LISBON (Reuters) - Portuguese retailer Jeronimo Martins 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)
Jerónimo Martins, SGPS, S.A. is a Group that holds assets in the food sector, mostly in distribution, with market leadership positions in Poland and Portugal. In 2023, the Group recorded sales of 30.6 billion euros and an EBITDA of 2.2 billion euros. The Group had a total of 134,379 employees and ended 2023 with a market capitalisation of 14.5 billion euros on the Euronext Lisbon stock exchange.
In Poland, Biedronka, representing 70% of Group sales and 85% of its EBITDA, is a chain of food stores and the undisputed leader in food retail and in 2023 it continued to increase its market share. Also in Poland, Hebe focuses on the specialised retail of health and beauty products, managing a considerable assortment of products at competitive prices and an in-store consultation service. At the end of 2023 Hebe opened two stores in Czechia, aimed at putting a face to the brand's presence in this country, where growth will be driven through e-commerce.
In Portugal, the Group has a leadership position in food distribution. It operates the banners Pingo Doce and Recheio, which are market leaders in the supermarket and cash & carry formats, respectively. Pingo Doce is a supermarket chain that has a restaurant area in most of its stores. It has two central kitchens that supply not only these restaurants, but also its in-store takeaway operation. Recheio operates a chain of cash & carry stores and has strengthened its business model with a specialised food service operation, underpinned by dedicated platforms, which essentially serve HoReCa customers with a delivery service. Recheio continues also to expand a network of traditional retail partners under the Amanhecer banner. Jerónimo Martins Agro-Alimentar currently operates in four distinct areas: dairy, livestock farming, aquaculture, and fruit and vegetables. The Group also operates two specialised chains, the Jeronymo coffee shops and kiosks and the Hussel chocolate and confectionery chain.
In Colombia, Ara is a chain of proximity food stores, mostly set up in residential neighbourhoods, offering quality at the best price and combining competitiveness with promotional opportunities in key categories for the Colombian consumer. Also in Colombia, Bodega del Canasto operates as a mini cash & carry, aiming for the traditional market (B2B), offering customised Private Brands and industry brands solution.
JERÓNIMO MARTINS, SGPS, S.A. 
