Dia Brasil announced the closure of 343 stores
The Court of Justice of São Paulo (TJ-SP) announced on Friday (22) that the First Bankruptcy and Judicial Recovery Court accepted the judicial recovery request of the Dia Brasil department store chain. The Spanish company's debt amounts to 1.08 billion Brazilian reals.
The management of the judicial recovery process will be the responsibility of Expertisemais Serviços Contábeis e Administrativos, represented by Elisa Fezzan.
Judge Adler Oliveira Nobre ordered the judicial recovery plan to be submitted within 60 days, followed by another 30 days for possible objections.
The company stated that its financial problems are limited to Brazil and should not affect its operations in Argentina and Spain.
On March 14, the Dia chain announced the closure of 343 of its 587 stores and 3 distribution centers in Brazil. The remaining 244 units, which will continue to operate, are located in the state of São Paulo. Día Brasil justified that the reduction in operations was necessary to focus efforts on businesses in other countries, considered more profitable.
Regarding financial results, in contrast to its performance abroad, the Dia chain faced negative numbers in Brazil in 2023:
- EBITDA (earnings before interest, taxes, depreciation and amortization) was negative at EUR 55 million (R$ 297.62 million at current prices), representing a decrease of 7.6%;
- The net loss amounted to 154 million euros (833.25 million Brazilian reals);
- Total sales decreased by 8.8% compared to the previous year.
EBITDA is used as an indicator of a company's ability to generate cash, and a lower indicator generally indicates negative growth prospects.
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