Alexandre Namioka

Alexandre Namioka requested updates on the pilot status of Tiendas 3B's perishables category and asked if newer categories are expected to be introduced in stores next year.

Answer

K. Anthony Hatoum, Founder, Chairman, and CEO, Tiendas 3B, highlighted continuous innovation across all product categories, citing a new ice cream bar as an example. He emphasized significant runway for new products within their hard discounter principles. Regarding perishables, he noted it's a high-potential category with extremely positive test results, but they are setting high standards for quality and efficiency, ensuring the entire value chain works perfectly before launch. He also mentioned stores are designed to absorb more SKUs without infrastructure changes.

Alexandre Namioka asked for an update on the pilot status of the perishables category and whether new categories are expected to be introduced in stores next year.

Answer

CEO K. Anthony Hatoum highlighted continuous innovation across all product categories, citing a new ice cream bar as a recent success. He emphasized significant runway for new products within the hard discounter model, which maintains limited, fast-rotating assortments and generates negative working capital. Hatoum stated that perishables tests are very positive, and the company remains optimistic, but they are ensuring the entire value chain works perfectly before a full launch.

Requested more detail on the drivers of strong Q4 margin expansion by country and sought more granularity on the sources of guided margin expansion and top-line growth for 2024.

Answer

Margin expansion was strong across all regions, driven by efficiencies in cost of revenue, tech, G&A, and S&M, a trend expected to continue. The 2024 top-line growth guidance assumes outperforming a market growing at ~10%, with no M&A factored in. Margin expansion will come from operating leverage across all line items above EBITDA.