Jerónimo Martins loses 15% in dividend cut

 In Companies, Economy, News

One of Portugal’s largest food retailers, Jerónimo Martins which owns supermarket chain Pingo Doce, has seen 14% wiped off its share value on the Lisbon Stock Market.

It was the largest fall since 2008 provoked by investor jitters reacting negatively to a dividend cut announced on Thursday.
The supermarket giant, which also has interests in Poland, published its first quarter profits which had fallen by one half, while the company announced it would slash dividends paid out to shareholders by 40% because of the pandemic.
The last time the international grocers suffered such a fall was when Lehman Brothers collapsed in 2008.
The retailer’s shares lost 14.68% to €13.40 with shares losing 12% at the start of trading in what was the largest single day’s trading fall in 12 years.
The fall registered for yesterday’s session puts Jerónimo Martins shares at their lowest price since May 2019.
On Wednesday, at close of trading, the company announced that its profits had fallen by almost a half for the first quarter, to €35 million as the effects of the pandemic began to be felt on its activity in the first fortnight of March.
As a consequence, Jerónimo Martins announced a 40% cut in the value of its dividends intended for distribution to its shareholders which will be voted on at the next general assembly meeting on 25 June.
The company intends to pay out €130.1 million, €86.7 million down on the expected shareholder dividend payout of €216.8 million.
Jerónimo Martins has also suspended plans to start new supermarket projects adding that additional staff and consumer safety costs set them back €15.5 million for March alone.