Almacenes Exito SA (EXTO) 2021 Q1 法說會逐字稿

Welcome to Grupo Éxito's First Quarter 2021 Results Conference Call. My name is Hilda, and I'll be your operator for today. (Operator Instructions)

Please note that this conference is being recorded.

I will now turn the call over to Mr. Ruy Souza, Chief Financial Officer. Mr. Souza, you may begin.

Thanks, Hilda. Good morning, everyone. Thanks for joining us today for Grupo Éxito's First Quarter 2021 Results. At this time, I'm pleased to present our Chief Executive Officer, Mr. Carlos Mario Giraldo.

I would like now to move forward to Slide #3 to see the agenda. We will cover Grupo Éxito's financial and operating highlights, performance by country and consolidated financial results for the first quarter and all for the operations in Colombia, Uruguay and Argentina.

Thank you for your attention. I will now turn the call over to Carlos Mario. Go on Carlos Mario, please.

Thank you, Ruy, and I welcome you all to this call, and thank you for your attention. If we go to Slide #4, and we start the presentation.

We report a very strong profitability quarter even if sales were negative at ex FX impact at minus 2.5% same-store sales impacted by the COVID food base plus especially by the closures that we received mainly during the half of the month of January. Our EBITDA margin came to 8%. That is plus 154 basis points. Our net income at COP 85,000 million, that is multiplied by 3.9x against the last quarter of last year and plus 168 basis points.

Omnichannel sales were at they have been in the past quarters and years, especially strong and gave us a sustainable market share. The share of omnichannel sales was again above double digits. That is in Colombia 13% and at a consolidated level 10.7%. And that is multiplied by 2.1x against the last quarter.

This quarter saw a special positive contribution from our complementary businesses. That is real estate and credit. Both had an outstanding performance. We have to highlight the performance of the real estate recurrent development activity, which contributed a net COP 61,000 million to the recurrent EBITDA of the company.

As you know, in our real estate business, we have 3 recurrent activities which are done every year. One is development of real estate spaces currently inside the stores and in shopping malls, the second one is commercialization of spaces and the third one is operation of our galleries and shopping malls. This one came from the development of our shopping malls.

Grupo Éxito is the best-performing LatAm food retailer in the S&P Sustainability Yearbook for the second straight year. This is very important because of the purpose that our people have in working for the sustainability of the countries where we work. Merco survey, which is the most reputable survey about corporate reputation, found that Éxito was seen by the people and by stakeholders as the third most responsible company during the COVID period in Colombia.

Going to Slide #5, we speak about sales in Colombia, the main market for Éxito. Here, same-store sales decreased 3.6%. If we subtract the impact of COVID, which we revealed in the first quarter of last year, the impact of (sic) [on] sales would have been a positive growth of 2.5%. That is above the level of inflation in Colombia. If we compare it against 2019, which was the last normal year, I would say, in comparable basis, we would have increase in sales of 4.1% during the first quarter.

In this quarter, I would say the negative effect/impact came from lockdowns and the store closures that we had during the month of January. And we had, in the positive side, a very solid contribution from omnichannel, from innovative formats and from the income coming from complementary businesses.

Going to Slide #6, where we say the sales in Colombia opened by segment and by brand. First, the Éxito brand, of course the most important brand in sales for the company, we have now 11 Éxito WOW hypermarkets, the most important hypermarkets of the company. They contributed with a growth of 9 percentage points above the rest of the stores with the Éxito brand, which reinforces the importance of this WOW innovation format. Nonfood was also positive for sales. It benefited, first, the comparison because last quarter of last year for nonfood was not good. And second, because of the omnichannel penetration. Nonfood business had a growth of 14.9%.

If we look Éxito brand as a whole compared with 2019, sales had a growth of 6.3%. That is way above the combination of inflation of both years.

Going to Carulla, the fresh market innovation format had a growth of 7.5 percentage points above the rest of the Carulla stores. Omnichannel is key for Carulla. Carulla has the largest share of any of the important brands of the company with a share of 15% of sales coming from home delivery and e-commerce. In the first quarter, sales of Carulla against 2019 had a very good, I would say, dynamic growth of 9.5%.

Going to our low-cost segment, that is Surtimayorista, Super Inter, Surtimax and also Aliados, it is having a gradual recovery. It has been impacted last year and still today by the HoReCa business, that is hotels, restaurants, cafeterias, most of them closed or restricted. And it had a decrease of 9.7% compared with the first quarter of 2019.

Going to Slide #7, we speak again in a consistent way about our innovation models. When we look at some of the WOW Éxito stores and Carulla FreshMarket and we put them against that complete sales of the company in Colombia, they now account for 19.7% of sales. That is quite material. Éxito WOW stores is, as you know, a model of experience, high experience for customers and high omnichannelity solutions in a hypermarket. It is the best merge between digital and physical. We will get by the end of this year to 19 stores with the WOW concept. Today, they account for 23% of the banner sales. And by the end of the year, we calculate they will account to near to 30% of the total sales of the Éxito brand. It is very important for profitability considering that the ROI of the Éxito transformations to WOW is around 30%. We have a potential of 33 additional conversions, and we are doing pilot for the Éxito WOW Economic (sic) [Econo] format for middle class. And with these pilots, we would have an additional potential of around 100 stores in the country.

Going to the Carulla FreshMarket. As you know, Carulla FreshMarket has been described by different retail associations as one of the formats for premium customers in the world that it has -- that you have to visit. Carulla FreshMarket is all about premium, fresh product, sustainable propositions. We will end the year with around 21 stores with the Carulla FreshMarket name and proposition. Today, they represent a material 31% of the sales of the banner, and they will represent by the end of the year near to 40%. That is as material as it is today in Uruguay, where that concept was first deployed within Latin America.

We had the first carbon-neutral fresh market -- supermarket in Colombia. That is a Carulla store in Bogotá, 140, which, I would say, is a very important advance in our sustainable proposition.

The potential for expansion in Carulla FreshMarket is an additional conversion of 20 stores of full size and 46 stores of midsized Carullas.

Going to Slide #8. In the low-cost segment, we continue to target consistently to the base of the pyramid in Colombia. It now accounts to around 14.4% of total sales of the company.

I would start with Surtimayorista. We will go to 36 stores by the end of the year, which would account between 4.4%, 4.5% of the total sales of the company. And what is very important in a popular format, it is a double-digit ROI format, which is scarce in the Colombian environment in popular formats. And it is, of course, a profitable wholesale format going to end consumer and, at the same time, to professional customers.

Super Inter is having an innovation format that we call Vecino. A Vecino is a popular store with a strong value proposition in fresh products, that is, in meat, fruit, vegetable, prepared food and also in basic grains, in basic food like rice, et cetera, to our customers.

The Vecino format, which is the innovation for Super Inter, now has 7 stores implemented, and it will end with 21 stores implemented by the year of the -- by the end of the year, and that would account for around 1/3 of the sales of Super Inter in Colombia.

In Aliados, we continue with 1,500 Aliados. We established a digital B2B applications app for the Aliados, which we think is going to help us a lot to deepen the alliance that we have with the main mom-and-pops in Colombia.

Going to Slide #9. It's very important to make a deep dive on our omnichannel strategy, which we called omni-customer because we believe that today, it's all about having the customer decide if he wants to be served in the physical or in the virtual/digital home delivery way. Normally, what we are finding is that the customers have both needs in different moments of the week and of their lives.

Summing all omnichannel home deliveries, they now come to a 13% share of Éxito sales. It is top in Latin America within omnichannel players. We sold in the first quarter COP 364,000 million, which had an increase of 118% in this type of service. 2 million orders, growing in orders at 60%.

If we remember last year, which was tough in omnichannelity share for all retailers in the region, we came to a very high 12.5%. The good news is that during the first quarter, this continues to be a sustainable trend and that we came to 13%, maintaining, as we said when we gave the guidance for this year, a more than double-digit share in sales. It is very balanced because in nonfood, the share is 18.2%. But very importantly and distinguish -- is something that distinguishes us from others is the food share. In food and consumer goods, the share is 10.1%. The Click & Collect service, which is key for service and convenience for our customers but also for profitability, had a share of 31% of the omnichannelity and is now established in 430 stores and also in 12 shopping malls of the company also to keep the service and to facilitate the sales to our tenants in our shopping malls.

Marketplace is a complete focus for us. We are now an important marketplace player in nonfood in Colombia. It accounts for a growth during the quarter of 53% of the gross merchandise volume, the GMV, and a share in total omnichannel sales of 14%.

Now I go to Slide #10, where I speak about our traffic and asset monetization, which is also a very important part of the Éxito business model.

In Viva Malls, where we are the top operator of commercial shopping malls in Colombia, our occupancy level went up to 92%. That is 20 basis points against the end of last year. We had a very important contribution, as I also said, in the development of shopping malls, income coming from the remuneration, the compensation the company receives for the development of the shopping malls of Envigado and of Tunja.

If we go to Puntos Colombia, it is very -- it satisfies to say that Puntos Colombia continues as the most important loyalty coalition and monetization strategy of customers in Colombia, a second currency that is shared by the customers of Éxito and Bancolombia but also now by more than 100 allies that had the issuance and redemption of points within their stores and their commercial proposition.

Puntos Colombia has currently near to 17 million customers. Of them, near to 5 million have already given the habeas data, which means the express authorization for the use, the responsible use of their data in the big data strategies of the organization. These 17 million customers represent that almost 1 out of every 3 Colombian has Puntos Éxito in their wallet, being digital wallet or physical presence in the stores. This is very important because it really turns Puntos Colombia into a second currency.

Tuya. Tuya had a good quarter, which compared against a very difficult quarter last year. It had a nonperforming loan above 30 years in a single digit. That is completely controlled, and this is good news. And we had an emphasis on deploying Tuya Pay wallet in markets where the wallets are having an important space. So now this organization has its own wallet through Tuya Pay, which is different from other wallets; not only carries and can transfer Colombian pesos but also Puntos Colombia.

In Slide #11, We keep looking for new initiatives of monetization. As we told in the past, we launched last year Éxito Media. The most important retailers in the world, Canadian, U.K., U.S. retailers, are launching media businesses because of the importance of the targeted data that we have with our customers and the deep know-how about our customers' behavior. This is a digital media on-off campaigns with our customers, with our suppliers but also with third parties that want to have access to this information and to this commercial opportunity.

Revenue went up 84% in the first quarter, and this is all about a targeted publicity. We also deployed starting the year the payment platform in alliance with Redeban. This is one of the most important payment platforms in Colombia with a huge potential. And the first 2 months have shown transactions of more than 13 million customers. That is very important as a start for this additional monetization strategy.

So I would now turn it to Ruy, and I will come later with the final conclusions before going to the Q&A.

Thank you, Carlos Mario. Let's continue on Slide 12 to review the main highlights in terms of financial performance in Colombia, where we see a solid operational margin improvement driven mainly by the complementary businesses but also by a resilient retail operation.

Starting from top line. Net revenues decreased 2.8% in the Q1, while sales decreasing -- with sales decreasing 5.7%. As we saw before, we are publishing Colombian sales in 3 segments: Éxito, Carulla and low cost. We had Éxito and Carulla growing above inflation in terms of 2 years' growth and the low-cost segment affected by the pandemic basically since last year. Isolating the COVID effect on the basis, the decrease of Colombian sales would have been 2.1% versus last year. In like-for-like terms, also excluding COVID from the basis, same-store sales would have been stable versus last year. And then comparing sales with first quarter of 2019, sales grew 4.1% for the total Colombian perimeter.

The positive aspects that contributed to sales evolution were, again, the omnichannel growth, 2.2x; and the innovative performance -- innovative formats' performance; as well as the nonfood category growth in this first quarter of 2021. The main negative impacts came from the mobility constraints we had during the beginning of January and also the last few days of March.

In terms of other revenues, we can see a good evolution driven by an income related to the real estate development activity and also the reactivation of Tunja (sic) [Tuya] royalties. I'd like to take a minute to detail this income from the real estate development activity.

Grupo Éxito develops real estate assets. And in almost all projects, it is responsible for elaborating the project, managing the construction and also commercializing the asset or the spaces. It is a key operating part of Éxito recurrent real estate business. It has been generating value to shareholders and other stakeholders throughout the years. We also had income from this activity on previous quarters and also in 2019. As we disclosed before, for example, with the ongoing development and property sale of Montevideo logistics compound in Bogotá.

For the first quarter of 2021, as Carlos Mario just mentioned, we were able to close and deliver 2 major projects, the shopping centers Viva Envigado and Viva Tunja, which basically generated this income for Éxito as developer. We continue to perform this activity as we have been during last years, and we hope to have additional income on the upcoming quarters.

In terms of gross margin post -- the gross margin posted is Q1 was also driven by these complementary businesses' income, with the retail business having a stable gross margin comparing to previous years. We had the gross margin landing 24.4%, 240 bps above last year, and the gross profit growing 7.8%.

In terms of SG&A, we were below last year in COP with an evolution considerably below inflation. This was thanks to several productivity initiatives that have been implemented since last year.

And finally, in terms of EBITDA, the Q1 shows good results and an evolution of 35.8% and 232 basis points of margin, reaching COP 241,000 million. When comparing to the first quarter of last year, complementary businesses contributed with additional COP 83,000 million, while retail was negative COP COP 19 million -- COP 19,000 million, sorry, basically due to the volume drop effect. The recurring EBITDA, isolating income from the real estate development activity in both years, was also - -was stable in cash and improved 21 basis points in terms of margin.

Moving on to the next slide, #13. Let's review the performance in Uruguay that, despite being negatively impacted by a sluggish holiday season due mainly to borders' closures, posted a solid 10.3% recurring EBITDA margin. Net revenues in Uruguay decreased 11.2% in the first quarter, strongly affected by the FX effect of minus 7.8%. In local currency, same-store sales decreased 4.5%, being negatively impacted by the borders' closures I just mentioned and also a strong first quarter of 2020 base. Nevertheless, we saw positive performance in omnichannel sales that grew 1.3x, reaching 3.3% penetration, and also positive evolution in nonfood categories that grew 6.1%.

In terms of gross margin in Uruguay, we made an important effort in markdown and logistics costs, and this was enough to have gross margin improving 113 basis points versus last year.

Expenses in this country grew 3 percentage points below inflation in local currency, and this was thanks to several operational efficiencies.

And finally, we were able to maintain a high level of EBITDA margin at 10.3% with EBITDA reaching COP 65,000 million for the first quarter.

In the next slide, #14, we will review Argentina performance, which is still very negatively impacted by the macroeconomic context and also by the constraints from the pandemic. In Argentina, our net revenues decreased by 23.7%, also strongly affected by the FX effect, in this case minus 35.6%. Same-store sales in local currency grew 21.2%, which is below inflation, impacted by, first, a higher basis from last year's stock-up; second, by mobility restrictions this year; also by the extension of the price increase restriction; and lastly by import constraints.

Real estate revenue in Argentina is still impacted also by this context and -- by the level of discounts that we granted to the tenants. But we were able to sustain occupancy rates at 89% for the first quarter closures.

Gross margin evolved positively, improving 153 bps, benefited by lower share of promotional events and an accurate pricing strategy. However, we still saw this negative impact from the restrictions I just mentioned and also from lower real estate contribution.

Expenses in Argentina also grew below inflation in Argentinian pesos but deteriorated 371 bps in terms of rate. That led EBITDA level to close roughly 0% with a 170 basis points margin decrease. Nevertheless, efforts in working capital and CapEx helped to protect the cash position in this operation.

To review our consolidated results, let's move forward to the next slide, #15. Here we can see that our EBITDA grew 16.7% with solid contribution from complementary businesses, as we saw in Colombia, and also our resilient retail with dropping volumes but stable gross margins.

Starting from net revenues, we see a decrease of 5.8% in the first quarter, negatively impacted by 3.9 percentage points of FX effects. Isolating that, net revenues evolution was minus 1.9%. Sales, as I mentioned before, was positively impacted by omnichannel evolution and innovative formats while negatively impacted by a higher basis last year and also new lockdowns during the first quarter of this year across the 3 countries.

Other revenues grew 50% driven by real estate development income and also driven by Tuya royalties reactivation.

Gross margin in the Q1 landed at 26.6%, almost 200 bps above last year driven mainly by the complementary business. But I would like also to highlight that the evolution of margin in the retail businesses was positive by 18 bps during the first quarter.

In terms of total expenses, we saw all 3 countries growing below inflation -- local inflation and a consolidated figure, 2.7%, below last year in Colombian pesos. This was thanks to the several productivity initiatives that have implemented -- that have been implemented in all 3 countries since last year.

Recurring EBITDA reached COP 307,000 million, 16.7% above last year with retail generating COP 34,000 million less EBITDA than last year from volume effects despite the stability in gross margins that I mentioned and with the complementary businesses generating additional COP 78,000 million versus last year.

EBITDA margin landed at 8%, 154 basis points above first quarter of 2020.

Finally, net group share result grew almost 4x, as we saw before, to reach COP 85,000 million in the first quarter and improved 168 basis points versus last year.

In the next slide, we'll detail the net results evolution. The net -- this evolution accounts from COP 22,000 million last year to COP 85,000 million in the first quarter of 2021. This is mainly explained by a positive operational contribution of COP 39,000 million plus COP 78 million from complementary business, minus COP 39 million from retail basically due to volume effects, positive contribution regarding income from associates by COP 36,000 million. Tuya last year had a negative COP 24,000 million impact for Grupo Éxito, and both Puntos Colombia and Tuya had positive contribution in this quarter. We also saw a strong reduction in the nonrecurring expenses, positively impacting financial statements by COP 21,000 million. Nonrecurring expenses was also below 2019 levels, and our forecast is to maintain that, as I mentioned before.

Financial expenses were COP 2,000 million higher than last year due to higher indebtedness, and negative variation in income tax that we see is mainly related to the impacts that I just mentioned.

Going on, finally, to Slide 17 regarding our cash and debt situation at holding level, I would like to highlight the following: cash position by the end of first quarter was positive at COP 514,000 million. And gross debt at the closing of first quarter was COP 1 billion, reducing around COP 100,000 million versus last year. The total net debt variation that we see versus first quarter of 2020 is explained totally by the extraordinary dividends paid in April last year.

That's all for the financial side. Now I will turn the call back to Carlos Mario to go on with our main conclusions for the quarter. Thank you.

Thank you, Ruy. I will go rapidly through the conclusions. The first one is profitability is strong. As you see, the net profit multiplied by near 4x against the quarter of last year and the EBITDA margin increasing by 154 basis points in a very tough quarter because in this quarter, we had to go through lockdowns, something that we are seeing going in a -- even in a more difficult way in quarter #2, as you have all seen; and second, given the tough comparison that we had in consumer goods, in food against the last quarter.

I would say that it is important to highlight the good thing that Éxito has a balanced strategy with complementary businesses. Because last year, we had a very negative impact from the credit business because of the provisions that had to be done and also from the real estate loan activity in the initial months. This year, on the contrary, we had a positive impact of Tuya credit. And also, we had a very important positive impact of the development part of the business of our real estate to the shopping mall developments.

In Colombia, I would say it's important to highlight that our omnichannelity goes from near 6% last year to 13%. It is a very top share in Latin America. Innovative formats continued to perform in the best way with WOW and FreshMarket growing much more than the rest of the brand and also representing now near to 20% of total sales of the company.

And in Uruguay, what I would say is the resiliency of the operations with a margin above 10% in EBITDA even if one of the most important events in every first quarter for Uruguay, which is the summer tourism but -- was reduced in more than 1 million customers near to 1.5 million customers, which is material for Uruguay.

And in Argentina, all our work in a tough macroeconomic environment to protect the debt position of the company and the cash generation.

Those would be the main conclusions, and we can open it now to the Q&A.

(Operator Instructions) We have a question from Nicolas Larrain from JPMorgan.

So I had a couple on this quarter. First of all, I wanted to understand a bit how is it that you're seeing trends now in April. And we've also now seen in the news some social unrest in some cities in Colombia. I wanted to understand how are you seeing that impact operations. I remember that for example, in Chile, we had some damages to stores at some point. I was wondering if you have suffered some of the same over there. And also on the real estate front, thank for explaining the mechanics there, but, yes, I wanted to understand if you could share like what has been the the income from this -- the development operations over the past 2 years. And how should we expect this going forward? What do you expect to get income from this type of activity over the next 2 years, for example?

Okay, Nicolas, thank you for your questions. I will go through the first one, and then I will hand it over to Ruy to make a little -- a history of our real estate development which have been there for the last years and what we look forward.

First, what I would say is April did not start well. I think it has been a month where probably we have had the toughest restrictions in COVID in Colombia during all the complete COVID section. The mayors of Bogotá, Medellín, Cali, Bucaramanga, Pereira, Barranquilla, Cartagena and -- name it, have done mostly restrictions. That is, they are opening the stores 4 days and closing 3 days the weekend. At first, they were completely closed. Now they open only to essential food but with a lot of transit restrictions because only 2 identification numbers or 3 maximum can go per day to the stores. This obviously has an impact.

And we are -- anyway, I would say we have the advantage, and this is very important. Éxito has the advantage of a very strong home delivery service both through our partner, Rappi, but also our own service, which now accounts for near 45% of all home deliveries. So it compensates partially these closures, and it gives us, I would say, an edge in the market.

Number two. Last Wednesday, we started with the national protest, some of it Pacific, some of it non-Pacific. Today, we have a very important day where there's going to be a national movement. We have had a very close and discrete, I would say, relationship with the Minister of Defense, with the police and with the army even, and we have been able to reduce the impact on our stores, I would say, to some impact but minor to what has happened, mostly in one store in Cali, Simón Bolívar, which is near to the transportation system, and other minor stores. But we haven't had a disruption of a store, only looting, and we are keeping this very close relationship with the authorities.

The tax reform, which was the initial ignition of this, was retired, and it will be -- we developed and redesigned. But anyway, the protest continue. And of course, through our association, we are helping and teaming with the government to try to find constructive solutions to this.

What I can tell you is that we're well prepared. We have the best risk management capacity, obviously, insurance that covers out these type of activities. But our most important priority today is the conservation of the integrity, security and -- of our customers and employees, and that's what we have been doing until now.

I believe that we have the fundamentals for the year. We keep our guideline and our outlook that we are going to improve our EBITDA margin by the end of the year. We had a very good start this quarter, so that gives us a good lead into that.

We continue to have a forecast of cash generation -- important cash generation on Éxito, which is very important. And keeping our net financial debt-EBITDA ratio completely controlled and not increasing our debt, we believe that, that will even permit us to continue with our expansion and with our transformations, which include between 35 and 40 projects for the rest of the year.

So of course, you have to look at the short term, and that's a reality. Nobody can cover it for all, the retail environment and the business environment in Colombia. But within them, I think we have advantages. We have innovation continuing. We have CapEx continuing. We have a complete reinforcement of our logistic and IT platforms. We have a strong CapEx, which still remains around $100 million for the rest of the year, and we have an omnichannelity capability, which is unique in Colombia and in the region.

I will hand it now to Ruy.

Nicolas, thanks for your question. I would like to start -- this is a very important question. We have in our business of develop -- real estate development basically 2 sources of income. We have projects that we develop and we sell the assets, and we have projects that we develop and sell the spaces and operate the asset.

Last year and also in 2019, we had income from this activity related to the first source, which was develop and sales of the assets. We had, for example, in 2019 first quarter COP 2 billion -- COP 2,000 million impact in EBITDA. And then on the fourth quarter of 2019, we had COP 6,000 million impact in EBITDA. Last year, for example, in the first quarter, we had a positive income from this activity of almost COP 10,000 million, which compares to the COP 75 million that we had this quarter.

So it is a recurring income we have been having throughout the last 2 years. For example, for the whole year of 2020, the impact in EBITDA is almost COP 25,000 million. But the thing is that the projects that we delivered on the first quarter that we legalized and booked on the first quarter of 2021 were the biggest ones, Viva Envigado and Viva Tunja. That's why this income was much higher than the previous quarter's. So we have been having this kind of income throughout the last 2 years.

We -- one of the main projects that is on the pipeline, which is development and sale of asset, which is our logistics compound called Montevideo in Bogotá, is still an ongoing project. We expect to have income from this project on the following quarters, maybe on the fourth quarter of this year, because the schedule is to deliver this project by November. And we are also seeking for new opportunities for the upcoming years.

I cannot forecast anything for 2022 or 2023. But this is an ongoing activity, and we will certainly have additional projects for the upcoming years. I don't know if it clears up the air for you.

(Operator Instructions) The next question comes from Irma Sgarz from Goldman Sachs.

Yes. Regarding the Éxito format in which the nonfood sales are more relevant share or with -- than any other [wholesale] formats is -- and obviously, you've successfully shifted part of the sales online during the pandemic. But as you think about reopening trends and some of those categories may be staying online to a larger degree or maybe even continuing to shift online to a larger degree, how do you think about, to some extent, repurposing the sales area that you've used within some of your larger stores for these nonfood items? Do you see other nonfood categories sort of strong -- strength -- being strengthened inside the store whilst maybe something like electronics, the client has moved online to a larger degree? Or do you even see opportunities to sometimes even -- potentially even reducing some of the area within the store and maybe using that for some of those galleries or renting it out or maybe some greater services in the store? Sort of trying to understand how you think about this more structural shift.

Irma, that's a very good question and let me open in various things. The first one is that our nonfood business is today around 30% of the total food of the company. And when you look at Éxito brand, it is more towards 40%. So it's really important.

Second, when you look at the Colombian nonfood environment, it is very different from what you see in the U.S. or in Mexico or in Brazil because really, the existence of specialists, especially in the digital part of nonfood, is very scarce. In Colombia, we only have 1 specialist, which is Alkosto. It doesn't have presence in all the country. And really, today, Alkosto and Éxito lead in the national basis the electronics business. So we are the specialists. We are the destination. So we continue to reinforce the experience of this type of business within our stores. That doesn't mean that we are not promoting e-commerce and marketplace. And as you see, our share in these businesses was 18%, which is quite good.

Then when we go to the other nonfood business, which is historic for Éxito, and that is textiles and apparel, apparel is in the history, in the birth of Éxito. We have very important nonfood private brands like Arkitect, Bronzini, People, which account for nearly 50% of the sales of apparel. We sell more than 50 million apparel pieces per year.

And here, our competitors are the department stores like Falabella, Zara and the other specialist brands in Colombia. But really here, we have an opportunity. Clearly, our share in the online business is not that big as it should be, and it's one of the emphasis the company is doing. But our presence inside the stores both of the national brands, international brands and our own brands is very important, and we want to keep it that way.

And in home products, we are not a specialist, but we have selected some categories in which we are deep and we can compete with a specialist like [Home Centre].

After having given this description, what I would say is that we are doing some reduction in spaces only where we find that there's a very important opportunity of a real estate combination or with a shopping mall or with a real estate partner like, for example, developing formats like Dollarcity or Decathlon, which have been partners with the company, entering and creating power centers.

So it's exceptional, but we -- and the other exceptional change in space is that we have to dedicate some space within the stores to reinforce the areas for omnichannel crossover activities with our customers and the picking and packing and delivery of both nonfood and food home deliveries, which is normal, something like the -- what Best Buy or Walmart are doing in a very good way in the U.S.

But the straight answer is no, we don't have a need to reduce space for nonfood. Yes, I mean, there are punctual moments in which we will reduce some space but not only for nonfood but for the complete assortment in very big stores of 10,000 square meters or 8,000 because we have to reinforce the areas for omnichannel cross activities and also to enter some partners that will drive us traffic and also real estate income.

(Operator Instructions) We have a follow-up question from Irma Sgarz from Goldman Sachs.

Yes. Within the home delivery, which I think you said was now 45% or accounting for 45% of the -- sorry, your own home delivery now accounting for 45% of the home delivery segment versus Rappi, I guess, accounting -- Rappi and others account for the other 55%, within that, how much of it is fulfilled from the stores directly versus from a centralized facility? And how do you see that balance sort of developing over time?

I don't have the exact percentage. But what I would say, our model is home delivery in food, almost all is delivered from stores. And we think it's the right way to do it, first, because it contains fresh products and fresh products are not productive to be delivered centrally; and second, because what we do is a geo-referentiation of the stores with the households that are asking for the command. So it makes -- the delivery is very near -- the delivery store is very near to the household and that it makes us that -- today, for example, the contribution -- the direct contribution to EBITDA of e-commerce is between 6% and 7% EBITDA, which is very, very important.

That's different in nonfood. In nonfood, we have the delivery mostly centralized in central delivery, I would say, buildings and facilities except the Click & Collect. And Click & Collect has become very important in our service. It is now around 30% of the total sales, and it is one of the big advantages that a player like Éxito has against the pure players in the nonfood business.

Thank you. And at this moment, we show no further questions. Do you have any final remarks?

Yes. Thank you for giving me the word.

What I would tell you is we have a business model which has shown to be consistently profitable in our region, especially in Colombia and in Uruguay. We are going through difficult moments, as everybody, but now concentrated in Colombia with lockdowns and social unrest. But the company is prepared both operationally and financially to go through that.

If you look at the Colombian retail environment, you have seen that our profitability is a very important advantage and that it is key for sustainability today and to maintain the confidence, especially from our suppliers that are giving us full support.

Omnichannelity in Éxito is here to stay. We thought that 12-point-something percent last year was the top we could get, but we continue increasing that share or at least maintaining it at that high level. And that is very good because that puts us in a very good competitive position against other players and even pure players.

Innovation is more important than ever, especially when formats like WOW and fresh have ROIs that can go from 15% to 30%. So it's an important contribution to the company.

And another thing that makes us different is our customer monetization and asset monetization. And when you look at the potential that things like Puntos Colombia has, it is amazing what we are seeing there for the future.

Finally, I would say Éxito is a heart brand. It is in the center of the hearts and the minds of the Colombians. And going through COVID and going through difficult moments for our people and high unemployment rates, we have reinforced our solidarity, contributing highly to the children nutrition, child nutrition with more than 250,000 nutritional packages last year and continuing this year.

And now, for example, we are doing something that has us very happy and enthusiastic. There's been a vaccination, massive solution, in our shopping malls. Today, Viva Barranquilla in the North Coast, Viva Villavicencio and Viva Wajiira are centers for vaccination in collaboration with the authorities. And tomorrow, I'm going to announce publicly jointly with the Gobernador de Antioquia and with Suramericana de Seguros that Viva Envigado is going to be the most important vaccination, massive center, in the metropolitan area of Medellín.

So we have to combine these because at the end, we have to have a sustainable business that is sustainable financially, sustainable socially and sustainable for the planet in the environment areas of our business.

I thank you all for being here, and I hope to see you in the next conference.

Thank you. Ladies and gentlemen, this concludes today's conference. We thank you for your participation. You may now disconnect.