Good morning. This is Centara's conference call where we will discuss the company's Q1 2019 results. At this time, all participants are connected in a listen only mode. Afterwards, the question and answer session will be open when further instructions for you to participate will be given. Please note that this conference call will be recorded.
This presentation accompanied by slides will be simultaneously broadcasted via the Internet on the website, ri.centara dotcom.br, where you can also download a copy of the company's presentation and its earnings release. Before proceeding, I would like to clarify that any statements given during this call relating to the company's business outlook must be treated as estimates that depend upon the country's economic conditions, the retail sector's regulations and performance and other variables. Therefore, these projections are subject to change. Here with us are Macer's Pedro Zimmel, Centaro's CEO Jose Salazar, CFO and IRO and Daniel Regensteiner, Treasury and Investor Relations Director, who will discuss Centara's performance in the Q1 of 2019. Afterwards, they will answer your questions.
Now, I would like to turn the floor over to Mr. Pedro Zimel. Please, Mr. Zemmell, you may proceed.
Good morning, everyone, and thank you for participating in our first results conference call as a publicly held company. I'll start by providing an overview of how Centauru is today. We're Latin America's largest sports retailer with 192 stores throughout the country as well as a solid digital platform that now accounts for 18% of total net revenue with omni channel, which already represents 53% of digital sales. Above all, the consumer is the backbone of our business, the focal point of our strategy and the inspiration for everything we do. We monitor our NPS monthly, which provides us with the basis of KPIs and bonuses and ended the Q1 of 2019 at 82%.
I'll start our presentation on Slide 3, where you can see the key highlights of our Q1 results. Overall, our main financial and operational lines advanced. Net revenue rose 14.4 percent to BRL 527.2 million year over year. EBITDA came to BRL46.7 million, 34% higher than in the Q1 of 2018 and reversed a net loss of BRL10.1 million reported in Q1 2018 to a net income of BRL2.3 million in Q1 2019. Consolidated same store sales grew by 11%, 6.2% at physical stores and 39.7% on the digital platform.
Omnichannel model sales jumped 22.9 percent to BRL62.1 million. As a percentage of digital sales, the omni channel advanced more than 30 percentage points from 23% to 53% year over year. We opened 4 new G5 stores adding 4,000 square meter, around 40,000 square feet in sales area and upgraded 9 other stores, equivalent to 12,000 square meters of existing area. In accordance with this model, in line with the company's plan of upgrading stores according to the G5 model. Now I turn the floor to Jose Salazar, our CFO and IRO, who will discuss details on the quarter's financial highlights.
Salazar, please proceed.
Thank you, Pedro. Good morning, everyone. Moving to Slide 4, we will discuss detail on our net revenue in the Q1 of 2019. As Pedro just mentioned, consolidated net revenues grew by 14% year over year. Such growth was driven by a 10.6% increase in revenue from brick and mortar stores, which totaled BRL436 1,000,000 and a 36.7% increase in digital platform revenue, which came to R91 $1,000,000.
At Cisco stores, the key drivers of growth were the addition of 4 of our new stores to the base and upgrading 9 stores to feed the G5 model, which has been a factor in our increase in sales. Digital platform sales reached 18% of net revenues, a 3 percentage point increase versus Q1 2018, The omni channel's 222.9 percent growth was the major highlight, which totaled BRL2.1 million and a 30.4 percentage point increase, reaching 53% of total digital sales. Despite its still small basis, the omni channel has revealed promising results. And from a historical perspective, as you can see on the graph, we have posted revenue growth consistently since Q1 2016, reaching a CAGR of 9.4%. Now let's move to Slide 5 to discuss our gross profit and gross margin.
Our gross profit advanced 17% to BRL264 1,000,000 in Q1 2019 against BRL226 1,000,000 recorded in the same period last year. Our gross margin also increased by 1 percentage point to 50.1% compared to 0.1% compared to 49% in Q1 'eighteen. The gross profit and gross margin increases are mainly explained by a lower McDowell or the concession of lower discounts, promotion and sales during Q1 2019 compared to Q1 2018. Let's move to Slide 6, where we can we will discuss operating expenses variations. It is worth quickly noting our historical expense trend with a CAGR of 5.5 percent from the last 3 fiscal years until Q1 2019.
Selling, general and administrative expenses were up by 13.9% versus Q1 2018, mainly due to a 15.8% increase in selling expenses from BRL157 1,000,000 in Q1 2018 to BRL182 1,000,000, but in line as a percentage of net revenue, advancing 0.4 percent from 34.2 percent to 34 point 6% in Q1 2019. Selling expenses variations are mainly explained by higher expenditure relating to variable revenue expenses such as commissions, card management fees, digital platforms and freight costs and expenses adjusted by inflation such as rental agreement adjusted by EGPL. General and administrative expenses rose by 4.5%, but came lower as a percentage of net revenue at 0.6 points percent from 7.3% to 6.7%. The 4.5% increase is mainly due to inflation variations. Now let's move to Slide 7 to discuss our EBITDA.
EBITDA totaled R46.7 million dollars in Q1 of 2019, up by 34% from R35 million dollars recorded in Q1 2018. The EBITDA margin also advanced from 7.6% to 8.9%, an improvement of 1.3 percentage points. As you can see on the graph in the right corner of the slide, gross margin growth was the key factor that boosted EBITDA and margin gains, accounting for a 1.1 percentage point increase out of a total of 1.3 percentage points. Now let's move to Slide 8 to discuss our net financial expenses. The company's net financial expenses fell by 10.5%, plus Q1 2018, with improved credit profile compared to last year.
We obtained a lower rate for the factoring of receivables, which significantly impacted our financial results. It is important to highlight that during the Q1 of 2019, due to uncertainties related to the IPO, we kept our strategy to pay taxes in installment plans, which generated approximately BRL5 1,000,000 in fines accounted for in the financial results. Such a strategy must not continue after the IPO. The Q1 2019 results still does not reflect the prepayment of most of our bank debt made after the IPO. Let's move next to Slide 9 to discuss our net income.
Since 2016, we have gradually reduced our net loss, as you can see on the graph in the upper right corner. And the Q1 of 2019 marked a full reversal to our net income. We posted a net income of R2.3 million dollars, reversing the loss of R10 $1,000,000 recorded in Q1 'eighteen as a result of the positive performance we have been delivering up to date. Also in the lower corner on the slide, you can see the breakdown of our net income reconciliation from reported EBITDA. On Slide 10, we will discuss our cash flow.
Our operating cash flow came negative at BRL108.6 million, up by 4% from R104.3 million dollars recorded in Q1 'eighteen. Negative cash variation in the quarter is mainly due to the inherent seasonal effect on the company's business. In the Q1, the payments are made for products acquired at year end, which results in cash disbursements in this period. In accordance with our policy of maintaining a minimum cash position in our balance sheet to minimize financial expenses, we reduced the financial volume of factory receivables, which was the key cause of the company's cash flow from financing variations. Now let's move to slide 11 to discuss our investments.
How we determine our adjusted net debt is illustrated clearly on the graph in the lower right corner of the slide. We added up the factoring of receivables and tax installment payment to loans and financing. For this reason, the company adjusted net debt was up by 3.6% from R848 million dollars in Q1 'eighteen to R879 million dollars in Q1 'nineteen. Reduction in the impact of receivable came in line with the company's efficient policy, which advanced this type to this type of receivables only if it is clear and urgently necessary, thus avoiding unnecessary financial expense. As an example of this policy, we can point out that on March 31, 2019, we had BRL94 1,000,000 available for anticipation.
Again, we highlight that by the end of April, the company paid a substantial amount of its bank debt using the proceeds of the offer, which going forward should significantly affect all the figures we have seen in our indebtedness breakdown as we considerably optimized our ownership structure or capital structure. Therefore, we are confident that the company is poised to boost and take advantage of the next growth cycles. Let's move to our Slide 12 to discuss our investments. Centaur CapEx dropped at 18.5% in Q1 'nineteen compared to the same period last year. The conclusion of omni channel systems installed in our stores in 2018 dropped this drop leading to lower CapEx levels in 1st Q 'nineteen.
The most relevant CapEx in 1st Q 2019 was in IT, which investments with investments allocated to the upgraded maintenance of our current technological hub. In line with the initial public offering documents, we expect investments to increase over the upcoming periods, enable the execution of our CapEx plan, store renovations and measures to modernization the company's digital platform. Well, that concludes our presentation, and we can now start our Q and A session. Thank you very much.
Thank The first question today will come from Irma Skars of Goldman Sachs. Please go ahead.
Yes, hi, good morning. I wanted to ask my first question on, so when you think about the outlook for this coming Q2 where you obviously comp against the World Cup quarter, can you maybe help us understand a little bit on from the one hand side in terms of product launches or any special initiatives that you may be launching in the Q2 to sort of offset this impact in that might be weighing on same store sales and just from a comp basis from the World Cup last year? And then my second question is regarding just what you're seeing in the traffic on the malls. I think you said on your earlier call that the same store sales was largely driven by traffic and conversion. And I was just curious when you look at the traffic that is coming through the malls, how you're seeing this start to the year?
I referred from some companies that obviously the consumers are still pretty restrained in spending capacity. So I was just curious to see to hear what you're seeing in on your mall based stores and what sort of actions you've taken specifically in the refurbished stores to try and drive more traffic into the store and drive the conversion up as well? Thank you.
Thank you, Guillermo. So the first question was this is Pedro. The first question was on the World Cup. And the World Cup is what we call low recurring event, happens every 4 years, and it won't happen in 2019. That means that the Q2 where the bulk of the sales on 2018 took place on the World Cup is a hard comp and the Q2 of 2019 will compare to that.
So it will be impacted on a comparison basis because there will be no World Cup in 2019 and there was a World Cup in 2018. 18. That said, we have multiple initiatives going around product wise. And there is one factor that might contain weight effect, which is the launch of the white jersey of Brazil and the fact that we're hosting the America Cup in Brazil. It's still to be seen.
It doesn't have the same impact as a World Cup, of course, but it mitigates the fact specifically in the Soccer division. It will be a hard comp, that's for sure. On the second part, which is the traffic on the malls, well, we have all stores are in malls. So the numbers we're seeing are based on consumers, the brick and mortar numbers, right, are based on consumers that walk into the mall. So what we believe we've been able to do, given that our growth and we're still reading the numbers of the malls, but our growth could be slightly higher than the average malls growth or higher than the average malls growth is that we're being able to make consumers that are walking into the aisles to walk into our stores more often.
And one of the main triggers for that is the G5. So when you look at the G5 and you see how the growth on the G5, where the growth comes from, it comes from more transactions, either traffic or conversion, so more transactions and not the average ticket. So what we assume here is that consumers are walking to the aisle because of the look and feel of the store, because of the experience one can have walking to one of our Zintaro stores, they will come in more often. The second part is the omnichannel approach. So when we look that up when you observe that up, the omnichannel sales represent 53% of the digital sales and a big chunk of that is click and collect, that consumers were pushing to the store, consumers are buying online, they were pushing to the store and they can buy something else, right?
And then sometimes they do. So that's also pushing traffic to our stores specifically. And finally, I believe that the fact that we've been investing in service and pursuing a NPS that has been growing year over year also allows consumers or stimulates consumers to come back. So we're growing and we're growing with a satisfied consumer base, which we can only assume that we have a higher chance that they will come back more often. So those are a couple of things that I can mention that we are doing at Centauro to boost the number of clients that buy at our store despite or in addition to the market growth.
Great. That's very helpful. Thank
you. Thank you.
We will now end the question and answer session. I would like to turn the floor back over to Mr. Pedro Zimmo for his final considerations. Mr. Zimmo, you may proceed.
Thank you, everyone, for whose talents and commitment to advancing the company made this achievement possible and our shareholders and investors who supported the company in the construction of this new growing cycle. We remain committed to offering the best service to our customers and delivering long term value to our shareholders. See you on our next conference call.
The conference has now concluded. We thank you for attending today's presentation. You may now disconnect your lines.