What: Fitch Ratings predicts sustained pressure on Falabella's credit profile throughout 2024.

Why it is important: The evaluation reflects the challenges posed by a competitive retail environment, economic downturns in Chile, and sluggish recovery in consumer spending. This ongoing assessment affects investor confidence and could influence Falabella's financial strategies and operations in the future.

Fitch Ratings has forecasted that Falabella will continue to face financial pressures into 2024 due to a tough economic climate in Chile, marked by a significant recession and a slow rebound in consumer behavior. Despite a better-than-expected financial report recently, which showed improvements in revenue and profit, the South American retail giant still struggles with a challenging market landscape and high execution risks. This situation follows a downgrade to a speculative grade by Fitch in late 2023, highlighting the ongoing difficulties Falabella faces in stabilizing its financial standing amidst intense competition and unfavorable macroeconomic conditions.

Fitch Ratings estimates that Falabella's credit profile will remain under pressure in 2024