SAO PAULO (Reuters) – Brazilian retailer GPA expects to raise about 500 million reais ($98.71 million) from asset sales in coming quarters, Chief Financial Officer Rafael Russowsky said in an earnings call with analysts on Tuesday.
That would add to the $156 million raised by the company from the divestment of its 13.31% stake in Almacenes Exito earlier this month, according to Russowsky, as it keeps searching for ways to reduce its debt.
GPA, which is controlled by France’s Casino, reported third quarter results on Monday, posting a wider net loss mainly driven by non-cash effects from the Exito spin-off but a nearly 10% growth in sales.
Sao Paulo-traded shares of the company jumped as much as 8.7% in the session before paring gains to trade up 2.5%, still one of the top gainers on Brazil’s benchmark stock index Bovespa, which rose 0.5%.
Year-to-date, however, GPA shares slide more than 25%.
The third-quarter results showed an improving trend in the retailer’s Brazilian operations while the deleveraging process remains in the spotlight, BTG Pactual analysts led by Luiz Guanais said.
“Despite the (gradual) deleveraging process, we see less room for the company to expand its sales area and margins in Brazil,” they added, “making it a riskier call than other food retailers in our coverage universe.”
($1 = 5.0655 reais)
(Reporting by Patricia Vilas Boas; Editing by Steven Grattan)