Investor Relations

Company Overview

Company Profile

Guararapes is the largest fashion group in Brazil and the parent company of the Lojas Riachuelo retail chain, with 364 stores nationwide, of which 328 were Riachuelo stores, 26 are Carter’s stores and 10 Casa Riachuelo stores.

An analysis of the retail textile market in the developed countries shows that large companies account for around 30% to 40% of the total, whereas in Brazil the biggest firms jointly represent only around 10% of the total. The substantial competitive edge of the smaller companies lies in the unregistered nature of their operations.

Nevertheless, the market of the leading chains has grown due to scale gains, investment in product quality, their positioning as sellers of fashion and more rapid inventory turnover, all of which allows these companies to adapt quickly to seasonal trends. Riachuelo has not only adopted the fast-fashion concept but has also developed partnerships with renowned national designers and fashion celebrities, including Cris Barros, Oskar Metsavaht (Osklen), Pedro Lourenço, Thais Gusmão, André Lima, Huis Clos, Juliana Jabour, Maria Garcia, Martha Medeiros, Matheus Massafera, Lethicia Bronstein, Camila Coutinho, Helô Rocha, Cláudia Leitte, Dudu Bertholini, Thássia Naves, Raphael Falci, Adriana Degreas, Robert Forrest, Fernanda Motta, Gabriela Pugliesi, Isolda and Lala Rudge, as well as exclusive collections with luxury brands, such as Daslu, Versace and Karl Lagerfeld.

In the last few years, Guararapes has invested strongly in its operations through the modernization of its industrial facilities and distribution centers in Natal and São Paulo, and the implementation of information technology for the operational and financial management of its businesses.

Integration between manufacturing (Guararapes), retail (Riachuelo) and financing (Midway), a successfully proven model worldwide, is the Group’s great advantage, since it allows the Company to respond rapidly to market changes.

Sustainability and responsibility are other pillars of the Company’s business model. With an integrated management which generates around 40,000 legally registered jobs, the Company pursues efficiency and competitiveness gains, prioritizing product development and manufacturing through eco-friendly processes and raw materials.

 

Lojas Riachuelo

Riachuelo was founded in 1947 as a chain of small street stores that sold fabrics at affordable prices. In 1979, it was acquired by Guararapes, which embarked on a corporate restructuring process and initiated a strategic change of direction towards apparel sales.

As of 1993, it began to focus on fashion. Always in tune with the latest national and international trends, Riachuelo offers superior quality at affordable prices, a strategy that involved developing and strengthening its private labels, each with its own visual identity and target audience.

With a nationwide presence, Riachuelo has stepped up its expansion pace in recent years. Between 2005 and 2010, it opened eight to sixteen stores per year; in 2010, however, it began to accelerate, opening 22 stores in 2011, followed by another 24 in 2012, 43 in 2013, 45 in 2014 and 28 in 2015. As of 2016, Riachuelo reduced the pace of expansion of news stores, inaugurating only 6 units and 12 units in 2017, totaling 302 stores and 636.700 sq.m of sales area. Currently, the company contains 315 stores and 654,200 sq.m of sales area.

Stores Map:

mapa do brasil

Midway Mall and Private Properties

The Midway Mall is located at the most important junction in Natal (Rio Grande do Norte), formed by Avenida Senador Salgado Filho and Avenida Bernardo Vieira, two of the city’s main thoroughfares. It is also highly accessible, located only 15 minutes from the city’s main districts, ensuring that the entire city perimeter is within its catchment area.

Inaugurated on April 27, 2005, and currently with nearly all of its gross area leased, the mall comprises 231,000 sq.m spread over three floors, with 13 anchor stores, satellite stores, a food court and several service outlets. The third floor, expanded in 2010, includes a seven-screen movie theater (Cinemark), five new anchor stores, various satellite stores and a complete gourmet area with renowned city restaurants.

Also on the third floor, the Midway Mall houses the Teatro Riachuelo, the most modern and comprehensive performing arts venue in Brazil’s Northeast. Inaugurated in December 2010, it can hold up to 3,500 spectators, depending on its configuration. The project exemplifies the mall’s consolidation of leisure, entertainment and the arts, providing the public with a wide range of shows and performances, through a specialized management team in partnership with highly experienced segment operators.

 

Transportadora Casa Verde

Transportadora Casa Verde (TCV) is responsible for part of the Group’s logistics and, thanks to the investments in recent years, particularly in technology, TCV ensures that the Company’s products are delivered to the Riachuelo stores in a timely and efficient manner.

 

History

Guararapes’ history began in 1947, when the brothers Nevaldo and Newton Rocha opened their first clothing store called “A Capital” , in Natal, Rio Grande do Norte. Four years later, the company installed a small garment industry in Recife, Pernambuco, and acquired several retail outlets at a time when the Northeast clothing market was beginning to expand.

In October 1956, the brothers founded Guararapes in Recife, transferring its headquarters to Natal two years later with the inauguration of its first factory, with 2,700 sq.m of built-up area. It is still there to this day.

The company went public at the beginning of the seventies and built factories in Fortaleza, Ceará and Mossoró, Rio Grande do Norte in 1976. In the same year, the Super G retail chain opened for business.

In 1979, Guararapes acquired the Riachuelo and Wolens stores, expanding its operations into retail fabrics, which has been responsible for most of the Group’s current growth. In the same year, the company inaugurated Guararapes Têxtil in Natal, with 40,000 sq.m of built-up area.

The brainchild of Flávio Rocha, the company launched the Pool brand in 1982, which targeted young people and became a fashion icon in the eighties. It was also the main sponsor of racing driver Ayrton Senna in his early career when he competed in the Kart and F-3 categories.

In 1997, the Natal manufacturing facility was expanded and transferred to the industrial district of Extremoz, Rio Grande do Norte. With a built-up area of 50,000 sq.m, it was responsibility for producing the Group’s knitwear, as well as some of its shirting. The three Fortaleza units produced woven fabrics (serge, jeanswear and shirting).

The Group has been investing in research, creation, development and the distribution process in order to evolve its integrated model so as to improve the timing between product conception and store deliveries. In order to do so, the Group maintains three distribution centers: one in Extremoz, inaugurated in 2000, with 58,000 sq.m; one in Guarulhos, São Paulo, inaugurated in 2002, with 85,000 sq.m; and the third in Manaus, Amazonas, with 6,000 sq.m.

In addition to Riachuelo, the Group owns Midway Financeira, Shopping Midway Mall and Transportadora Casa Verde.

In 2005, Guararapes began focusing more intensely on Riachuelo, which has been absorbing 100% of the Company’s output since 2008.

In addition to the retail/garment industry integration, financing is also managed in an integrated manner as the Company strives to obtain the maximum from its operations. In fact, it is the only player to integrate the three pillars of its business: retail, industry and financing.

 

Timeline

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