25 de febrero de 2014 / 20:25 / en 4 años

Jeronimo Martins profit up, sees sales growing further

* Q4 net profit 201 mln euros vs 206 mln avg forecast

* Sales up 8.6 percent but EBITDA slips

* Sees 2014 sales growth same or more than last year’s 10.7 pct

* EBITDA margin could continue to decline in 2014

LISBON, Feb 25 (Reuters) - Portuguese retailer Jeronimo Martins on Tuesday posted a 14 percent increase in quarterly net profit as sales rose and said it will keep betting on promotional price positioning to boost market share and sales even if it dented profitability.

“We expect the growth of the groups sales in 2014, excluding the effect of the exchange rates, to be at least in line with the growth achieved in 2013” of 10.7 percent, the company, which is the largest food retailer in Poland and the second-largest at home, said in a statement.

Net profit in the fourth quarter rose to 102 million euros ($140 million) on an 8.5 percent sales growth, but earnings before interest, taxes, depreciation and amortization (EBITDA) slipped about 2 percent to 204 million euros.

Analysts had forecast, on average, a net profit of 106 million euros and EBITDA of 211 million.

“We will continue to reinforce our price positioning, as necessary, to maintain our sales growth ahead of the market in Poland and Portugal,” it said, adding that while EBITDA is expected to grow in line with sales, EBITDA margin could end up below 2013 levels due to tough competition in its key markets.

The margin, a measure of operating profitability, fell 30 basis points to 6.6 percent of sales in 2013 due to price positioning in Poland and also the impact of the group’s start-up costs in Colombia.

For all of 2013, Jeronimo Martins profit rose 6 percent to 382 million euros, while EBITDA rose 5 percent to 777 million euros.

“In 2013 all our businesses grew ahead of the market, having responded well to the challenging economic and competitive environments in Poland and Portugal,” the company said, adding that it had to rely heavily on intensive promotional actions to grow market share.

Bailed-out Portugal last year started to emerge form its worst recession since the 1970s, but its economy still contracted 1.4 percent.

Jeronimo Martins, whose shares had risen 0.9 percent on Tuesday before the results were announced, said it is “well prepared to perform in 2014, a year in which we expect the economic and competitive environments to remain difficult and intense.” ($1 = 0.7282 euros) (Reporting By Andrei Khalip, editing by William Hardy)

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