Jeronimo Martins' second-quarter profit falls 28% on lower margins

Jeronimo Martins SGPS SA

24/07/2024 19:43

LISBON, July 24 (Reuters) - Portuguese retailer Jeronimo
Martins  JMT.LS  posted a larger-than-expected 28% drop in
second-quarter net profit on Wednesday, as a decline in margins
from food price deflation offset higher sales at Polish market
leader Biedronka.
    The company said in a statement that its consolidated net
profit fell to 156 million euros ($169 million) in the quarter,
while analysts polled by LSEG had expected, on average, a profit
of 167.6 million euros.
    Chief Executive Pedro Soares dos Santos said "2024 has been
marked, after an inflationary cycle, by the harsh effects
resulting from a sharp correction in food prices and a
significant cost increase" and that he expected this to continue
in the second half of the year.
    "In this context of uncertainty...we will stick to our
priorities: ...grow sales in volume, as pivotal for preserving
our competitiveness, increasing our customer bases, and
expanding market shares," he said in a statement.
    Consolidated sales rose 6.8% to around 8.2 billion euros in
the quarter fueled by a 5.7% increase at the Polish market
leader Biedronka, where sales reached around 5.8 billion euros.
    However, Biedronka's like-for-like sales in Polish zlotys
fell by 4.6% in the quarter after rising 4.6% in the previous
three months.
    At home, sales at the Pingo Doce supermarket chain rose 3.7%
to 1.2 billion euros, while in Colombia its Ara stores booked
721 million euros in sales, up 22% from a year earlier.
    Consolidated earnings before interest, taxes, depreciation
and amortization (EBITDA) dropped 4.8% to 532 million euros,
below the average of 557.5 million euros expected by analysts.
    The company's EBITDA margin - a key measure of profitability
- slipped to 6.4% at the end of June from 6.9% a year earlier.
    The margin at Biedronka fell to 7.6% from 8.5% a year ago.
    


($1 = 0.9214 euros)

 (Reporting by Sergio Goncalves; editing by Charlie Devereux and
Diane Craft)
 ((sergio.goncalves@thomsonreuters.com; +351213509204; Reuters
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