reversal) for Doubtful Accounts
1,000
(1,000)
6.01.01.13
Provision (Reversal) for Inventory Losses and Damages
138,000
132,000
6.01.01.16
Gain on Leasing Liabilities Write-Off
(74,000)
(4,000)
6.01.02
Changes in Assets and Liabilities
(851,000)
925,000
6.01.02.01
Accounts Receivable
(49,000)
(44,000)
6.01.02.02
Inventories
(87,000)
9,000
6.01.02.03
Recoverable Taxes
189,000
77,000
6.01.02.04
Other Assets
(67,000)
77,000
6.01.02.05
Related Parties
66,000
201,000
6.01.02.06
Restricted Deposits for Legal Proceeding
3,000
19,000
6.01.02.07
Trade Payables
(551,000)
(971,000)
6.01.02.08
Payroll and Related Taxes
37,000
47,000
6.01.02.09
Taxes and Social Contributions Payable
(8,000)
175,000
6.01.02.10
Provision for Legal Proceedings
(19,000)
(2,000)
6.01.02.11
Deferred Revenue
(97,000)
4,000
6.01.02.12
Other Payables
(30,000)
(66,000)
6.01.02.13
Income Tax and Social Contribution, Paid
(238,000)
-
6.01.02.15
Received Dividends and Interest on Own Capital
-
1,399,000
6.02
Net Cash of Investing Activities
(757,000)
(199,000)
6.02.02
Purchase of Property, Plant and Equipment
(739,000)
(571,000)
6.02.03
Purchase of Intangible Assets
(19,000)
(13,000)
6.02.04
Proceeds From Sale of Property, Plant and Equipment
1,000
385,000
6.03
Net Cash of Financing Activities
1,240,000
(1,026,000)
6.03.01
Capital Increase
18,000
-
6.03.02
Proceeds From Borrowings and Financing
1,874,000
599,000
6.03.03
Payments of Borrowings and Financing
(366,000)
(1,478,000)
6.03.05
Payments of Dividends and Interesr on Own Capital
(85,000)
-
6.03.09
Payment of Lease Liability
(201,000)
(147,000)
6.05
Increase (Decrease) in Cash and Cash Equivalents
979,000
563,000
6.05.01
Cash and Cash Equivalents at the Beginning of the Period
3,532,000
1,876,000
6.05.02
Cash and Cash Equivalents at the End of the Period
4,511,000
2,439,000
7
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Statements of Changes in Shareholders' Equity 1/1/2021 to 6/30/2021
R$ (in thousands)
Code
Description
Capital stock
Capital reserve, granted options and treasury shares
Profit reserve
Retained earnings
/Accumulated losses
Other comprehensive income
Shareholders' equity
5.01
Opening balance
761,000
4,000
645,000
-
-
1,410,000
5.02
Prior Period Adjustments
-
-
(63,000)
-
-
(63,000)
5.03
Adjusted Opening Balance
761,000
4,000
582,000
-
-
1,347,000
5.04
Capital Transactions with Shareholders
18,000
7,000
-
-
-
25,000
5.04.01
Capital Increase
18,000
-
-
-
-
18,000
5.04.03
Stock Options Granted
-
7,000
-
-
-
7,000
5.05
Total Comprehensive Income
-
-
-
545,000
-
545,000
5.05.01
Net Income for the Period
-
-
-
545,000
-
545,000
5.07
Closing Balance
779,000
11,000
582,000
545,000
-
1,917,000
8
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Individual Interim Financial Information / Statements of Changes in Shareholders' Equity 1/1/2020 to 6/30/2020
R$ (in thousands)
Code
Description
Capital stock
Capital reserve, granted options and treasury shares
Profit reserve
Retained earnings
/Accumulated losses
Other comprehensive income
Shareholders' equity
5.01
Opening Balance
4,421,000
18,000
2,497,000
-
162,000
7,098,000
5.03
Adjusted Opening Balance
4,421,000
18,000
2,497,000
-
162,000
7,098,000
5.04
Capital Transactions with Shareholders
57,000
3,000
-
-
-
60,000
5.04.01
Capital Increases
57,000
-
-
-
-
57,000
5.04.03
Stock Options Granted
-
3,000
-
-
-
3,000
5.05
Total Comprehensive Income
-
-
-
275,000
1,553,000
1,828,000
5.05.01
Net Income for the Period
-
-
-
275,000
-
275,000
5.05.02
Other Comprehensive Income
-
-
-
-
1,553,000
1,553,000
5.05.02.07
Fair Value of Trade Receivable
-
-
-
-
(2,000)
(2,000)
5.05.02.08
Cash Flow Hedge
-
-
-
-
(6,000)
(6,000)
5.05.02.09
Income Taxes Related to Other Comprehensive Income
-
-
-
-
(2,000)
(2,000)
5.05.02.10
Exchange Differences over Conversion of Foreign Operations
-
-
-
-
1,563,000
1,563,000
5.06
Internal Changes of Shareholders' Equity
-
-
102,000
-
-
102,000
5.06.08
Other
-
-
(6,000)
-
-
(6,000)
5.06.09
Hyperinflationary Economy Effect
-
-
108,000
-
-
108,000
5.07
Closing Balance
4,478,000
21,000
2,599,000
275,000
1,715,000
9,088,000
9
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Balance Sheet - Assets
R$ (in thousands)
Current quarter
Prior period
Code
Description
06/30/2021
12/31/2020
1
Total Assets
20,481,000
18,821,000
1.01
Current Assets
9,371,000
8,349,000
1.01.01
Cash and Cash Equivalents
4,511,000
3,532,000
1.01.03
Accounts Receivable
264,000
216,000
1.01.03.01
Trade Receivables
230,000
182,000
1.01.03.02
Other Receivables
34,000
34,000
1.01.04
Inventories
3,688,000
3,739,000
1.01.06
Recoverable Taxes
683,000
768,000
1.01.08
Other Current Assets
225,000
94,000
1.01.08.01
Non-current Assets Held for Sale
147,000
0
1.01.08.01.01
Assets Held for Sale
147,000
0
1.01.08.03
Other
78,000
94,000
1.01.08.03.01
Derivative Financial Instruments
0
57,000
1.01.08.03.03
Other Current Assets
78,000
37,000
1.02
Non-current Assets
11,110,000
10,472,000
1.02.01
Long-Term Assets
1,105,000
1,190,000
1.02.01.09
Receivable From Related Parties
179,000
178,000
1.02.01.10
Other Non-current Assets
926,000
1,012,000
1.02.01.10.04
Recoverable Taxes
771,000
866,000
1.02.01.10.05
Restricted Deposits for Legal Proceedings
132,000
134,000
1.02.01.10.06
Derivative Financial Instruments
2,000
11,000
1.02.01.10.07
Other Non-current Assets
21,000
1,000
1.02.02
Investments
798,000
769,000
1.02.02.01
Investments in Associates
798,000
769,000
1.02.02.01.02
Investments in Subsidiaries
798,000
769,000
1.02.03
Property, Plant and Equipment
8,160,000
7,476,000
1.02.03.01
Property, Plant and Equipment in Use
5,456,000
5,043,000
1.02.03.02
Right of Use on Leases
2,704,000
2,433,000
1.02.04
Intangible Assets
1,047,000
1,037,000
1.02.04.01
Intangible Assets
1,047,000
1,037,000
1.02.04.01.02
Intangible Assets
1,047,000
1,037,000
10
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Balance Sheet - Liabilities
R$ (in thousands)
Current quarter
Prior period
Code
Description
06/30/2021
12/31/2020
2
Total Liabilities
20,481,000
18,821,000
2.01
Current Liabilities
8,006,000
8,786,000
2.01.01
Payroll and Related Taxes
408,000
371,000
2.01.02
Trade Payables
4,505,000
5,058,000
2.01.03
Taxes and Contributions Payable
282,000
528,000
2.01.04
Borrowings and Financing
2,191,000
2,120,000
2.01.04.01
Borrowings and Financing
260,000
280,000
2.01.04.02
Debentures
1,931,000
1,840,000
2.01.05
Other Liabilities
620,000
709,000
2.01.05.01
Payables to Related Parties
104,000
41,000
2.01.05.02
Others
516,000
668,000
2.01.05.02.01
Dividends and Interest on Own Capital
-
85,000
2.01.05.02.08
Financing Related to Acquisition of Assets
51,000
34,000
2.01.05.02.09
Deferred Revenue
139,000
227,000
2.01.05.02.12
Other Current Liabilities
113,000
150,000
2.01.05.02.17
Lease Liability
213,000
172,000
2.02
Non-current Liabilities
10,558,000
8,688,000
2.02.01
Borrowings and Financing
7,344,000
5,711,000
2.02.01.01
Borrowings and Financing
984,000
952,000
2.02.01.02
Debentures
6,360,000
4,759,000
2.02.02
Other Liabilities
2,890,000
2,612,000
2.02.02.02
Others
2,890,000
2,612,000
2.02.02.02.07
Property Tax
12,000
8,000
2.02.02.02.09
Other Accounts Payable
2,878,000
2,604,000
2.02.03
Deferred Taxes
72,000
82,000
2.02.03.01
Deferred Income Tax and Social Contribution
72,000
82,000
2.02.04
Provision for Legal Proceedings
251,000
282,000
2.02.06
Deferred Revenue
1,000
1,000
2.03
Shareholders' Equity
1,917,000
1,347,000
2.03.01
Share Capital
779,000
761,000
2.03.02
Capital Reserves
11,000
4,000
2.03.04
Earnings Reserve
1,127,000
582,000
11
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Statements of Operations
R$ (in thousands)
Current Quarter
Year to date current period
Previous Quarter
Year to date previous period
Code
Description
4/1/2021 to 6/30/2021
1/1/2021 to 6/30/2021
4/1/2020 to 6/30/2020
1/1/2020 to 6/30/2020
3.01
Net Operating Revenue
10,049,000
19,497,000
8,242,000
16,080,000
3.02
Cost Of Sales
(8,327,000)
(16,268,000)
(6,904,000)
(13,525,000)
3.03
Gross Profit
1,722,000
3,229,000
1,338,000
2,555,000
3.04
Operating Income / Expenses
(1,126,000)
(2,150,000)
(954,000)
(1,845,000)
3.04.01
Selling Expenses
(804,000)
(1,560,000)
(647,000)
(1,267,000)
3.04.02
General and Administrative Expenses
(152,000)
(289,000)
(104,000)
(198,000)
3.04.05
Other Operating Expenses
(184,000)
(330,000)
(203,000)
(380,000)
3.04.05.01
Depreciation and Amortization
(154,000)
(299,000)
(121,000)
(238,000)
3.04.05.03
Other Operating Expenses, Net
(30,000)
(31,000)
(82,000)
(142,000)
3.04.06
Share of Profit of Associates
14,000
29,000
-
-
3.05
Profit from Operations Before Net Financial Expenses
596,000
1,079,000
384,000
710,000
3.06
Net Financial Expenses
(145,000)
(279,000)
(131,000)
(286,000)
3.06.01
Financing Revenues
52,000
69,000
66,000
129,000
3.06.02
Financing Expenses
(197,000)
(348,000)
(197,000)
(415,000)
3.07
Income Loss Before Income Tax and Social Contribution
451,000
800,000
253,000
424,000
3.08
Income Tax and Social Contribution
(146,000)
(255,000)
(84,000)
(139,000)
3.08.01
Current
(164,000)
(265,000)
(184,000)
(261,000)
3.08.02
Deferred
18,000
10,000
100,000
122,000
3.09
Net Income from Continued Operations
305,000
545,000
169,000
285,000
3.10
Net Income from Discontinued Operations
-
-
58,000
64,000
3.10.01
Net Income from Discontinued Operations
-
-
58,000
64,000
3.11
Net Income for the Period
305,000
545,000
227,000
349,000
3.11.01
Attributed Controlling Company Partners
305,000
545,000
175,000
275,000
3.11.02
Attributed Partners Non-controlling
-
-
52,000
74,000
3.99
Earnings per Share - (Reais/Share)
3.99.01
Basic Earnings per Share
3.99.01.01
Common
1.13758
2.02854
0.67829
1.06589
3.99.02
Diluted Earnings per Share
3.99.02.01
Common
1.13758
2.02854
0.67829
1.06589
12
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Statements of Comprehensive Income
R$ (in thousands)
Current Quarter
Year to date current period
Previous Quarter
Year to date previous period
Code
Description
4/1/2021 to 6/30/2021
1/1/2021 to 6/30/2021
4/1/2020 to 6/30/2020
1/1/2020 to 6/30/2020
4.01
Net income for the Period
305,000
545,000
227,000
349,000
4.02
Other Comprehensive Income
-
-
1,431,000
2,043,000
4.02.02
Foreign Currency Translation
-
-
1,433,000
2,052,000
4.02.04
Fair Value of Trade Receivables
-
-
(1,000)
-
4.02.05
Cash Flow Hedge
-
-
(1,000)
(5,000)
4.02.06
Income Taxes over Other Comprehensive Income
-
-
-
(2,000)
4.02.08
Other Comprehensive Income
-
-
-
(2,000)
4.03
Total Comprehensive Income for the Period
305,000
545,000
1,658,000
2,392,000
4.03.01
Attributable To Controlling Shareholders
305,000
545,000
1,244,000
1,828,000
4.03.02
Attributable To Non-Controlling Shareholders
-
-
414,000
564,000
13
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Satatements of Cash Flows - Indirect method
R$ (in thousands)
Current period accumulated
Prior period accumulated
Code
Description
01/01/2021 - 06/30/2021
01/01/2020 - 06/30/2020
6.01
Net Cash Operating Activities
496,000
(888,000)
6.01.01
Cash Provided by The Operations
1,347,000
1,315,000
6.01.01.01
Net Income for The Period
545,000
349,000
6.01.01.02
Deferred Income Tax and Social Contribution
(10,000)
(185,000)
6.01.01.03
Gain (Losses) on Disposal of Property and Equipments
68,000
127,000
6.01.01.04
Depreciation and Amortization
324,000
646,000
6.01.01.05
Interest and Inflation Adjustments
401,000
415,000
6.01.01.07
Share of Profit (Loss) of Subsidiaries and Associates
(29,000)
41,000
6.01.01.08
(Reversal) Provision for Legal Proceedings
(24,000)
3,000
6.01.01.10
Provision for Share Purchase Options
7,000
3,000
6.01.01.11
Provision (Reversal) for Doubtful Accounts
1,000
-
6.01.01.13
Provision (Reversal) for Inventory Losses and Damages
138,000
(7,000)
6.01.01.14
Other Operating Expenses / Revenues
-
20,000
6.01.01.16
Gain on Leasing Liabilities Write-Off
(74,000)
(97,000)
6.01.02
Changes in Assets and Liabilities
(851,000)
(2,203,000)
6.01.02.01
Accounts Receivable
(49,000)
(32,000)
6.01.02.02
Inventories
(87,000)
28,000
6.01.02.03
Recoverable Taxes
189,000
(94,000)
6.01.02.04
Other Assets
(67,000)
89,000
6.01.02.05
Related Parties
66,000
208,000
6.01.02.06
Restricted Deposits for Legal Proceeding
3,000
17,000
6.01.02.07
Trade Payables
(551,000)
(2,593,000)
6.01.02.08
Payroll and Related Taxes
37,000
19,000
6.01.02.09
Taxes and Social Contributions Payable
(8,000)
301,000
6.01.02.10
Payments of Provision for Risk
(19,000)
(13,000)
6.01.02.11
Deferred Revenue
(97,000)
(15,000)
6.01.02.12
Other Payables
(30,000)
(118,000)
6.01.02.13
Income Tax and Social Contribution,Paid
(238,000)
-
6.02
Net Cash of Investing Activities
(757,000)
(359,000)
6.02.02
Acquisition of Property and Equipment
(739,000)
(697,000)
6.02.03
Increase in Intangible Assets
(19,000)
(40,000)
6.02.04
Sales of Property and Equipment
1,000
385,000
6.02.09
Acquisition of Investment Property
-
(7,000)
6.03
Net Cash of Financing Activities
1,240,000
384,000
6.03.01
Capital Increase
18,000
6.03.02
Proceeds From Borrowings and Financing
1,874,000
2,659,000
6.03.03
Payments of Borrowings and Financing
(366,000)
(1,788,000)
6.03.05
Dividends and Interest on Equity, Paid
(85,000)
(124,000)
6.03.09
Payment of Lease Liability
(201,000)
(363,000)
6.04
Exchange Variation Cash and Cash Equivalents
-
455,000
6.05
Increase (Decrease) in Cash and Cash Equivalents
979,000
(408,000)
6.05.01
Cash and Cash Equivalents at the Beginning of the Period
3,532,000
5,026,000
6.05.02
Cash and Cash Equivalents at the End of the Period
4,511,000
4,618,000
14
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Statements of Changes in Shareholders' Equity 1/1/2021 to 6/30/2021
R$ (in thousands)
Code
Description
Capital
stock
Capital reserve, granted options and treasury shares
Profit reserve
Retained earnings
/Accumulated losses
Other comprehensive income
Shareholders' equity
Non-Controlling Shareholders' participation
Consolidated Shareholders' equity
5.01
Opening balance
761,000
4,000
645,000
-
-
1,410,000
-
1,410,000
5.02
Prior Period Adjustments
-
-
(63,000)
-
-
(63,000)
-
(63,000)
5.03
Adjusted Opening Balance
761,000
4,000
582,000
-
-
1,347,000
-
1,347,000
5.04
Capital Transactions with Shareholders
18,000
7,000
-
-
-
25,000
-
25,000
5.04.01
Capital Increase
18,000
-
-
-
-
18,000
-
18,000
5.04.03
Stock Options Granted
-
7,000
-
-
-
7,000
-
7,000
5.05
Total Comprehensive Income
-
-
-
545,000
-
545,000
-
545,000
5.05.01
Net Income for the Period
-
-
-
545,000
-
545,000
-
545,000
5.07
Closing Balance
779,000
11,000
582,000
545,000
-
1,917,000
-
1,917,000
15
FREE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) ITR - Interim Financial Information - June 30,2021 - SENDAS DISTRIBUIDORA S.A.
Consolidated Interim Financial Information / Statements of Changes in Shareholders' Equity 1/1/2020 to 6/30/2020
R$ (in thousands)
Code
Description
Capital stock
Capital reserve, granted options and treasury shares
Profit reserve
Retained earnings
/Accumulated losses
Other comprehensive income
Shareholders' equity
Non-Controlling Shareholders' participation
Consolidated Shareholders' equity
5.01
Opening Balance
4,421,000
18,000
2,497,000
-
162,000
7,098,000
2,603,000
9,701,000
5.03
Adjusted Opening Balance
4,421,000
18,000
2,497,000
-
162,000
7,098,000
2,603,000
9,701,000
5.04
Capital Transactions with Shareholders
57,000
3,000
-
-
-
60,000
(68,000)
(8,000)
5.04.01
Capital Increases
57,000
-
-
-
-
57,000
-
57,000
5.04.03
Stock Options Granted
-
3,000
-
-
-
3,000
-
3,000
5.04.06
Dividends
-
-
-
-
-
-
(68,000)
(68,000)
5.05
Total Comprehensive Income
-
-
-
275,000
1,553,000
1,828,000
564,000
2,392,000
5.05.01
Net Income for the Period
-
-
-
275,000
-
275,000
74,000
349,000
5.05.02
Other Comprehensive Income
-
-
-
-
1,553,000
1,553,000
490,000
2,043,000
5.05.02.06
Other Comprehensive Income
-
-
-
-
(2,000)
(2,000)
-
(2,000)
5.05.02.08
Cash Flow Hedge
-
-
-
-
(6,000)
(6,000)
1,000
(5,000)
5.05.02.09
Income Taxes Related to Other Comprehensive Income
-
-
-
-
(2,000)
(2,000)
-
(2,000)
5.05.02.10
Exchange Differences over Conversion of Foreign Operations
-
-
-
-
1,563,000
1,563,000
489,000
2,052,000
5.06
Internal Changes of Shareholders' Equity
-
-
102,000
-
-
102,000
1,000
103,000
5.06.08
Other
-
-
(6,000)
-
-
(6,000)
(2,000)
(8,000)
5.06.09
Hyperinflationary Economy Effect
-
-
108,000
-
-
108,000
3,000
111,000
5.07
Closing Balance
4,478,000
21,000
2,599,000
275,000
1,715,000
9,088,000
3,100,000
12,188,000
16
1
Corporate Information
Sendas Distribuidora S.A. (the 'Company' or 'Sendas') is mainly engaged in the retail and wholesale sale of food, bazar, and other products through its stores, represented by the banner 'ASSAÍ'. The Company is based in the State of Rio de Janeiro, at Avenida Ayrton Senna, 6.000, Lote 2 - Anexo A, Jacarepaguá/RJ. On June 30, 2021, the Company operated 187 stores and 13 Distribution Centers which were present in all five regions of the country, distributed in 23 states (including Federal District).
With the corporate reorganization process concluded on December 31, 2020, see note 1.2, the Company ceased to be a wholly owned subsidiary of Grupo Pão de Açucar ('GPA') and became a direct subsidiary of Wilkes Participações S.A. ('Wilkes').
On November 27, 2019, the Company took over from Casino Guichard Perrachon ('Casino') the control of Almacenes Éxito S.A. ('Éxito'), an entity operating in Colombia, under the supermarket and hypermarket banners Éxito, Carulla, Super Inter, Surtimax, and Surtimayorista, in Argentina under the banner Libertad and in Uruguay under the banners Disco and Devoto. Additionally, Éxito operates in Colombia under the banner Viva in the mall centers. On December 31, 2020, the Company transferred Éxito's control in its entirety to GPA as part of spin-off transaction, see note 1.2 and the Éxito's operations has been presented as discontinued operations, see note 27.
1.1
Listing of Sendas in the Novo Mercado of B3 and NYSE
On February 19, 2021, the Company communicated to the market, through Material Fact, that on February 10, 2021 the request for listing and admission to the trading of the Company's shares in the Novo Mercado segment of the B3 S.A. - Brasil, Bolsa, Balcão was approved. And, on February 12, 2021 the request for listing of the Company American Depositary Securities ('ADSs') representing its common shares on the New York Stock Exchange ('NYSE') was approved.
GPA's shareholders received, after the close of trading on February 26, 2021 ('Cut-off Date'), shares issued by the Company, in proportion to their respective holdings in the capital stock of GPA.
The shares and ADSs issued by the Company became to be negotiated on B3 and NYSE since March 1, 2021.
1.2
Corporate reorganization
At meetings held on December 12, 2020 and disclosed to the market on December 14, 2020, the Board of Directors of the Company and GPA approved the Transaction to separate the cash and carry business under the ASSAÍ banner from the traditional retail business of GPA.
At the Extraordinary Shareholders' Meeting held on December 31, 2020, shareholders of the Company and GPA approved the Transaction described below:
i) Spin-off of the Company: partial spin-off of Sendas with the incorporation of the spin-off assets by GPA whose the net carrying amount calculated by the independent evaluator company was R$9,179, comprising 90.93% of the total Éxito's shares held by the Company, corresponding to 393,010,656 (three hundred ninety-three million, ten thousand, six hundred fifty-six) shares and equivalent to approximately 87.80% of the total shares issued by Éxito ('Éxito participation') and for 6 (six) gas stations held by Sendas ('Operational Assets') in the amount of R$25; and
ii) Spin-off of GPA: partial spin-off of GPA which aims segregate the totality of shareholding participation that GPA holds, whose net carrying amount calculated by the independent evaluator company was R$1,216, with the distribution of the shares issued by Sendas, owned by GPA, directly to GPA's shareholders, as a proportion of one share issued by the Company for each one share issued by GPA.
In the spin-off process between Sendas and GPA, an exchange of assets was performed that transferred to GPA 9.07% of the total shares held by the Company, corresponding to 39,246,012 (thirty-nine million, two hundred and forty-six thousand and twelve) shares and equivalent to approximately 8.77% of total shares issued by Éxito undertaking the receipt of the following assets owned by GPA that may be developed by the Company:
i) 50% of the shares of Bellamar Empreendimento e Participações Ltda. ('Bellamar'), a holding Company that holds an investment in 35.76% of the Financeira Itaú CBD S.A - Crédito, Financiamento e Investimento ('FIC'), in the amount of R$769, see note 11.1, and real state in the amount of R$146.
ii) Company's capital stock increase in the amount of R$685 through: a) R$500 in cash; b) R$140 capitalization of amounts payable to GPA; c) R$45 net book assets of stores that may be developed by the Company.
iii) R$168 regarding to contingent liabilities and related judicial deposits and which the Company and GPA have agreed to be responsible after the spin-off. This indemnity effects were recorded in related parties, see note 10.
According to the material fact published on November 19, 2020, the Company obtained all necessary authorizations from its creditors, in order to proceed with the segregation of its cash & carry operation through referred spin-off, on the same date, the renegotiation of certain remuneration rates was also approved and the release from GPA as guarantor for the issuance of the Company's debentures and promissory notes. The total amount of the renegotiated debt was R$6,644, representing 85% of the Company's gross debt of the Company on December 31, 2020.On the other hand of the renegotiation of the remuneration rates, the Company obtained a 'waiver' related to financial covenants for the period of December 31, 2020 up to December 31, 2023 and due to this renegotiation, the amount of R$71 was recognized in the financial result as debt cost.
17
1.2.1
Derecognition of Éxito subsidiary
Éxito's balance sheet as of December 31, 2020 is presented below. The Company no longer presents consolidated financial statements on December 31, 2020, since the derecognition of Company's only subsidiary has occurred.
ASSETS
12/31/2020
Current
Cash and cash equivalents
3,687
Trade receivables
384
Other accounts receivables
220
Inventories
2,993
Recoverable taxes
570
Other current assets
130
7,984
Assets held for sale
30
Total current assets
8,014
Non-current
Related parties
82
Legal deposits
3
Other non-current assets
171
Investments
480
Investment properties
3,639
Property, plant and equipment
10,504
Intangible assets
4,051
Total non-current assets
18,930
Total assets
26,944
LIABILITIES
Current
Trade payable
6,449
Borrowings and financing
1,051
Payroll and related taxes
375
Lease liabilities
377
Related parties
77
Taxes and social contribution payable
288
Acquisition of non-controlling interest
636
Deferred revenues
200
Dividends payable
40
Other current liabilities
236
Total current liabilities
9,729
Non-current
Borrowings and financing
520
Deferrend income tax and social contribution
883
Provision for legal proceedings
139
Lease liabilities
2,039
Other non-current liabilities
39
Total non-current liabilities
3,620
SHAREHOLDERS' EQUITY
Total shareholders' equity
13,595
Total liabilities and shareholders' equity
26,944
1.3
Impacts of the pandemic on the Company's interim financial information
Since December 2019, a new strain of Coronavirus named as COVID-19 has spread across the world. Since then, the Company has been monitoring the spread of COVID-19 and its impacts on its operations. Several actions have been taken by the Company, among them, we appointed a crisis committee composed of senior management, which makes decisions in line with recommendations of the Brazilian Ministry of Health, local authorities, and professional associations.
The Company implemented all the measures to mitigate the transmission of virus at our stores, warehouses, and offices, such as frequent sanitization, employees' safety/protection equipment, flexible working hours, and home office, among others.
Since the beginning of the COVID-19 outbreak, our stores have remained open during periods of general lockdown, as we are considered an essential service. The Company has a strong commitment to society to continue selling essential products to its customers. We did not face supply-side hurdles from industries that continued supplying our distribution centers and stores.
On March 10, 2020, CVM issued circular letter CVM-SNC/SEP No. 02/2020 and on January 29, 2021 issued circular letter CVM-SNC/SEP No. 01/2021, guiding publicly held Companies to carefully assess the impacts of COVID-19 on their business and report in the interim financial information the main risks and uncertainties as result of such analysis, following the applicable accounting standards.
In this regard, the Company fully analyzed its financial statements, in addition to updating the analyses of going concern. Below are the key topics analyzed:
18
• The Company reviewed its budget, adopted to estimate the calculation of the recovery of store assets and intangible assets on December 31, 2020, and no significant reductions were seen in revenues, and in other items of the income statement to evidence impairment of these assets. Due to uncertainties concerning the end of the pandemic and its macroeconomic effects, the Company analyzed the indication of impairment for certain assets and, accordingly, updated its impairment tests. There were no new elements in the semester ended June 30, 2021 that the Company's need to review the asset recovery test.
The recoverable value is determined by calculating the value in use, from cash projections deriving from financial budgets, which were reviewed and approved by senior management for the next three years, considering the assumptions updated for December 31, 2020. The discount rate applied to cash flow projections is 9.8% on December 31, 2020, and the cash flows to exceed three years are extrapolated, applying a growth rate of 4.6% on December 31, 2020. As a result of this analysis, we did not identify the need for recording a provision for impairment of these assets;
• The Company analyzed the collection of balances of trade receivables from credit card operators, clients, galleries at our stores, property rentals, and concluded that, at this point, it is not necessary to record provisions, in addition to those already recorded;
• Concerning inventories, the Company does not foresee the need to make a market price adjustment;
• Financial instruments already reflect the market assumptions in their valuation, there are no additional exposures not disclosed. The Company is not exposed to significant financing denominated in US dollars;
• At this point, the Company does not foresee additional funding; and
• Finally, the costs necessary to adapt the Company's stores to serve the public were not significant.
In summary, according to Management's estimates and the monitoring of the impacts of the pandemic, there are no effects that should be recorded in the Company's interim financial information for de period ended June 30, 2021, nor are there any effects on the continuity and / or estimates of the Company that would justify changes or recording provisions in addition to those already disclosed. The Company will continue to monitor and evaluate the impacts and, if necessary, make the necessary disclosures.
1.4
Going concern analysis
Management has assessed the Company's ability to continue operating in a foreseeable future and concluded that Company has ability to maintain its operations and systems working regularly, even in the face of the COVID-19 pandemic (see note 1.3). Therefore, Management is not aware of any material uncertainty that could indicates significant doubts about its ability to continue operating. The interim financial information has been prepared based on the assumption of business continuity.
2
Basis of preparation and disclosure of the individual and consolidated interim financial information
The individual and consolidated interim financial information have been prepared in accordance with IAS 34 - Interim Financial Reporting issued by International Accounting Standards Board ('IASB') and accounting standard CPC 21 (R1) - Interim report and disclosed aligned with the standards approved by the Brazilian Securities and Exchange Commission ('CVM'), applicable to the preparation of the Interim Financial Information.
The interim financial information has been prepared on a historical cost basis except for certain financial instruments measured at their fair value. All relevant information in the financial statements is being evidenced by and corresponds to that used by Management in the administration of the Company.
The individual and consolidated interim financial information are presented in millions of Brazilian Reais (R$), which is the functional currency of the Company.
The interim financial information for the six-month period ended June 30, 2021 were approved by the Board of Directors on July 27, 2021.
3
Significant accounting policies
The main accounting policies and practices applied by the Company to the preparation of the individual and consolidated interim financial information are in accordance with those adopted and disclosed in note 3 and in each explanatory note corresponding to the financial statements for the year ended December 31, 2020, and, therefore, it should be read together.
3.1
Standards, amendments and interpretation
There were no new standards, amendments and interpretation issued that must be disclosed for the three-month period ended June 30, 2021.
4
Restatement of the interim financial information
4.1
Restatement of the corresponding amounts as result of Éxito's spin-off
The consolidated interim financial statement of operations, consolidated statement of added value for the period and the explanatory notes for the six-month period ended June 30, 2020 are being restated due to Éxito subsidiary's spin-off according to the effects of such transaction in compliance with the accounting standard CPC 31 / IFRS 5 - Non-Current Assets Held for Sale and Discontinued Operation.
19
The cash flow statement includes continued and discontinued operations in line with accounting standard CPC 31 / IFRS 5.
Statement of Operations
Consolidated
6/30/2020
Orinally presented
Spin-off effects
Restated
Net operating revenue
26,411
(10,331)
16,080
Cost of sales
(21,328)
7,803
(13,525)
Gross profit
5,083
(2,528)
2,555
Operating expenses, net
Selling expenses
(2,657)
1,390
(1,267)
General and administrative expenses
(639)
441
(198)
Depreciation and amortization
(584)
346
(238)
Share of profit (loss) of associates
(41)
41
-
Other operating expenses, net
(244)
102
(142)
(4,165)
2,320
(1,845)
Operating profit before net financial result
918
(208)
710
Net financial result
(444)
158
(286)
Income before income taxes from continued operations
474
(50)
424
Income tax and social contribution
(125)
(14)
(139)
Net income from continued operations
349
(64)
285
Discontinued operations
Net income from discontinued operations
-
64
64
Net income for the period
349
-
349
Statement of added value
Consolidated
6/30/2020
Orinally presented
Spin-off effects
Restated
Revenues
Sales of goods
29,195
(11,570)
17,625
(Allowance) reversal for doubtful accounts
(10)
9
(1)
Other revenues
280
43
323
29,465
(11,518)
17,947
Products acquired from third parties
Costs of goods sold
(21,828)
7,399
(14,429)
Materials, energy, outsourced services and other
(2,111)
979
(1,132)
(23,939)
8,378
(15,561)
Gross value added
5,526
(3,140)
2,386
Retention
Depreciation and amortization
(646)
394
(252)
Net value added produced by the Company
4,880
(2,746)
2,134
Value added received in transfer
Share of profit (loss) of subsidiaries and associates
(41)
41
-
Financial revenue
227
(98)
129
186
(57)
129
Net income from discontinued operations
-
64
64
Total value added to distribute
5,066
(2,739)
2,327
Personnel
1,911
(1,023)
888
Direct compensation
1,459
(902)
557
Benefits
317
(86)
231
Government severance indemnity fund for employees (FGTS)
46
-
46
Others
89
(35)
54
Taxes, fees and contributions
2,127
(1,460)
667
Federal
506
(213)
293
State
1,530
(1,184)
346
Municipal
91
(63)
28
External financiers
679
(256)
423
Interest
671
(256)
415
Rental
8
-
8
Shareholders' remuneration
349
-
349
Retained earnings for the period
275
-
275
Non-controlling interest in retained earnings
74
-
74
Total added value distributed
5,066
(2,739)
2,327
4.2
Restatement - Earnings per share
On October 5, 2020, the reverse stock split of 3,269,992,034 (three billion, two hundred sixty-nine million, nine hundred ninety-two thousand and thirty-four) nominative common shares, without nominal value issued by the Company, in the proportion of 12,1854776946393 to compose 1 (one) share ('Reverse Stock Split') was approved, resulting in the Company's capital stock divided into 268,351,567 (two hundred sixty-eight million, three hundred fifty-one thousand and five hundred sixty-seven) nominative common shares, without nominal value. The reverse stock split was not reflected in the interim financial information on June 30, 2020, originally issued on October 6, 2020, which disagree with the accounting standard CPC 41 / IAS 33 - Earning per share, resulting in the following restatement:
6/30/2020
Originally presented
Reverse stock split effects
Restated
Basic and diluted number:
Basic profit allocated and not distributed
275
-
275
Allocated net income available to ordinary shareholders
275
-
275
Basic and diluted denominator (million shares)
Weighted average number of shares
3,141
12.18548
258
Basic and diluted earnings per million shares (R$)
0.08755
-
1.06589
20
4.3
Restatement of profit retention reserve and proposed dividends
In the financial statements as of December 31, 2020, published on February 22, 2021, the legal reserve was constituted in the amount of R$217, exceeding the limit of 20% of the Company's capital stock as established by art. 193 of Law No. 6,404/1976. The table below presents the impacts of the adjustments for the proper constitution of the legal reserve and proposed dividends and the restatement of the Company's financial statement, see note 20.2 and 20.3.
Below we present the impacts on the balance sheet lines:
12/31/2020
Originally presented
Adjustments
Restated
Current liabilities
Dividends payable
22
63
85
Total current liabilities
8,723
63
8,786
Shareholders' equity
Legal reserve
217
(65)
152
Profit retention
428
65
493
Dividends allocation
(22)
(63)
(85)
Total Shareholders' equity
1,410
(63)
1,347
5
Significant accounting judgments, estimates, and assumptions
The preparation of the individual and consolidated interim financial information requires Management to makes judgments and estimates and adopt assumptions that impact the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the end of the period, however, the uncertainty about these assumptions and estimates could result in substantial adjustments to the carrying amount of asset or liability impacted in upcoming periods.
The significant assumptions and estimates applied on the preparation of the individual and consolidated interim financial information for the period ended June 30, 2021, were the same as those adopted in the individual and consolidated financial statements for the year ended December 31, 2020.
6
Cash and cash equivalents
6/30/2021
12/31/2020
Cash and bank accounts - Brazil
70
64
Cash and bank accounts - Abroad (*)
23
29
Financial investments - Brazil (**)
4,418
3,439
4,511
3,532
(*) On June 30, 2021, the Company had funds held abroad, being R$23 in US Dollars (R$24 in US Dollars and R$5 in Colombian Pesos on December 31, 2020).
(**) On June 30, 2021, the financial investments correspond to the repurchase and resale agreements and certificate of deposits, yielded by the weighted average of 98.90% of CDI - Interbank Deposit Certificate (96.96% of CDI on December 31, 2020) and redeemable within terms less than 90 days, as of the date of investment, without losing income.
7
Trade receivables
Note
6/30/2021
12/31/2020
From sales with:
Credit card companies
7.1
68
62
Credit card companies with related parties
10.1
13
17
Sales ticket and others
122
77
Trade receivables with related parties
10.1
20
10
Trade receivables with suppliers/slips
12
20
Allowance for doubtful accounts
7.2
(5)
(4)
230
182
7.1
Credit card companies
The Company, through the cash management strategy, anticipates the amount receivable with credit card companies, without any right of recourse or related obligation and derecognizes the balance of trade receivables.
7.2
Allowance for doubtful accounts
6/30/2021
12/31/2020
At the beginning of the period
(4)
(5)
Additions
(16)
(12)
Reversals
15
13
At the end of the period
(5)
(4)
Set forth below the breakdown of trade receivables by their gross amount by maturity period:
Overdue
Total
Due
Up to
30 days
> 90 days
6/30/2021
235
231
1
3
12/31/2020
186
181
2
3
-
21
8
Inventories
Note
6/30/2021
12/31/2020
Stores
3,321
3,416
Distribution centers
8.1
392
374
Allowance for loss on inventory obsolescence and damages
8.2
(25)
(51)
3,688
3,739
8.1
Commercial agreements
On June 30, 2021, the amount of unrealized commercial agreements, as a reduction of inventory balance, totaled R$474 (R$444 on December 31, 2020).
8.2
Allowance for loss on inventory obsolescence and damages
6/30/2021
12/31/2020
At the beginning of the period
(51)
(41)
Additions
(147)
(140)
Write-offs
9
8
Reversals
164
141
At the end of the period
(25)
(32)
9
Recoverable taxes
Note
6/30/2021
12/31/2020
State VAT tax credits - ICMS
9.1
1,205
1,311
Social Integration Program and Contribution for Social Security Financing - PIS/COFINS
9.2
266
141
Provision for exclusion of ICMS on PIS/COFINS calculation base
9.2
(51)
-
Social Security Contribution - INSS
9.3
31
36
Income tax and social contribution
1
144
Others
2
2
Total
1,454
1,634
Current
683
768
Non-current
771
866
9.1
State VAT tax credits - ICMS
Since 2008, the Brazilian States have been substantially amending their local laws aiming at implementing and broadening the ICMS tax replacement system. The referred system implies the prepayment of ICMS throughout the commercial chain, upon goods outflow from a manufacturer or importer or their inflow into the State. The expansion of such system to a wider range of products traded at retail assumes that the trading cycle of these products will end in the State, such that ICMS is fully owed to such State.
The refund process requires evidence through tax documents and digital files of transactions made, entitling the Company to such a refund. Only after ratification by State tax authorities and/or the compliance with specific ancillary obligations aiming to support such evidence that credits can be used by the Company, which occur in periods after these are generated.
Since the number of items traded at the retail subject to tax replacement has been continuously increasing, the tax credit to be refunded by the Company has also grown. The Company has been realizing referred credits with authorization for immediate offset with those credits due in view of its operations, through the special regime, also other procedures regulated by state rules.
With respect to credits that cannot yet be immediately offset, the Company's Management, based on a technical recovery study, based on the future expectation of growth and consequent compensation with taxes payable arising from its operations, believes that its future compensation is viable. The studies mentioned are prepared and periodically reviewed based on information extracted from the strategic planning previously approved by the Company's Board of Directors. For the interim financial information as of June 30, 2021, the Company's management has monitoring controls over adherence to the annually established plan, reassessing and including new elements that contribute to the realization of the ICMS balance to be recovered, as shown in the table below:
Year
Amount
Em 1 year
453
From 1 to 2 years
248
From 2 to 3 years
260
From 3 to 4 years
139
From 4 to 5 years
32
After 5 years
73
Total
1,205
9.2
PIS and COFINS credits
On March 15, 2017, the Federal Supreme Court ('STF') recognized, as a matter of general repercussion, the unconstitutionality of the inclusion of ICMS in the PIS and COFINS calculation base. On May 13, 2021 judged the Declaration Embargoes in relation to the amount to be excluded from the calculation basis of the contributions, in which case it should only be the ICMS paid, or if the entire ICMS, as shown in respective invoices.
22
The STF decided to modulate the effects of the decision, for taxpayers who distributed the lawsuits before March 15, 2017 or with administrative proceedings in progress before that same date, would be have rights to take advantage of the past period. As the decision was rendered in a process with recognized general repercussions, the understanding reached is mandatory for all judges and courts. The Company informs that it had a lawsuit filed on October 31, 2013, having obtained a favorable decision and a final and unappealable decision on July 16, 2021, thus allowing the recognition of the credit for the period covered by the lawsuit.
The Brazilian Securities and Exchange Commission (CVM) had published Circular Letter No. 01/2021, among other topics, giving recommendations to publicly traded companies regarding the recognition of tax credits arising from the exclusion of ICMS from the PIS calculation basis and of COFINS, recommending that recognition only occur when there is reference, in the final decision, to the period covered in the lawsuit and the amount of ICMS to be excluded, until the decision becomes final.
On June 30, 2021, regarding available information, the Company partially recorded its right, net of provision, in the amount of R$62 (R$40 in net revenue and R$22 in financial result, arising from monetary correction). Due to the volume of data, the extension of the period to be calculated and the complexity of the calculation, in addition to the rules of the Federal Revenue of Brazil to be attended to determine all the credit to be offset, that is a preliminary estimate and the total amount will be calculated, the Company estimates that the difference between the estimate amount and the amount to be calculated will not be significant. Such provision refers to the period that the Company is calculating and detailing the supporting documentation. The Company will use its best efforts in order to have the definitive recognition in the third quarter of 2021, with the final and unappealable decision, as mentioned above.
Currently, the Company, according the favorable judgment of the STF, has been recognizing the exclusion of ICMS from the PIS and COFINS calculation basis based on the same assumptions mentioned previously.
9.3
Incidence of social security contributions
On August 28, 2020, the STF, in general repercussion, recognized as constitutional the incidence of social security contributions (INSS) on the additional one-third of vacation payment. The Company has been monitoring the progress of these issues involving unconstitutionality in social security contributions, and together with its legal advisors, concluded that the elements to date do not impact the recoverability of the respective INSS credits recorded in the amount of R$11 on June 30, 2021 (R$11 on December 31, 2020).
10
Related Parties
10.1
Balances and related party transactions
Assets
Liabilities
Clients
Other assets
Suppliers
Other liabilities
6/30/2021
12/31/2020
6/30/2021
12/31/2020
6/30/2021
12/31/2020
6/30/2021
12/31/2020
Controlling shareholders
Euris
-
-
-
-
-
-
1
-
Casino Guichard Perrachon
10
10
-
-
-
-
-
-
10
10
-
-
-
-
1
-
Other related parties
GPA (i)
10
-
166
168
10
-
103
41
Greenyellow
-
-
2
-
-
-
-
-
Joint venture
Financeira Itaú CBD S.A. Crédito, Financiamento e Investimento ('FIC')
13
17
11
10
8
11
-
-
23
17
179
168
10
-
103
41
Total
33
27
179
168
10
-
104
41
Parent Company
Consolidated
Transactions
Transactions
Revenue (expenses)
Revenue (expenses)
6/30/2021
6/30/2020
6/30/2021
Controlling shareholders
Wilkes Participações S/A
(1)
-
-
Euris
(1)
-
-
Casino Guichard Perrachon
(23)
-
-
(25)
-
-
Other related parties
GPA (i)
(89)
(115)
(115)
FIC
6
4
4
Compre Bem
(3)
2
2
Puntos Colombia
-
-
(54)
Tuya
-
-
11
Greenyellow
(14)
(2)
(18)
Grupo Exito
-
-
(10)
Others
-
-
(1)
(100)
(111)
(181)
Total
(125)
(111)
(181)
(i) Amounts refer to the spin-off and responsibility agreement which the Company assigned related to the corporate reorganization occurred on Decemebr 31, 2020. See note 1.2.
23
10.2
Management compensation
Expenses referring to the statutory executive board compensation recorded in the Company's statement of operations in the periods ended June 30, 2021 and 2020 as follows (amounts expressed in thousands reais):
Base salary
Variable compensation
Stock option plan
Total
2021
2020
2021
2020
2021
2020
2021
2020
Executive officers
16,024
-
-
-
2,125
-
18,149
-
Board of director
14,660
9,690
7,243
3,513
1,597
2,835
23,500
16,038
Fiscal council
72
-
-
-
-
-
72
-
30,756
9,690
7,243
3,513
3,722
2,835
41,721
16,038
The stock option plan refers to the Company's executives holding GPA shares and this plan has been treated in the Company's statement of operations, related expenses are allocated to the Company and recorded in the statement of operations against capital reserve - stock options in shareholders' equity.
11
Investiments
The details of the Company's investment at the end of the period are presented below:
Participation in investments - %
Direct participation
Investment type
Company
Country
6/30/2021
12/31/2020
Joint venture
Bellamar Empreendimento e Participações S.A.
Brazil
50.00
50.00
Investiments composition and breakdown
Bellamar
As of Decemeber 31, 2020
769
Share of profit and loss of associates
29
As of June 30, 2021
798
11.1
Acquisition of Bellamar's participation
On December 31, 2020, the Company's shareholders approved through extraordinary general meeting the exchange transaction between GPA and Sendas that comprised the acquisition of 50% of Bellamar's participation which holds 35.76% of FIC'S capital stock. According to this transaction, the Company indirectly holds hereafter 17.88% of FIC's capital stock.
The transaction related to Bellamar's acquisition was assessed as a joint venture, in accordance with CPC 19 (R2) / IFRS 11 - Joint business.
Since the acquisition is a joint venture valued through the equity method, the assets identified, and the liabilities assumed are recorded within the investment line.
Corporate information
FIC has the practice off entire operations, as permitted by laws and regulamentation, to credit, financing and investments entities, the issuance and management of owned and third parties' credit cards, as well as the performance of correspondents' function in the country. FIC's operations are conducted by Itaú Unibanco Holding S.A.
In regard with corporate reorganization process involving the Company, see note 1.2, the Company prepared a study in order to evaluate the fair value of intangible assets and the indicative purchase price allocation ('PPA') related to the minority participation acquisition of 17.88% of FIC's shares, through Bellamar, by the Company on December 31, 2020.
Determination of consideration transferred through the acquisition
The Company transferred to GPA equivalent to 9.07% of Éxito's shares, corresponding to 39,246,012 (thirty-nine million, two hundred forty-six thousand and twelve) shares.
Fair value of identified assets and liabilities acquired
Management hired an independent company to determine the value of FIC's shares, evaluated in the range of R$4.63 up to R$4.86 per share.
In order to determine the value of shares during the spin-off process, it was adopted the amount of R$4.74, therefore, on December 31, 2020, the market value of FIC was in the amount of R$4,301, that represents the amount of R$1,538 related to the fair value of Bellamar's investment on FIC.
According to the exchange transaction, the Company received 50% of Bellamar's shares by means of fair value, in amount of R$769.
Composition of acquisition price
For the period ended June 30, 2021, the Company concluded the allocation of the acquisition value corresponding to the 17.88% participation in FIC of R$ 769. FIC's identifiable assets and liabilities are demonstrated in the table below.
Assets acquired and liabilities assumed
The fair value of FIC's identifiable assets and liabilties on December 31, 2020 (acquisition date) are demonstrated as follows:
24
Assets
Cash and cash equivalents
29
Marketable securities
22
Credit operations
6,213
Other credits
98
Other receivables
3
Other credits, non-current
265
Property, plant and equipment and intangible assets
3,127
Investments
47
9,804
Liabilities
Deposits
(790)
Interfinancial relations
(2,457)
Other liabilities
(2,256)
(5,503)
Total fair value of identifiable net assets
4,301
Company's participation
17.88%
Acquisition price
769
Book shareholders's equity acquired
(211)
Fair value adjustment - intangible assets
(388)
Unallocated portion
170
11.2
Joint venture
The Company's investment in Bellamar is recognized as a joint venture and is recorded through the equity method, in accordance with account standard CPC 18 / IAS 28 - Investments in associates and joint ventures. Based on equity method, the investment in a joint venture should be recognized by the cost, on the beginning. The account value of investment is adjusted for variation recognition purposes related to Company's participation on shareholders' equity of joint venture after the acquisition date.
The joint venture's interim financial information is prepared on the same period basis of disclosure that the Company. When necessary, adjustments are made to ensure that polices are aligned with the Company's.
After the method equity is applied, the Company determines if it is necessary recognize additional loss of recuperable value over investments related to the joint venture. The Company will determine, on each annual closing date of balance sheet, if exists objective evidence that means the investment on joint venture suffered loss due to the reduction of recuperable value. In case of such loss is identified, the Company calculates the value of loss due to the reduction of recuperable value as a difference between the joint venture's recuperable value and the carrying amount and recognizes the loss on its statement of operations. On December 31, 2020, the analysis was not made by the Company, since on this date, the Company recognized the initial participation, regarding explanation on note 11.1.
25
12
Property, plant and equipment
12.1
Property, plant and equipment breakdown
As of Decemeber 31, 2020
Additions
Remeasurment
Write-off
Depreciation
Transfers and others (i)
As of June 30, 2021
Lands
481
26
-
-
-
(33)
474
Buildings
609
58
-
-
(7)
1
661
Improvements
2,598
423
-
(1)
(86)
(68)
2,866
Equipment
635
83
-
(1)
(62)
(1)
654
Facilities
269
31
-
-
(12)
1
289
Furnitures and appliances
340
28
-
(1)
(25)
6
348
Constructions in progress
78
111
-
-
-
(64)
125
Others
37
2
-
-
(7)
7
39
Subtotal
5,047
762
-
(3)
(199)
(151)
5,456
Lease - right of use:
Buildings
2,423
206
231
(66)
(113)
4
2,685
Equipment
6
16
-
-
(3)
-
19
Subtotal
2,429
222
231
(66)
(116)
4
2,704
Total
7,476
984
231
(69)
(315)
(147)
8,160
As of December 31, 2019
Additions
Remeasurment
Write-off
Depreciation
Transfers and others (ii)
As of June 30, 2020
Lands
450
38
-
(100)
-
(114)
274
Buildings
846
32
-
(168)
(6)
(163)
541
Improvements
1,849
319
-
(62)
(68)
280
2,318
Equipment
548
72
-
(2)
(51)
(8)
559
Facilities
265
14
-
(16)
(10)
(13)
240
Furnitures and appliances
290
22
-
-
(21)
10
301
Constructions in progress
37
47
-
(5)
-
(46)
33
Others
35
2
-
-
(6)
6
37
Subtotal
4,320
546
-
(353)
(162)
(48)
4,303
Lease - right of use:
Buildings
1,700
441
99
(59)
(80)
5
2,106
Equipment
5
-
-
-
-
-
5
Subtotal
1,705
441
99
(59)
(80)
5
2,111
Total
6,025
987
99
(412)
(242)
(43)
6,414
(i) On the six-month period ended June 30, 2021, the transfer column presents the transfer between fixed assets to 'assets held for sale' in amount of R$147, see note 28.2.
(ii) On the six-month period ended June 30, 2020, the transfer column presents: (a) the capital contribution through GPA's real state in the amount of R$57 and (b) the transfer of fixed assets to 'assets held for sale' in amount of R$106.
12.2
Composition of Property, plant and equipment
6/30/2021
12/31/2020
Historical cost
Accumulated depreciation
Net amount
Historical cost
Accumulated depreciation
Net amount
Lands
474
-
474
481
-
481
Buildings
759
(98)
661
704
(95)
609
Improvements
3,555
(689)
2,866
3,203
(605)
2,598
Equipment
1,138
(484)
654
1,061
(426)
635
Facilities
385
(96)
289
354
(85)
269
Furnitures and appliances
543
(195)
348
513
(173)
340
Constructions in progress
125
-
125
78
-
78
Others
110
(71)
39
101
(64)
37
7,089
(1,633)
5,456
6,495
(1,448)
5,047
Financial lease
Buildings
3,540
(855)
2,685
3,205
(782)
2,423
Equipment
62
(43)
19
47
(41)
6
3,602
(898)
2,704
3,252
(823)
2,429
Total property, plant and equipment
10,691
(2,531)
8,160
9,747
(2,271)
7,476
26
12.3
Capitalized borrowing costs
The capitalized borrowing costs for the six-month periods ended on June 30, 2021 were R$7 (R$3 on June 30, 2020). The rate used for the capitalization of borrowing costs was 155.25% (140.78% on June 30, 2020) of CDI, corresponding to the effective interest rate of loans taken by the Company.
12.4
Additions to property, plant and equipment for cash flow presentation purpose are as follows
6/30/2021
6/30/2020
Additions
984
987
Leases
(222)
(441)
Capitalized interest
(7)
(3)
Financing of property and equipment - Additions
(711)
(478)
Financing of property and equipment - Payments
695
506
Total
739
571
(i) Additions related to the acquisition of operating assets, purchase of land and buildings to expansion activities, building of new stores, improvements of existing distribution centers and stores and investments in equipment and information technology.
(ii) The additions and payments of property, plant and equipment above are presented to reconcile the acquisitions during the period with the amounts presented in the statement of cash flows net of items that did not impact cash flow.
12.5
Other information
On June 30, 2021, the Company recorded in the cost of sales and services the amount of R$25 (R$15 on June 30, 2020), relating to the depreciation of machinery, building and facilities of distribution centers.
13
Intangible
12/31/2020
Additions
Amortization
6/30/2021
Goodwill
618
-
-
618
Softwares
70
7
(6)
71
Commercial rights
310
12
(3)
319
Tradename
39
-
-
39
1,037
19
(9)
1,047
12/31/2019
Additions
Amortization
Transfers
6/30/2020
Goodwill
618
-
-
-
618
Softwares
64
7
(8)
1
64
Commercial rights
312
6
(2)
-
316
Tradename
39
-
-
-
39
1,033
13
(10)
1
1,037
6/30/2021
12/31/2020
Historical cost
Accumulated amortization
Net amount
Historical cost
Accumulated amortization
Net amount
Goodwill
871
(253)
618
1,741
(1,123)
618
Softwares
132
(61)
71
126
(56)
70
Commercial rights
339
(20)
319
327
(17)
310
Tradename
39
-
39
39
-
39
Total intangible
1,381
(334)
1,047
2,233
(1,196)
1,037
13.1
Impairment test of intangible assets with an indefinite useful life, including goodwill
The impairment test of intangible assets uses the same practices described in note 16 as part of individual and consolidated financial statements as of December 31, 2020.
On December 31, 2020, the Company revised the plan used to assess impairment for Cash Generating Units (CGUs) and there is no significant deviation which could indicates losses or the need of a new evaluation for the period ended June 30, 2021. See the considerations related to the COVID-19 pandemic effects in note 1.3.
14
Trade payable, net
Note
6/30/2021
12/31/2020
Product suppliers
4,726
5,450
Service providers
71
85
Service providers - related parties
10.1
18
11
Bonuses from suppliers
14.1
(310)
(488)
Total
4,505
5,058
14.1
Commercial agreements
Such agreements include discounts obtained from suppliers. Those amounts are defined according to contracts agreements and include discounts based on purchase volume, joint marketing actions, logistics refund and others. The receipt occurs through the offset of outstanding invoices regarding supply agreement, therefore, the financial liquidity occur by the net amount.
27
15
Financial instruments
The main financial instruments and their amounts recorded in the interim financial information, by category, are as follows:
Note
6/30/2021
12/31/2020
Financial assets
Amortized cost
Related parties - assets
10
179
178
Trade receivables and other accounts receivable
113
117
Fair value through income
Cash and cash equivalentes
6
4,511
3,532
Financial instruments - fair value hedge - long position
15.7
2
68
Fair value through other comprehensive income
Trade receivables with credit card companies and sales tickets
151
99
Financial liabilities
Other financial liabilities - amortized cost
Related parties - liabilities
10
(104)
(41)
Trade payables
14
(4,505)
(5,058)
Financing through acquisition of assets
(51)
(34)
Borrowings and financing
15.7
(893)
(897)
Debenture
15.7
(8,291)
(6,599)
Lease liabilities
17
(3,091)
(2,776)
Fair value through income
Borrowings and financing, including derivatives
15.7
(318)
(335)
Financial instruments - fair value hedge - short position
15.7
(33)
-
Net exposure
(12,330)
(11,746)
The fair value of other financial instruments described on the table above approximates to the carrying amount based on the existing payments terms. Financial instruments measured at amortized cost, whose fair values differ from book value are disclosed in note 15.4.
15.1
Considerations on risk factors that may affect the Company's business
15.1.1
Credit Risk
• Cash and cash equivalents
In order to minimize credit risks, the Company adopts investments policies at financial institutions approved by the Company's Financial Committee, also taking into consideration monetary limits and financial institution evaluations, which are regularly updated.
• Trade receivables
Credit risk related to trade receivables is minimized by the fact that a large portion of sales are paid with credit cards, and the Company sells these receivables to banks and credit card companies, aiming to strengthen working capital. The sales of receivables result in derecognition of the accounts receivable due to the transfer of the credit risk, benefits and control of such assets. Additionally, regarding the trade receivables collected in installments, the Company monitor the risk through the credit concession and by periodic analysis of the provision for losses.
The Company also has counterparty risk related to derivative instruments, which is mitigated by the Company carrying out transactions, according to policies approved by governance boards.
There are no amounts receivable or sales that are individually, higher than 5% of trade receivables or sales, respectively.
15.1.2
Interest rate risk
The Company obtains borrowings and financing with major financial institutions for cash needs for investments. As a result, the Company is mainly exposed to relevant interest rates fluctuation risk, especially in view of derivatives liabilities (foreign currency exposure hedge) and CDI Indexed debts. The balance of cash and cash equivalents, indexed to CDI, partially offsets the interest rate risk.
15.1.3
Foreign currency exchange rate risk
The Company is exposed to exchange rate fluctuations, which may increase outstanding balances of foreign currency-denominated borrowings. The Company uses derivatives, such as swaps, aiming to mitigate the foreign currency exchange rate risk, converting the cost of debt into domestic currency and interest rates.
15.1.4
Capital risk management
The main objective of the Company's capital management is to ensure that the Company maintains its credit rating and a well-balanced equity ratio, in order to support businesses and maximize shareholder value. The Company manages the capital structure and adjusts taking into account changes in the economic conditions.
The capital structure is thus demonstrated:
6/30/2021
12/31/2020
Restated
Borrowings, financing and debentures
(9,535)
(7,831)
(-) Cash and cash equivalents
4,511
3,532
(-) Derivative financial instruments
2
68
Net debt
(5,022)
(4,231)
Shareholders' equity
1,917
1,347
% Net debt over Shareholders' equity
262%
314%
28
15.1.5
Liquidity risk management
The Company manages liquidity risk through the daily analysis of cash flows and maturities of financial assets and liabilities.
The table below summarizes the aging profile of the Company's financial liabilities as of June 30, 2021.
Less than 1 year
1 to 5 years
More than 5 years
Total
Borrowings and financing
1,251
429
24
1,704
Debenture
2,287
6,035
1,760
10,082
Derivative financial instruments
(4)
(9)
(2)
(15)
Lease liabilities
497
2,163
3,175
5,835
Trade payable
4,505
-
-
4,505
Total
8,536
8,618
4,957
22,111
The table above was prepared considering the undiscounted cash flows of financial liabilities based on the earliest date the Company may be required to make a payment or be eligible to receive a payment. To the extent that interest rates are floating, the non-discounted amount is obtained based on interest rate curves for the period ended June 30, 2020. Therefore, certain balances are not consistent with the balances reported in the balance sheet.
15.2
Derivative financial instruments
Reference value
Fair value
6/30/2021
12/31/2020
6/30/2021
12/31/2020
Swap with hedge accounting
Hedge purpose (debt)
388
309
318
335
Long Position
Fixed rate
106
106
67
72
USD + Fixed
282
203
251
263
Short Position
(388)
(309)
(349)
(267)
Net hedge position
-
-
(31)
68
Realized and unrealized gains and losses on these contracts during the six-month period ended June 30, 2021, are recorded as financial income or expenses and the balance payable at fair value is R$31 (balance receivable of R$68 as of December 31, 2020). Assets are recorded as 'financial instruments' and liabilities as 'borrowings and financing'.
The effects of the fair value hedge recorded in the statement of operations for the six-month periods ended June 30, 2021, resulted in a loss of R$23, recorded under debt of cost, note 24 (gain of R$104 as of June 30, 2020).
15.2.1
Fair values of derivative financial instruments
Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm's length transaction.
Fair values are calculated using projected the future cash flow, using the CDI curves and discounting to present value, using CDI market rates for swap both disclosed by the B3.
The fair value of exchange coupon swaps versus CDI rate was determined based on market exchange rates effective at the date of the financial statements and projected based on the currency coupon curves.
In order to calculate the coupon of foreign currency indexed-positions, the straight-line convention - 360 consecutive days was adopted and to calculate the coupon of CDI indexed-positions, the exponential convention - 252 business days was adopted.
15.3
Sensitivity analysis of financial instruments
According to Management's assessment, the most probable scenario is what the market has been estimating through market curves (currency and interest rates) of the B3, on the maturity dates of each transaction.
Therefore, in the probable scenario (I) there is no impact on the fair value of financial instruments. For scenarios (II) and (III), for the exclusive effect, a deterioration from 25% to 50% was taken into account, respectively, on risk variables, up to one year of financial instruments.
For a probable scenario, the weighted exchange rate was R$5.28 on the due date, and the interest rate weighted was 6.58% per year.
In the case of derivative financial instruments (aiming at hedging the financial debt), changes in scenarios are accompanied by respective hedges, indicating that the effects are not significant.
The Company disclosed the net exposure of derivative financial instruments, each of the scenarios mentioned above in the sensitivity analysis as follows:
Market projections
Transactions
Risk
(CDI Increase)
As of 6/30/2021
Scenario (I)
Scenario (II)
Scenario (III)
Borrowings and financing
CDI + 2% per year
(1,155)
(80)
(100)
(120)
Fixed rate swap contract (Passive Tip)
CDI + 0,03% per year
(64)
(49)
(52)
(55)
Exchange swap contract (Passive Tip)
CDI + 1,35% per year
(284)
(22)
(28)
(34)
Debentures
CDI + 1,93% per year
(8,282)
(541)
(677)
(812)
Total net effect (loss)
(9,785)
(692)
(857)
(1,021)
Cash equivalents
98.90%
4,511
248
310
372
Net exposure loss:
(5,274)
(444)
(547)
(649)
29
15.4
Fair values measurement
The Company discloses the fair value of financial instruments measured at fair value and of financial instruments measured at amortized cost, the fair value of which differ from the carrying amount, in accordance with CPC46 / IFRS13, which refer to the requirements of measurement and disclosure. The fair value hierarchy levels are defined below:
Level 1: fair value measurement at the balance date considering quoted (unadjusted) market prices in active markets for identical assets or liabilities which the Company can access at the measure date.
Level 2: Valuation techniques for which the lowest level inputs that is significant to the fair value measurement is directly or indirectly observable, except for quoted prices included on Level 1.
Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
The fair values of trade receivables and trade payables approximate their carrying amounts.
The table below sets forth the fair value hierarchy of financial assets and liabilities measured at fair value of financial instruments measured at amortized cost, for which the fair value has been disclosed in the interim financial information:
Carrying amount
Fair value
6/30/2021
12/31/2020
6/30/2021
12/31/2020
Level
Trade receivables with credit cards companies and sales vouchers
151
99
151
99
2
Swaps of annual rates between currencies
(33)
57
(33)
57
2
Interest rate swaps
2
11
2
11
2
Borrowings and financing (fair value)
(318)
(335)
(351)
(335)
2
Borrowings and financing (amortized cost)
(9,184)
(7,496)
(8,397)
(6,529)
2
(9,382)
(7,664)
(8,628)
(6,697)
There were no changes between fair value measurement hierarchy levels during the period ended June 30, 2021.
Interest rate swaps, cross-currency and borrowings and financing are classified in level 2 since the fair value of such financial instruments was determined based on readily observable inputs, such as expected interest rate and current and future foreign exchange rate.
15.5
Operations with derivative financial instruments
The Company has derivative contracts with the following financial institutions: Itaú BBA ans Scotiabank
The outstanding derivative financial instruments are presented in the table below:
Description
Reference value
Maturity
6/30/2021
12/31/2020
Debt
USD - BRL
US$ 50
2021
-
57
USD - BRL
USD 50
2023
(33)
-
Interest rate swaps registered at CETIP
Pre-fixed rate x CDI
R$ 54
2027
4
5
Pre-fixed rate x CDI
R$ 52
2027
(2)
6
Derivatives - Fair value hedge - Brazil
(31)
68
15.6
Borrowings and financing
15.7
Debt composition
Weighted average
6/30/2021
12/31/2020
Current
Debenture and promissory notes
Debenture and promissory notes
CDI + 1,73% per year
1,954
1,864
Borrowing costs
(23)
(24)
Total debenture and promissory notes
1,931
1,840
Borrowings and financing
In national currency
Working capital
TR + 9,80%
10
12
Working capital
CDI + 2% per year
253
9
Borrowing costs
(5)
(5)
Total national currency
258
16
In foreign currency
Working capital
CDI + 1,25% aper year
2
264
Total in foreign currency
2
264
Total of borrowings and financing
260
280
Derivative financial instruments
Swap contracts
CDI + 1,35% per year
-
(57)
Total derivative financial instruments
-
(57)
Total current
2,191
2,063
30
Weighted average
6/30/2021
12/31/2020
Non-current
Debenture and promissory notes
Debenture and promissory notes
CDI + 1,99% per year
6,374
4,780
Borrowing costs
(14)
(21)
Total debenture and promissory notes
6,360
4,759
Borrowings and financing
In national currency
Working capital
TR + 9,80%
57
60
Working capital
CDI + 2% per year
650
901
Borrowing costs
(6)
(9)
Total of national currrency
701
952
In foreign currency
Working capital
250
-
Total of foreign currency
250
-
Total national currency
951
952
Derivative financial instruments
Swap contracts
CDI + 0,03% per year
(2)
(11)
Swap contracts
CDI + 1,35% per year
33
-
Total derivative financial instruments
31
(11)
Total of non-current
7,342
5,700
Total
9,533
7,763
Current asset
-
57
Non-current asset
2
11
Current liabilities
2,191
2,120
Non-current liabilities
7,344
5,711
15.8
Rollforward of borrowings and financing
Amount
Balance on Decemeber 31, 2019
8,467
Funding
599
Interest provision
222
Swap contracts
(72)
Mark-to-market
(2)
Exchange rate and monetary variation
71
Borrowing costs
21
Interest amortization
(257)
Principal amortization
(1,223)
Swap amortization
2
Balance on June 30, 2020
7,828
Amount
Balance on Decemeber 31, 2020
7,763
Funding
1,874
Interest provision
195
Swap contracts
89
Mark-to-market
7
Exchange rate and monetary variation
(24)
Debt modification effect IFRS 9
(23)
Borrowing costs
18
Interest amortization
(96)
Principal amortization
(273)
Swap amortization
3
Balance on June 30, 2021
9,533
15.9
Schedule of non-current maturities
Maturity
Amount
From 1 to 2 years
3,091
From 2 to 3 years
3,104
From 3 to 4 years
569
From 4 to 5 years
352
After 5 years
246
Total
7,362
Borrowing cost
(20)
Total
7,342
-
31
15.10
Debenture and promissory notes
Date
Type
Issue amount
Outstanding debentures (units)
Issue
Maturity
Annual financial charges
Unit price (in Reais)
6/30/2021
12/31/2020
First Issue of Promissory Notes - 2nd series
Non-preemptive right
50
1
4/7/2019
5/7/2021
CDI + 0,72% per year
52,998,286
54
53
First Issue of Promissory Notes - 3rd series
Non-preemptive right
50
1
4/7/2019
4/7/2022
CDI + 0,72% per year
52,998,286
54
53
First Issue of Promissory Notes - 4th series
Non-preemptive right
250
5
4/7/2019
4/7/2023
CDI + 0,72% per year
52,998,286
271
267
First Issue of Promissory Notes - 5th series
Non-preemptive right
200
4
4/7/2019
4/7/2024
CDI + 0,72% per year
52,998,286
217
214
First Issue of Promissory Notes - 6th series
Non-preemptive right
200
4
4/7/2019
4/7/2025
CDI + 0,72% per year
52,998,286
217
213
First Issue of Debentures - 2nd series
Non-preemptive right
2,000
200,000
4/9/2019
08/20/2021
CDI + 2,34% per year
876
1,779
1,762
First Issue of Debentures - 3rd series
Non-preemptive right
2,000
200,000
4/9/2019
08/20/2022
CDI + 2,65% per year
1,004
2,055
2,033
First Issue of Debentures - 4th series
Non-preemptive right
2,000
200,000
4/9/2019
08/20/2023
CDI + 3% per year
1,005
2,076
2,049
Second Issue of Debentures - 1st series
Non-preemptive right
940,000
940,000
1/6/2021
05/22/2026
CDI + 1,70% per year
1,005
943
-
Second Issue of Debentures - 2nd series
Non-preemptive right
600,000
600,000
1/6/2021
05/22/2028
CDI + 1,95% per year
1,005
662
-
Borrowing cost
(37)
(45)
8,291
6,599
Current
1,931
1,840
Non-current
6,360
4,759
The Company issues debentures to strengthen its working capital, maintain its cash strategy, lengthen its debt profile and make investments. The debentures issued are unsecured, without renegotiation clauses and not convertible into shares.
15.11
Guarantees
The company signed promissory notes for certain borrowings agreements.
15.12
Swap contracts
The Company uses swap operations for 100% of its borrowings denominated in US dollars and fixed interest rates, exchanging these liabilities for Real linked to CDI (floating) interest rates. The annual weighted average rate on June 30, 2021 was 2.64% of CDI (2.76% on December 31, 2020).
15.13
Financial convenants
In connection with the debentures and promissory notes issued and part of loan operations denominated in foreign currencies, the Company is required to maintain certain financial ratios. These ratios are calculated quarterly based on the Company's consolidated financial statements drawn up in accordance with the accounting practices adopted in Brazil, as follows: (i) consolidated net debt / equity less than or equal to 5.0 not exceeding equity; and (ii) consolidated net debt/EBITDA ratio should be lower than or equal to 3.25.
Also, the instrument of the 1st issuance of the Company's debentures provides for a restrictive covenant that determines limits for distribution of dividends above the legal minimum and higher indebtedness for the acquisition of other entities.
On June 30, 2021, the Company was compliant with those ratios. In addition, the Company has been complying with all restrictive covenants, and, over the last three years ended on December 31, 2020, no event occurred that would require the Company to accelerate the payment of its debts.
16
Provision for legal proceedings
The provision for legal proceedings is estimated by the Company and it is corroborated by its legal advisors, and such provision is recorded in sufficient amount to settle losses assessed and classified as probable.
Tax claims
Social security and labor
Civil
Total
Balance as of Decemeber 31, 2020
169
64
49
282
Additions
48
24
3
75
Reversal
(82)
(10)
(7)
(99)
Payments
-
(9)
(10)
(19)
Monetary correction
4
3
5
12
Balance as of June 30, 2021
139
72
40
251
Tax claims
Social security and labor
Civil
Total
Balance as of Decemeber 31, 2019
143
61
36
240
Additions
-
5
3
8
Reversal
(1)
(4)
(6)
(11)
Payments
-
(1)
(1)
(2)
Monetary correction
1
4
1
6
Balance as of June 30, 2020
143
65
33
241
16.1
Tax claims
Tax claims are subject by law to the monthly monetary correction, which refers to an adjustment to the provision based on indexing rates adopted by each tax jurisdiction. Both interest rates charges and fines, where applicable, were calculated and provisioned with respect to unpaid amounts.
32
The main tax claims provisioned are as follows:
The Company has other tax claims, which according to its legal counsels' analysis, were provisioned, namely: (i) discussions on the non-application of Prevention Accident Factor (FAP); (ii) discussions with State tax authorities on ICMS tax rate calculated in electricity bills; (iii) staple basket; (iv) IPI on resale of imported goods and (v) other matters.
The provisioned amount on June 30, 2021, for these matters is R$139 (R$169 on December 31, 2020).
16.2
Social security and labor
The Company is a party to various labor proceedings, especially due to dismissals in the regular course of business. On June 30, 2021, the Company recorded a provision of R$72 (R$64 on December 31, 2020), referring to a potential risk of loss relating to labor claims. Management, with the assistance of its legal counsels, assesses these claims and recording provisions for losses when reasonably estimated, considering previous experiences in relation to amounts claimed.
16.3
Civel
The Company is party to civil proceedings (indemnifications, collections, among others) at in different procedural phases and various central courts. Management records provisions in amounts considered sufficient to cover unfavorable court decisions when its internal and external legal counsel assess the losses to be probable.
Among these proceedings, we highlight the following:
The Company is party to various lawsuits requesting the renewal of rental agreements and the review of the current rent paid. The Company records a provision for the difference between the amount originally paid by stores and the amounts claimed by the adverse party in the lawsuit when internal and external legal counsels consider the probability of changing the lease amount paid by the entity. On June 30, 2021, the provision for these lawsuits amounted to R$9 (R$23 on December 31, 2020), for which there are no judicial deposits for legal proceedings.
The Company is party to certain lawsuits relating to the fines applied by inspection bodies of direct and indirect administration of the federal government, states, and municipalities, including consumer defense bodies (PROCONs, INMETRO, and local governments). The Company, assisted by its legal counsel, assesses these claims recording provisions for probable cash disbursements, according to the probability of loss. On June 30, 2021, the provision for these lawsuits is R$5 (R$5 on December 31, 2020).
The Company's total civil and regulatory claims on June 30, 2021, is R$40 (R$49 on December 31, 2020).
16.4
Possible contingent liabilities
The Company is party to other litigations for which the probability of loss was deemed by its legal counsel to be possible, but not probable, therefore, not accrued, totaling an updated amount of R$2,313 on June 30, 2021 (R$2,408 on December 31, 2020). Accordingly, no provisions were recorded in connection with these proceedings, which are mainly related to:
IRPJ (corporate income tax), IRRF (withholding income tax), CSLL (social contribution on net income) - The Company received several tax assessment notices relating to tax offsetting proceedings, goodwill disallowance, disagreements regarding payments and overpayments, fines due to non-compliance with ancillary obligation, among other less relevant issues. The amount involved corresponds to R$469 on June 30, 2021 (R$466 on December 31, 2020).
COFINS, PIS (federal taxes on gross revenues) - The Company has been questioned about discrepancies in payments and overpayments; fine due to non-compliance with ancillary obligation, disallowance of COFINS and PIS credits, among other issues. These proceedings are pending judgment at the administrative and judicial levels. The amount involved in these tax assessments is R$629 as of June 30, 2021 (R$632 on December 31, 2020).
ICMS (State VAT) - The Company received tax assessment notices from State tax authorities in connection with credits from purchases from suppliers' acquisitions considered unqualified by the registry of the State Revenue Service, among others matters. These tax assessments amount to R$1,124 on June 30, 2021 (R$1,235 on December 31, 2020). These proceedings are pending final judgment at the administrative and judicial levels.
ISS (services tax), IPTU (urban property tax), Fees and other - The Company has received tax assessments relating to discrepancies in payments of IPTU, fines due to non-compliance with ancillary obligations, ISS - refund of advertising expenses and various fees, totaling R$12 on June 30, 2021 (R$13 on December 31, 2020). These proceedings are pending judgment at the administrative and judicial levels.
INSS (national institute of social security) - The Company was assessed due to the levy of payroll charges over benefits granted to its employees, among other issues, with possible losses of R$22 on June 30, 2021 (R$21 on December 31, 2020). Proceedings have been discussed in the administrative and judicial levels.
Other litigation- These proceedings refer to real estate lawsuits in which the Company claims the renewal of lease agreements and rents according to market prices. These lawsuits involve proceedings litigated in civil court, and special civil court, as well as administrative proceedings filed by inspection bodies, such as the consumer defense body (PROCONs), the National Institute of Metrology, Standardization and Industrial Quality- INMETRO, the National Agency of Sanitary Surveillance - ANVISA, among others, totaling R$43 on June 30, 2021 (R$24 on December 31, 2020).
33
The Company engages external legal counsel to represent it in the tax assessments, whose fees are contingent on the final outcome of the lawsuits. Percentages may vary according to qualitative and quantitative factors of each proceeding, on June 30, 2021, the estimated amount, in case of success of all lawsuits, was approximately R$14 (R$17 on December 31, 2020).
16.5
Guarantees
The Company granted guarantees to judicial process related a civil, tax and labor nature, described below:
Lawsuits
Letter of guarantees
Tax claims
456
Social security and labos
105
Civil and others
53
Total
614
The guarantees cost is aproximately 0.37% per year of the value of the lawsuits and it is registered as expense in the course of time.
16.6
Deduction of ICMS from the calculation basis of PIS and COFINS
Since the adoption of the non-cumulative regime to calculate PIS and COFINS, the Company has claimed the right to deduct ICMS taxes from the calculation basis of PIS and COFINS. On March 15, 2017, the Federal Supreme Court (STF) recognized, in terms of general repercussion, the unconstitutionality of including ICMS in the PIS and COFINS calculation basis.
In May 2021, the STF Plenary judged the Declaration Embargoes, in relation to the amount to be excluded from the PIS and COFINS calculation basis, if it should only be the ICMS paid, or if all the ICMS highlighted in the invoices, the STF issued a favorable decision to the taxpayers, concluding that all outstanding ICMS should be excluded from the PIS and COFINS calculation basis.
Since of such decision on March 15, 2017, the procedural progress has been as anticipated by our legal advisors without any change in the management's judgment. On July 16, 2021, the Company obtained a favorable decision in its individual legal proceeding, with the decision the Company will revisit the rationale adopted in the reliable measurement, in order to ensure that the calculations are in accordance with the final decision. See note 9.2.
16.7
Restricted deposits for legal proceedings
The Company is challenging the payment of certain taxes, contributions, and labor liabilities and made judicial deposits in the corresponding amounts, as well as escrow deposits related to the provision for legal proceedings.
The Company recorded amounts referring to judicial deposits in its assets as follows.
Lawsuits
6/30/2021
12/31/2020
Tax claims
65
64
Social security and labor
64
67
Civil and others
3
3
Total
132
134
17
Leases
17.1
Minimum future payments and potential right of PIS and COFINS
Leasing agreements totaled R$ 3,091 on June 30, 2021 (R$ 2,776 on December 31, 2020). The minimum future payments as leases, by leases term and with the fair value of minimum lease payments, are as follows:
6/30/2021
12/31/2020
Financial lease liabilities - minimum payments
Less than 1 year
213
172
1 to 5 years
1,009
866
More than 5 years
1,869
1,738
Present value of financial lease agreements
3,091
2,776
Future financing charges
2,744
2,478
Gross amount of financial lease agreements
5,835
5,254
PIS and COFINS embedded in the present value of lease agreements
188
169
PIS and COFINS embedded in the gross value of lease agreements
355
319
Lease liabilities interest expense is stated in note 24. The incremental interest rate of the Company on the signing date of the agreement was 10.12% in the period ended June 30, 2021 (9.72% on December 31, 2020).
If the Company had adopted the projection of inflation imbedded in the nominal incremental rate and converting to a present value as a calculation method, the average percentage of inflation to be project for year will be 3.47% approximately. The average term of the agreements analyzed is 15.5 years.
17.2
Lease obligation rollforward
Amount
As of Decemeber 31, 2019
1,885
Funding - Lease
441
Remeasurement
99
Interest provision
104
Amortization
(147)
Write-off due to early termination of agreement
(4)
Aquisition of partnership
8
As of June 30, 2020
2,386
Current
135
Non-current
2,251
Amount
As of Decemeber 31, 2020
2,776
Funding - Lease
222
Remeasurement
231
Interest provision
137
Amortization
(201)
Write-off due to early termination of agreement
(74)
As of June 30, 2021
3,091
Current
213
Non-current
2,878
34
17.3
Lease expense on variable rents, low-value, and short-term assets
Parent Company
Parent Company and Consolidated
6/30/2021
12/31/2020
(Expenses) revenues of the period:
Variables (1% of sales)
(4)
(8)
Subleases (*)
13
8
(*) It refers mainly to the revenue from rental contracts to be received from commercial galleries.
18
Deferred revenues
6/30/2021
12/31/2020
Back Lights
93
186
Checkstand
21
29
Gift card
1
2
Marketing
21
11
Others
4
-
Total
140
228
Current
139
227
Non-current
1
1
The Company received in advance amounts referring to the rental of backlight panels, supplier product exhibition modules, or check stands, rental of displays, and front-fee anticipation with credit card operators.
19
Income tax and social contribution
19.1
Reconciliation of income tax and social contribution expense
Parent Company
Consolidated
6/30/2021
6/30/2020
6/30/2020
Restated
Earnings before income tax and social contribution
800
414
424
Expense of income tax and social contribution at nominal rate
(272)
(141)
(144)
Adjustments to reflect the effective rate
Tax fines
(1)
-
-
Share of profits
10
(3)
-
Tax benefits
8
10
10
Other permanent differences
-
(5)
(5)
Effective income tax
(255)
(139)
(139)
Income tax and social contribution for the period
Current
(265)
(261)
(261)
Deferred
10
122
122
Income tax and social contribution expenses
(255)
(139)
(139)
Effective tax
31.9%
33.6%
32.8%
19.2
Breakdown of deferred income tax and social contribution
Key components of deferred income tax and social contribution in the balance sheet are the following:
6/30/2021
12/31/2020
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred income tax and social contribution
Provision for legal proceedings
67
-
67
81
-
81
Exchange rate variation
1
-
1
26
-
26
Goodwil tax amortization
-
(318)
(318)
-
(315)
(315)
Mark-to-market adjustment
-
-
-
-
(2)
(2)
Property, plant and equipment and intangibles and investment properties
27
-
27
37
-
37
Unrealized gains with tax credits
-
(21)
(21)
-
(60)
(60)
Cash flow hedge
-
(17)
(17)
-
(20)
(20)
Lease net of right of use
140
-
140
131
-
131
Modification debt effects - IFRS 9
16
-
16
24
-
24
Others
33
-
33
16
-
16
Gross deferred income tax and social contribution assets (liabilities)
284
(356)
(72)
315
(397)
(82)
Compensation
(284)
284
-
(315)
315
-
Net deferred income tax and social contribution assets (liabilities), net
-
(72)
(72)
-
(82)
(82)
Management has assessed the future realization of deferred tax assets, considering the projections of future taxable income. This assessment was based on information from the strategic planning report previously approved by the Board of Directors of the Company.
The Company estimates the recovery of the deferred tax assets as follows:
Years
Amount
Up to 1 year
56
From 1 year to 2 years
73
From 2 years to 3 years
1
More than 5 years
154
284
35
19.3
Rollfoward of deferred income tax and social contribution
6/30/2021
12/31/2020
At the beginning of the period
(82)
(395)
Benefits in the period
10
268
Corporate reorganization
-
45
At the end of the period
(72)
(82)
20
Shareholders' equity
20.1
Capital stock and stock rights
The Company's capital stock on June 30, 2021 is R$ 779 (R$ 761 on December 31, 2020), represented by 269 million registered common shares, (268 million on December 31, 2020), all non-par and registered shares. According to the Company's bylaws, the Company's authorized capital stock may be increased up to 400 million common shares.
On June 1, 2021 the Management Board approved a capital increase of R$18, corresponding to the issuance of 544 thousands common shares.
20.2
Distribution of dividends and interest on equity
The Extraordinary Shareholders' Meeting held on September 29, 2020 approved the interim payment of interest on equity, in the gross amount of R$ 310, over which the withholding income tax was deducted in the amount of R$ 46, corresponding to the net amount of R$ 264.
Management proposed dividends to be distributed, considering the anticipation of interest on equity to its shareholders, calculated as follows:
12/31/2020
Restetad
Net income for the year ended on December 31, 2020
1,398
% Legal reserve
5%
Legal reserve for the year
5
Base for dividends
1,393
Interest on equity payment - net
264
Minimum mandatory dividends - 25%
349
Dividends proposed payable
85
On March 26, 2021, the amount of dividends and profits company's destination related to year ended December 31, 2020 proposed by the Management were disclosed to the market. Such management's proposal was approved on April 28, 2021 (see note 28.2) and the amount of dividends will be adjusted to reflect the minimum percentage required by law.
At the general shareholders' meeting held on April 28, 2021, the shareholders voted to approve the minimum mandatory dividend in the aggregate amount of R$349, calculated in accordance with Brazilian Corporate Law and the Company's bylaws, with respect to the fiscal year ended December 31, 2020. This amount corresponds to R$1.29846211682919 per common share. Of the total amount, R$264 was paid on November 27, 2020 as interest on shareholders' equity, and R$85 will be payable as follows: (i) on June 7, 2021, to holders of common shares based on the shareholding composition of April 28, 2021; and (ii) on June 14, 2021, to holders of ADSs as of April 30, 2021. The residual amount payable corresponds to R$0.31654126223623 per common share.
20.3
Legal reserve
Legal reserve: this is recorded by appropriating 5% of the net income of each fiscal year, observing the 20% limit of capital. On June 30, 2021, the amount is R$152 (R$152 on December 31, 2020).
The destination differs from the financial statements, since the destination of 5% of net income to the legal reserve would result on the exceeding of 20% of capital stock.
21
Net operating revenue
Parent Company
Parent Company and Consolidated
6/30/2021
6/30/2020
Gross operating revenue
Restated
Goods
21,246
17,615
Services rendered and others
52
44
21,298
17,659
(-) Revenue deductions
Returns and sales cancellation
(36)
(30)
Taxes
(1,765)
(1,549)
(1,801)
(1,579)
Net operating revenue
19,497
16,080
36
22
Expenses by nature
Parent Company
Parent Company and Consolidated
6/30/2021
6/30/2020
Restated
Inventory costs
(16,001)
(13,300)
Personnel expenses
(1,189)
(972)
Outsourced services
(116)
(113)
Selling expenses
(283)
(213)
Functional expenses
(328)
(283)
Other expenses
(200)
(109)
(18,117)
(14,990)
Cost of sales
(16,268)
(13,525)
Selling expenses
(1,560)
(1,267)
General and administrative expenses
(289)
(198)
(18,117)
(14,990)
23
Other operating expenses, net
Parent Company
Parent Company and Consolidated
6/30/2021
6/30/2020
Restated
Result with property and equipment
6
(23)
Reversal (provision) for legal proceedings
5
(2)
Reestructuring expenses
(42)
(51)
Covid-19 spending on prevention
-
(66)
Total
(31)
(142)
24
Net financial result
Parent Company
Parent Company and Consolidated
6/30/2021
6/30/2020
Financial expenses
Restated
Cost of debt
(190)
(235)
Cost and discount of receivables
(15)
(22)
Monetary correction (liabilities)
(9)
(7)
Interest on leasing liabilities
(133)
(100)
Other financial expenses
(1)
(51)
Total financial expenses
(348)
(415)
Financial revenues
Cash and cash equivalents profitability
25
18
Monetary correction (assets)
41
108
Other financial revenues
3
3
Total financial revenues
69
129
Total
(279)
(286)
25
Earnings per share
The Company calculates earnings per share by dividing the net income, referring to each class of share, by total outstanding common shares during the period.
At the extraordinary general shareholders´ meeting held on October 5, 2020, Company' shareholders voted to approve the reverse stock split of 3,269,992,034 (three billion, two hundred and sixty-nine million, nine hundred and ninety-two thousand and thirty-four) common shares, with no par value issued by Company, in the proportion of 12.1854776946393 to 1 (one) (the 'Reverse Stock Split'). Immediately following the Reverse Stock Split, capital stock of Company was represented by 268,351,567 (two hundred and sixty-eight million, three hundred and fifty-one thousand, five hundred and sixty-seven) common shares, with no par value.
The table below sets forth the net income available to holders of common shares and the weighted average number of common shares outstanding used to calculate basic and diluted earnings per share in each period:
6/30/2021
6/30/2020
Basic and diluted number:
Restated
Allocated basic earnings and not distributed from continued operation
545
275
Net income allocated available to common shareholders
545
275
Basic and diluted denominator (millions of shares)
Weighted average of the number of shares
268
258
Basic and diluted earnings per million shares (R$) from continued operation
2.02854
1.06589
26
Non-cash transactions
The Company had transactions that did not represent a cash disbursement, and therefore, such transactions were note presented in the cash flow statements, as described below:
• Purchase of property, plant and equipment not yet paid, in note 12.4
37
27
Discontinued operation
At the Extraordinary Shareholders' meeting held on December 31, 2020, shareholders of the Company and GPA approved the corporate restructuring proposal which consisted of the full spin-off of Éxito to GPA. Éxito is a Colombian company operating in Colombia under the banners of Éxito, Carulla, Super Inter, Surtimax, and Surtimayorista supermarkets and hypermarkets, in Argentina, under the Libertad banner, and in Uruguay under Disco and Devoto banners. Also, Éxito operates shopping malls in Colombia under the banner Viva.
On June 30, 2020, Éxito's results were classified as a discontinued operation as follows:
6/30/2020
Statement of operations
10,331
Cost of sales
(7,803)
Gross profit
2,528
Operating expenses
Selling expenses
(1,390)
General and administrative expenses
(441)
Depreciation and amortization
(346)
Share of loss of associates
(41)
Other operating expenses, net
(102)
(2,320)
Operating profit before net financial result
208
Net financial result
(158)
Income before income taxes
50
Income tax and social contribution
14
Net income for the period
64
Comprehensive income results as presented below:
6/30/2020
Net income for the period
64
Items that may be subsequently reclassified to statement of operations
Exchange rate variation of foreign Investments
(4)
Other comprehensive income
1
Comprehensive income for the period
61
Net cash flow incurred are:
6/30/2020
Operating activities
(1,278)
Investment activities
(159)
Financing activities
11
Exchange rate variation on cash and cash equivalents
455
Net cash used
(971)
Earnings per share:
6/30/2020
Basic and diluted
0.1429
Operation segment:
6/30/2020
Net sales
10,331
Gross profit
2,528
Depreciation and amortization
(346)
Share of loss of associates
(41)
Operating profit
208
Net financial result
(158)
Income before income taxes
50
Income taxes and social contribution
14
Net income for the period
64
12/31/2020
Current assets
8,014
Non-current assets
18,930
Current liabilities
9,729
Non-current liabilities
3,620
Equity capital/ minority
13,595
The Éxito Group's operations were treated as a separate segment on June 30, 2020 and as result of the discontinuity of its operation in the financial statements as of December 31, 2020, the Company operates now as a single segment, as described in note 1.2.
38
28
Subsequent events
28.1
Split of common shares
On July 8, 2021, the Company issued the extraordinary general meeting announcement to be held on August 11, 2021, in order to approval of the proposal of split of common shares issued by the Company, whereby each share issued by the the Company will be split into 5 (five) shares of the same type, without changing the amount of the Company's current capital stock.
28.2
Commitment of purchase and sale of real state
On July 19, 2021, the Company entered into the 'Private Instrument of Commitment of Real Estate Investment, Commitment of Purchase and Sale of Real Estate and Incorporation of in Rem Right of Surface, Under Suspensive Conditions and Other Covenants' with an investment fund administered by BRL Trust Distribuidora de Títulos e Valores Mobiliários SA and managed by TRX Gestora de Recursos Ltda. The purpose of the Instrument is the sale, development and lease of 5 properties of the Company located in the States of São Paulo, Rio de Janeiro and Rondônia.
The transaction covers the sale of 1 property already built and other 4 lands, over which shall be carried out construction and real estate development project. The total sale amount of the Properties to be received by the Company is R$ 364, the sale amount and cost amount of the construction of the properties will be base for defining the final amount of the properties' monthly rents. On June 30, 2021, the assets transferred to 'assets held for sale' was in amount of R$147.
The performance of the acquisition of the properties is conditioned to the fulfilment of certain suspensive conditions provided in the Instrument until October 14, 2021.
28.3
Approval of obtention of financial resources
On July 27, 2021, were approved the acquisition of real estate receivables certificates (CRI), in the amount of R$1,500 and of promissory notes, in the total amount of R$2,500. Such transactions will have an average maturity of more than 4 years and have due dates from 2022 and 2023.
The conclusion of the public offering is subject to full compliance with the conditions precedent set out in the documentation relating to the respective funding.
28.4
Capital stock increase
On July 27, 2021, the Company approved, in accordance with Article 6 of the Bylaws and the limit of authorized capital, the increase of capital stock in the amount of R$ 8 by menos of the issuance of 404,186 (four hundred four thousand, one hundred eighty-six) common shares. With this, the Company's capital stock increased from R$ 779 to R$ 787, fully subscribed and paid for, divided into 269,299,859 common shares with no par value.
39
Attachments
Original document
Permalink
Disclaimer
Sendas Distribuidora SA published this content on 28 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 July 2021 10:12:49 UTC.
Sendas Distribuidora SA, also known as Assai Atacadista, is a Brazil-based company mainly engaged in the food distribution sector. The Firm's activities are divided into two operational segments: Cash & Carry and Retail. Through the Cash & Carry segment, the Company offers food, bazaar items and other products to wholesale customers, through self-service stores operated in Brazil under the Assai brand name. The Retail segments includes operations of hypermarkets, supermarkets and convenience shops under following brands: Exito, Carulla, Surtimaorista, Surtimax, Super Inter and Viva Malls in Colombia; Devoto, Disco and Geant in Uruguay; and Libertad, Mini Libertad and Paseo Libertad Malls in Argentina.