Lojas Quero-Quero, Odontoprev, and Iochpe-Maxion: Navigating Expansion, Costs, and Market Recovery

Lojas Quero-Quero, a Brazilian retail chain specializing in home improvement and financial services, reported a significant drop in net profit for the fourth quarter of 2024.

The company’s profit fell by 89.6%, from R$60.2 million in the same period of 2023 to R$6.3 million. This decline occurred despite an 11.2% increase in net operating revenue, which reached R$727.4 million ($121 million) during the quarter.

The company faced rising operational expenses, which surged by 40.1% to R$223.3 million ($37 million), impacting profitability. EBITDA dropped by 33% to R$68.0 million ($11 million), while the EBITDA margin contracted by 6.2 percentage points to 9.3%.

However, same-store sales grew by 6.9% in Q4 2024, recovering from a negative performance in Q4 2023. In terms of expansion, Lojas Quero-Quero inaugurated five new stores in December, bringing the total number of new stores opened in 2024 to 22.

This growth aligns with the company’s broader strategy of reinvesting capital for long-term expansion, though it has yet to yield significant improvements in overall returns.

Odontoprev: Resilient Revenue Growth Despite Profit Decline

Odontoprev, a leader in dental plan services in Brazil, reported a net profit of R$114.0 million ($19 million) for Q4 2024, representing a year-over-year decline of 9.7%.

This decrease was influenced by a one-time regulatory gain of R$36.7 million in Q4 2023, which inflated the prior year’s results. Excluding non-recurring items, recurrent net profit rose by an impressive 27.3% annually.

The company’s revenue grew by 8.2% year-over-year to R$589.6 million ($98 million) for the quarter. Key contributors included an 8% increase in corporate segment revenue and a 9% rise in small and medium enterprise (SME) plans. Individual plans also grew modestly by 2.7%.

Operational costs rose moderately, with service costs increasing by 5.7% to R$235.2 million ($39 million) and marketing expenses climbing by 23.1% to R$71.3 million ($12 million). Adjusted EBITDA for the quarter declined by 12.6%, reaching R$151.4 million ($25 million).

Odontoprev added a net total of 106,000 beneficiaries during the quarter, bringing its total membership base to nearly 8.92 million people. For the full year of 2024, recurrent profit totaled R$529.0 million ($88 million) (a growth of 9.6%), while annual revenue reached R$2.27 billion ($378 million) (up by 5.9%).

Iochpe-Maxion: A Turnaround Year with Profit Recovery

Iochpe-Maxion, a prominent manufacturer of automotive components such as wheels and frames, achieved a remarkable turnaround in Q4 2024 by posting a net profit of R$68.3 million ($11 million), reversing a loss of R$7.5 million from Q4 2023. This recovery was fueled by strong revenue growth and operational improvements.

Revenue for the quarter increased by 12.2% year-over-year to R$3.91 billion ($652 million), driven primarily by higher volumes in Brazil’s commercial vehicle market following changes in emissions regulations. However, economic challenges in regions like Europe, Thailand, and South Africa negatively impacted demand.

EBITDA surged by 30.7% to reach R$378.3 million ($63 million) during the quarter, reflecting improved operational efficiency despite rising costs of goods sold (up by 10.4%) and operational expenses (up by 20.2%). The company’s gross margin also improved significantly.

Iochpe-Maxion reduced its net debt slightly to R$3.63 billion ($605 million) as of December 2024 and maintained a leverage ratio of 2.39x EBITDA. For the full year, the company reported a net profit of R$264.7 million ($44 million) compared to just R$30.7 million in 2023, while annual revenue grew modestly by 2.5%, totaling R$15.33 billion ($2,555 million).

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