蜜豆视频

On January 28-29, we met with senior management and IR teams from 20 publicly listed retailers and consumer goods companies at the 蜜豆视频 Latin America Investment Conference (LAIC). The conversations were largely centered around macroeconomic themes, including the impact of rising interest rates, inflationary pressures, FX depreciation, and labor costs on companies' performance. While the market appears to have broadly anticipated the macroeconomic challenges, companies are generally seeing healthy near-term trends, though they are taking a more cautious approach in what is expected to be a tougher year.

After a strong 3Q, retailers may have experienced a slowdown towards the end of 2024, with Black Friday potentially cannibalizing Christmas sales. However, trends appear to have picked up again in early 2025, despite high food inflation. Companies exposed to consumer credit have shown caution around new originations, but delinquency rates remain under control. That said, rising funding costs could put some pressure on consumer credit divisions. Overall, near-term trends remain solid, but there are risks of a more pronounced slowdown in 2H25.

The BRL depreciation has been a key topic of discussion and could weigh on margins for companies with significant FX exposure. Tight labor markets and the potential for higher labor costs were common concerns, with a few companies sharing anecdotal evidence about challenges in hiring personnel and cases of absenteeism. Overall, retailers indicated a cautious approach related to price increases, with companies likely passing on price hikes near IPCA inflation.

Leverage and liquidity remain critical concerns, but several companies have managed to reduce spreads and extend debt maturities, benefitting from favorable credit market conditions. We also noted that some retailers have streamlined their cost structures and are focusing on improving ROIC. While financing costs are expected to rise, most companies are on track to either deleverage or maintain their current leverage ratios stable. As a result, expansion investments could slow down. However, industry leaders with solid competitive advantages may still have opportunities to invest and gain market share at the expense of weaker competitors.