Jerónimo Martins profits up 60%

The Portuguese grocer Jerónimo Martins (JM) posted a net result of €140 million for the first three months of 2023, an increase of 59.1% on the result the group – which owns the Pingo Doce supermarkets – posted for Q1 in 2022.

In a communiqué to the Portuguese stock market regulator CMVM, the retail group emphasised the “a strong start to 2023 with positive sales” that grew 23.4% to €6.8Bn, “despite consumption facing pressure from the effects of inflation in the first three months of the year.”
Nevertheless, the comparisons with the previous year will become “more glaring” from the second quarter of the year “when comparisons are made with figures from 2022 that include progressively sharper increases in food prices”.
JM notes that food inflation has remained high in the three countries in which it operates – Portugal, Poland and Colombia – which is undermining the confidence and purchasing power of families.
The President of JM, Pedro Soares dos Santos said that JM would continue to be “an anti-inflationary force” and “absorb part of the (inflationary) pressure from the price increases affecting consumers”.
Between January and March, the group’s EBITDA margin fell 18 base points in relation to the like-for-like period, to 6.6% “reflecting the pressure on the gross margin on the investment in the prices made by all the food retail brands.
Moreover, the “strong performance of sales” drove a growth of 20.1% in the value of EBITDA, to €446 million.
“We are focusing on carrying out our strategy in a disciplined and focused way because we know that it is strengthening our presence in the markets in which we operate, continuously improving value propositions while creating the necessary conditions to ensure the growth of sales in the volume of sales that will better protect our profitability and the future sustainability of our businesses”, states the group’s president.
Last year JM’s annual profits were €590 million (+27.5%) while at a general shareholders meeting on April 20 it was agreed to distribute €345.6 million in premiums, or €0.55 per share and to be paid out on May 17.
In Portugal, where the company operates Pingo Doce and Recheio, JM expects a challenging environment marked by “fragile internal consumption” and trading down (buying cheaper products) to continue in 2023.
On the other hand, it expects tourism in Portugal to be the main driver for growth in the Horeca sector (Hotels and Restaurants).

Photo: Lusa – Manuel Almeida