Americanas will have debt overflow and difficult credit after scandal, say analysts; understand

If the accounting errors of R$ 20 billion do not affect Americanas’ cash at first, analysts point out that the retailer will certainly have an overflow in its debt, which could lead it to enter “survival mode”, cutting investments and jobs .

In contracts with creditors, especially buyers of securities issued by the company, a limit is stipulated on the ratio between net debt and Ebitda, which is equivalent to the operating result.

An analyst who prefers not to be identified says that this ratio should increase a lot, which will allow creditors to ask for the anticipation of the maturity of the debts.

In this scenario, Americanas SA would have to try to negotiate with its creditors new terms and conditions, with higher interest rates. For the analyst, investments in the business, in this scenario, should drastically decrease.

In a relevant fact released this Wednesday (11), Americanas states that this accounting inconsistency has an “immaterial effect” on its cash, that is, it does not immediately affect the resources that the company has to continue operating.

But according to analysts, this scenario should change. That’s because the R$ 20 billion shortfall made public is equivalent to Americanas’ gross debt at the end of the third quarter of 2022, the last balance sheet published by the company.

In September of last year, Americanas SA’s gross debt was R$ 19.3 billion. And the company consumed R$ 8.3 billion in cash between July and September, of which R$ 2.6 billion in acquisitions of companies such as Hortifruti Natural da Terra, the formation of the partnership with Vibra at Vem Conveniência, and the group Uni.Co, owner of the Puket brand.

At a conference with investors held this Thursday (12), the now former president of Americanas, Sergio Rial, who took office on January 2, said that the practice had been adopted for years, which explains the size of the gap in the balance sheet.

XP Investimentos believes that the company will have a deterioration in its working capital, which is the money used to pay suppliers, among other day-to-day expenses of a retailer. And so, the gap starts to have a direct effect on the company’s cash.

According to an expert, who prefers not to be identified, with the information available so far, it is possible to outline a preliminary scenario of what was done in Americanas’ accounting.

He claims that it is common in retail for companies to resort to bank financing to pay suppliers, which generally give a period of between 30 and 90 days to receive. That is, the company resorts to the bank, which pays the supplier, transforming this debt into a bank debt.

Banks charge interest on this financing, which should be accounted for as an expense to purchase goods. However, according to this analyst, Americanas would have recorded in the balance sheet only the value of the merchandise, without including in this expense the amount of interest paid to the banks.

Americanas has among its main shareholders the group of entrepreneurs that owns 3G Capital, formed by Jorge Paulo Lemman, Marcel Herrmann Telles, Carlos Alberto Sicupira, Alex Behring and Roberto Thompson Motta.

The group is also a shareholder of Kraft Heinz, along with Warren Buffett’s Berkshire Hathaway. In 2019, the food giant had to make a US$ 15.4 billion adjustment to its balance sheet, after having overvalued the values ​​of its assets, such as brands and group companies, between 2015 and 2018.

Kraft Heinz made a settlement of US$ 62 million with the SEC (capital market regulator in the United States) to end the lawsuit filed against the company, which ended without Kraft admitting or denying accounting misconduct.

CVM opens process to investigate company

The CVM (Securities and Exchange Commission) announced this Thursday (12) the opening of two processes to investigate the practices of Americanas. One on the balance sheets, and another on the announcement of the inconsistency of R$ 20 billion to the market.

Americanas common shares have not left the auction since the beginning of trading, but indicate a 90% drop this Thursday. The reaction is much worse than expected by Luan Alves, chief analyst at VG Research.

“Taking into account only the financial part, I expected a 30% fall in the stock. But in fact, the issue of governance is weighing on, and the exit from the Rial brings back uncertainties, in addition to the accounting issue”, says Alves.

The expectation for the start of Sergio Rial’s tenure as CEO of Americanas appeared in the performance of the stock in recent weeks. Between December 16, 2022 and this Wednesday (11), the share went from BRL 7.25 to BRL 12.00, up 63%, according to a survey by TradeMap.

XP also raises the risks of a lawsuit filed by investors in the United States. “The company has stock receipts traded in New York, and in similar cases, there have been class actions where minority shareholders have been harmed by executive decisions.”

In this sense, the AMEC (Association of Capital Market Investors) released a note in which it mentions “perplexity” regarding the performance of the areas that take care of the governance of Americanas. “Primarily audits, in light of the estimated magnitude of the accounting inconsistency.”

Abradin (Brazilian Association of Investors) says it is considering adopting measures with the CVM and the Public Ministry to protect minority shareholders.

Pwc, which is responsible for auditing Americanas SA’s balance sheets, was approached and stated that it does not comment on client cases. Americanas will also not comment on the matter.