The Brazilian shoemaker Grendene had a good first quarter with gross revenues up by 12.1 percent to 371.3 million Brazilian reais (€131.2m-$183.7m). While domestic sales grew by just 2.9 percent to R$239.3 million in the period ended March 31, exports jumped by 33.8 percent to R$132.1 million. Net sales increased by 14.9 percent to R$321.0 million (€113.4m-$158.8m).
The gross margin rose by 5.1 percentage points to 40.5 percent. Grendene had a whopping 83.1 percent jump in earnings before interest, taxes, depreciation and amortization (Ebitda) to R$42.6 million (€15.1m-$21.1m), leading to a 56.8 percent jump in net income to R$64.3 million (€22.7m-$31.8m).
By volume, sales dropped both in and outside Brazil. Domestic sales fell by 4.2 percent to 18.6 million pairs of shoes, and they dropped by 15.6 percent to 15.7 million pairs outside the country, for a total drop in volume of 9.8 percent. However, average sales prices went up by 24.3 percent, breaking down to an increase of 7.4 percent to R$12.84 (€4.50-$6.35) in Brazil and a big rise of 58.5 percent to R$8.40 (€3.00-$4.15) internationally. Grendene’s share of total Brazilian shoe exports was 38.6 percent in the quarter, leading the market.
Looking ahead, the country said that it would keep an eye on currency exchange rates and inflation, but reiterated its previous guidance for coming years. Grendene expects average compound annual growth rates of 8-12 percent for gross revenues through 2013, and of 12-15 percent each year in net profits.
So far in the current quarter, the company has launched two new lines in Europe, the Ipanema GB Sementes line in Madrid and the Melissa line by Zaha Hadid in Milan.