Jerónimo Martins, SGPS, S.A.

JMT

PTJMT0AE0001

Food Retail & Distribution

Real-time Euronext Lisbonne Other stock markets 08:03:50 2024-04-25 am EDT			5-day change	1st Jan Change
18.51 ^EUR	-0.64%		+3.35%	-19.66%

Apr. 18	Canada Targets 12 Foreign Grocers to Lure to Food-Retailing Market -- 2nd Update	DJ
Apr. 18	Canada Targets 12 Foreign Grocers to Lure to Food-Retailing Market -- Update	DJ

Jeronimo Martins SGPS S A : 9M 2020 Report

November 24, 2020 at 01:13 pm EST

CONSOLIDATED REPORT

AND ACCOUNTS

FIRST NINE MONTHS 2020

Unaudited

INDEX

Message from the Chairman and CEO - Pedro Soares dos Santos	3
I - CONSOLIDATED MANAGEMENT REPORT
1.	Sales Analysis	4
2.	Results Analysis	6
3.	Balance Sheet	8
4. Third Quarter 2020 Update on Covid - 19 Impact	9
5. Outlook for 2020	9
6.	Proposal for Reserves Distribution	10
7. Consolidated Management Report Appendix	11
7.1 The Impact of IFRS 16 on Financial Statements	11
7.2. Sales Evolution	13
7.3. Stores Network	13
7.4. Definitions	13
8.	Reconciliation Notes	14
9.	Information Regarding Individual Financial Statements	16
II - CONSOLIDATED FINANCIAL STATEMENTS
1. Financial Statements	17

2. Notes to the Financial Statements	21

R&A | First Nine Months 2020

Message from the Chairman and CEO

Pedro Soares dos Santos

''Six of the first nine months of 2020 were marked by the effects of the COVID-19 pandemic. During this period, the determination of our teams and the flexibility of our operations allowed us to be agile and creative. We adapted the value proposals of our banners to complex market conditions, reinforcing their assertiveness and relevance to the consumer.

The strength of our balance sheet has allowed us not to lose sight of the long-term perspective and to remain unwavering in our commitment to our strategic priorities.

Despite the tough times we live in, I believe that today we are better prepared than six months ago to deal with the demands of the reality of each market and to continue to grow in a sustainable way.

I am aware that uncertainty remains very high. The Christmas season, traditionally so important for food retail, may be impacted by restrictions on mobility and lack of confidence of a more price-sensitive consumer, due to the unique moment that is experienced worldwide.

In the early days of the pandemic, in response to the uncertainty about the impact of the health crisis, the payout ratio of the 2019 results was exceptionally reduced to 30% from the 50% initially announced. At this stage, our Companies have proven their resilience and determination. As such, and taking into consideration the strength of the Group's performance in these adverse times, our current cash position and the level of financial flexibility necessary for the future, the Board of Directors will propose to the Company's shareholders the payment of remaining amount to the 50% payout, in line with JM's dividend policy."

R&A \| First Nine Months 2020	3
Message from the Chairman

I - CONSOLIDATED MANAGEMENT REPORT

1. Sales Analysis

(Million Euro)	9M 20	9M 19		%	Q3 20	Q3 19		%

		% total		% total	excl. FX	Euro		% total		% total	excl. FX	Euro
Biedronka	9,909	69.8%	9,236	67.6%	10.3%	7.3%	3,374	69.1%	3,172	66.7%	9.3%	6.4%
Pingo Doce	2,844	20.0%	2,912	21.3%		-2.3%	1,006	20.6%	1,019	21.4%		-1.2%
Recheio	639	4.5%	757	5.5%		-15.6%	240	4.9%	291	6.1%		-17.5%
Ara	615	4.3%	560	4.1%	25.1%	9.9%	192	3.9%	204	4.3%	10.9%	-5.6%
Hebe	180	1.3%	180	1.3%	3.0%	0.1%	65	1.3%	63	1.3%	6.4%	3.5%
Others & Cons. Adjustments	10	0.1%	17	0.1%		-42.1%	4	0.1%	6	0.1%		-21.7%
Total JM	14,198	100%	13,662	100%	6.6%	3.9%	4,881	100%	4,754	100%	5.4%	2.7%

Group sales were €14.2 bn, 3.9% above the nine months of 2019 (+6.6% at constant exchange rates), with like-for-like (LFL) of 3.5%. In the third quarter, sales reached 4.9 bn, 2.7% ahead of the third quarter of 2019 (+5.4% at constant exchange rates) with LFL at 2.2%.

Sales (Million Euro)		LFL Growth

		+3.9%	(9M 20/19)
9M 19	9M 20

								14,198
								13,662
								7.2%		9.8%
+7.3%
										3.5%

9,909
9,236
									-3.5%
-2.3%							-9.4%

	-15.6%							-15.7%
2,912
2,844		+9.9%	+0.1%		Hebe	Recheio


	757	639	560	615		180		Biedronka	Pingo	Ara	JM
	180	17	10	Doce *

Biedronka Pingo Doce	Recheio	Ara	Hebe	Others &	JM	* Excl. Fuel LFL: -2.3%
				Cons.Adjust. Consolidated

In Poland, consumers have shown more restraint since the beginning of the pandemic but continue to react to commercial proposals that offer quality products at good prices.

Food inflation was 5.8% in the first nine months, having declined from 6.4% in the second quarter to 3.2% in the third quarter.

Biedronka LFL

11.1%

7.2%

6.0%

4.8%

9M 20

market conditions early in the pandemic. The banner needs with increased availability, by extending necessary, and with increased commercial was a strong performance dynamic that persisted in

allowed the company to compensate for lower basket

grew 10.3% in local currency, including a LFL of sales grew 9.3% in local currency, with LFL at 6.0%.

nine months, Biedronka sales increased 7.3% to €9.9 sales reached €3.4 bn, 6.4% ahead of third quarter of in every month of the first nine months period.

its investment plan at the beginning of the pandemic, focused on executing its expansion and refurbishment opened 52 new locations (45 net additions) and

R&A \| First Nine Months 2020	4
Consolidated Management Report

Hebe LFL

1.7%

-1.7%

-9.4%

-26.6%

9M 20

of €180 mn, in line with the first nine months of 2019. In 3.0% (+6.4% in the third quarter).

was heavily impacted in the second quarter by the

. The reopening of these centres in early May, together of social life, allowed the Company to build some sales

third quarter performance.

pandemic, with clear signs of trading down in food retail.

Food inflation was 2.1% in the period (+2.3% in the third quarter).

Pingo Doce LFL*

3.5%

-1.5%

-2.3%

	-8.5%
Q1	Q2	Q3	9M 20

particularly affected by the restrictions to circulation of people, density and high number of visits. The restrictions also had on its restaurants, coffee shops and the take-away

Pingo Doce improved its performance, maintaining a strong designed to win the preference of the consumer in these difficult

months were €2.8 bn, a 2.3% reduction with LFL at -2.3% quarter, sales decreased by 1.2% to reach 1 bn euros with

new locations in the first nine months and carried out 17

* Excl. Fuel

Recheio LFL

0.1%

-17.7%

-15.7%

€639 mn, a reduction of 15.6% relative to the first nine LFL at -15.7%. In the third quarter, sales declined by 17.5% 7%.

continued to reflect the sharp decline in the activity of which represented more than 35% of Recheio's sales. In May allowed to reopen. There was a slow resumption of activity many small businesses still closed. Out-of-home food affected by the large decline in tourism flow and lower demand

	-26.9%
Q1	Q2	Q3	9M 20

R&A \| First Nine Months 2020	5
Consolidated Management Report

In Colombia, the confinement measures in effect from the beginning of April until the end of August had a large negative impact on the economy. In September, street traffic increased as the country began to gradually lift containment measures and curfews ended in most municipalities.

Ara LFL

34.3%

9.8%

1.1%

		-1.7%
Q1	Q2	Q3	9M 20

currency by 25.1%, with LFL of 9.8%. In euro terms, €615 mn. In third quarter, sales in local currency euro terms) with LFL of -1.7%. This sales performance trading hours due to the implementation of containment

the Company opened 33 stores (25 net additions).

2. Results Analysis

(Million Euro)	9M 20	9M 19		Q3 20	Q3 19

Net Sales and Services	14,198		13,662		3.9%	4,881		4,754		2.7%
Gross Profit	3,116	21.9%	2,991	21.9%	4.2%	1,084	22.2%	1,058	22.3%	2.5%
Operating Costs	-2,087-14.7%-1,941-14.2%	7.5%	-690	-14.1%	-676	-14.2%	2.0%
EBITDA	1,029	7.3%	1,049	7.7%	-1.9%	395	8.1%	382	8.0%	3.3%
Depreciation	-545	-3.8%	-528	-3.9%	3.1%	-183	-3.8%	-177	-3.7%	3.8%
EBIT	485	3.4%	521	3.8%	-7.0%	211	4.3%	206	4.3%	2.8%
Net Financial Costs	-140	-1.0%	-127	-0.9%	10.4%	-45	-0.9%	-49	-1.0%	-9.3%
Gains in Joint Ventures and Associates	0	0.0%	0	0.0%	n.a.	0	0.0%	0	0.0%	n.a.
Other Profits/Losses	-21	-0.1%	-6	0.0%	n.a.	-1	0.0%	-2	0.0%	n.a.
EBT	324	2.3%	389	2.8%	-16.7%	166	3.4%	155	3.3%	7.6%
Income Tax	-95	-0.7%	-99	-0.7%	-4.1%	-41	-0.8%	-39	-0.8%	4.4%
Net Profit	229	1.6%	289	2.1%	-21.1%	125	2.6%	115	2.4%	8.6%
Non-Controlling Interests	-9	-0.1%	-23	-0.2%	-59.3%	-10	-0.2%	-12	-0.2%	-13.6%
Net Profit Attributable to JM	219	1.5%	267	2.0%	-17.8%	115	2.4%	103	2.2%	11.2%

EPS (€)	0.35		0.42		-17.8%	0.18		0.16		11.2%
EPS without Other Profits/Losses (€)	0.37		0.43		-13.2%	0.18		0.17		10.3%

Operating Profit (EBITDA)

The Group's EBITDA reached €1,029 mn, 1.9% below the first nine months of 2019. At constant exchange rates, EBITDA was broadly stable relative to the previous year (+0.3%). The EBITDA margin was 7.3% (7.7% in the first nine months of 2019).

R&A \| First Nine Months 2020	6
Consolidated Management Report

EBITDA & EBITDA Margin - JM Consolidated					This	margin performance	incorporates the
				increase in operating costs related to the

EBITDA										EBITDA Mg	pandemic (c.€32 mn) and the impact of
									operational deleveraging. This	impact	was
(Million Euros)									(%)		particularly strong in the second quarter, as a

1,100						8.0% 8.1%				9.0%	result of lower sales performance in that
										period. In the	third quarter,	better	sales
1,000	7.3%		7.7%		7.7%			8.0%

						7.3%	performance and the execution of cost control
		7.1%
900
	6.6%										7.0%	initiatives in all Companies allowed the Group's
800
												EBITDA to reach €395 mn, 3.3% above the
												6.0%
700												third quarter of 2019, with a margin of 8.1%

600												5.0%	(8.0% in the third quarter of 2019).
500												4.0%	Biedronka recorded an EBITDA of €913 mn, an
400												3.0%
											increase of 5.7% vs. the same period on the
300
											2.0%	previous year (+8.7% at constant exchange
200
											1.0%	rate).
100

0												0.0%	The EBITDA margin was 9.2% versus 9.4% in

	Q1 19 Q1 20	Q2 19 Q2 20		Q3 19 Q3 20	9M 19 9M 20		the first nine months of 2019. In the third
					EBITDA	EBITDA Mg					quarter, margin was at 9.6%, stable on the

													third	quarter	of 2019.	The	good	sales

performance, the optimized margin-mix management and the increased cost discipline allowed the Company to protect the EBITDA margin in a more demanding operational context due to the pandemic, while maintaining a strong promotional dynamic.

Distribution in Portugal registered an EBITDA of €190 mn, 21.4% below the same period in 2019. The EBITDA margin was 5.5% (6.6% in the first nine months of 2019). The savings from cost cuts were not sufficient to offset the additional costs related to the pandemic and the operational deleveraging resulting from the lower turnover. In the third quarter, margin was at 6.7% (7.4% in the third quarter of 2019).

Hebe's EBITDA was €10 mn, 18.2% higher than the first nine months of 2019.

Ara registered a reduction in EBITDA losses from €25 mn in the first nine months of 2019 to €23 mn in the first nine months of 2020, benefiting from the depreciation of the Colombian peso. Reflecting the impact of ongoing cost cuts, losses in local currency declined by c.20%, and decreased, in euros, by 35.3% to €3 mn, in the third quarter.

Financial Results

Net financial costs were €140 mn versus €127 mn in the same period last year. These costs include exchange translation losses totalling €20 mn, related to value adjustments in the capitalization1 of operating leases in Poland denominated in euros.

Net Results

Group net profit declined 17.8% to €219 mn. This result is impacted by the negative effects of Pandemic, by translation losses, and also by other losses and gains in the amount of -21 million euros, reflecting restructuring costs and write-offs related to adjustments in Ara's network of stores and the closure of Hebe pharmacies and reinforcement, in the context of the pandemic, of provisions for receivables and for stock depreciation.

1 In the context of the IFRS16 adoption, the capitalized rents, related to lease contracts denominated in euros, in Polish subsidiaries, are recognized as liabilities, translated at the exchange rate prevailing at the reporting date (September 30, 2020). According to this standard, the changes resulting from the differences in the exchange rate of each period have to be booked as Net financial costs (Net foreign exchange on leases), representing an accounting adjustment without impact on cash flow.

R&A \| First Nine Months 2020	7
Consolidated Management Report

3. Balance Sheet

(Million Euro)	9M 20	2019	9M 19

Net Goodwill	621	641	632
Net Fixed Assets	3,853	4,140	3,906
Net Rights of Use (RoU)	2,109	2,318	2,209
Total Working Capital	-2,573	-2,793	-2,576
Others	140	94	85
Invested Capital	4,150	4,400	4,256
Total Borrowings	548	732	654
Financial Leases	13	17	17
Capitalised Operating Leases	2,205	2,368	2,249
Accrued Interest	1	3	-1
Cash and Cash Equivalents	-872	-949	-734
Net Debt 1	1,894	2,172	2,185
Non-Controlling Interests	248	254	246
Share Capital	629	629	629
Reserves and Retained Earnings	1,379	1,346	1,196

Shareholders Funds	2,256	2,229	2,071

1 Net Debt amount was restated in 2019. Cash in hand previously considered in Total Working Capital was restated to Cash and Cash Equivalents heading.

The net cash position, excluding capitalised operating leases, was €311 mn.

Cash Flow

(Million Euro)	9M 20	9M 19

EBITDA	1,029	1,049
Capitalised Operating Leases Payment	-203	-194
Interest Payment	-114	-120
Other Financial Items	0	0
Income Tax	-142	-116

Funds From Operations	572	619
Capex Payment	-367	-399
Change in Working Capital	18	140
Others	-17	-5

Cash Flow	205	356

O cash flow generated in the period was €205 mn.

Investment

(Million Euro)	9M 20	Weight	9M 19	Weight

Biedronka	141	55%	221	55%
Distribution Portugal	71	28%	109	27%
Ara	16	6%	57	14%
Others	30	12%	18	4%

Total CAPEX	258	100%	405	100%

The Group's capex (excluding right of use assets acquired in accordance with IFRS16) was €258 mn, of which c.55% was allocated to Poland.

R&A \| First Nine Months 2020	8
Consolidated Management Report

4. Third quarter 2020 update on Covid-19 impact

Since the beginning of March, the Group's Executive Team, in close coordination with the Executive Teams of each Company, has provided ongoing support to the operations. This highly efficient decision-making process allowed us to rapidly adapt short-term action plans in response to the evolution of the pandemic.

Our three priorities have remained unchanged since the beginning of the health crisis. First, the safety of our teams and of the consumers who visit us. Second, the stability of the supply chain, including the support of the most fragile suppliers and producers. Third, the ability to offer good quality products at low prices.

In consolidated terms, there was an increase of €32 mn in the first nine months in operating costs related to: i) extraordinary bonus to the operational teams, ii) expenses with individual and collective protective equipments and supplies and iii) finance of multiple initiatives of social support in the three countries. This support includes direct community aid and contributions to scientific efforts to stop the pandemic and deal with its effects. Provisions for trade receivables, included in Other Profits and Losses, increased by €3 mn due to the rise in credit risk associated with the pandemic.

All Group Companies implemented a rigorous review of existing processes that successfully mitigated the impact of these extra costs on profitability.

In each country, measures deemed necessary by the respective governments and health authorities were adopted. In addition, our banners prepared specific responses appropriate to the different geographies.

In Poland, measures to restrict the circulation of people were gradually lifted during the second quarter. From June to the end of September there were no specific containment measures applied to the food retail sector. However, there was less store traffic than usual because people worked from home and reduced their social activities.

Biedronka maintained in the third quarter the flexibility in opening hours to which it had resorted in the second quarter, now adjusted to store location and expected traffic. The commercial dynamic and operations flow were adjusted to respond to a lower frequency of visits.

Hebe, which was heavily impacted in the second quarter by the closure of shopping centres, improved its operating performance throughout the third quarter largely as a result of the lifting of restrictions to circulation. Sales' growth potential is still limited by the consumer's low shopping frequency.

In Portugal, retail stores continued in the third quarter to be limited to a maximum of 5 persons per 100 sqm. The low mobility of people was aggravated by the sharp drop in tourism. This drop impacted commerce activity in general and the demand for restaurants and hotels in particular.

In addition, in mid-September the sale of alcoholic beverages after 8 pm was banned.

Being a high frequency store, Pingo Doce's sales were pressured by fewer store visits and lower sales in its restaurants, take-away and coffee shops.

Recheio's performance continues to reflect the pressure caused by the significant drop in HoReCa demand.

In Colombia, strict confinement measures continued until the end of August. In addition to limiting the circulation of people, the curfew rules and the closing of commercial activity on certain days of the week were maintained. In the third quarter, these measures resulted in a reduction of c.16% in Ara's trading hours.

With a fragile economy where informality prevails and where it is estimated that 4.8 million formal jobs have been lost during this period, the country is experiencing a very severe and challenging recession.

5. Outlook for 2020

Until the end of the third quarter, the Polish market continued to show a certain resilience to the impacts of the health crisis. However, consumers became more cautious and more price sensitive.

In October, in response to the growing number of daily infections, a traffic-light-style colour system was implemented in Poland. This system classifies as yellow or red zones different geographic areas according to the local severity of the pandemic. The system prescribes different containment measures for yellow and red zones. In the case of retail, for stores located in the most affected areas (red zone), the limit to people inside the store is 1 customer per 15 sqm (for stores over 100 sqm) or 5 clients per checkout (in stores with an area less than 100 sqm). There was also the reintroduction during the days of the week, of exclusive hours (from 10 am to noon) for consumers older than 60.

Biedronka confirmed its capacity to anticipate and responded swiftly to the needs of consumers, gaining market share throughout the period. Our main banner proved that it continues to deserve the preference of the Polish consumers by reinforcing its focus on price leadership and product quality. Starting in the middle of October, the banner was, once again, the first to extend the opening hours of the stores in response to the onset of a new phase of the pandemic.

R&A \| First Nine Months 2020	9
Consolidated Management Report

In Portugal, consumer demand was impacted by the large contraction in tourism, a sector that accounts for a large part of Portuguese employment. The back-to-school period seems to have increased street traffic, which might result in a rise in consumption relative to the last two quarters.

In the middle of October, the state of calamity was reinstated, imposing, among other restrictions, limits to the number of people who can gather in streets, restaurants and cafes.

Pingo Doce and Recheio keep investing on the competitiveness of their offer, reinforcing the attractiveness of their value propositions in response to a more price sensitive consumer.

In Colombia, national and local authorities implemented very restrictive containment measures. The economy and unemployment reflect the long-lasting confinement that has been in place. The country has started to reopen slowly in September. It is still too early to gauge the impact of this reopening on consumer behaviour.

Ara preserved its value proposition during the confinement period and is reinforcing its cost discipline to operate in a consumer environment that is likely to become more challenging.

Market conditions for the coming months, which include the Christmas season, are hard to predict due to uncertainty about the evolution of the epidemic and the containment measures that may be implemented. Further restrictions on mobility at a national level are likely to be introduced. Nonetheless, we are now better prepared to guarantee an adequate response to the challenges that may arise. We will continue fighting for and winning consumer preference in an operational environment that will be more demanding than in the previous year.

With regards to investment, Biedronka, benefiting from less restrictive management of the health crisis in Poland, was the Company that quickly resumed its original plan and is trying to increase the pace of execution to recover from delays in its expansion. If conditions in the construction sector remain unchanged, Biedronka is expected to add c.100 locations to its network in the year. Pingo Doce should open c.13 stores and Ara c.50. We currently expect the 2020 Group capex programme to reach c.€450 mn.

6. Proposal for reserves distribution

The Board of Directors acknowledges that there is substantial uncertainty about the timeline of the COVID-19 pandemic and of its effects in the different countries where the Group operates. All our businesses will continue to be affected by the pandemic crisis.

Nevertheless, the lessons learned so far leave the Group better prepared to face the challenges ahead. We have a solid financial position, ending September with a strong net cash position.

In the initial phase of the pandemic, when uncertainty was extreme, the Board of Directors decided to follow a prudent approach and to reduce the 2019 payout ratio from 50% to 30%. The Board of Directors reserved, at the time of this decision, the possibility of proposing the distribution of the remaining part of the 50% payout if conditions allowed it.

Therefore, taking into account the Group's performance, the cash position at the end of September, and the need to maintain financial flexibility, the Board will propose to the Extraordinary General Meeting to be held on November 26, the payment of €86.7 mn from the Company's free reserves, representing a gross amount of €0.138 per share, excluding own shares.

Lisbon, 27 October 2020

The Board of Directors

R&A \| First Nine Months 2020	10
Consolidated Management Report

7. Consolidated Management report appendix

7.1 The impact of IFRS 16 on Financial Statements Income Statement by Functions

(Million Euro)		IFRS16			Excl. IFRS16
	9M 20	9M 19		9M 20	9M 19

Net Sales and Services		14,198	13,662		14,198	13,662
Cost of Sales		-11,082	-10,671		-11,082	-10,671
Gross Profit		3,116	2,991		3,116	2,991
Distribution Costs		-2,381	-2,239		-2,444	-2,296
Administrative Costs		-251	-231		-252	-232
Other Operating Profits/Losses		-21	-8		-21	-8
Operating Profit		464	513		400	455
Net Financial Costs		-140	-127		-25	-24
Gains/Losses in Other Investments		0	2		0	2
Gains in Joint Ventures and Associates		0	0		0	0

Profit Before Taxes		324	389		375	434
Income Tax		-95	-99		-103	-106
Profit Before Non Controlling Interests		229	289		271	328
Non-Controlling Interests		-9	-23		-11	-25
Net Profit Attributable to JM		219	267		260	302

Income Statement (Management View)

		(Excl. IFRS16)			(Excl. IFRS16)
(Million Euro)	9M 20	9M 19		Q3	20	Q3 19
Net Sales and Services	14,198		13,662		3.9%	4,881		4,754		2.7%
Gross Profit	3,116	21.9%	2,991	21.9%	4.2%	1,084	22.2%	1,058	22.3%	2.5%
Operating Costs	-2,385	-16.8%	-2,234	-16.4%	6.8%	-789	-16.2%	-773	-16.3%	2.1%
EBITDA	731	5.1%	757	5.5%	-3.4%	296	6.1%	285	6.0%	3.5%
Depreciation	-310	-2.2%	-294	-2.2%	5.6%	-105	-2.2%	-99	-2.1%	6.2%
EBIT	421	3.0%	463	3.4%	-9.2%	191	3.9%	187	3.9%	2.1%
Net Financial Costs	-25	-0.2%	-24	-0.2%	5.9%	-7	-0.1%	-8	-0.2%	-11.1%
Gains in Joint Ventures and Associates	0	0.0%	0	0.0%	n.a.	0	0.0%	0	0.0%	n.a.
Other Profits/Losses	-21	-0.1%	-6	0.0%	n.a.	-1	0.0%	-2	0.0%	n.a.
EBT	375	2.6%	434	3.2%	-13.6%	183	3.8%	177	3.7%	3.4%
Income Tax	-103	-0.7%	-106	-0.8%	-2.8%	-44	-0.9%	-43	-0.9%	1.7%
Net Profit	271	1.9%	328	2.4%	-17.1%	139	2.9%	134	2.8%	4.0%
Non-Controlling Interests	-11	-0.1%	-25	-0.2%	-54.9%	-11	-0.2%	-13	-0.3%	-13.6%
Net Profit Attributable to JM	260	1.8%	302	2.2%	-14.0%	128	2.6%	121	2.6%	5.8%

EPS (€)	0.41		0.48		-14.0%	0.20		0.19		5.8%
EPS without Other Profits/Losses (€)	0.44		0.49		-10.0%	0.20		0.19		5.1%

R&A \| First Nine Months 2020	11
Consolidated Management Report

Balance Sheet

		(Excl. IFRS16)
(Million Euro)	9M 20	2019	9M 19

Net Goodwill	621	641	632
Net Fixed Assets	3,853	4,140	3,906
Total Working Capital	-2,569	-2,788	-2,571
Others	124	86	78
Invested Capital	2,029	2,079	2,045

Total Borrowings	548	732	654
Financial Leases	13	17	17
Accrued Interest	1	3	-1
Cash and Cash Equivalents	-872	-949	-734
Net Debt 1	-311	-196	-64
Non-Controlling Interests	253	257	248
Share Capital	629	629	629
Reserves and Retained Earnings	1,458	1,389	1,231

Shareholders Funds	2,341	2,275	2,108

1 Net Debt amount was restated in 2019.

Cash in hand previously considered in Total Working Capital was restated to Cash and Cash Equivalents heading.

Cash Flow

	(Excl. IFRS16)
(Million Euro)	9M 20	9M 19


EBITDA	731	757
Interest Payment	-19	-22
Other Financial Items	0	0
Income Tax	-142	-116

Funds From Operations	571	619
Capex Payment	-367	-399
Change in Working Capital	18	141
Others	-16	-5

Cash Flow	205	356

EBITDA and EBITDA Margin Breakdown

(Million Euro)			IFRS16					Excl. IFRS16
	9M 20	Mg	9M 19	Mg		9M 20	Mg	9M 19	Mg

Biedronka		913	9.2%		864	9.4%		709	7.2%	665	7.2%
Distribution Portugal		190	5.5%		242	6.6%		139	4.0%	189	5.1%
Ara		-23	n.a.		-25	n.a.		-47	n.a.	-51	n.a.
Hebe		10	5.7%		9	4.8%		-7	n.a.	-5	n.a.
Others & Cons. Adjustments		-62	n.a.		-39	n.a.		-64	n.a.	-41	n.a.
JM Consolidated		1,029	7.3%		1,049	7.7%		731	5.1%	757	5.5%

R&A \| First Nine Months 2020	12
Consolidated Management Report

Financial Costs Breakdown

(Million Euro)	IFRS16
9M 20	9M 19


Net Interest	-15	-18
Interests on Capitalised Operating Leases	-95	-98
Exchange Differences	-25	-8
Others	-5	-4

Financial Results	-140	-127

7.2 Sales Evolution

Excl. IFRS16

9M 20	9M 19

-15	-18
-	-
-5	-2
-5	-4

-25	-24

		Total Sales Growth				LFL Growth

	Q1 20	Q2 20	H1 20	Q3 20	9M 20	Q1 20	Q2 20	H1 20	Q3 20	9M 20
Biedronka
Euro	12.6%	3.4%	7.8%	6.4%	7.3%
PLN	13.2%	8.7%	10.9%	9.3%	10.3%	11.1%	4.8%	7.8%	6.0%	7.2%
Hebe
Euro	14.6%	-16.6%	-1.7%	3.5%	0.1%
PLN	15.2%	-11.8%	1.2%	6.4%	3.0%	-1.7%	-26.6%	-14.8%	1.7%	-9.4%
Pingo Doce	3.5%	-8.8%	-2.9%	-1.2%	-2.3%	2.8%	-10.2%	-4.0%	-2.5%	-3.5%
Excl. Fuel	4.3%	-7.1%	-1.6%	-0.1%	-1.1%	3.5%	-8.5%	-2.8%	-1.5%	-2.3%
Recheio	0.2%	-26.7%	-14.4%	-17.5%	-15.6%	0.1%	-26.9%	-14.5%	-17.7%	-15.7%
Ara
Euro	38.9%	0.5%	18.8%	-5.6%	9.9%
COP	52.3%	16.7%	33.4%	10.9%	25.1%	34.3%	1.1%	16.6%	-1.7%	9.8%
Total JM
Euro	11.0%	-1.3%	4.6%	2.7%	3.9%
Excl. FX	12.0%	3.1%	7.3%	5.4%	6.6%	9.5%	-0.7%	4.2%	2.2%	3.5%

7.3 Stores Network

Number of Stores	2019		Openings		Closings	9M 20	9M 19
Q1 20	Q2 20	Q3 20	9M 20

Biedronka	3,002	11	23	18	7	3,047	2,932
Hebe	273	8	3	1	29	256	255
Pingo Doce	441	1	2	6	0	450	437
Recheio	42	0	0	0	0	42	42
Ara	616	19	4	10	8	641	578

			Openings		Closings/
Sales Area (sqm)	2019			Remodellings	9M 20	9M 19

		Q1 20	Q2 20	Q3 20	9M 20
Biedronka	2,021,345	8,394	16,694	12,708	-5,533	2,064,673	1,965,522

Hebe	66,805	2,109	703	240	2,897	66,960	62,052
Pingo Doce	513,272	102	2,496	3,771	0	519,641	510,142
Recheio	133,826	0	0	0	0	133,826	133,826
Ara	207,982	6,235	1,502	3,622	3,001	216,340	195,506

7.4 Definitions

Like for like (LFL) sales: sales made by stores that operated under the same conditions in the two periods. Excludes stores opened or closed in one of the two periods. Sales of stores that underwent profound remodelling are excluded for the remodelling period (store closure).

R&A \| First Nine Months 2020	13
Consolidated Management Report

8. Reconciliation Note

(Following ESMA guidelines on Alternative Performance Measures from October 2015)

Income Statement

Income Statement		Income Statement by Functions in the Consolidated Report &
(page 6)		Accounts - First Nine Months 2020 Results

Net Sales and Services		Net sales and services

Gross Profit		Gross profit

Operating Costs		Includes headings of Distribution costs; Administrative costs; Other
	operating costs and excludes Depreciations of €-544.8 mn


EBITDA

Depreciation		Value reflected in the note - Segments Reporting

EBIT

Net Financial Costs		Net financial costs

Gains in Joint Ventures and Associates		Gains (Losses) in joint ventures and associates

Other Profits/Losses		Includes headings of Other operating profits/losses; Gains in disposal
		of business (when applicable) and Gains (losses) in other investments
		(when applicable)

EBT

Income Tax		Income tax

Net Profit

Non-Controlling Interests		Non-Controlling interests

Net Profit Attributable to JM

R&A \| First Nine Months 2020	14
Consolidated Management Report

Balance Sheet

Balance Sheet		Balance Sheet in the Consolidated Report & Accounts
(page 8)	-	First Nine Months 2020 Results

Net Goodwill	Amount reflected in the heading of Intangible assets

Net Fixed Assets	Includes the headings Tangible and Intangible assets excluding the
	Net goodwill (€620.9 mn) and Financial leases (€13.5 mn)

Net Right-of-Use Assets (RoU)	Includes the heading of Net rights of use excluding the Financial leases
	(€13.5 mn)

Total Working Capital	Includes the headings Current trade debtors, Accrued income and
	Deferred costs; Inventories; Biological assets; Trade creditors, Accrued
	costs and Deferred income; Employee benefits; and also, the value of
	€-12.1 mn related to 'Others' due to its operational nature.
	Excludes the value of €-1.9 mn related to Interest accruals and
	deferrals (note - Net financial debt)

Others	Includes the headings Investment property; Investments in joint
	ventures and associates; Other financial investments; Non-Current
	trade debtors, Accrued income and Deferred costs; Deferred tax assets
	and liabilities; Income tax receivable and payable; Provisions for risks
	and contingencies;
	Excludes the value of €-12.1 mn related to 'Others' due to its
	operational nature, as well as, when applicable, Collateral deposits
	associated with financial debt (note - Debtors, accruals and deferrals)

Invested Capital

Total Borrowings	Includes the heading Borrowings current and non-current

Financial Leases	Value reflected in the headings of Lease liabilities current and
	non-current

Capitalised Operating Leases	Including the headings of Lease liabilities current and non-current
	deducted of liabilities with Financial leases (€12.7 mn)

Accrued Interest	Includes the heading Derivative financial instruments and the value of
	€-1.9 mn related to Interest accruals and deferrals (value reflected in
	note - Net financial debt)

Marketable Securities and Bank Deposits	Includes the heading Cash and cash equivalents, as well as, when
	applicable, Collateral deposits associated with financial debt (note -
	Debtors, accruals and deferrals)

Net Debt

Non-Controlling Interests	Non-Controlling interests

Share Capital	Share capital

Reserves and Retained Earnings	Includes the heading Share premium, Own shares, Other reserves and
	Retained earnings

Shareholders' Funds

R&A \| First Nine Months 2020	15
Consolidated Management Report

Cash Flow

Cash Flow	Cash Flow in the Consolidated Report & Accounts
(page 8)	- First Nine Months 2020 Results
EBITDA	Included in the heading of Cash generated from operations

Capitalised Operating Leases Payment	Included in the heading Leases paid

Interest Payment	Includes the headings of Loans interest paid, Leases interest paid
	and Interest received

Income Tax	Income tax paid

Funds from Operations

Capex Payment	Includes the headings Disposal of tangible and intangible assets;
	Disposal of financial and investment property; Acquisition of tangible
	and intangible assets; Acquisition of financial investments and
	investment property. It also includes acquisitions of tangible assets
	classified as finance leases under previous regulations (€0.0 mn)

Change in Working Capital	Included in the heading of Cash generated from operations

Others	Includes the headings disposal of business (when applicable), being
	the remaining amount included in the heading Cash generated from
	operations

Cash Flow

9. Information Regarding Individual Financial Statements

In accordance with number 5 of article 10 of the Regulation number 5/2008 of the Portuguese Securities Market Commission (CMVM), the Quarter Individual Financial Statements of Jerónimo Martins SGPS, S.A. are not disclosed as they do not include additional relevant information, compared to the one presented in this report.

R&A \| First Nine Months 2020	16
Consolidated Management Report

II - CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT BY FUNCTIONS

FOR THE PERIODS ENDED AT 30 SEPTEMBER 2020 AND 2019

			Euro thousand

		September	September
	Notes	2020	2019

Sales and services rendered	3	14,197,942	13,662,242
Cost of sales	4	(11,081,727)	(10,671,275)
Gross profit		3,116,215	2,990,967

Distribution costs	4	(2,380,822)	(2,239,150)
Administrative costs	4	(250,829)	(230,726)
Other operating profits/losses	4.1	(20,898)	(7,993)
Operating profit		463,666	513,098

Net financial costs	5	(140,268)	(127,074)
Gains (losses) in joint ventures and associates		74	167
Gains (losses) in other investments		50	2,322
Profit before taxes		323,522	388,513

Income tax	6	(95,012)	(99,043)
Profit before non-controlling interests		228,510	289,470

Attributable to:
Non-controlling interests		9,331	22,908
Jerónimo Martins Shareholders		219,179	266,562
Basic and diluted earnings per share - Euros	12	0.3488	0.4242

To be read with the attached notes to the consolidated financial statements.

	Euro thousand

3rd Quarter	3rd Quarter
2020	2019

4,881,346	4,753,908
(3,796,894)	(3,695,435)
1,084,452	1,058,473

(793,418)	(771,868)
(79,588)	(80,988)

(3,920)
210,894 201,697

(44,752) (49,363)

2,276

166,354 154,638

(41,054) (39,306)

125,300 115,332

10,261 11,883

115,039 103,449

0.1831 0.1646

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIODS ENDED AT 30 SEPTEMBER 2020 AND 2019

		Euro thousand

	September	September
Notes	2020	2019

Net profit	228,510	289,470
Other comprehensive income:

Items that will not be reclassified to profit or loss	-	-

Currency translation differences	(79,473)	(14,931)
Change in fair value of cash flow hedges	(7)	406
Change in fair value of hedging instruments on foreign operations	25,766	(423)
Related tax	(2,187)	(363)

Items that may be reclassified to profit or loss	(55,901)	(15,311)

Other comprehensive income, net of income tax	(55,901)	(15,311)

Total comprehensive income	172,609	274,159

Attributable to:
Non-controlling interests	9,331	22,908
Jerónimo Martins Shareholders	163,278	251,251
Total comprehensive income	172,609	274,159

To be read with the attached notes to the consolidated financial statements.

	Euro thousand

3rd Quarter	3rd Quarter
2020	2019

125,300	115,332

-	-

(19,889)	(28,523)
(182)	620
2,207	2,081
(1,042)	(490)

(18,906)	(26,312)

(18,906)	(26,312)

106,394	89,020

10,261	11,883
96,133	77,137
106,394	89,020

R&A \| First Nine Months 2020	17
Consolidated Financial Statements

CONSOLIDATED BALANCE SHEET AT 30 SEPTEMBER 2020 AND 31 DECEMBER 2019

			Euro thousand

		September	December
	Notes	2020	2019
Assets
Tangible assets	7	3,701,737	3,969,937
Intangible assets	7	758,806	794,010
Investment property	7	8,533	8,563
Right-of-use assets	7	2,122,697	2,334,949
Biological assets		4,816	3,336
Investments in joint ventures and associates		5,567	5,193
Other financial investments		1,327	1,327
Trade debtors, accrued income and deferred costs	9	70,117	86,767
Deferred tax assets		154,586	138,130

Total non-current assets		6,828,186	7,342,212

Inventories		925,386	1,038,627
Biological assets		4,360	5,563
Income tax receivable		15,104	11,469
Trade debtors, accrued income and deferred costs	9	345,383	424,689
Derivative financial instruments	8	1,680	-
Cash and cash equivalents	10	872,491	929,311
Total current assets		2,164,404	2,409,659

Total assets		8,992,590	9,751,871

Shareholders' equity and liabilities
Share capital		629,293	629,293
Share premium		22,452	22,452
Own shares		(6,060)	(6,060)
Other reserves		(122,912)	(67,011)
Retained earnings		1,485,386	1,396,293
		2,008,159	1,974,967

Non-controlling interests		247,911	253,941

Total shareholders' equity		2,256,070	2,228,908

Borrowings	13	248,244	308,764
Lease liabilities	14	1,851,697	1,999,293
Trade creditors, accrued costs and deferred income	17	776	764
Employee benefits	16	71,322	69,669
Provisions for risks and contingencies	16	28,886	27,780
Deferred tax liabilities		57,314	70,678
Total non-current liabilities		2,258,239	2,476,948

Borrowings	13	299,558	423,685
Lease liabilities	14	366,373	384,980
Trade creditors, accrued costs and deferred income	17	3,771,017	4,182,149
Derivative financial instruments	8	240	3,056
Income tax payable		41,093	52,145
Total current liabilities		4,478,281	5,046,015

Total shareholders' equity and liabilities		8,992,590	9,751,871

To be read with the attached notes to the consolidated financial statements

R&A \| First Nine Months 2020	18
Consolidated Financial Statements

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS´EQUITY

FOR THE PERIODS ENDED 30 SEPTEMBER 2020 AND 2019

									Euro thousand

	Shareholders' equity attributable to Shareholders of Jerónimo Martins, SGPS, S.A.

				Other reserves
								Non-controlling	Shareholders'

	Share capital	Share	Own shares		Currency	Retained	Total	interests	equity
	premium	Cash flow	earnings
			translation
				hedge
				reserves


Balance Sheet as at 1 January 2019	629,293	22,452	(6,060)	(50)	(76,996)	1,209,259	1,777,898	238,356	2,016,254

Equity changes in 2019

Currency translation differences

Change in fair value of cash flow hedging

Change in fair value of hedging instruments on foreign operations

(6)	(15,211)	(15,217)	(15,217)
329		329	329
	(423)	(423)	(423)

Other comprehensive income	-	-	-	323	(15,634)	-	(15,311)	-	(15,311)
Net profit						266,562	266,562	22,908	289,470

Total comprehensive income	-	-	-	323	(15,634)	266,562	251,251	22,908	274,159
Dividends						(204,241)	(204,241)	(15,260)	(219,501)

Balance Sheet as at 30 September 2019	629,293	22,452	(6,060)	273	(92,630)	1,271,580	1,824,908	246,004	2,070,912


Balance Sheet as at 1 January 2020	629,293	22,452	(6,060)	(22)	(66,989)	1,396,293	1,974,967	253,941	2,228,908

Equity changes in 2020

Currency translation differences

Change in fair value of cash flow hedging

Change in fair value of hedging instruments on foreign operations

2	(81,663)	(81,661)	(81,661)
(6)		(6)	(6)
	25,766	25,766	25,766

Other comprehensive income	-	-	-	(4)	(55,897)	-	(55,901)	-	(55,901)
Net profit						219,179	219,179	9,331	228,510

Total comprehensive income	-	-	-	(4)	(55,897)	219,179	163,278	9,331	172,609
Dividends (note 11)						(130,086)	(130,086)	(15,361)	(145,447)

Balance Sheet as at 30 September 2020	629,293	22,452	(6,060)	(26)	(122,886)	1,485,386	2,008,159	247,911	2,256,070

To be read with the attached notes to the consolidated financial statements

R&A \| First Nine Months 2020	19
Consolidated Financial Statements

CONSOLIDATED CASH FLOW STATEMENT

FOR THE PERIODS ENDED AT 30 SEPTEMBER 2020 AND 2019

			Euro thousand

	Notes	September	September
	2020	2019


Net results		219,179	266,562
Adjustments for:
Non-controlling interests		9,331	22,908
Income tax		95,012	99,043
Depreciations and amortisations		544,794	528,383
Provisions and other operational gains and losses		31,405	22,979
Net financial costs		140,268	127,074
Gains/losses in associated companies		(74)	(167)
Gains/Losses in other investments		(50)	(2,322)
Profit/losses in tangible, intangible and right-of-use assets		3,887	2,262
		1,043,752	1,066,722
Changes in working capital:
Inventories		39,290	47,822
Trade debtors, accrued income and deferred costs		20,277	(7,219)
Trade creditors, accrued costs and deferred income		(73,275)	76,810
Cash generated from operations		1,030,044	1,184,135
Income taxes paid		(141,691)	(116,052)
Cash flow from operating activities		888,353	1,068,083
Investment activities
Disposals of tangible and intangible assets		1,547	1,365
Disposals of other financial investments and investment property		-	5,000
Interest received		2,252	2,166
Dividends received		100	96
Acquisition of tangible and intangible assets		(368,324)	(396,301)
Acquisition and investments in joint ventures and associates		(350)	(2,000)
Collateral deposits associated to financial debt		19,367	-
Cash flow from investment activities		(345,408)	(389,674)
Financing activities
Loans interest paid		(20,389)	(23,671)
Leases interest paid	5	(95,005)	(98,231)
Net change in loans	13	(98,031)	37,492
Leases paid	14	(205,587)	(198,487)
Dividends paid	11	(145,447)	(219,501)
Cash flow from financing activities		(564,459)	(502,398)
Net changes in cash and cash equivalents		(21,514)	176,011
Cash and cash equivalents changes
Cash and cash equivalents at the beginning of the year		929,311	545,988
Net changes in cash and cash equivalents		(21,514)	176,011
Net foreign exchange difference		(35,306)	(7,041)
Cash and cash equivalents at the end of 9 Months	10	872,491	714,958

To be read with the attached notes to the consolidated financial statements

Euro thousand

	September	September
	2020	2019

Cash Flow from operating activities	888,353	1,068,083
Cash Flow from investment activities	(345,408)	(389,674)
Cash Flow from financing activities	(564,459)	(502,398)

Cash and cash equivalents changes	(21,514)	176,011

The amounts presented for quarters are not audited.

3rd Quarter	3rd Quarter
2020	2019

508,681	444,245
(77,531)	(135,036)
(393,091)	(109,989)

38,059	199,220

R&A \| First Nine Months 2020	20
Consolidated Financial Statements

INDEX TO THE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1.	Activity .................................................................................................................................................................................	22
2.	Accounting policies .........................................................................................................................................................	25
3.	Segments reporting ........................................................................................................................................................	26
4.	Operating costs by nature............................................................................................................................................	27
5.	Net financial costs ...........................................................................................................................................................	28
6.	Income tax recognised in the income statement.................................................................................................	28
7.	Tangible assets, intangible assets, investment property and right-of-use assets................................	29
8.	Derivative financial instruments ................................................................................................................................	29
9.	Trade debtors, accrued income and deferred costs...........................................................................................	30
10.	Cash and cash equivalents..........................................................................................................................................	30
11.	Dividends ............................................................................................................................................................................	30
12.	Basic and diluted earnings per share ......................................................................................................................	30
13.	Borrowings .........................................................................................................................................................................	30
14.	Lease liabilities..................................................................................................................................................................	31
15.	Financial debt....................................................................................................................................................................	32
16.	Provisions and employee benefits ............................................................................................................................	32
17.	Trade creditors, accrued costs and deferred income ........................................................................................	32
18.	Contingencies....................................................................................................................................................................	33
19.	Related parties..................................................................................................................................................................	34
20.	Events after the balance sheet date ........................................................................................................................	34

R&A \| First Nine Months 2020	21
Notes to the Consolidated Financial Statements

1. Activity

Jerónimo Martins, SGPS, S.A. (JMH), is the parent Company of Jerónimo Martins Group (Group) and has its head office in Lisbon.

The Group operates in the food area, particularly in the distribution and sale of food and other fast-moving consumer goods products. The Group has operations in Portugal, Poland and Colombia.

Head Office: Rua Actor António Silva, n.º 7, 1649-033 Lisboa

Share Capital: 629,293,220 euros

Registered at the Commercial Registry Office of Lisbon and Tax Number: 500 100 144 JMH has been listed on Euronext Lisbon since 1989.

The Board of Directors approved these consolidated financial statements on 27 October 2020.

Covid-19

The first nine months of the year were definitely marked by the impact caused directly and indirectly by Covid-19 pandemic, and it is not yet possible to accurately predict the magnitude of the impacts or the date on which they will end. However, some behavioural changes and measures related to the pandemic, adopted by companies and people, are already visible and will not change in the near future.

Since the first cases started to appear, namely in the regions where it operates, the Group has been closely monitoring all developments related with the disease, implementing judiciously the measures deemed adequate according to the recommendations issued by the relevant international authorities, namely the World Health Organization and the European Centre for Disease Prevention and Control, and from the competent bodies in the countries where it operates.

The Group's Executive Management Team, in direct coordination with the Companies' CEOs and Executive Teams, acted as a Group Crisis Committee and assumed the management of the business continuity plan, ensuring the preparation of the action and prevention plans deemed necessary and appropriate to anticipate and mitigate the adverse effects and the economic and financial impacts of the pandemic on the Group's activities. These plans have been constantly updated and revised considering the evolution of the pandemic and its effects in each of the geographies in which the Group is present.

Under this coordination, and closely following the recommendations of the official entities, the Group Companies implemented the operational measures needed to better protect their employees, customers and other stakeholders, introducing the necessary adjustments in their supply chains, during confinement and de- confinement phases.

Taking into account the events that have taken place so far, and even though the next few months remain surrounded by uncertainty regarding the epidemiological situation and the measures implemented in the various countries, it is not expected that impacts of the pandemic could jeopardize the going concern of the Group's operations.

However, in view of the increasing number of infections, accompanied by new government measures aimed at restricting the spread of the epidemic, it is not yet possible to quantify the magnitude of the overall impacts on the Group's accounts. The key priority continues to be the implementation of all measures considered adequate to minimize the negative effects on its operation, in line with the recommendations of the authorities and protecting the best interests of the Customers, Suppliers, Employees and local Communities.

The Group expects to overcome this adverse context, proceeding, in an adjusted manner, with the implementation of its strategy, in order to ensure, as quickly as possible, the return to the levels of growth and profitability expected by Shareholders and remaining stakeholders.

Financial risks

The Group is exposed to several financial risks, namely: i. price risk, which includes interest and exchange rate risks;

transactional risk, which includes credit and liquidity risk; and iii. the risk arising from the Group's investments portfolio, including various risks such as interest rate, credit, foreign exchange, inflation, political and fiscal. These risks are described in the Consolidated Financial Statements chapter of the 2019 Annual Report, point 29 - Financial risks.

During the first nine months of 2020, due to the impacts of the pandemic caused by SARS-CoV-2 virus and the measures adopted by governments, companies and individuals to mitigate the spread of the virus, we highlight the following impacts on the risks to which the Group is exposed to:

R&A \| First Nine Months 2020	22
Notes to the Consolidated Financial Statements

Foreign exchange risk

The main source of exposure to foreign exchange risk comes from Group' operations in Poland and in Colombia. During the first nine months of 2020, the limitations on the circulation of people and goods caused by the pandemic, slowed down the world economy and brought a greater uncertainty to the markets, leading to a significant devaluation of these currencies in March, with a partial recovery in June, followed by a further devaluation during the third quarter.

	Polish Zloty	% deval.	Colombian Peso	% deval.
Exchange rates evolution	compared to	compared
(PLN)	(COP)
	Dec-19	to Dec-19


31 December 2019	4.2568	n.a.	3,685.7100	n.a.
31 March 2020	4.5506	-6.90%	4,453.4100	-20.83%
30 June 2020	4.4560	-4.68%	4,209.2300	-14.20%
30 September 2020	4.5462	-6.80%	4,541.4600	-23.22%

In the first nine months of 2020, the impact to the Group of the exchange rate devaluation, essentially, resulting from the exchange rate conversion of assets and liabilities denominated in the currencies of the countries where the Group operates, amounts to a loss of EUR (55,897) thousand, recognized in currency translation reserves in equity.

Given that the Group's subsidiaries maintain several operational activities denominated in currencies other than their functional currency, part of which are covered by hedging instruments, the net impact in the first nine months of 2020, corresponded to a loss of EUR (25,428) thousand, recognized in profit or loss.

The Group's exposure to foreign exchange risk in financial assets and liabilities recognized as at 30 September

2020 was as follows:

As at 30 September 2020	Euro	Zloty	Colombian	US Dollar	Total
peso


Total financial assets	443,154	711,545	39,720	15	1,194,434
Total financial liabilities	1,529,831	4,027,082	666,006	50	6,222,969

Net financial position in the balance sheet	(1,086,677)	(3,315,537)	(626,286)	(35)	(5,028,535)

As at 31 December 2019
Total financial assets	275,245	1,012,520	69,197	-	1,356,962
Total financial liabilities	1,624,984	4,539,468	834,976	64	6,999,492

Net financial position in the balance sheet	(1,349,739)	(3,526,948)	(765,779)	(64)	(5,642,530)

Considering the net position of the financial assets and liabilities on the balance sheet at 30 September 2020, a depreciation of the zloty against the euro of around 10% would have a positive impact of EUR 311,948 thousand on the equity's currency translation reserves (in 31 December 2019: a positive impact of EUR 335,636 thousand). Regarding the Colombian peso, a depreciation against the euro of 10% would have a positive impact on the equity's currency translation reserves of EUR 56,935 thousand (in 31 December 2019: a positive impact of EUR 69,616 thousand).

Considering the net financial assets related with operating activities that some Group subsidiaries hold in currencies other than their functional currency, a 10% depreciation of the exchange rate would have a negative impact on the results of EUR (34,342) thousand.

Considering the total net assets (financial and non-financial) to which the Group is exposed to in Zlotys and Colombian pesos, the effect of a 10% depreciation of these currencies would have a negative impact of EUR (113,387) thousand in total equity (in 31 December 2019: a negative impact of EUR (120,451) thousand).

Credit risk

The Group manages centrally its exposure to credit risk on bank deposits, short-term investments and derivatives contracted with financial institutions. Those are selected based on the ratings they receive from one of the independent benchmark rating agencies. Apart from the existence of a minimum accepted rating, there is also a maximum exposure to each of these financial institutions.

As of 30 September 2020 the credit quality on bank deposits and short-term investments and derivative financial instruments with positive value, which amount to EUR 869,975 thousand is segregated as follows: 48% in financial

R&A \| First Nine Months 2020	23
Notes to the Consolidated Financial Statements

institutions with a rating between A- and AA-; 50% in financial institutions with a rating between BBB- and BBB+; and 2% in financial institutions with a lower rating.

With regard to trade receivables (credit to customers), the increased risk caused by the pandemic is mainly circumscribed to the Cash & Carry business, since the other businesses operate based on sales paid with cash or by electronic means of payment, mainly bank cards (debit and credit). This risk is managed based on experience and individual customer knowledge, and/or by imposing credit limits which are monitored on a monthly basis. In addition, the Company uses credit insurance to mitigate the associated risk.

As of 30 September 2020, from the amount of EUR 38,560 thousand related to accounts receivable, approximately 91% referred to customers without default or impairment indicators, or whose credits were covered by credit insurance or bank guarantees.

For the remaining accounts receivable, the Group's priority has been to find the best solutions together with its business partners, having been carried out, since the second quarter of 2020, an assessment about the ability to recover existing balances.

It was possible to renegotiate payment terms for some of the customers. However, considering the pandemic evolution, the limitations still in force in some sectors of activity, as well as the expected difficult recovery in the Tourism sector, there are already indicators of possible impairment risks, namely in the HoReCa channel customers (Hotels, Restaurants and Cafes).

Since the recovery of the financial capacity of customers depends to a large extent on the evolution of the pandemic, on restrictive measures to the development of the respective economic activities, on possible state support and on socio-economic context, based on the case by case analysis of its debtors, the Group reinforced its provisions for bad debts in the amount of EUR 3,200 thousand, already at the end of the second quarter.

Some Group companies, such as Pingo Doce in Portugal and Jeronimo Martins Polska (Biedronka) in Poland, sublease parts of their commercial areas to third parties ("Tenants"), with many of these partners having their businesses affected by the pandemic generated by the Covid-19 virus. For this reason, the Group suspended rents collection in the first months after the declaration of the pandemic, having meanwhile negotiated with the vast majority of its partners discounts on rents, thus contributing to mitigate financial constraints and contribute to the continuity of their activities.

The Group is permanently monitoring the financial situation of its customers, tenants and other business partners, with no significant non-compliance situations, at this stage, that could lead to the recognition of impairment losses, in addition to the above.

Liquidity risk

Liquidity risk is managed by maintaining an adequate level of cash and cash equivalents, as well as by negotiating credit facilities that, not only ensure the regular development of the Group' activities, but also ensure some flexibility to be able to absorb shocks unrelated to Company activities.

Throughout the year the Group maintains liquidity reserves in the form of credit lines contracted with the financial institutions with which it relates, in order to ensure the ability to meet its commitments, without having to finance itself under unfavourable conditions. Thus, on 30 September 2020, the Group has contracted credit lines that were not being used in the total amount of EUR 1,058,359 thousand.

In addition, the Group had, at 30 September 2020, a liquidity reserve consisting of cash and cash equivalents in the amount of EUR 872,491 thousand.

This way, the Group expects to satisfy all its treasury needs with the use of operating activity flows and liquidity reserves, and if eventually necessary, using the existing available credit lines. The Group believes that compliance with the current covenants associated with the issued debt is duly ensured.

Recoverability of tangible and intangible assets and investment properties

In a context of great uncertainty regarding the evolution of the Covid-19 pandemic, its impacts in terms of economic slowdown and changes in consumption patterns, the Group started a review of its strategy and business plans, that is expected to be approved during the last quarter of the year.

Being difficult to estimate the medium-term impacts on the Group's businesses, there is already a recovery, at different speeds, of all its activities. In line with the existing recommendation, the Group carried out a sensitivity analysis to the assumptions used in the impairment tests on Goodwill conducted at the end of 2019, concluding that there are no clear impairment indicators on this date.

In a scenario of a permanent decline of 10% of the expected cash flows, there is no risk of recoverability of Goodwill from any of the business units. The risk of a potential impairment loss related to the Retail business unit in Portugal

R&A \| First Nine Months 2020	24
Notes to the Consolidated Financial Statements

could be placed in a very conservative scenario, in which there are permanent cash flows reductions above 10% and without corrective measures being taken.

The measures that have been imposed by the different Governments, with restrictions for intermittent periods of activity at national, regional and local levels, significantly limit the ability to assess the future operating perspectives of the stores in which the Group operates, which constitutes the bulk of their investments in tangible assets.

Despite the operational limitations described, the economic slowdown and changes in consumption patterns, the Group companies have the necessary instruments to readjust their value propositions.

The aforementioned strategic review and its translation in terms of business plans, as well as the expected stabilization and better visibility of the pandemic effects, will allow, until the end of the current year, to better assess the existence of impairment indicators on the main assets of the different businesses.

The continuous monitoring of the different businesses and the effects that result from the pandemic, led the Group to already identify a set of assets for which there is no longer any probability of generating future economic benefits, either because decisions were taken to close activity or to cancel ongoing projects, resulting in the recognition of write-offs, impairments and other associated costs in the amount of EUR 7,339 thousand.

Accounting policies

Basis for preparation
All amounts are shown in thousand euros (EUR thousand) unless otherwise stated.

JMH consolidated financial statements were prepared in accordance with the interim financial reporting standard (IAS 34), and all other International Financial Reporting Standards (IFRS) issued by International Accounting Standards Board (IASB) and with the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) as adopted by the European Union (EU).

The consolidated financial statements were prepared in accordance with the same standards and accounting policies adopted by the Group in the preparation of the annual financial statements, except for the adoption of new standards, amendments and interpretations, effective as of 1 January 2020, and including an explanation of the events and relevant changes for the understanding of variations in the financial position and Group performance since the last annual report. Thus, some of the notes from the 2019 annual report are omitted because no changes occurred, or they are not materially relevant for the understanding of the interim financial statements.

Change in accounting policies and basis for presentation:

2.1.1. New standards, amendments and interpretations adopted by the Group

Between November 2019 and April 2020, the EU issued the following Regulations, which were adopted by the Group from 1 January 2020:

EU Regulation

Regulation no. 2075/2019

Regulation no. 2104/2019

Regulation no. 34/2020

Regulation no. 551/2020

Regulation no. 1434/2020

IASB Standard or IFRIC Interpretation

endorsed by EU

Amendments to References to the Conceptual Framework in IFRS Standards (Amendments)

Amendments to IAS 1 Presentation of Financial Statements and IAS

8 Accounting Policies, Changes in Accounting Estimates and Errors: Definition of Material (Amendments)

Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7)

Amendment to IFRS 3 Business Combinations: Business Definition

Amendment to IFRS 16 Leases Covid-19 Related Rent Concessions

Issued in

March 2018

October 2018

September 2019

October 2018

May 2020

Mandatory for financialyears beginning on or after

1 January 2020

The Group adopted the amendments, with no significant impact on its Consolidated Financial Statements.

2.1.2. New standards, amendments and interpretations endorsed by EU but not effective for the financial year beginning 1 January 2020 and not early adopted

During the first nine months of 2020, the EU did not issue any Regulation regarding the endorsement of new standards, amendments or interpretations that have not yet been implemented by the Group.

R&A \| First Nine Months 2020	25
Notes to the Consolidated Financial Statements

2.1.3. New standards, amendments and interpretations issued by IASB and IFRIC, but not yet endorsed by EU

During the first nine months of 2020, the IASB issued the following amendments that are still pending endorsement by the EU:

IASB Standard or IFRIC Interpretation

IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Non-current (amendments)

IFRS 3 Business Combinations: References to the Conceptual Framework (amendments)

IAS 16 Property, Plant and Equipment: Income prior to expected use (amendments)

IAS 37 Provisions, Contingent Liabilities and Contingent Assets: Costs of fulfilling onerous contracts (amendments)

2018-2020 cycle of improvements to the IFRS standards: IFRS 1 First-time Adoption of International Financial Reporting Standards, IFRS 9 Financial Instruments, IFRS 16 Leasings and IAS 41 Agriculture (amendments)

IFRS 17 Insurance Contracts (amendments)

IFRS 4 Insurance Contracts (will be supersede by IFRS 17): Extension of the Temporary Exemption from Applying IFRS 9 (amendments)

IFRS 9 Financial Instruments; IAS 39 Financial Instruments: Recognition and

Measurement; IFRS 7 Financial Instruments: Disclosures; IFRS 4 Insurance contract; and IFRS 16 Leases - Interest Rate Benchmark Reform - Phase 2 (amendments)

Issued in

January 2020

May 2020

June 2020

August 2020

Expected application for financial years beginningon or after

1 January 2023

1 January 2022

1 January 2023

1 January 2021

The Management is currently evaluating the impact of adopting these amendments to standards already in place, and so far, does not expect a significant impact on the Group's Consolidated Financial Statements.

2.2. Transactions in foreign currencies

Transactions in foreign currencies are translated into Euros at the exchange rate prevailing on the transaction date.

On the balance sheet date, monetary assets and liabilities expressed in foreign currencies are translated at the exchange rate prevailing on that date and exchange differences arising from this conversion are recognised in the income statement. When qualifying as hedges on investments in foreign subsidiaries the exchange differences are deferred on the Company's equity.

The main exchange rates applied on the balance sheet date are as follows:

Euro foreign exchange reference rates				Colombian Peso

( x foreign exchange units per 1 euro )	Polish Zloty
(COP)
	(PLN)

Rate at 30 September 2020	4.4562	4,541.4600
Average rate for the year	4.4229		4,145.3100

Rate at 30 September 2019	4.3782		3,769.7800
Average rate for the year	4.3007		3,641.7000

3. Segments reporting

Segment information is presented in accordance with internal reporting to Management. Based on this report, the Management evaluates the performance of each segment and allocates the available resources.

Management monitors the performance of the business based on a geographical and business perspective. Due to the fact that the business units in the distribution area in Portugal share a set of competences, the Group analyses, on a quarterly basis, its segments in an aggregate performance perspective. In addition, the Group also separates the business units Poland Retail and Colombia Retail. Apart from these there are also other businesses which due to their low materiality, are not reported separately.

Business segments:

Portugal Distribution: comprises the business unit of JMR (Pingo Doce supermarkets) and the business unit Recheio (Wholesale operation of cash & carry and foodservice);
Poland Retail: the business unit which operates under the Biedronka banner;
Colombia Retail: the business unit which operates under Ara banner;

R&A \| First Nine Months 2020	26
Notes to the Consolidated Financial Statements

Others, eliminations and adjustments: includes i. business units with reduced materiality (Coffee Shops, Chocolate Stores and Agribusiness in Portugal, and Health and Beauty Retail in Poland); ii. the Holding Companies; and iii. Group's consolidation adjustments.

Management evaluates the performance of segments based on the Earnings Before Interest and Taxes (EBIT). This indicator excludes the effects of other operating profits/losses.

Detailed Information by Business Segments as at September 2020 and 2019

	Portugal Distribution	Poland Retail	Colombia Retail	Others, eliminations and	Total JM Consolidated
	adjustments

	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019

Net sales and services	3,487,889	3,673,401	9,909,456	9,236,271	615,500	560,166	185,097	192,404	14,197,942	13,662,242
Inter-segments	683	996	1,198	1,212	-	-	(1,881)	(2,208)	-	-
External customers	3,487,206	3,672,405	9,908,258	9,235,059	615,500	560,166	186,978	194,612	14,197,942	13,662,242
Operational cash flow (EBITDA)	190,020	241,626	913,410	863,808	(22,502)	(25,193)	(51,570)	(30,767)	1,029,358	1,049,474
Depreciations and amortisations	(128,409)	(127,451)	(351,290)	(338,501)	(36,395)	(35,260)	(28,700)	(27,171)	(544,794)	(528,383)
Earnings before interest and taxes (EBIT)	61,611	114,175	562,120	525,307	(58,897)	(60,453)	(80,270)	(57,938)	484,564	521,091
Other operating profits/losses									(20,898)	(7,993)
Financial results									(140,144)	(124,585)
Income tax									(95,012)	(99,043)
Net result attributable to JM									219,179	266,562


Total assets (1)	2,674,794	2,717,142	5,172,311	5,868,688	669,977	862,144	475,508	303,897	8,992,590	9,751,871

Total liabilities (1)	2,169,213	2,179,203	4,206,113	4,710,273	672,070	845,056	(310,876)	(211,569)	6,736,520	7,522,963


Investments in tangible and intangible asset	71,496	109,413	141,012	214,356	16,162	57,184	29,385	15,678	258,055	396,631

(1) The comparative report is 31th December of 2019

Reconciliation between EBIT and operational result

	2020	2019

EBIT	484,564	521,091
Other operating profits/losses	(20,898)	(7,993)
Operational result	463,666	513,098

4. Operating costs by nature

	Sep 2020	Sep 2019

Cost of goods sold and materials consumed	(11,054,303)	(10,652,601)
Changes in inventories of finished goods and work in progress	1,889	2,358
Net cash discount and interest paid to suppliers	19,412	25,357
Electronic payment commissions	(30,715)	(27,293)
Other supplementary costs	(4,230)	(4,290)
Supplies and services	(557,591)	(507,111)
Advertising costs	(65,378)	(77,657)
Rents	(10,441)	(12,489)
Staff costs	(1,301,731)	(1,199,568)
Depreciation and amortisation of tangibles and intangibles assets	(307,666)	(290,963)
Depreciation of right-of-use assets	(237,128)	(237,420)
Profit/loss with tangible and intangible assets	(4,470)	(2,553)
Profit/loss with right-of-use assets	583	291
Transportation costs	(148,705)	(151,231)
Other natures of profit/loss	(33,802)	(13,974)

Total	(13,734,276)	(13,149,144)

R&A \| First Nine Months 2020	27
Notes to the Consolidated Financial Statements

4.1. Other operating profits/losses
Operating costs by nature include the following other operating losses and gains considered material, which are
excluded from the Group's performance indicators, to assure a better comparability between financial periods:

		Sep 2020	Sep 2019

	Costs related with activities closure and projects canceled	(6,047)	(4,759)
	Assets write-offs and gains/losses in sale of tangible assets	(846)	(1,143)
	Changes to benefit plans and actuarial assumptions	-	(2,091)
	Impairment losses on current assets	(6,295)	-
	Activities closing and canceled projects costs	(5,987)	-
	Others	(1,723)	-

	Total	(20,898)	(7,993)

5. Net financial costs

	Sep 2020	Sep 2019

Loans interest expense	(16,978)	(19,471)
Leases interest expense	(95,005)	(98,231)
Interest received	2,151	2,130
Net foreign exchange	(5,332)	(2,410)
Net foreign exchange on leases	(20,492)	(5,585)
Other financial gains and losses	(5,008)	(3,693)
Fair value of financial investments held for trade:
Derivative instruments (note 8)	396	186
Total	(140,268)	(127,074)

The interest expense heading includes the interest regarding loans measured at amortised cost, as well as interest on cash flow hedging instruments (note 8).

Other financial gains and losses include costs with debt issued by the Group, booked in results through effective interest method.

Exchange differences on Net foreign exchange on leases refer to the exchange rate update, reported on 30 September 2020, on the euro-denominated lease contracts of the subsidiaries JMP (Biedronka) and JMDiF (Hebe), compared to the amount recognised at the end of the previous year (31 December 2019).

6. Income tax recognised in the income statement

	Sep 2020	Sep 2019

Current income tax
Current tax of the year	(130,317)	(127,005)
Adjustment to prior year estimation	2,360	2,894
	(127,957)	(124,111)

Deferred tax
Temporary differences created and reversed	31,521	23,220
Change to the recoverable amount of tax losses and temporary	487	1,049
differences from previous years

	32,008	24,269

Other gains/losses related to tax
Impact of changes in estimates for tax litigations	937	799

	937	799


Total income tax	(95,012)	(99,043)

R&A \| First Nine Months 2020	28
Notes to the Consolidated Financial Statements

Income tax expense is calculated based on the weighted average annual income tax rate expected for the year.

In 2020 the income tax rates for Group companies were the same applied in 2019, with the exception of Jerónimo Martins Colombia, where the rate was 32% compared to 33% in 2019.

7. Tangible assets, intangible assets, investment property and right-of-use assets

	Tangible assets	Intangible assets	Investment	Right-of-use	Total
	property	assets

Net value at 31 December 2019	3,969,937	794,010	8,563	2,334,949	7,107,459

Foreign exchange differences	(220,107)	(27,719)	-	(153,594)	(401,420)
Increases	253,366	4,689	-	98,380	356,435
Contracts update	-	-	-	100,793	100,793
Disposals and write-offs	(6,017)	-	-	-	(6,017)
Contracts cancellation	-	-	-	(20,653)	(20,653)
Transfers	2,253	(2,203)	-	(50)	-
Depreciation, amortisation and impairment losses	(297,695)	(9,971)	-	(237,128)	(544,794)
Fair value changes	-	-	(30)	-	(30)
Net value at 30 September 2020	3,701,737	758,806	8,533	2,122,697	6,591,773

Net value of intangible assets at 30 September 2020 include Goodwill in the amount of EUR 620,948 thousand.

Due to currency translation adjustment of the assets in the Group's businesses reported in foreign currency, the net amount of tangible and intangible assets and right-of-use assets decreased by EUR (401,420) thousand, which includes a decrease of EUR (19,755) thousand related to Goodwill from businesses in Poland.

8. Derivative financial instruments

Derivatives held for trading

Currency forwards - stock purchase (COP/USD)

Currency forwards - stock purchase (EUR/USD)

Currency forwards - stock purchase (PLN/EUR) Currency forwards - stock purchase (PLN/USD)

Cash flow hedging derivatives

Interest rate swap (PLN)

Currency forwards - stock purchase (PLN/USD)

Foreign operation investments hedging derivatives

Currency forwards (PLN)

		Sep 2020							Dec 2019

Notional	Assets	Liabilities		Notional	Assets		Liabilities

	Current	Non-	Current	Non-			Current			Non-	Current	Non-
	current	current				current	current

2.2 million	8	-	14		-	-		-		-	-		-
EUR

0.5 million	3	-	-		-	4 million USD		-		-	43		-
USD

-	-	-	-		-	92 million		-		-	352		-
	EUR

-	-	-	-		-	6 million USD		-		-	20		-
-	-	-	-		-	166 million		-		-	26		-
	PLN

6.6 million	4	-	36		-	2 million USD		-		-	1		-
USD

520 million	1,665	-	190		-	649 million		-		-	2,614		-
PLN		PLN

Total derivatives held for trading	11	-	14	-	-	-	415	-
Total hedging derivatives	1,669	-	226	-	-	-	2,641	-

Total assets/liabilities derivatives	1,680	-	240	-	-	-	3,056	-

R&A \| First Nine Months 2020	29
Notes to the Consolidated Financial Statements

9. Trade debtors, accrued income and deferred costs

	Sep 2020	Dec 2019

Non-current
Other debtors	66,920	65,385
Collateral deposits associated to financial debt	-	19,367
Deferred costs	3,197	2,015

Total	70,117	86,767

Current
Commercial customers	41,722	64,188
Other debtors	115,892	124,371
Other taxes receivable	9,049	7,617
Accrued income and deferred costs	178,720	228,513

Total	345,383	424,689

The Group held a remunerated deposit in the amount of EUR 19,367 thousand, set in 2014 and with a maturity occurred in January 2020, which was being used as collateral for financial bank loans to the subsidiary Jeronimo Martins Colombia, S.A.S..

10. Cash and cash equivalents

	Sep 2020	Dec 2019

Bank deposits	724,833	541,454
Short-term investments	143,462	383,816
Cash in hand	4,196	4,041

Total	872,491	929,311

11. Dividends

Dividends in the amount of EUR 145,447 thousand were paid in 2020, to JMH shareholders in the amount of EUR 130,086 thousand, and to partners with non-controlling interests in the Group companies in the amount of EUR 15,361 thousand.

12. Basic and diluted earnings per share

	Sep 2020	Sep 2019

Ordinary shares issued at the beginning of the year	629,293,220	629,293,220
Own shares at the beginning of the year	(859,000)	(859,000)
Weighted average number of ordinary shares	628,434,220	628,434,220

Diluted net results of the year attributable to ordinary shares	219,179	266,562

Basic and diluted earnings per share - Euros	0.3488	0.4242

13. Borrowings

The Group has negotiated commercial paper programs in the total amount of EUR 265,000 thousand, of which EUR 115,000 thousand are committed. The utilizations under these programs are remunerated at the Euribor rate for the respective issue period, plus variable spreads. In the first nine months of the year some emissions were carried out, to meet cash requirements, but without any utilizations as of 30 September 2020.

An extension of a bank overdraft line held by Jeronimo Martins Polska, S.A.and Jeronimo Martins Drogerie i Farmacja Sp. z o.o. was negotiated for an additional two years in the amount of PLN 150,000 thousand. An extension of a loan by JM Nieruchomości Bis Sp. z.o.o. for PLN 326,250 thousand (c. EUR 71,700 thousand) was also negotiated, for two years more.

A new financing contract was signed between European Investment Banking (EIB) and Jerónimo Martins, SGPS, S.A., Jeronimo Martins Polska, SA and JM Nieruchomości Bis Sp. z o.o., which aims to finance energy sustainability

R&A \| First Nine Months 2020	30
Notes to the Consolidated Financial Statements

projects in the Biedronka chain, for an amount total of m PLN 720,000 (c. EUR 160,000 thousand), whose funds will only be taken in the last quarter of the year.

Jerónimo Martins Colombia contracted a loan in Colombian pesos, in the medium and long term, with IFC, a member of the World Bank Group, in an amount exceeding COP 350,000,000 thousand, equivalent to USD 95,000 thousand.

13.1 Current and non-current loans

		Opening	Change acc.			Foreign	Closing
	Sep 2020	Cash flows	Transfers	exchange
	balance	policy	balance
				difference

Non-current loans
Bank loans	308,764	-	85,967	(111,252)	(35,235)	248,244

Total	308,764	-	85,967	(111,252)	(35,235)	248,244

Current loans
Bank overdrafts	34,099	-	(32,818)	-	(1,281)	-
Bank loans	389,586	-	(151,180)	111,252	(50,100)	299,558

Total	423,685	-	(183,998)	111,252	(51,381)	299,558


		Opening	Change acc.			Foreign	Closing
	Dec 2019	Cash flows	Transfers	exchange
	balance	policy *	balance
				difference

	Non-current loans
	Bank loans	277,524	-	108,128	(79,420)	2,532	308,764
	Financial lease liabilities	10,866	(10,866)	-	-	-	-

	Total	288,390	(10,866)	108,128	(79,420)	2,532	308,764

	Current loans
	Bank overdrafts	-	-	33,782	-	317	34,099
	Bank loans	346,531	-	(41,973)	79,420	5,608	389,586
	Financial lease liabilities	4,283	(4,283)	-	-	-	-

	Total	350,814	(4,283)	(8,191)	79,420	5,925	423,685

* With the adoption of the IFRS16 standard, the amounts were reclassified to "Lease liabilities" (see note 14).

14. Lease liabilities

	Sep 2020	Current	Non Current	Total

	Opening balance	384,980	1,999,293	2,384,273

	Increases (new contracts)	11,868	86,512	98,380
	Payments	(204,745)	(842)	(205,587)
	Transfers	184,120	(184,120)	-
	Contracts change/ cancel	12,184	67,373	79,557
	Foreign exchange difference	(22,034)	(116,519)	(138,553)

	Closing balance	366,373	1,851,697	2,218,070


	Dec 2019	Current	Non Current	Total

	Opening balance	-	-	-

	Change in accounting policy	370,964	2,042,191	2,413,155
	Increases (new contracts)	30,032	208,729	238,761
	Payments	(258,043)	(6,154)	(264,197)
	Transfers	259,869	(259,869)	-
	Contracts change/ cancel	(20,953)	(1,236)	(22,189)
	Foreign exchange difference	3,111	15,632	18,743

	Closing balance	384,980	1,999,293	2,384,273

R&A \| First Nine Months 2020			31
Notes to the Consolidated Financial Statements

During the first nine months of 2020, the incremental borrowing rates used to measure lease liabilities were revised, considering changes in the financial markets. At 30 September 2020, the average incremental borrowing rate was 5.74% (in a range between 2.4% and 9.1%). At 31 December 2019, the average incremental borrowing rate was 5.67% (in a range between 2.5% and 8.9%).

15. Financial debt

The net consolidated financial debt at the balance sheet date is as follows:

	Sep 2020	Dec 2019*

Non-current loans (note 13.1)	248,244	308,764
Current loans (note 13.1)	299,558	423,685
Financial lease liabilities - non-current(note 14)	1,851,697	1,999,293
Financial lease liabilities - current (note 14)	366,373	384,980
Derivative financial instruments (note 8)	(1,440)	3,056
Interest on accruals and deferrals	1,948	423
Cash and cash equivalents (note 10)	(872,491)	(929,311)
Collateral deposits associated to financial debt (note 9)	-	(19,367)
Total	1,893,889	2,171,523

December 2019 Financial debt was restated. Cash in hand, which is part of Cash and cash equivalents is now included in Financial debt.

16. Provisions and employee benefits

	Risks and	Employee
	contingencies	benefits
Balance at 1 January	27,780	69,669

Set up, reinforced and transfers	3,041	5,506
Unused and reversed	(920)	(8)
Foreign exchange difference	(515)	(1,750)
Used	(500)	(2,095)

Balance at 30 September	28,886	71,322

17. Trade creditors, accrued costs and deferred income

	Sep 2020	Dec 2019

Non-current
Other commercial creditors	82	51
Accrued costs and deferred income	694	713

Total	776	764

Current
Other commercial creditors	2,954,607	3,320,957
Other non-commercial creditors	208,471	334,128
Other taxes payables	115,349	120,791
Contracts liabilities with customers	5,147	3,628
Refunds liabilities to customers	699	788
Accrued costs and deferred income	486,744	401,857

Total	3,771,017	4,182,149

R&A \| First Nine Months 2020	32
Notes to the Consolidated Financial Statements

18. Contingencies

In Portugal, following search and seizure actions carried out in late 2016 and early 2017 in several entities operating in the food distribution sector, the Competition Authority determined the opening of several inquiries, in the scope of which it came to issue against suppliers and retailers, including Pingo Doce, six statements of objection ("notas de ilicitude") for alleged anti-competitive practices, consisting of price alignment for certain products.

The statements of objection ("notas de ilicitude") do not reflect any definitive judgment on the actual occurrence of the alleged infractions, which the Company refutes to have existed.

The proceedings are at a very early stage having Pingo Doce already presented its response to the said illegality notes.

In Poland, during 2019, the Company Jeronimo Martins Polska (JMP) was notified by UOKiK (the Polish Office of Competition and Consumer Protection) on the opening of two proceedings, one of which regarding potential abuse of bargaining power in commercial relations with fruits and vegetables suppliers, and the other on missing labels on shelves and discrepancies between prices on the shelfs and the ones showed at the checkouts.

During the first nine months of 2020 JMP was notified on the opening of two other proceedings related to the accuracy of the promotions' information found on the Company's website and the marking of country of origin of fruit and vegetable products at the store level.

In August 2020, UOKiK notified the JMP of the decision on the case regarding the lack of price labels on the shelves and discrepancies in prices, and concluded by imposing a fine of PLN 115,000 thousand (c. EUR 25,000 thousand). The above-mentioned decision is not final, so the JMP, disagreeing with the understanding and conclusion of this Authority, appealed against it to the Court of Competition and Consumer Protection.

The remaining three processes are under analysis. The Company has provided all requested documents and replied to UOKIK on a timely basis. At the date of the emission of this report, there are no known decisions issued by UOKiK, regarding them are known, so it is therefore premature to foresee any conclusions and potential responsibilities to be recognized.

As at 30 September 2020, the following changes occurred to the contingencies mentioned in the 2019 Annual Report:
1. The Portuguese Tax Authorities assessed, regarding 2016, JMR SGPS and regarding 2016 and 2017 JMH (as the head of the Tax Group in which Recheio SGPS is included), the amounts of EUR 43,632 thousand and EUR 19,972 thousand, respectively, related to the taxation in CIT of ¼ of the results generated in internal operations of the Tax Group. As explained in the 2018 Annual Report (and previous years), this assessment results from the application of the transitional rule included in the Portuguese State Budget of 2016. Based on the assessment of our legal and fiscal advisors, we firmly believe that there are sufficient grounds to oppose the said rules. Therefore, no provisions have been made for the amount assessed and which is expected to be further assessed from the application of the 2016, 2017, 2018 and 2019 transitory rules - c. EUR 225,000 thousand in taxes;
2. The Food and Veterinary Department (Direcção-Geral de Alimentação e Veterinária) claimed from Pingo Doce, Recheio and Hussel the amounts of EUR 21,307 thousand, EUR 2,226 thousand and EUR 46 thousand, respectively, in respect of the Food Safety Tax (Taxa de Segurança Alimentar Mais - TSAM) assessed for the years 2012 to 2020. The values at stake have been challenged in Court, since it is understood that this tax is not due, namely on the grounds of the unconstitutional nature of the Statute that approved the TSAM. Despite the court having decided that the Food Safety Tax is not unconstitutional, the Companies maintain their understanding and appealed to the Constitutional Court, which kept the decision. Pingo Doce appealed against that decision to the Conference of Judges ("Conferência de Juízes"), and at the same time filed a complaint with the European Commission based on illegal state aid. The proceedings are still pending. The Group regularly assesses the risk and likelihood of its conclusion. However, in order to protect its legitimate interests and not to harm its position in these disputes, it does not disclose the amounts that may have been provisioned.

R&A \| First Nine Months 2020	33
Notes to the Consolidated Financial Statements

19. Related parties

56.136% of the Group is owned by the Sociedade Francisco Manuel dos Santos, B.V., and no transactions occurred between this company and any other company of the Group in the first nine months of 2020, neither were there any amounts payable or receivable between them on 30 September 2020.

Balances and transactions of Group companies with related parties are as follows:

	Joint ventures	Other related parties (*)

	Sep 2020	Sep 2019	Sep 2020	Sep 2019

Sales and services rendered	-	-	81	104
Interest income	45	39	-	-
Stocks purchased and services supplied	3,615	3,277	71,060	88,459

	Joint ventures	Other related parties (*)

	Sep 2020	Dec 2019	Sep 2020	Dec 2019

Trade debtors, accrued income and deferred costs	37	46	9	7
Trade creditors, accrued costs and deferred income	900	597	5,070	5,945

Other related parties corresponds to Other financial investments ,entities participated and/or controlled by the major shareholder of Jerónimo Martins and entities owned or controlled by members of the Board of Directors.

All the transactions with these related parties were made under normal market conditions, i.e. the transaction value corresponds to prices that would be applicable between non-related parties.

Outstanding balances between Group companies and related parties, being a result of trade agreements, are settled in cash, and are subject to the same payment terms as those applicable to other agreements celebrated between Group companies and their suppliers.

There are no provisions for doubtful debts and no costs were recognised during the year related with bad debts or doubtful debts with these related parties.

20. Events after the balance sheet date

At the conclusion of this Report there were no relevant events to highlight that are not disclosed in the Financial Statements.

Lisbon, 27 October 2020

The Certified Accountant

The Board of Directors

R&A \| First Nine Months 2020	34
Notes to the Consolidated Financial Statements

Attachments

Original document
Permalink

Disclaimer

Jeronimo Martins SGPS SA published this content on 24 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2020 18:12:01 UTC

Latest news about Jerónimo Martins, SGPS, S.A.

Canada Targets 12 Foreign Grocers to Lure to Food-Retailing Market -- 2nd Update	Apr. 18	DJ
Canada Targets 12 Foreign Grocers to Lure to Food-Retailing Market -- Update	Apr. 18	DJ
JERONIMO MARTINS : No major surprises in FY23; FY24 outlook is less than impressive!	Mar. 08
Transcript : Jerónimo Martins, SGPS, S.A., 2023 Earnings Call, Mar 07, 2024	Mar. 07
Jerónimo Martins, SGPS, S.A. Reports Earnings Results for the Fourth Quarter Ended December 31, 2023	Mar. 06	CI
Jerónimo Martins, SGPS, S.A. Reports Earnings Results for the Full Year Ended December 31, 2023	Mar. 06	CI
Why do family businesses outperform?	Mar. 05
JERONIMO MARTINS : Q4 sales dampened by a softer showing from Biedronka and Ara	Jan. 12
Jeronimo Martins' 2023 sales hit record over 30 billion euros	Jan. 11	RE
JERONIMO MARTINS : Q3 momentum led by Polish banners; further moderation in Colombian Ara	23-10-27
Transcript : Jerónimo Martins, SGPS, S.A., Nine Months 2023 Earnings Call, Oct 26, 2023	23-10-26
Jerónimo Martins, SGPS, S.A. Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2023	23-10-25	CI
Jeronimo Martins' third-quarter profit soars 28%, margin narrows	23-10-25	RE
Jeronimo Martins' third-quarter profit soars 28%	23-10-25	RE
Jerónimo Martins, SGPS, S.A.(ENXTLS:JMT) added to S&P International 700	23-09-18	CI
Jerónimo Martins, SGPS, S.A.(ENXTLS:JMT) added to S&P EUROPE 350 - Consumer Staples Distribution & Retail (Industry Group)	23-09-18	CI
Jerónimo Martins, SGPS, S.A.(ENXTLS:JMT) added to S&P EUROPE 350 - Consumer Staples	23-09-18	CI
Jerónimo Martins, SGPS, S.A.(ENXTLS:JMT) added to S&P EUROPE 350	23-09-18	CI
Jerónimo Martins, SGPS, S.A.(ENXTLS:JMT) added to S&P Global 1200	23-09-18	CI
Government facilitates fresh price negotiations in France; ripple effect likely!	23-09-01
JERONIMO MARTINS : Strong Q2 performance; management trying to balance sales growth and profitability!	23-07-31
Transcript : Jerónimo Martins, SGPS, S.A., H1 2023 Earnings Call, Jul 27, 2023	23-07-27
Jerónimo Martins, SGPS, S.A. Reports Earnings Results for the Second Quarter and Six Months Ended June 30, 2023	23-07-26	CI
J.Martins retailer first-half profit jumps 36%, inflation dents margins	23-07-26	RE
Are Aldi Nord and Sud planning to merge?	23-07-11

Chart Jerónimo Martins, SGPS, S.A.

Duration

Period

More charts

Company Profile

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.

Sector

Food Retail & Distribution

Calendar

2024-04-25 - Q1 2024 Earnings Release

Related indices

STOXX EUROPE 600 (EUR)

More about the company

Income Statement Evolution

More financial data

Analysis / Opinion

JERONIMO MARTINS : No major surprises in FY23; FY24 outlook is less than impressive!

March 08, 2024 at 01:14 am EST

More Strategies

Ratings for Jerónimo Martins, SGPS, S.A.

Trading Rating

Investor Rating

ESG Refinitiv

B-

More Ratings

Analysts' Consensus

Sell

Buy

Mean consensus

OUTPERFORM

Number of Analysts

Last Close Price

18.63 EUR

Average target price

23.39 EUR

Spread / Average Target

+25.53%

Consensus

EPS Revisions

Estimates Revisions

Quarterly earnings - Rate of surprise

Company calendar

Sector Supermarkets & Convenience Stores

	1st Jan change	Capi.
JERÓNIMO MARTINS, SGPS, S.A.	-19.66%	12.51B
FOMENTO ECONÓMICO MEXICANO, S.A.B. DE C.V.	-10.48%	37.7B
AVENUE SUPERMARTS LIMITED	+14.07%	37.47B
SEVEN & I HOLDINGS CO., LTD.	+9.92%	34.52B
SM INVESTMENTS CORPORATION	+8.60%	20.02B
COLES GROUP LIMITED	+1.30%	14.13B
ICA GRUPPEN	-.--%	11.82B
CASEY'S GENERAL STORES, INC.	+14.89%	11.68B
DINO POLSKA S.A.	-18.06%	9.25B
J SAINSBURY PLC	-13.95%	7.79B

Supermarkets & Convenience Stores

Jerónimo Martins, SGPS, S.A.

Equities

JMT

PTJMT0AE0001

Food Retail & Distribution

Jeronimo Martins SGPS S A : 9M 2020 Report

EPS Revisions