Jeronimo Martins' first-quarter profit falls 31% as margins squeezed

Jeronimo Martins SGPS SA

26/04/2024 08:38

LISBON, April 26 (Reuters) - Portuguese retailer
Jeronimo Martins  JMT.LS  reported on Friday a bigger than
expected drop in first-quarter net profit as a hit to its
margins from food price deflation more than offset higher sales
at its market-leading Polish chain, Biedronka.
    The company booked a consolidated net profit of 97 million
euros ($104 million), down 31% from 140 million euros in the
same quarter last year and below analysts' average forecast of
118.3 million euros, according to LSEG.
    Chief Executive Pedro Soares dos Santos said the company had
known a "combination of food deflation and cost inflation would
further increase competition, particularly in Poland."
    Therefore the company had maintained an "unwavering focus on
price leadership to continue to raise volumes," he said.
    Consolidated sales rose 18.6% to around 8.1 billion euros in
the quarter, slightly more than analysts' 7.9 billion euro
estimate, fuelled by a 18.8% increase at Biedronka, where sales
reached 5.8 billion euros.
    In Portugal, sales at the Pingo Doce supermarket chain rose
8.3% to 1.2 billion euros, while in Colombia, its Ara stores
booked 130 million euros in sales, up 39%% from a year earlier.
    Consolidated earnings before interest, taxes, depreciation
and amortization (EBITDA) rose 14% to 508 million euros, but the
company's EBITDA margin - a key measure of profitability -
slipped to 6.3% at the end of March from 6.6% a year earlier.
    The margin at Biedronka fell to 7.7% from 8.1% a year ago.  
 
   ($1 = 0.9316 euros)

 (Reporting by Sergio Goncalves  Editing by Inti Landauro and
Mark Potter)
 ((sergio.goncalves@thomsonreuters.com; +351213509204; Reuters
Messaging: sergio.goncalves.reuters.com@reuters.net))