The new owners of Alpargatas moved its head office to less expensive premises in São Paulo with a more collaborative layout during the month of August. Alpargatas also opened a new distribution center in the state of Minas Gerais that is supposed to improve the integration of the online and offline retail operations of Havaianas in Brazil, which went up by 10 percent on a comparable store basis in the third quarter ended Sept. 30.
According to one of its main shareholders, Itaùsa, Alpargatas' consolidated net revenues increased by 11.4 percent in the quarter to 1,036.9 million reais (€225.8m-$248.7m), with improved performances for Havaianas, Osklen and the Mizuno license. In Brazil alone, total revenues rose by 10.9 percent to R$ 741.6 million (€161.5m-$177.9m).
The company's international sales of sandals posted increases of 13.9 percent in volume and 10.4 percent in value, rising to €162.1 million (€35.3m-$38.9m), with particularly strong growth in the rest of Latin America and the Asia-Pacific region. Alpargatas' operations in Argentina recorded a 15.5 percent increase to R$ 133.2 million (€29.0m-$31.9m), with higher average prices making up for a drop of 10.3 percent in footwear volumes.
Havaianas has a new distributor in Argentina and is expanding in Colombia. Furthermore, the brand, which was already covering the Chinese market through Tmall, has joined the marketplace of JD.com and opened many new mono-brand stores in Asia since the establishment of an office for Alpargatas in Hong Kong.
Consolidated net income declined by 51.2 percent to R$ 58.5 million (€12.7m-$14.0m). Excluding extraordinary items, it jumped by 104.3 percent to R$ 172.8 million (€37.6m-$41.4m) and the adjusted Ebitda went up by 36.5 percent to R$ 155.5 million (€33.9m-$37.3m), thanks in part to an improvement of 2.9 percentage points in the gross margin and a better management of expenses following the introduction of a new “value improvement program” called VIP 100% and a “zero-base budgeting program” called OBZ.
For the first nine months of this year, Alpargatas' net earnings were down by 46.7 percent to R$ 133.9 million (€29.2m-$32.1m) on 11.7 percent higher net sales of R$ 2.65 billion (€577.3m-$635.6m).
Itaùsa increased its stake in Alpargatas by 0.3 percentage points to 28.9 percent in August. Together with Cambuhy Investimentos and Brazil Warrant, Itaùsa acquired 85.7 percent of Alpargatas' shares two years ago (Shoe Intelligence Vol. 19 N° 13+14).