Brazil apparel firm Lojas Renner expects softer results before 2026 improvement, CFO says

H and M Hennes and Mauritz AB

09/09/2025 12:30

Corrects headline, lead paragraph and paragraph 6 in story from September 9 to say Lojas Renner's CFO spoke about sales, not financial results, results nor earnings

By Paula Arend Laier

SAO PAULO, Sept 9 (Reuters) - Lojas Renner LREN3.SA, Brazil's largest fashion retailer by market value, sees a softer second half of the year for its sales when compared to early 2025, particularly in the current quarter, its chief financial officer said.

Renner, an about 60-year-old firm whose largest shareholder is BlackRock BLK.N, runs almost 700 stores in Brazil.

"The second half of the year will see lower growth," Chief Financial Officer Daniel Martins told Reuters in an interview on Friday, without providing specific details on the expected performance.

The executive said that the level of Brazil's benchmark interest rate, which is currently at a near 20-year high, has been affecting consumers, making them more selective.

For the third quarter, which ends this month, he said there would be an effect from a tougher comparison base year-on-year, as a warmer than usual autumn in Brazil last year postponed purchases to the third quarter.

However, Martins said he expected Renner's sales to recover from then on, with a stronger fourth quarter and a more positive outlook for 2026.

He said eventual lower interest rates in Brazil next year could allow credit, through Renner's financial arm Realize, to have a greater contribution to the group's sales, although he noted this potential move would be made carefully.

Besides struggling with interest rate levels, Brazilian fashion retailers have been also seeing growing competition from foreign rivals, especially Asian firms such as Shein, which has said the country is one of its five main markets globally.

Moreover, Swedish fast-fashion retailer H&M HMb.ST opened last month its first physical store in Brazil and launched online operations in the country.

Martins acknowledged H&M as a competitor, but said there were difficulties for firms outside Brazil to grow in the country.

"Everyone arrives with a thirst for Brazil and then realizes how difficult it is", he said. "To what extent will H&M bring in fashion from abroad that wasn't originally designed for the Brazilian public?"

 (Reporting by Paula Arend Laier in Sao Paulo; Writing by Andre Romani; Editing by Jamie Freed)

 ((paula.laier@thomsonreuters.com; X: @paulalaier;))