lojas americanas announces consolidated gross … · earnings release 2q12 and 1h12 1 / 20 lojas...

EARNINGS RELEASE 2Q12 AND 1H12

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LOJAS AMERICANAS ANNOUNCES CONSOLIDATED GROSS REVENUE OF R$ 5.8 BILLION IN 1H12

Rio de Janeiro, August 14th, 2012 – Lojas Americanas S.A. [BOVESPA: LAME3 (common) and LAME4 (preferred), one of the leading retail

chains in Brazil with 648 stores as of today and present in 24 states plus the Federal District, announces today its results for the 2nd

quarter of 2012 (2Q12) and 1

st half of 2012 (1H12). The accounting information that serves as the basis for the comments that follow are presented in

accordance with the international financial reporting standards (IFRS), to the rules issued by the Brazilian Securities Exchange Commission (CVM) and in Reais (R$). The comparisons refer to the 2

nd quarter of 2011 (2Q11) and the 1

st half of 2011 (1H11).

OPERATIONAL AND FINANCIAL HIGHLIGHTS

Executive Summary 1H12 – Comparison to 1H11

1H12 1H11 Var. (%) Financial Highlights (R$ MM) 1H12 1H11 Var. (%)

3,010.9 2,669.3 12.8% Net Revenues 5,002.1 4,690.3 6.6%

922.9 787.8 17.1% Gross Profit 1,499.1 1,434.0 4.5%30.7% 29.5% +1.2 p.p. Gross Margin (%NR) 30.0% 30.6% -0.6 p.p.

430.8 351.6 22.5% EBITDA 583.3 579.5 0.7%

14.3% 13.2% +1.1 p.p. EBITDA Margin (%NR) 11.7% 12.4% -0.7 p.p.

69.2 95.2 -27.3% Net Income 78.7 105.8 -25.6%

2.3% 3.6% -1.3 p.p. Net Margin (%NR) 1.6% 2.3% -0.7 p.p.

ConsolidatedParent Company

Consolidated Gross Revenues (R$ MM)

2,075

3,376 4,211 4,388

4,844 5,380 5,755

1H06 1H07 1H08 1H09 1H10 1H11 1H12

CAGR = 18.5%

Consol. EBITDA (R$ MM) and EBITDA Mg. (%NR)

156.2

259.3 330.2

398.0 482.6

579.5 583.3

9.9%10.3% 10.4%

11.1%11.5%

12.4%

11.7%

1H06 1H07 1H08 1H09 1H10 1H11 1H12

EBITDA (R$ million) EBITDA (% NR)

CAGR = 24.6%

Evolution in Number of Stores

207

370 418

469 479

565 643

1H06 1H07 1H08 1H09 1H10 1H11 1H12

Gross Revenues In 1H12, the parent company gross revenue reached R$ 3.544 billion, a growth of 12.4% over

1H11. The consolidated gross revenue was R$ 5.755 billion in 1H12, an increase of 7.0%;

Net Revenues In 1H12, the parent company net revenue reached R$ 3.011 billion, an increase of 12.8% over

1H11. The consolidated growth was of 6.6%, compared to 1H11;

“Same Stores” Net Revenues

Growth in ―same stores‖ net revenues of 8% in the first half of the year;

Gross Margin

In the parent company, the gross margin was 30.7% of net revenues in 1H12, an improvement

of 1.2 p.p.. The consolidated gross margin was 30.0% of net revenues in 1H12, representing a

variation of -0.6 p.p.;

Selling, General and Administrative Expenses (SG&A)

The selling, general and administrative expenses in the parent company totaled 16.3% of the net

revenue in 1H12, same level of 1H11. In the consolidated, selling, general and administrative

expenses totaled 18.3% of net revenues in 1H12, a variation of +0.1 p.p, in relation to 1H11;

EBITDA

In the parent company, EBITDA reached R$ 430.8 million in 1H12, an increase of 22.5%

compared to 1H11. The parent company EBITDA margin was 14.3% of net revenues, a 1.1 p.p.

improvement. The consolidated EBITDA reached R$ 583.3 million in 1H12, an increase of 0.7%

in relation to 1H11. The consolidated EBITDA margin was 11.7% of net revenues in 1H12;

Fitch Ratings upgraded Lojas Americanas and B2W’s ratings to A+

The credit rating agency Fitch Ratings upgraded Lojas Americanas and B2W’s long-term

corporate rating from A to A+, with stable outlook;

B2W

Consolidated gross revenues of 2.230 billion in 1H12;

Expansion

The ―SEMPRE MAIS BRASIL‖ store opening program is right on schedule. We opened 28 new

stores as of today.

Charts – ―1H‖ means first half of each year.

Only the data from 2009 to 2012 are presented according to the IFRS.

The historic data are in compliance with the corporate norms in effect for each period.

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MULTICHANNEL RETAIL STRUCTURE Lojas Americanas operates through a multichannel service structure. In addition to the bricks-and-mortar store chain, the Company reaches customers with a wide range of products and services sold via the Internet, telephone, catalogs, TV and kiosks. B2W – Companhia Global do Varejo, the result of the merger of Americanas.com and Submarino in 2006, has a portfolio that includes the Americanas.com, Submarino, Shoptime, B2W Viagens, Ingresso.com, Submarino Finance, BLOCKBUSTER® Online, MesaExpress.com.br and SouBarato.com.br brands, which offer more than 36 categories of products and services through the Internet, telephone sales, catalogs, TV and kiosks distribution channels. Lojas Americanas’ stake in B2W at the end of the first half of 2012 was 58.87%. Lojas Americanas also offers credit and financial products to its clients through Financeira Americanas Itaú (FAI)*, a joint-venture with Banco Itaú. The following organizational chart illustrates the integrated approach of Lojas Americanas:

* As reported through the Material Fact published on August 9, 2012, the end of the partnership between Lojas Americanas and Itaú Unibanco Holding S.A. to offer, distribute and sell financial products and services is subject to the approval of the Central Bank of Brazil.

Multichannel Retailer

Bricks-and-Mortar Internet, Telephone Sales, Catalogues,

TV and Kiosks.

Participation: 58.87% Results Consolidation: 100%

Participation: 50% Results Consolidation: 50%

Financial Products*

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COMMENTS ON OPERATING PERFORMANCE EASTER MISMATCH In 2012, the Easter event took place on April 8 whereas last year it occurred on April 24. Therefore, the sales related to this important event were more concentrated in the 1Q12 in comparison with the same period of 2011. In order to remove this effect, the results’ analyses are going to be oriented to the accumulated of the first half of the year (1H12). NET REVENUES In 1H12, the parent company net revenues reached R$ 3.011 billion, a growth of 12.8% when compared to the R$ 2.669 billion registered in 1H11. In the ―same stores sales‖ concept, the growth of net revenues in the first half of 2012 was 8%. The consolidated net revenues of Lojas Americanas and its subsidiaries totaled R$ 5.002 billion in 1H12, a growth of 6.6% when compared to the R$ 4.690 billion registered in 1H11.

1,578 2,517

3,186 3,591

4,215 4,690 5,002

1H06 1H07 1H08 1H09 1H10 1H11 1H12

Consolidated Net Revenue(R$ million)

CAGR = 21.2%

1,120 1,389

1,743 2,043

2,325 2,669

3,011

1H06 1H07 1H08 1H09 1H10 1H11 1H12

Parent Company Net Revenue(R$ million)

CAGR = 17.9%

GROSS PROFIT / GROSS MARGIN

In the parent company, the gross profit was 30.7% of the NR in 1H12, an evolution of 1.2 p.p. when compared to the gross margin of 29.5% of the NR reported in 1H11. The consolidated gross profit in 1H12 reached R$ 1,499 million. Consolidated gross margin in 1H12 was 30.0% of net revenues (NR), representing a -0.6 p.p. variation. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES In 1H12, the parent company selling, general and administrative expenses totaled R$ 492.1 million, or 16.3% of the NR, reaching the same level of 1H11. In the consolidated point of view, selling, general and administrative expenses totaled R$ 915.8 million in 1H12 or 18.3% of the NR, a variation of +0.1 p.p. (%NR) in relation to 1H11.

19.6

21.4

20.3 20.4

18.6 18.2 18.3

1H06 1H07 1H08 1H09 1H10 1H11 1H12

Consolidated Sales, General and Administrative Expenses (%NR)

19.9 19.5 19.018.1

17.216.3 16.3

1H06 1H07 1H08 1H09 1H10 1H11 1H12

Parent Company Sales, General and Administrative Expenses (%NR)

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EBITDA

In 1H12, the parent company EBITDA reached R$ 430.8 million, the equivalent to a 22.5% growth when compared to 1H11. The EBITDA margin of the parent company for the period was 14.3%, 1.1 p.p. above the margin of 1H11. In 1H12, the consolidated EBITDA totaled R$ 583.3 million, representing a 0.7% increase in relation to 1H11. The consolidated EBITDA margin was 11.7% of net revenues in 1H12, compared to 12.4% of the NR in 1H11. The following table shows the EBITDA per Company:

EBITDA 1H12 %NR 1H11 %NR R$ ∆ %

Consolidated 583.3 11.7% 579.5 12.4% 3.8 0.7%

LOJAS AMERICANAS 430.8 14.3% 351.6 13.2% 79.2 22.5%

B2W 139.0 7.0% 234.7 11.7% (95.7) -40.8%

FAI, BWU and Other 13.5 - (6.8) - 20.3 -298.5%

156.2

259.3 330.2

398.0 482.6

579.5 583.3

9.9%10.3% 10.4% 11.1%

11.5%12.4%

11.7%

1H06 1H07 1H08 1H09 1H10 1H11 1H12


Consolidated EBITDA

CAGR = 24.6%

98.0 127.5

173.5 215.0

262.9

351.6

430.8

8.7% 9.2% 10.0% 10.5% 11.3%

13.2%

14.3%

1H06 1H07 1H08 1H09 1H10 1H11 1H12


Parent Company EBITDA

CAGR = 28.0%

NET FINANCIAL RESULT In the parent company, the net financial expenses in 1H12 totaled R$ 218.8 million, a variation of 32.8% in relation to the R$ 164.7 million net financial expenses registered in 1H11. The increase of 32.8% in the parent company net financial expenses in 1H12 is related to the growth of the indebtedness and to the improvement of the average maturity debt profile, which went from 691 days in 1H11 to 1,141 days in 1H12 (from 23 to 38 months). The consolidated financial expenses in 1H12 totaled R$ 380.9 million, representing a variation of 23.7% in relation to the expenses of R$ 308.0 million registered in 1H11. For a better evaluation of the parent company’s net financial result we must consolidate the revenues and financial expenses of the non-operating subsidiaries (BWU and others). Thus, in the following table, we present a view of the financial result with the aforementioned effects.

Breakdown of the Net Financial Result - R$ MM 1H12 1H11 ∆ %

Parent Company Net Financial Result (before non-operating subsidiaries and FAI) (218.8) (164.7) 32.8%

(+) Net Financial Result of Non-Operating Subsidiaries and FAI 26.9 27.5 -2.2%

(+) B2W Net Financial Result - Consolidated (189.0) (170.8) 10.7%

Consolidated Net Financial Result (380.9) (308.0) 23.7%

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The Company continues to reaffirm its commitment to a conservative cash investment policy, expressed by the use of hedge instruments in foreign currencies, to offset eventual exchanges fluctuations, whether relative to financial liabilities or total cash position. These instruments offset the foreign exchange risk, transforming the cost of the debt to local currency and interest rates (as a percentage of CDI*). Similarly, it is worth mentioning that the Company’s cash is invested with Brazil’s largest financial institutions. *CDI - Interbank Deposit Certificate: average rate of funding through the interbank market.

NET RESULT AND NET RESULT PER SHARE The parent company net income in 1H12 was R$ 69.2 million, a variation of -27.3% when compared to the R$ 95.2 million registered in 1H11. The variation in the parent company net income is mainly related to the increase of the financial expenses and to the reduction of the equity accounting. The consolidated net income in 1H12 was R$ 78.7 million, a variation of -25.6% when compared to the R$ 105.8 million registered in 1H11. The following table shows the main variations from Parent Company EBITDA to net result:

Reconciliation of the Net Result - R$ MM 1H12 1H11 ∆ %

EBITDA 430.8 351.6 22.5%

(+) Depreciation / Amortization (64.1) (51.1) 25.4%

(+) Net Financial Result (218.8) (164.7) 32.8%

(+) Equity Accounting (28.8) (1.4) 1957.1%

(+) Other Operat. Income (Expenses)* (0.5) - -

(+) Income tax and social contribution (49.4) (39.2) 26.0%

(=) Net Result 69.2 95.2 -27.3%

* In the old accounting rules, considered as "non-operating income".

Parent Company

The following table shows the main variations from Consolidated EBITDA to net result:

Reconciliation of the Net Result - R$ MM 1H12 1H11 ∆ %

EBITDA 583.3 579.5 0.7%

(+) Depreciation / Amortization (98.0) (77.6) 26.3%

(+) Net Financial Result (380.9) (308.0) 23.7%

(+) Other Operat. Income (Expenses)* (36.2) (60.5) -40.2%

(+) Minority / Statutory Participation 33.5 9.1 268.1%

(+) Income tax and social contribution (23.0) (36.7) -37.3%

(=) Net Result 78.7 105.8 -25.6%

* In the old accounting rules, considered as "non-operating income".

Consolidated

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INDEBTEDNESS Lojas Americanas uses its cash flow giving priority to investments that generate the best returns for shareholders. Thus, we have listed below the main actions carried out in the period between 07/01/2011 and 06/30/2012: Investments made by Lojas Americanas and B2W in property and intangible assets (websites and systems

development) of R$ 840.5 million;

Payment of interest on equity and gross dividends in the amount of R$ 79.9 million.

Lojas Americanas’ consolidated short and long-term loans and debentures on 06/30/2012 totaled R$ 5,548.9 million. If we deduct the cash position of R$ 3,913.1 million (cash + money market investments + accounts receivable from credit and debit cards + 50% of FAI’s consumer financing) from total loans, we will reach a net debt position of R$ 1,635.8 million.

R$ million

Indebtedness 06/30/2012 03/31/2012

Short Term Debt 1.055,1 1.101,1

Short Term Debentures 196,7 163,7

Shot Term Indebtedness 1.251,8 1.264,8

Long Term Debt 2.618,4 2.549,3

Long Term Debentures 1.678,7 1.461,6

Long Term Indebtedness 4.297,1 4.010,9-Total Debt (1) 5.548,9 5.275,7

Cash and banks 134,7 170,4

Money market investments 2.232,3 1.826,8

1.069,4 1.604,4

476,7 492,2-

Total Cash (2) 3.913,1 4.093,8-

Net Cash (Debt) (2) - (1) (1.635,8) (1.181,9)00

Net Debt / EBITDA LTM 1,1 0,80

Average Maturity of Debt (in days) 1.025 1.066

Credit Cards Accounts Receivable

Consolidated

Customers financing - FAI

In 06/30/2012, the Company’s net debt was 1.1x of the accumulated EBITDA in the last 12 months. It should be noted that the average maturity of the debt went from 840 days in 1H11 to 1,025 days in 1H12 (from 28 to 34 months). In order to face the uncertainties and the volatility of the financial market, Lojas Americanas is guided by the principle of preserving cash and extending its debt profile. During the past years, a number of measures were taken with this objective in mind, which permits us to consolidate the Company’s long-term growth plan. Accounts receivable are composed of receivables from credit cards, net of the discounted value which have immediate liquidity and can be considered as cash. The breakdown of accounts receivable from the consolidated viewpoint of Lojas Americanas is shown in the following table:

Accounts Receivable Conciliation 06/30/2012 03/31/2012

Gross Credit-Cards Receivable 2,338.8 2,698.1

Electronic debits and checks Receivables 14.1 16.5

Receivable Discounts 1,283.5 1,110.2

1,069.4 1,604.4

Present-value adjustment (13.1) (17.8)

Customers financing - FAI 476.7 492.2

Allowance for doubtful accounts (163.9) (171.4)

Other accounts receivable 205.1 226.8

Consolidated Net Accounts Receivable 1,574.2 2,134.2

Accounts Receivable from credit / debit cards

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Because of the adoption of the new CPCs/IFRS, in particular the CPC 38 and its corresponding IAS 39, the Company began to write off (derecognize) receivables from credit card administrators the moment they are effectively discounted (as of the explanatory notes of the financial statements). However, to better demonstrate the volume of receivables discounted on the base-dates analyzed, in the chart above the Company presents the accounts receivable adjusted by the discounts made until the base-dates under analysis. NO FOREIGN CURRENCY EXPOSURE In the 1H12, Lojas Americanas S.A.’s balance sheet recorded foreign currency denominated debt. Such debt, however, is FULLY PROTECTED against any foreign exchange fluctuations through derivative (swap) operations that replace the foreign exchange risk for the variation in the basic Brazilian interest rate (CDI). SALES BY MEANS OF PAYMENT The breakdown of the sales, by means of payment in 1H12 and 1H11 can be seen in the following table:

Means of Payment 1H12 1H11 Var. 1H12 1H11 Var.

Cash 59% 56% +3 p.p. 49% 45% +4 p.p.

Credit Cards 41% 44% -3 p.p. 51% 55% -4 p.p.

*Considers the third parties credit cards, the Financeira Americanas Itaú and Submarino Finance private label cards.

Parent Company Consolidated

PARENT COMPANY NET WORKING CAPITAL

Lojas Americanas’ net working capital in 1H12 was -2 days.

-10

-2

06/30/2011 06/30/2012

(Net Working Capital = Days of Inventory + Days of Accounts Receivable – Days of Suppliers)

The change in Lojas Americanas’ net working capital during the period demonstrates the constant striving to improve our operating processes and the development of partnerships with our suppliers.

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CUSTOMER SERVICE’S LEVEL

Seeking to reward companies with excellent customer service’s levels, the complaint website Reclame Aqui has created the RA 1000 Seal. Companies who receive this Seal show the customer their commitment to post-sales service, raising its trust in their brand, services and products. Lojas Americanas received RA 1000 for its excellent levels of customer’s Answer, Solution and Evaluation. With regard to the complaints registered by the website, 100% of the cases were promptly answered and more than 94% were conveniently solved. The Seal reinforces Lojas Americanas’ goal of bringing more convenience to their clients and exceeding their expectations when meeting their needs.

INVESTMENT AND EXPANSION PARENT COMPANY INVESTMENT In 1H12, from the parent company’s point of view, Lojas Americanas invested a total of R$ 283.2 million, with emphasis on expansion, improvements in the chain of store and technological upgrade. Included in this total are investments in goods for rental in the amount of R$ 18.6 million. The following table shows the details of Lojas Americanas’ parent company investments in 1H12:

R$ million %

Openings / Improvements 258.4 91%

Technology / Logistics / Operation 6.2 2%

Goods for rental and others 18.6 7%

TOTAL 283.2 100% Expansion of the Chain of Stores We intend to create value for our shareholders, following our internal motto, ―We Always Want More‖. The Lojas Americanas’ expansion project takes place on three main fronts: Lojas Americanas (brick-and-mortar retail), B2W (Internet, telephone sales, catalogs, TV and kiosks) and Financeira Americanas Itaú (financial products). At the end of 1H12, Lojas Americanas owned 643 stores, divided in the following formats:

Format Number of Stores %

Traditional 407 63%

Express 236 37%

Total 643 100% In 2012, we opened 28 stores as of today and we have more than 80 stores with contract signed or in an advanced stage of negotiation, which demonstrates the Company’s commitment to the execution of our ―SEMPRE MAIS BRASIL – 80 ANOS EM 4!‖ expansion plan. Throughout the year we decided to deactivate one store.

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Evolution of Sales Area x Number of stores

Position at June 30

343

411

447

496 510

587

649

207

Stores

370

Stores

418

Stores

469

Stores

479

Stores

565

Stores

643

Stores

1H06 1H07 1H08 1H09 1H10 1H11 1H12

Sale

s A

rea (

tho

usan

d m

²)

Nu

mb

er

of

Sto

res

State Traditional Stores Express StoresSales Area

(m²)

BA 1 - 909

ES 1 - 1,005

GO 4 - 3,779

MG 2 - 1,579

PA 2 - 2,396

PB 1 - 1,197

PE 1 2 1,230

PR 1 - 1,072

RJ 2 1 2,092

RS 1 - 1,059

SC 1 - 915

SP 1 1 1,067

Total 18 4 18,300

Openings in the 1st Half/2012:

State Traditional Stores Express StoresSales Area

(m²)

BA 2 - 2,541

DF 1 - 1,230

MG 1 - 886

SP - 1 425

TO 1 - 897

Total 5 1 5,979

Openings after the 1st Half/2012:

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Expansion Plan – “SEMPRE MAIS BRASIL”

The ―SEMPRE MAIS BRASIL‖ program, announced at the end of 2009, forecasts 400 new stores in Brazil for the period between 2010 and 2013.

As of 1H12, all the Company’s stores were located in only 223 of the more than 5,5 thousands cities in the country, which demonstrates the opportunity for Lojas Americanas to open new stores in cities that are at a greater distance from Brazil’s large urban centers.

As illustrated in the following chart, based on economic feasibility studies and analyses conducted internally using the EVA

® (Economic Value Added) tool, together with socio-economic data (population, income, access to basic

services, access to consumer goods, among others), we believe that at this moment there is the possibility that our brick-and-mortar retail stores could be present in approximately 127 additional cities.

127223

5,150

Cities with Lojas Americanas

Cities with potential for opening Lojas Americanas

Nationwide distribution

In the last years we increased our presence in cities further from urban centers and started our operations in Tocantins and Acre states. In 2012 so far, we opened our first store in 13 new cities. At the end of 1H12 our stores were located in 24 states of the country plus the Federal District, with distribution as follows: 61.6% in the Southeast, 18.8% in the South/Midwest and 19.6% in the North/Northeast. Coupled with our confidence in the development of the country, the expansion plan for these new cities could especially benefit the North/Northeast/Midwest regions. As it has occurred historically, the growth should be in the proportion of 70% Traditional stores (average sales area between 1,300 m² and 1,500 m²) and 30% Express stores (average sales area between 300 m² and 500 m²). The following table shows the number of stores inaugurated in 2010, 2011 and the estimate of store openings for 2012 and 2013:

YearNumber of

Stores

2010 70

2011 90

2012 110 to 120

2013 120 to 130 In February, 2012, Lojas Americanas and B2W announced the creation of a new Distribution Center, this time in Uberlândia, Minas Gerais. The new Distribution Center will guarantee a faster supply of the physical stores, a greater agility in delivery of products purchased on the B2W’s sites and a better customer service for the Minas Gerais and for the Midwest and North regions.

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INDICATORS AND HIGHLIGHTS OF THE SUBSIDIARIES B2W – COMPANHIA GLOBAL DO VAREJO

We are presenting below the results for 1Q12 and 1H12 of our subsidiary B2W – Companhia Global do Varejo

(BOVESPA: BTOW3).

The accounting information that serves as the basis for the following comments are presented pursuant to international financial reporting standards (IFRS) as well as the regulations issued by the Brazilian Securities Exchange Commission (CVM) and the Novo Mercado listing regulations, and are in reais (R$). The comparisons refer to the 2

nd quarter of 2011 (2Q11) and the 1

st half of 2011.

Gross Revenue

In 2Q12, the consolidated gross revenue reached R$ 1,110.4 million, whereas the gross revenue in the parent company was R$ 1,027.2 million;

Net Revenue

In 2Q12, the consolidated net revenue reached R$ 996.9 million, whereas the net revenue in the parent company was R$ 926.9 million;

Submarino Card share reached 40% of the website’s sale

The share of the Submarino Card reached 40% of Submarino’s website sales in 2Q12; Evolution of the PROCON Complaints Ratings

In 1H12, the number of complaints registered in PROCON (Foundation of Consumer Protection and Defense) São Paulo presented a significant reduction of 64% when compared to the same period of the preceding year;

Fitch Ratings upgraded B2W’s ratings to A+

The credit rating agency Fitch Ratings upgraded B2W’s long-term corporate rating from A to A+, with stable outlook;

Investment Plan for the next 3 years

B2W will invest more than R$ 1 billion in the next 3 years, reaffirming the strategy of getting closer to the client. In line with that goal, in the next 60 days, will be opened 4 Distribution Centers and we will open another 10 Distribution Centers in the next 3 years.

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FINANCEIRA AMERICANAS ITAÚ – FAI The Company reported through a Material Fact published on August 9, 2012 that it ended, in common agreement with Itaú Unibanco Holding S.A., their partnership to offer, distribute and sell financial products and services, securities and pension products to clients of Lojas Americanas and its affiliates. As a consequence, Lojas Americanas agreed to sell to Itaú Unibanco Holding S.A. its full ownership interest in the capital stock of FAI, in the approximate amount of R$ 83 million and to acquire the right to exclusivity for the offer, distribution and sale of financial products and services by the Company, for the approximate amount of R$ 112 million. Due to the purchase and sale of FAI, Itaú Unibanco Holding S.A. will also liberate all of the guarantees and other obligations of Lojas Americanas referring to the aforementioned agreement. The right regarding the exclusivity of the offer for distribution and sale of financial services and products is posted to the books under Intangible Assets and is amortized by the period of time remaining in the contract, which in this case is 13.5 years. The impact on income, net of taxes and with the deduction of the expenses linked to the closing of the agreement, represents a positive effect of approximately R$ 35 million. LASA, in compliance with the obligations that were assumed when it set up its B2W – Companhia Global do Varejo ("B2W") subsidiary on November 23, 2006, will offer to B2W the portion of the right to exclusivity that it acquired to offer, distribute and sell Financial Services and Products through B2W’s distribution channels. The conclusion of the operation is subject to the approval of the Brazilian Central Bank and the parties commit themselves to respect a transition period in order to gradually finalize all of the partnership operations. 2Q12 and 1H12 Results: At the end of 1H12, FAI had issued nearly 1.5 million cards

287 thousand of which were private label and 1.2 million co-branded, which can be used in Lojas Americanas and elsewhere;

Receivables portfolio in 1H12 reached R$ 953 million Mix of the current portfolio is composed of 0.2% personal loans and 99.8% credit cards

Last year, personal loans represented 1.9% and credit cards, 98.1%.

469 561736 777 849 908

1.046 1.025 1.033 1.002 1.087 968 951 114

88

62 50 50

36

33 25 20 13 7

3 2

2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12

Portfolio of Receivables FAI(R$ million)

Personal Loans Private Label + Co-Branded

Glossary: Receivables portfolio: Amounts to receive from sales.

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CORPORATE GOVERNANCE AND CAPITAL MARKETS Since 1940, Lojas Americanas S.A. has been listed on the Brazilian Stock, Mercantile & Futures Exchange (BM&FBOVESPA). The Company has a shareholder base composed of common shares (LAME3) and preferred shares (LAME4). Lojas Americanas has a Board of Directors consisting of eight members, five appointed by the controllers, one appointed by minority shareholders, and two appointed by the Board of Directors. Lojas Americanas also have a Fiscal Council formed by 3 members, two being indicated by the controllers and one indicated by the minority shareholders. Since 2006, the Company has maintained a commitment, as part of its By-Laws, to concede full (100%) tag-along rights for all of its common and preferred shares. This guarantees that all of Lojas Americanas’ shareholders will receive equal treatment in the event of a change of ownership, assuring them the right to sell their shares under the same terms extended to the controlling shareholders. Below is a brief description of major corporate events occurred this year: On January 19, 2012, the Company reported the 6th Issue of simple debentures, non-convertible into shares, for a global total amount of R$ 500 million. The funds obtained through the Debentures issuance will be used for reinforcing the Company’s cash as well as lengthening its debt profile. On March 8, 2012, at a Board of Directors Extraordinary Meeting, the board members approved the distribution of ―Intermediate Dividends‖, calculated upon the net income for the fiscal year ended December 31, 2011, and decided that the proposal of the net income’s allocation – which was presented to the shareholders at the Company’s General Meeting – would de be adjusted in order to take into account the declaration of these intermediate dividends. On April 30, 2012 the Company’s General and Extraordinary Shareholders Meetings were held, at which the following Resolutions were approved: 1 – To take recognizance of the accounts prepared by the managers and related financial statements for the fiscal year ended December 31, 2011; 2 – Allocation of the net income reported for the fiscal year ended December 31, 2011; 3 – Proposal for the adoption of the Capital Budget for the fiscal year of 2012; 4 – Increase of the social capital, upon the capitalization of net profit reserves; 5 – Amendment to the Bylaws of the Company and its consolidation; 6 – Review of the Company’s Stock Option Plan. 7 – Establishment of the Fiscal Council and the election of Messrs. Ricardo Scalzo, Vicente Antonio de Castro Ferreira and Márcio Luciano Mancini to the position of full members and Messrs. Carlos Alberto de Souza, André Amaral de Castro Leal, and Pedro Carvalho de Mello as alternate members. On July 2, 2012, a meeting of the Board of Directors was held to elect Mr. Carlos Eduardo Rosalba Padilha as Chief Operating Officer, for a mandate that shall expire, along with the other members of the Management, as of the holding of the General Shareholders Meeting in 2013. On August 3, 2012, at an Extraordinary Shareholders Meeting, the shareholders unanimously elected Love Goel as a new effective member of the Company’s Board of Directors, for a mandate that shall expire, along with the other members of the Management, as of the holding of the General Shareholders Meeting in 2013. On August 9, 2012, the Company reported through a Material Fact that it ended, in common agreement with Itaú Unibanco Holding S.A., their partnership to offer, distribute and sell financial products and services, securities and pension products to clients of Lojas Americanas and its affiliates. The conclusion of the operation is subject to the approval of the Brazilian Central Bank and the parties commit themselves to respect a transition period in order to gradually finalize all of the partnership operations. The minutes of the meetings listed above, as well as other corporate and financial information of Lojas Americanas S.A. are available for inspection on our Investor Relations website (http://ir.lasa.com.br) and on the website of the Brazilian Securities and Exchange Commission (www.cvm.gov.br).

http://ir.lasa.com.br/

http://www.cvm.gov.br/

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About Lojas Americanas S.A. Lojas Americanas was founded in 1929, in Niterói, Rio de Janeiro, and is present in all the regions of the country (24 states plus the Federal District), with 648 stores — 411 in the Traditional format and 237 in the Express format — equivalent to 671 thousand square meters of sales space. The average sales space of traditional stores is 1,400 square meters, with daily stock replacement and an offer of approximately 60,000 items. The Express model follows the smaller store concept, with an average size of 400 square meters, just-in-time logistics and a selected product range of about 15,000 items, appropriate for each location and client profile of these stores. Lojas Americanas assures its clients competitive prices with respect to its competition and offers quality products in its Home, Leisure, Beauty, Children’s, Confectionary and Convenience Foods worlds. Lojas Americanas’ brick-and-mortar stores are serviced by three distribution centers, located in São Paulo, Rio de Janeiro and Pernambuco. Lojas Americanas’ shares are listed on the BM&FBOVESPA through ticker symbols LAME3 (common) and LAME4 (preferred).

“We Always Want More”

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ANNEX I – CONSOLIDATED FINANCIAL STATEMENT

Lojas Americanas S.A.

Income Statements

(in million of Brazilian reais, except earnings per share) 2Q12 2Q11 Variation 1H12 1H11 Variation

Gross Sales and Services Revenue 2,953.6 2,799.8 5.5% 5,755.4 5,379.6 7.0%

Taxes on sales and services (387.8) (362.3) 7.0% (753.3) (689.3) 9.3%

Net Sales and Services Revenue 2,565.8 2,437.5 5.3% 5,002.1 4,690.3 6.6%

Cost of goods and services sold (1,796.3) (1,711.3) 5.0% (3,503.0) (3,256.3) 7.6%

Gross Profit 769.5 726.2 6.0% 1,499.1 1,434.0 4.5%

Gross Margin (% NR) 30.0% 29.8% +0.2 p.p. 30.0% 30.6% -0.6 p.p.

Operating Revenue (Expenses) (508.7) (464.9) 9.4% (1,013.8) (932.1) 8.8%

Selling expenses (426.0) (388.0) 9.8% (852.0) (786.0) 8.4%

General and administrative expenses (32.5) (38.2) -14.9% (63.8) (68.5) -6.9%

Depreciation and amortization (50.2) (38.7) 29.7% (98.0) (77.6) 26.3%

Operating Income before Net Financial Result

and Equity Accounting260.8 261.3 -0.2% 485.3 501.9 -3.3%

Net Financial Result (190.6) (171.6) 11.1% (380.9) (308.0) 23.7%

Other operating income (expenses)* (32.3) (38.5) -16.1% (36.2) (60.5) -40.2%

Minority interest 16.0 8.5 88.2% 33.5 9.1 268.1%

Income tax and social contribution (16.2) (16.3) -0.6% (23.0) (36.7) -37.3%

Net Income of the Period 37.7 43.4 -13.1% 78.7 105.8 -25.6%

Net Margin (% NR) 1.5% 1.8% -0.3 p.p. 1.6% 2.3% -0.7 p.p.

EBITDA 311.0 300.0 3.7% 583.3 579.5 0.7%

EBITDA Margin (% NR) 12.1% 12.3% -0.2 p.p. 11.7% 12.4% -0.7 p.p.

* In the former accounting rules, considered as "non-operating income".

Consolidated

Periods ended in June, 30

Consolidated


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ANNEX II – PARENT COMPANY FINANCIAL STATEMENT


Income Statements

(in million of Brazilian reais, except earnings per share) 2Q12 2Q11 Variation 1H12 1H11 Variation

Gross Sales and Services Revenue 1,843.4 1,706.2 8.0% 3,543.9 3,153.5 12.4%

Taxes on sales and services (278.8) (262.2) 6.3% (533.0) (484.2) 10.1%

Net Sales and Services Revenue 1,564.6 1,444.0 8.4% 3,010.9 2,669.3 12.8%

Cost of goods and services sold (1,090.8) (1,021.8) 6.8% (2,088.0) (1,881.5) 11.0%

Gross Profit 473.8 422.2 12.2% 922.9 787.8 17.1%

Gross Margin (% NR) 30.3% 29.2% +1.1 p.p. 30.7% 29.5% +1.2 p.p.

Operating Revenue (Expenses) (289.4) (257.6) 12.3% (556.2) (487.3) 14.1%

Selling expenses (238.3) (217.9) 9.4% (460.3) (407.1) 13.1%

General and administrative expenses (15.8) (13.7) 15.3% (31.8) (29.1) 9.3%

Depreciation and amortization (35.3) (26.0) 35.8% (64.1) (51.1) 25.4%

Operating Income before Net Financial Result

and Equity Accounting184.4 164.6 12.0% 366.7 300.5 22.0%

Net Financial Result (110.4) (95.2) 16.0% (218.8) (164.7) 32.8%

Equity accounting (16.4) (7.1) 131.0% (28.8) (1.4) 1957.1%

Other operating income (expenses)* (0.1) 0.4 -125.0% (0.5) - -

Income tax and social contribution (24.5) (24.6) -0.4% (49.4) (39.2) 26.0%

Net Income of the Period 33.0 38.1 -13.4% 69.2 95.2 -27.3%

Net Margin (% NR) 2.1% 2.6% -0.5 p.p. 2.3% 3.6% -1.3 p.p.

EBITDA 219.7 190.6 15.3% 430.8 351.6 22.5%

EBITDA Margin (% NR) 14.0% 13.2% +0.8 p.p. 14.3% 13.2% +1.1 p.p.

* In the former accounting rules, considered as "non-operating income".

Parent Company


Parent Company


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ANNEX III – BALANCE SHEET


Balance Sheet

(In Million Reais) 06/30/2012 06/30/2011 06/30/2012 06/30/2011

ASSETS

CURRENT ASSETS

Cash and banks 103.3 146.3 134.7 170.7

Marketable Securities 685.3 574.9 2,231.7 1,989.3

Clients accounts receivable 402.9 282.8 1,574.2 2,269.9

Inventories 870.7 788.9 1,459.1 1,320.2

Recoverable taxes 458.0 308.6 617.4 386.8

Prepaid expenses 12.5 15.1 21.8 25.7

Other accounts receivable 160.4 122.3 230.1 242.2

Total Current Assets 2,693.1 2,238.9 6,269.0 6,404.8

NON-CURRENT ASSETS

Marketable Securities 13.6 11.5 0.6 6.5

Loans e advances to subsidiaries companies 0.9 3.7 - -

Receivables from stockholders - Stock Option Plan 64.8 64.1 64.8 64.1

Deferred income tax and social contribution 57.8 56.2 455.4 357.5

Escrow deposits 60.6 39.7 106.5 73.3

Other non current assets 13.3 10.1 13.3 10.1

Investments 1,540.7 1,201.7 - -

Property, plant and equipment 926.0 557.4 1,167.4 761.1

Intangible assets 129.9 481.0 1,413.3 1,156.4

Deferrred assets 17.2 37.6 - -

Total Non-Current Assets 2,824.8 2,463.0 3,221.3 2,429.0

TOTAL ASSETS 5,517.9 4,701.9 9,490.3 8,833.8

LIABILITIES AND SHAREHOLDER´S EQUITY

CURRENT LIABILITIES

Suppliers 1,303.7 1,317.0 1,926.4 1,900.7

Loans and financing 346.5 779.0 1,055.1 1,590.7

Debentures 176.4 153.7 196.7 346.6

Payroll and related charges 38.4 35.4 59.3 51.3

Taxes payable 65.2 125.9 73.0 141.3

Income tax and currents social contribution 42.2 - 46.3 -

Dividends and participations proposed - - - 0.2

Provisions for contingencies 10.2 8.9 24.8 16.8

Other accounts payable 69.6 109.5 309.7 375.1

Total Current Liabilities 2,052.2 2,529.4 3,691.3 4,422.7

NON-CURRENT LIABILITIES

Long term liabilities:

Loans e advances to subsidiaries companies 21.2 27.1 - -

Loans and financing 1,164.7 1,345.7 2,618.4 2,796.3

Debentures 1,284.9 78.2 1,678.7 384.1

Taxes payable 22.2 57.4 24.7 106.2

Income tax and deferred social contribution 40.5 - 119.4 -

Allowance for contingencies 86.4 67.2 107.8 85.1

Allowance for loss on investiments 19.5 14.8 - -

Advance for cession in mining usage rights 22.9 24.5 19.1 20.4

Other accounts payable - - 11.9 5.2

Total Non-Current Liabilities 2,662.3 1,614.9 4,580.0 3,397.3

SHAREHOLDER'S EQUITY

Social capital 526.4 296.4 526.4 296.4

Capital reserves 16.6 12.1 16.6 12.1

Goodwill on Capital Transactions (160.8) (160.8) (160.8) (111.7)

Profit reserves 508.5 469.0 480.6 371.0

Treasury shares (158.3) 95.2 (158.3) 105.8

Equity Evaluation Adjustment 1.7 (156.4) 1.7 (156.4)

Profit/ Loss for the period 69.3 2.1 78.7 2.1

Minority Interest - - 434.1 494.5

Total Shareholders' Equity 803.4 557.6 1,219.0 1,013.8

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 5,517.9 4,701.9 9,490.3 8,833.8

The accompanying notes are an integral part of these financial statements


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ANNEX IV – CASH FLOW STATEMENT


CASH FLOW STATEMENT - INDIRECT METHOD

(In Million Reais) 06/30/2012 06/30/2011 06/30/2012 06/30/2011

Cash Flow from Operating Activities

Net income for the period: 69.2 95.2 78.7 105.8

Adjustments to net income:

Depreciation and amortization 72.2 59.7 106.0 86.2

Residual and deferred value of fixed assets write-off 4.0 3.7 4.3 3.8

Equity accounting 28.8 1.4 - -

Income tax and social contribution referred 7.3 1.5 (24.3) 15.3

Interest on credits (2.2) (3.9) (2.2) (3.9)

Interest and variations financing and other debits 95.6 37.8 119.5 115.3

Adjustment in provision for contingencies - - 5.2 6.2

Stock option plan 1.4 0.9 1.9 0.9

Allowance for doubtfull accounts (0.4) (0.7) 37.1 49.7

Others 10.2 (0.3) 0.8 (6.9)

Minority Interest - - (33.6) (9.2)

Adjusted net income 286.1 195.3 293.4 363.2

Decrease (increase) in operating assets:

Trade accounts receivable 205.7 207.5 412.8 (197.2)

Inventories 75.0 70.7 4.0 87.9

Recoverable taxes (105.3) (107.8) (141.0) (112.3)

Prepaid expenses (3.3) (19.7) 2.9 9.2

Escrow deposits (19.9) 0.1 (34.7) (7.8)

Other accounts receivable (8.8) 40.9 18.1 (13.5)

143.4 191.7 262.1 (233.7)

Increase (decrease) in operating liabilities:

Suppliers (390.7) (246.1) (474.2) (433.0)

Payroll and related charges 0.8 6.1 4.2 8.6

Taxes payable (current and non-current) (81.2) (80.2) (92.5) (108.8)

Contingencies payments (current and non-current) (6.3) (7.1) (6.5) (10.3)

Loans and advances from subsidiaries (1.2) (3.3) - -

Other accounts payable (current and non-current) (57.1) 15.6 (78.0) 19.9

(535.7) (315.0) (647.0) (523.6)

Net cash provided (or used) by operating activities (106.2) 72.0 (91.5) (394.1)

Cash flow from investing activities

Marketable Securities 385.3 278.4 25.7 (142.8)

Investiments on subsidiaries - (703.6) - -

Plant, property and equipment (260.2) (95.7) (292.4) (172.1)

Intangible (23.0) (15.3) (183.1) (162.3)

Dividends received 0.3 3.7 - -

Net cash provided (or used) by invest activities 102.4 (532.5) (449.8) (477.2)

Cash flow from financing activities

Loans e financing ( current and non-current):

Borrowings - 708.0 199.9 1,368.5

Liquidations (154.3) (221.8) (397.4) (346.1)

(154.3) 486.2 (197.5) 1,022.4

Debentures (current and non-current) 348.9 (144.5) 638.7 (156.8)

Discounted receivables (117.9) 201.9 180.3 (268.1)

Receivables from Stock Option Plan 4.2 (1.9) 4.2 (1.9)

Goodwill of the subsidiaries shares subscription - - - (49.1)

Capital Increase 15.8 11.3 15.8 11.3

Capital Increase - Minority Interest - - - 411.4

Interest on equity and dividends paid (96.1) (85.2) (96.2) (87.7)

Share buy-back (0.8) (1.9) (0.8) (1.9)

Net cash provided (or used) by financing activities (0.2) 465.9 544.5 879.6

Net increase (decrease) in cash (4.0) 5.4 3.2 8.3

Cash at the begining of period 107.3 140.9 131.5 162.4

Cash at the end of period 103.3 146.3 134.7 170.7

Net increase (decrease) in cash (4.0) 5.4 3.2 8.3

The accompanying notes are an integral part of these financial statements


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Evolution of the number of stores, associates and sales area – Lojas Americanas

Number of stores Sales Area Number of Associates

06/30/11 565 587 thousand m² 14,079

Opened Closed/Transferred

63 (7)

12/31/11 621 631 thousand m² 15,596


7 -

03/31/12 628 636 thousand m² 15,004


15 -

06/30/12 643 649 thousand m² 15,340

This table shows the number of stores, sales area and number of associates of the parent company and of BWU. Store transfers: stores in the BLOCKBUSTER® format whose were transferred to a nearby Lojas Americanas store.

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EARNINGS RESULTS CONFERENCE CALL

EBITDA (LAJIDA – operating profit before interest, taxes, depreciation and amortization and excluding other revenues/expenses) is presented as additional information because we believe it represents an important indicator of our operational performance, besides being useful for comparing our performance to that of other companies in the retail sector. However, no number should be considered in isolation as a substitute for net profit determined in accord with Corporate Law and the rules of the Securities Exchange Commission or as a measure of the profitability of the Company. In addition, our calculations cannot be compared to other similar measures adopted by other companies Statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of Lojas Americanas, eventually expressed in this report are merely projections and, as such, are based exclusively on the expectations of Lojas Americanas’ management concerning the future of the business and its continued access to capital to fund the Company’s business plan. Such statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry, among other factors and are, therefore, subject to change without prior notice BLOCKBUSTER® trademarks are owned by Blockbuster Inc. and Lojas Americanas S.A. has the right to use these trademarks in the activities of video rental and sales operation. MSCI Brand logo: The use of Morgan Stanley Capital International Inc. registered trademarks and indices ("MSCI") does not constitute any type of sponsorship, endorsement or promotion on the part of MSCI, its affiliates, its suppliers or other parties involved or related in the compilation, computation or creation of any MSCI index. MSCI’s indices are registered trademarks of MSCI or its affiliates and Lojas Americanas S.A. has been granted a license to use these trademarks for given purposes.

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