Jeronimo Martins' third-quarter profit soars 28%, margin narrows (updated)

Jeronimo Martins SGPS SA

25/10/2023 18:01

(Adds CEO comment, sales breakdown, EBITDA margin and
investment)
    By Patricia Vicente Rua
       LISBON, Oct 25 (Reuters) - Portuguese retailer Jeronimo
Martins  JMT.LS  on Wednesday posted a 28% jump in third-quarter
net profit, driven by a robust sales increase at its
market-leading chain Biedronka in Poland, although its
profitability narrowed.
        In a statement, Chief Executive Pedro Soares dos Santos
expected profitability to remain under pressure in what remains
of the year from substantial cost inflation, while the company
has to reduce its prices to sell more.
  
        He added that "with the war in Ukraine with no end in
sight and the escalation of tension in the Middle East, the
impacts on the fragile consumer confidence are highly
unpredictable."
  
        The company reported a net profit of 202 million euros 
($214 million) between July and September.    
    Consolidated sales rose 22% to 7.9 billion euros in the
quarter, fuelled by a 24% rise at the discount chain Biedronka,
where sales reached 5.5 billion euros.    
    At home, its Pingo Doce supermarkets posted a 9.3% rise in
sales to 1.3 billion euros, while in Colombia, its expanding Ara
chain booked 666 million euros, up 42.5% from a year earlier. 
        Consolidated earnings before interest, taxes,
depreciation and amortisation (EBITDA) grew 18% to 586 million
euros, but the EBITDA margin - a key measure of profitability - 
slipped to 7.4% from 7.6% a year ago.       
  
        The company plans to keep investment in 2023 at last
year's levels of around 1 billion euros, of which about 45% will
be invested in Poland, it said.
  
($1 = 0.9454 euros)

 (Reporting by Patrícia Vicente Rua; Editing by Andrei Khalip)
 ((patricia.rua@thomsonreuters.com; +351 21 123 2775; Reuters
Messaging: patricia.rua.reuters.com@reuters.net))