Brazilian footwear company Alpargatas, owner of the iconic Havaianas brand, achieved a significant turnaround in 2024, reporting a consolidated net profit of R$2.1 million ($350,000) in the fourth quarter.
This marks a sharp recovery from the R$1.6 billion ($267 million) loss posted during the same period in 2023, according to recent financial disclosures. For the full year, Alpargatas recorded a net profit of R$107.4 million ($18 million), reversing a R$1.8 billion ($300 million) loss from 2023.
Adjusted figures highlight even stronger performance; excluding extraordinary items, adjusted net profit reached R$28.7 million ($5 million) in Q4 and R$157.9 million ($26 million) for the year.
However, challenges remain, as adjusted EBITDA for Q4 dropped 46.5% year-over-year to R$36 million ($6 million), though annual EBITDA totaled R$353 million ($59 million) with an 8.6% margin.
Revenue growth played a central role in this recovery. Quarterly net revenue rose 11.2% year-over-year to R$1.1 billion ($183 million), while annual revenue increased by 10% to R$4.1 billion ($683 million).
Strategic Overhaul and Growth in 2024
The Havaianas brand drove much of this growth through improved domestic sales volumes and better alignment with consumer demand. In Brazil alone, sales volumes increased by 13% in Q3 and 15.2% over the first nine months of 2024 compared to the prior year.
Under CEO Liel Miranda’s leadership since early 2024, Alpargatas has executed a strategic overhaul focused on cost reduction and market prioritization.
Investments were cut from R$500 million ($83 million) in 2023 to just R$180 million ($30 million) in 2024, while workforce reductions and product portfolio streamlining stabilized operations.
The company also concentrated on its core markets—Brazil, Southern Europe, the U.S., and Southeast Asia—while scaling back less profitable international ventures.
Despite these gains, Alpargatas faces ongoing hurdles internationally, where margins remain under pressure due to distributor de-stocking and operational inefficiencies.
Additionally, its stock price has yet to recover fully from investor skepticism. Looking forward, Alpargatas plans to leverage its operational efficiencies and strong domestic market position to achieve sustainable growth while addressing challenges abroad.
The enduring popularity of Havaianas and strategic adjustments have positioned the company for cautious optimism as it continues its recovery trajectory into 2025.