Assai's Revised Store Opening Forecast

SAO PAULO (Reuters) – Brazilian food retailer Assai announced on Thursday its revised forecast to open approximately 10 new stores next year, which is half of the previous estimate of about 20, as detailed in a recent securities filing.

Assai, operating in a hybrid wholesale format, began to slow its store openings last year. This change comes as the management focuses on financially deleveraging the company following an aggressive expansion trend.

The retailer reduced its openings from 60 stores in 2022 to 27 in 2023 and is targeting around 15 for this year. Looking ahead, the company expects to resume its expansion plans only by 2026, estimating about 20 new store openings at that time.

Additionally, Assai projected its financial leverage, measured by net debt/EBITDA, to be approximately 2.6 times by the end of 2025. It maintained its target of under 3.2 times for this year.

The company's projections includes planned cash investments between 1 billion reais ($176.92 million) and 1.2 billion reais for the year 2025, influenced by a recent interest rate hike in Brazil and changes in the local yield curve.

Note: $1 = 5.6522 reais