(Adds details, context and shares performance)
SAO PAULO, April 23 (Reuters) - Brazilian upscale mall operator Iguatemi Empresa de Shopping Centers SA is aiming to cut capital expenditure by 40% in 2020 to help offset a drop in revenue after stepping in to offer discounts to shopkeepers impacted by the coronavirus-related lockdowns, its chief financial officer said on Thursday.
"We have been working quite hard to reduce our spending and grant discounts to ease (shopkeepers) cash restraints in April and May," CFO Cristina Betts told analysts and investors during a call.
Iguatemi is exempting shopkeepers whose stores were closed in April from paying rent after deciding that March would be charged proportionally and collected in five installments as of October, Betts said, citing a waiver of 25% to 50% on top of that depending on the shopkeeper's credit score.
The company is also cutting maintenance costs by as much as 50%, while promotional fees will be reduced between 60% and 100% depending on each mall, the executive added.
According to Betts, malls renovations will be postponed for as long as possible which, among other cost-cutting initiatives, should save 100 million reais ($18.23 million) in capex this year.
Iguatemi owns approximately 450,000 square meters of its 706,903 square-meter portfolio comprised of 15 malls, 2 outlets, 3 commercial towers and one power center.
Betts noted the company currently has a comfortable cash position and leverage to get through the coronavirus crisis, adding financial covenants are not yet a concern and lockdowns are likely to be gradually lifted in coming weeks.
Iguatemi plans to reopen this week its outlet mall in the southern state of Santa Catarina, one of the first to ease social distancing measures in Brazil, with reduced opening hours, she said.
In Sao Paulo state, where Iguatemi has most of its malls, a statewide quarantine decree issued by Governor Joao Doria is expected to be eased as of May 11.
"We will probably operate with reduced opening hours for a while after reopening, but it's difficult to say dates as all depends on the coronavirus spread pace," Betts said.
All of Brazil's 577 malls were shut by state and municipal decrees amid the pandemic, but so far 47 have already resumed operations, according to local malls association Abrasce.
$1 = 5.4860 reais Reporting by Gabriela Mello Editing by Chizu Nomiyama and Diane Craft