Bompreco Reports 3Q00 Consolidated Results.Business Editors RECIFE, Brazil--(BUSINESS WIRE)--Nov. 13, 2000 Bompreco S.A. Supermercados do Nordeste (Bovespa: BPCO BPCO Bronchopneumopathie Chronique Obstructive BPCO Broncopneumopatia Cronica Ostruttiva 4; 144A: BMPA BMPA Bombay Master Printers' Association LX; e Reg S: BMPG LX) today reported consolidated results for the three-month period ended September 30, 2000. For this quarter, the consolidated net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight result of R$642.6 million represents an increase of 15.3 percent in comparison to the same period of last year - R$557.2 million. When adjusted for IGP-DI IGP-DI Índice Geral de Preços Disponibilidade Interna (Portugese: General Price Index - Domestic Availability; Brazil) , net sales increased year-over-year by 0.4 percent in comparison to the third quarter of 1999. Supermarket sales in Brazil for the third quarter, as reported by the Brazilian Supermarket Association (ABRAS ABRAS Associação Brasileira de Supermercados (Portugese: Brazilian Association of Supermarkets) ), increased year-over-year by 2.2 percent in real terms. Consolidated gross profit for the third quarter increased by 32.3 percent to R$163.3 million, from R$123.4 million for the same period last year. Consequently, consolidated gross margin for the period improved to 25.4 percent, from 22.2 percent in the same quarter last year. This performance was mainly a result of gains from successful negotiations with the company's suppliers, as well as continuous company-wide improvements in the distribution network. It is worth highlighting the gross margin verified at Bompreco Bahia, which has been consistently improving over the last quarters and increased year-over-year to 24.4 percent, from 20.8 percent in the third quarter of 1999. Consolidated sales expenses for the quarter, as a percentage of net sales, rose to 17.3 percent from 17.1 percent in the same period last year, mainly as a consequence of an increase in rent expenses generated from the transfer, in December of 1999, of existing real estate property to a Specific Purpose Entity, which are rented to the Company. Consolidated administrative expenses for the period, as a percentage of net sales, decreased year-over-year to 3.3 percent, from 3.6 percent in the third quarter of 1999. Combined, consolidated operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for the third quarter declined, as a percentage of net sales, to 20.5 percent, from 20.7 percent in the equivalent period of last year. As a result of the gross profit improvement posted for the quarter, consolidated EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become increased by 285.1 percent to R$31.3 million, from R$8.1 million in the same period last year. As a percentage of net sales, consolidated EBITDA for the quarter increased to 4.9 percent from 1.5 percent in the year-ago period. EBITDA at Bompreco Bahia for the quarter improved year-over-year by 270.4 percent to R$13.9 million, from R$3.7 million in the equivalent period of last year. Consequently, Bompreco Bahia's EBITDA margin improved to 6.4 percent, from 1.9 percent in the same quarter of last year. Consolidated EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). for the quarter increased to R$17.1 million, from a negative R$3.5 million in the same period of last year. Consolidated EBIT margin for the quarter improved year-over-year to 2.7 percent, from a negative 0.6 percent in last year's same period. For the quarter, Bompreco posted consolidated financial expenses of R$20.9 million, compared with R$40.7 million in the same period of last year, mainly as a consequence of a devaluation devaluation, decreasing the value of one nation's currency relative to gold or the currencies of other nations. It is usually undertaken as a means of correcting a deficit in the balance of payments. of the Real against the U.S. dollar during the third quarter of 1999. It is important to highlight that the increase in financial expenses, which rose to R$40.1 million during the quarter from R$29.3 million last year, is primarily a result of a higher volume of short-term financing and a growth in the company's long term liabilities, related to the issuance of 35,000 debentures convertible into preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. during the fourth quarter of 1999. Consolidated financial revenues were R$26.0 million, compared with R$21.5 million in the same quarter of last year. The company reported a net loss for the period of R$1.5 million compared with a loss of R$28.3 million in the third quarter of last year. At September 30, 2000, HiperCard, Bompreco's main credit tool, counted over 1.5 million cardholders, of which more than nine hundred thousand were accountholders. HiperCard is accepted at all Bompreco's stores and in 44,000 third-party retailers from Bahia to Maranhao. HiperCard's operating revenues for the quarter increased year-over-year by 32.4 percent, while accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying from clients rose by 28.7 percent to R$308.5 million. Regarding past due accounts, HiperCard accounts over 30 days past due for the quarter were 5.2 percent of total accounts receivable, compared to 4.5 percent in the same quarter of last year. Losses for the period were within expectations, around one percent of credit sales. For the third quarter, HiperCard reported a net income of R$6.5 million compared to an income of R$6.2 million in the third quarter of 1999. During the third quarter, Bomclube, Bompreco's loyalty program, was used in approximately 75 percent of all transactions carried out at the company's stores. To date, the program has awarded in excess of 3.8 million prizes to Bompreco's customers. INVESTMENT PLAN In addition to the continuous modernization process of existing stores and construction of its new distribution center, the Company opened two new supermarkets at the end of October and beginning of November. One of the new units, Bompreco Piedade, is located in Jaboatao dos Guararapes, greater Recife, state of Pernambuco Pernambuco (pərnəmb  `k ), state (1991 pop. 7,127,855), 37,946 sq mi (98,280 sq km), NE Brazil, on the Atlantic Ocean. , and features a total
selling area of 2,145 square meters and 18 check-outs, in addition to
190 spaces available for parking. This unit operates 24 hours and offers
automated teller machines automated teller machine (ATM), device used by bank customers to process account transactions. Typically, a user inserts into the ATM a special plastic card that is encoded with information on a magnetic strip. from a variety of banks and a Bompreco
pharmacy.The store opened in the city of Aracaju, state of Sergipe, features a total selling area of 2,100 square meters with 24 check-outs, and also offers a Bompreco pharmacy and automated teller machines for the convenience of its customers. Going forward, Bompreco expects to open, by the end of the year, one hypermarket hy·per·mar·ket n. A very large commercial establishment that is a combination of a department store and a supermarket. hypermarket Noun a huge self-service store [translation of French in the city of Fortaleza, state of Ceara, and one compact hypermarket in the city of Vitoria da Conquista Vitoria da Conquista (vētô`rēə dä k ng-kē`stə), city (1991 pop. 225,091), Bahia state, E Brazil, in the Batalha Mts. , state of Bahia.For the year of 2001, the Company forecasts a capital expenditure program totaling approximately R$200.0 million, which includes: - The opening of four new hypermarkets in the cities of Natal, state of Rio Grande do Norte, Fortaleza, state of Ceara, Aracaju, state of Sergipe, and Olinda, greater Recife, state of Pernambuco; - The continuous remodeling and modernization process of existing units, especially in the states of Pernambuco and Bahia; - Conclusion of the first two phases of the new distribution center in Jaboatao dos Guararapes, state of Pernambuco, and expansion of the distribution center for perishables in Salvador, state of Bahia. ROYAL AHOLD APPOINTS A NEW PRESIDENT TO BOMPRECO On September 11, 2000, the company's Board of Directors appointed Mr. Tom den Hertog President & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Bompreco as of November. Den Hertog is a seasoned retail executive who has developed Ahold's presence in the Asian markets as President and CEO of Ahold Asia Pacific and of the company's activities in Thailand. Earlier in his career, Den Hertog held executive positions at Albert Heijn Albert Heijn B.V. is a supermarket chain founded in 1887 in Oostzaan, the Netherlands. It is named after Albert Heijn senior, the founder of the first store which was a small grocery store in Oostzaan. , Ahold's Dutch flagship supermarket company, and at Ahold Institutional Food Supply (now Deli XL). Royal Ahold operates over 500 stores in eight Latin American countries List of American countries Nations:
Santa Isabel or Ysabel Island, central Solomon Islands, western South Pacific Ocean. in Chile, Peru and Paraguay, and La Fragua in Guatemala, El Salvador El Salvador (ĕl sälväthōr`), officially Republic of El Salvador, republic (2005 est. pop. 6,705,000), 8,260 sq mi (21,393 sq km), Central America. and Honduras. Royal Ahold operates approximately 7,000 supermarkets, hypermarkets and other store formats in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Europe, Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. and Asia with annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. sales approaching Euro 50 billion. Bompreco S.A. Supermercados do Nordeste is the largest chain of retail stores in the North and Northeast of Brazil in terms of sales Terms of sale Conditions under which a firm proposes to sell its goods or services for cash or credit. . The company currently operates, including the two recently opened supermarkets, 104 stores, for a total selling area of 280,439 square meters over eight of the nine states that comprise the Northeast of Brazil. The company operates its stores through four formats, with 19 hypermarkets, 63 supermarkets, 19 minimarkets and 3 magazine stores. Gross sales Gross Sales A measure of overall sales that isn't adjusted for customer discounts or returns, calculated simply by adding all sales invoices, and not including operating expenses, cost of goods sold, payment of taxes, or any other charge. for fiscal year 1999 were R$2.7 billion and EBIT of R$54.0 million. Bompreco's preferred shares are listed on the Bovespa in Brazil. The company's GDSs, each representing two preferred shares, trade on the Luxembourg Exchange. On June 30, 2000, Bompreco had 67,367,970 shares outstanding. For additional information, please refer to the company's web site at www.bompreco.com.br
ADDITIONAL INFORMATION AND OPERATIONAL BREAKDOWNS:
Net sales:
Bompreco Nordeste Comparison with 3Q99
Same stores All stores Industry(1)
Nominal Real(2) Nominal Real(2) Real(2)
3Q00 4.2 (9.3) 16.4 1.3 2.2
Bompreco Bahia Comparison with 3Q99
Same stores All stores Industry(1)
Nominal Real(2) Nominal Real(2) Real(2)
3Q00 6.5 (7.3) 9.7 (4.6) 2.2
Consolidated Comparison with 3Q99
Same stores All stores Industry(1)
Nominal Real(2) Nominal Real(2) Real(2)
3Q00 5.0 (8.6) 14.0 (0.8) 2.2
(1) As reported by the Brazilian Supermarket Association (ABRAS)
(2) Adjusted by IGP-DI
Net Sales(1) M(2)
3Q00 YTD Stores(2) Check-outs Associates Selling
Area
Bompreco
Nordeste
Hypermarkets 268.611 785.213 13 698 6.664 92.605
Supermarkets 105.965 312.537 27 518 3.856 51.603
Minimarkets 11.004 32.667 10 94 392 7.365
Magazines 16.764 49.463 3 62 386 8.712
Bompreco
Bahia
Hypermarkets 87.936 256.962 6 254 2.204 36.634
Supermarkets 115.655 339.871 34 603 4.154 72.469
Minimarkets 12.155 36.472 9 74 481 6.806
Total 618.090 1.813.185 102 2.303 18.137 276.194
(1) In thousands of Reais
(2) Does not include stores opened during the fourth quarter
SALES BREAKDOWN
Bompreco Bompreco Consolidated
Nordeste Bahia
3Q00 3Q99 3Q00 3Q99 3Q00 3Q99
Cash Purchases 39,0% 43,0% 41,8% 43,4% 39,9% 43,1%
HiperCard 45,8% 43,4% 25,5% 21,5% 39,0% 35,6%
Post-dated checks - - 6,2% 8,8% 2,1% 3,1%
Others 15,2% 13,6% 26,5% 26,3% 19,0% 18,2%
- FINANCIAL TABLES TO FOLLOW -
For tabular information, please contact Taylor Rafferty at 212/889-4350 |
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