Cencosud eyes expansion

Cencosud eyes expansion

Chilean retailer Cencosud predicted an increase in revenues this year as it announced plans to invest US$1.28bn in new store openings.

Latin America's third-largest retailer will invest $413m in the opening of 33 new stores and two shopping malls in Chile. It also plans to spend $198m on 26 new stores in Brazil; $119m to open 15 supermarkets and a mall in Peru; $147m to open 27 stores in Argentina and $3m to open a home improvement store in Colombia.

The company emphasised that 86% of its planned investment will be made in the supermarket channel, where it operates a number of banners including the Jumbo and Santa Isabel chains.

Cencosud indicated that it expects this "aggressive expansion plan" to drive revenues. The company predicted that sales would total $18bn in the 12 months to end-February 2013, up from $12.9bn in 2010. The group's fiscal 2011 results are due out next month.

The retailer forecast EBITDA of approximately $1.58bn with an EBITDA margin target of 8.8%.

The announcement comes on the heels of news that Cencosud is mulling issuing American Depositary Receipts to list in the US. At the group's AGM last April, Cencosud shareholders approved a $2bn capital increase and, in a regulatory filing on Thursday, the company said that any potential US listing would be part of this capital increase.