InRetail Peru Corp ((INREF)) has held its Q3 earnings call. Read on for the main highlights of the call.
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InRetail Peru Corp’s recent earnings call painted a mixed picture of the company’s current standing and future prospects. While there were positive elements such as stable economic conditions in Peru, revenue growth, and a successful debt issuance, challenges were also evident, particularly with declining adjusted EBITDA, net income, and issues in the Shopping Malls segment. Despite these hurdles, the company remains focused on strategic expansion and laying the groundwork for future growth.
Stable Economic Momentum in Peru
The Peruvian economy continues to exhibit stable economic momentum, bolstered by low inflation and a strong exchange rate. This stability reinforces Peru’s position as one of the most stable economies in the region, providing a solid foundation for InRetail Peru’s operations.
Positive Growth in Revenue
InRetail Peru reported a consolidated revenue growth of 3.5% compared to the previous year. This positive trend highlights the company’s ability to navigate economic challenges and maintain a steady growth trajectory.
Successful Issuance of Senior Unsecured Notes
In October, InRetail Shopping Malls successfully issued approximately $500 million of senior unsecured notes. This achievement marked the lowest spreads ever and extended debt maturity beyond 2030, showcasing the company’s strong financial management and strategic planning.
Expansion in Food Retail Segment
The Food Retail segment experienced a top-line growth of 5.4% in Q3 2025, driven by the Mass and Makro formats. The segment also expanded its footprint by opening 53 net new Mass stores, underscoring its growth potential.
Pharma Segment Resiliency
Despite changes in the business model, the Pharma segment showed resilience with a revenue increase of 0.8% and an adjusted EBITDA growth of 1.1%. This performance indicates the segment’s ability to adapt and thrive in a dynamic market.
ESG Achievements
The Food Retail segment achieved significant ESG milestones, obtaining its fourth carbon footprint star from MINAM and donating over 4 million food rations through the Bueno por Dentro program. These achievements reflect the company’s commitment to sustainability and social responsibility.
Adjusted EBITDA Decline
InRetail Peru faced a slight decline in adjusted EBITDA of 0.7% compared to Q3 2024. This decline highlights the challenges the company faces in maintaining profitability amidst economic pressures.
Challenges in Shopping Malls Segment
The Shopping Malls segment registered a revenue decline of 5% and a 12.8% drop in adjusted EBITDA, primarily due to an incident at the Real Plaza Trujillo Mall. This segment’s performance underscores the operational challenges that need addressing.
Net Income Decrease
Net income decreased by 12.7% compared to Q3 2024, influenced by the decline in adjusted EBITDA and increased net financial expenses. This decrease signals the need for strategic adjustments to improve financial performance.
Impact of Trujillo Mall Closure
The continued closure of the Real Plaza Mall in Trujillo had a negative impact on revenues and necessitated extraordinary discounts to tenants. This situation highlights the operational risks associated with unforeseen incidents.
Forward-Looking Guidance
InRetail Peru maintained its guidance of mid-single-digit growth in consolidated revenues and low single-digit growth in consolidated adjusted EBITDA for 2025. Despite the challenges, the company remains optimistic about achieving its growth targets, supported by strategic initiatives and successful financial maneuvers.
In summary, InRetail Peru Corp’s earnings call reflected a balanced view of achievements and challenges. While the company faces hurdles in certain segments, its strategic focus on expansion and financial stability positions it well for future growth. The overall sentiment remains cautiously optimistic, with a clear emphasis on overcoming current challenges and capitalizing on growth opportunities.