Jerónimo Martins, SGPS, S.A.

Group sales increased 5.1% year over year, or 4.5% at constant exchange rates, to EUR 18.3 billion. EBITDA rose 7.6% to EUR 1.2 billion, and the EBITDA margin improved 16 basis points to 6.8% from 6.6%. Excluding IFRS 16, the Group ended June with a net cash position of EUR 11 million after paying EUR 409 million to shareholders. Cash flow before dividends was negative EUR 332 million, and H1 capital investment was EUR 412 million. By banner, Biedronka sales were EUR 12.6 billion (+1.7%), Hebe sales were EUR 312 million (+5%), Pingo Doce sales were EUR 2.7 billion (+5.3%), Recheio sales were EUR 673 million (+2.5%), and Ara sales were EUR 2 billion (+30.2% in euros, +21.1% in local currency). On outlook, management said it does not expect any material improvement in market conditions in the second half, with geopolitical uncertainty, weak visibility and pressure on consumer confidence likely to persist. The investment program for the year is capped at around EUR 1.2 billion, focused on growth, store modernization and logistics.

The lead executive emphasized that the first half was more demanding than expected because of strong food price pressure, fuel-related costs, and cautious consumers focused on low prices and promotions. The strategic response was consistent across banners: protect price competitiveness, strengthen value propositions, execute efficiently, and continue to drive volume. Tone-wise, management was cautious but confident that the businesses remain resilient and that the company can preserve consumer preference while protecting long-term value.

The CFO highlighted that EBITDA growth outpaced sales growth, with margin up to 6.8%, and said this came from volume growth, sales mix and efficiency rather than easing market conditions. She noted that H1 cash flow before dividends was negative EUR 332 million, reflecting EUR 412 million of capital investment, EUR 409 million of dividends, and working-capital pressure from Biedronka basket deflation. She also flagged higher financial costs from the expansion program and capitalized lease interest, plus EUR 40 million tied to the Jerónimo Martins Foundation, and said the annual investment program is capped at around EUR 1.2 billion.

Analysts focused heavily on Poland: when food inflation might turn positive, whether Biedronka’s margins are sustainable, how much of the volume growth came from market share, and whether the company would reinvest some of the margin uplift. Management said it does not yet see an inflection in supplier pricing or food deflation, and that Q3 still looks difficult, with a possible easing only later in the year. On Biedronka, she said price leadership will be maintained, some margin may be reinvested if needed to preserve competitiveness, and market share was roughly stable through May with a slight improvement in June. She also explained that the strong gross margin came mainly from assortment mix and promotions, while Slovakia remains at an early stage with 17 stores and still EBITDA dilutive; on potential M&A there, management would not comment on rumors but said it does not exclude opportunities.