Jerónimo Martins (JMT) H1 2024 earnings summary

Executive summary

• Sales rose 12.3% year-over-year to €16.3 billion, with strong volume growth and market share gains across all banners despite challenging consumer demand, sharp food inflation drop, and intense competition, especially in Poland.

• EBITDA increased 3.5% to €1.0 billion, but margin declined to 6.4% from 6.9% due to price investments and high cost inflation, particularly wage increases.

• Net profit attributable to shareholders fell 29.1% year-over-year to €253 million, impacted by operational deleverage, higher finance costs, and a €40 million endowment to the Jerónimo Martins Foundation.

• 140 new stores opened in H1, with significant expansion in Ara and Biedronka.

• Strategic focus remains on reinforcing price leadership, growing volumes, and investing in store expansion, refurbishment, and sustainability initiatives.

Financial highlights

• Net sales reached €16,298 million (+12.3% year-over-year); group like-for-like sales growth was 1.1%.

• Consolidated EBITDA was €1,040 million (+3.5%), with margin down to 6.4%; EBIT at €527 million (-8.6%).

• Net profit attributable to shareholders: €253 million (-29.1%); EPS: €0.40 (-29.1%).

• Net cash position (excl. IFRS 16) at €394 million after €411.6 million dividend payment; net debt at €3.2 billion.

• Cash flow generated in the period was -€383 million, impacted by deflation and dividend payments.

Outlook and guidance

• Basket deflation and high cost inflation expected to persist in H2 2024, with further pressure on EBITDA margins likely.

• CapEx for 2024 reiterated at ~€1.2 billion, focused on expansion, store refurbishments, and sustainability.

• Biedronka to increase price investment and add 130–150 net new stores; Ara to open ~150 new stores and invest in logistics.

• Strategic priorities unchanged: maintain price leadership, grow sales in volume, and reinforce market shares.

• Increased investment in working capital anticipated due to deflationary scenario and support for local suppliers.