Half-year profits at Latin American retailer Cencosud have fallen 29% as higher costs and weaker second-quarter earnings from its supermarkets offset higher sales.
Cencosud, which has stores in five South American countries including its home market Chile and Brazil, reported net income of CLP90.6m (US$188,000) for the six months to the end of June, down 28.9%.
The retailer cited an increase in SG&A costs, higher financial charges and larger losses from foreign exchange variations.
However, operating income dropped 5.9% to CLP250.1m. Operating income from Cencosud’s supermarket arm, which accounts for half of earnings, fell 12.2%. The retailer cited a jump in staff costs in Argentina and weaker results in Brazil, where it is integrating last year’s acquisition of local supermarket chain Prezunic.
The purchase of Prezunic did help boost sales, which increased 23.1% to CLP4.37bn. Cencosud reported higher same-store sales at its hypermarkets and supermarkets in Chile, Brazil, Argentina and Peru.