Lojas Quero-Quero S.A

—

What it is

Lojas Quero-Quero was founded in 1967 in Rio Grande do Sul by a local entrepreneurial family, building a chain that sells construction materials alongside appliances, furniture, and electronics — all under one roof and all on credit if needed. The network has strong presence in small and mid-sized cities across Brazil’s South and Centre-West regions, markets that are too thin to attract the big-box nationals.

The company closed 2025 with 586 stores, having opened 21 and shut 8 during the year. An in-house credit card and financial services arm — think of it as the store’s own small bank — is central to the model, letting customers buy a washing machine in 12 monthly instalments.

—

Who owns it

Advent International, the US private-equity firm, acquired and overhauled Quero-Quero’s governance between 2008 and 2010, then took the company public on B3 in August 2020 under the ticker LJQQ3. Advent remained the reference investor after the IPO while gradually trimming its stake through market placements, improving liquidity and diversifying the shareholder base through 2021–2025.

Institutions collectively hold about 55% of the shares, consistent with EODHD’s figure of 54.7%; the general public — individual investors — holds roughly 30%. The structure is straightforward: one share, one vote, with no dual-class shares or golden shares.

—

Who runs it

Peter Takaharu Furukawa is Chief Executive Officer, and was one of the executives who led the company’s IPO in August 2020. His earlier roles include CEO of IMC, COO of Pernambucanas, and CEO of Submarino.

Jean Mello serves as CFO and Investor Relations Officer. At board level, Christiano Antoniazzi Galló, an independent board member since 2020, was designated chair of the board of directors in October 2025, replacing Flávio Benicio Jansen Ferreira after five years in the role.

The board currently has seven members, six of whom qualify as independent under B3‘s Novo Mercado rules.

—

The money, in plain words

Revenue has grown — up 4.6% in 2025 to R$2.79bn (~US$541m) year-on-year (our calculation) — but the company is losing money, not making it. It lost about 6.8 cents on every real of sales in the past twelve months, a net margin of –6.8%, because Brazil’s benchmark interest rate (the Selic) has stayed very high, making its in-house lending operation expensive to fund.

The company attributes the margin squeeze mainly to lower returns from its financial services arm, hit by the rising Selic, combined with a more promotional retail environment and weak demand.

For every real shareholders have invested, the company is destroying about 44 cents of value per year — a return on equity of –43.8%, which is the core of the bear case. The balance sheet shows net debt of R$654.7m (~US$127.1m), calculated as R$438m (US$85 mn) of cash against R$1.09bn (US$212 mn) of total borrowings (our calculation); the leverage ratio — net debt relative to operating earnings — stood at 1.4 times at year-end 2025, up one full turn on a year earlier.

The company’s entire market value today is just R$285.5m (~US$55.4m), less than half its net debt — a sign that the market prices in considerable execution risk.

—

What it is doing now

In 2025, Quero-Quero invested R$49.4m (US$10 mn) in store openings, refits, logistics, and technology. The expansion continues despite the losses: in February 2025, the company announced plans to open 20 to 30 new stores before year-end, maintaining the belief that planting stores in underserved towns will eventually generate the scale needed to absorb central costs.

Sales at existing stores, however, fell 1.8% for the full year, meaning new stores are adding revenue while old ones lose ground — a pattern that needs to reverse.

—

What to watch

• The Selic rate trajectory. Brazil’s central bank interest rate is the single biggest lever on Quero-Quero’s profitability: a sustained cut would lower funding costs for its credit arm and immediately improve margins.
• Same-store sales trend. Existing-store sales fell 1.5% in Q4 2025 and 1.8% for the full year — a return to growth here is the clearest sign that the business model is working again.
• Cash runway. With R$438m (US$85 mn) in cash against R$1.09bn (US$212 mn) of debt and ongoing losses, investors will watch closely whether the company needs to raise fresh equity or refinance debt on tighter terms.
• New board leadership. Christiano Galló’s elevation to board chair in October 2025 is recent; any strategic shift in capital allocation or store-roll-out pace that follows will be an early signal of his priorities.

—

This is news, not investment advice.