Sonae slips after lower Q1 profit amid weak cash generation

Sonae SGPS SA

18/05/2023 10:51

** Shares in Portugal's Sonae  YSO.LS  fall 1.3% after the
food retailer posted a 38% drop in Q1 net profit to 26 million
euros ($28.62 million)
    ** Brokerage Renta 4 says the results were better than it
expected, but points to "weak" cash generation impacted by
working capital, early payment to suppliers in MC, higher
investments and M&A
    ** It also notes a net debt increase to 922 million euros,
+382 million euros vs 4Q22
    ** AS Independent Research analyst António Seladas said in
an emailed comment that investors see Sonae as a "value trap"
with a difficult-to-understand strategy after the company sold a
25% stake in unit Sonae MC in 2021
    ** "The transaction was a big mistake," Seladas says
    ** Including Wednesday's fall, Sonae's stock is up around 2%
YTD

($1 = 0.9084 euros)

 (Reporting by Jakub Olesiuk)
 ((jakub.olesiuk@tr.com))