May 21, 2020 / 3:29 PM / 3 months ago

Retailer Jeronimo Martins says open to acquisition opportunities

By Patricia Vicente Rua

LISBON, May 21 (Reuters) - Portuguese retailer Jeronimo Martins has put a 750 million euro ($821 million) investment plan for 2020 on hold but remains in a solid position to take advantage of any opportunities that could arise from the coronavirus crisis, its CEO said on Thursday.

The firm’s capital expenditure plan included widening its existing networks in Poland, Portugal and Colombia as well as exploring expanding to other countries such as Romania, CEO Pedro Soares Santos wrote in an emailed reply to questions from Reuters.

These plans are temporarily suspended but investments to which the company had already committed and those in execution would still go through, dos Santos said, though declining to specify how many locations would open this year.

“Fortunately, this crisis finds us in a financially solid situation, after a year of strong results in 2019, which gives us the flexibility to act on the possible opportunities which could come out of these times,” he said.

Sales increased 11% to 4.7 billion euros in the first quarter of 2020 compared to the same period last year, with Polish affiliate Biedronka leading the way with a 12.3% sales increase to 3.3 billion euros.

By contrast, Portugal’s Pingo Doce supermarket trailed behind with a 3.5% sales increase to 936 million.

“By the behaviour of consumers in Portugal from the start of the pandemic, we can see that economic difficulties are starting to affect a lot of families,” he said, adding that social distancing measures also affected Pingo Doce’s sales.

Portugal, which has confirmed 29,912 cases of the new coronavirus and 1,277 deaths, is expected to take a 6.8% hit to its GDP in 2020, according to European Commission predictions.

The Polish economy is expected to contract 4-5%, with the country reporting a lower toll of 19,268 cases and 948 deaths so far. ($1 = 0.9136 euros) (Reporting by Patricia Rua, Writing by Victoria Waldersee, editing by Andrei Khalip)

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