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Jeronimo Martins Earnings Release 2021
1906_iss_2022-03-09_b2314058-8304-478f-b4e6-4c7342c6c5d4.pdf
Earnings Release
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FULL YEAR RELEASE
2021
Lisbon, 9 March 2022
FINANCIAL CALENDAR
General Shareholders Meeting: 21 April 2022 Q1 2022 Results: 28 April 2022 H1 2022 Results: 27 July 2022 9M 2022 Results: 26 October 2022 *All releases will be published after the closing of the market
ADDITIONAL NON-FINANCIAL INFORMATION RELATING TO THE PERIOD (MEDIA PRESENTATION) HERE
This release includes, in Appendix 1, for comparison purposes, the Financial Statements excluding the effect of the IFRS16.
INVESTOR RELATIONS OFFICE MEDIA RELATIONS OFFICE +351 21 752 61 05 +351 21 752 61 80 [email protected] [email protected]
Cláudia Falcão [email protected] Rita Fragoso [email protected]om Hugo Fernandes [email protected] Nuno Abreu [email protected]
Jerónimo Martins, SGPS, S.A. Public Company | Head office: Rua Actor António Silva, n. º7, 1649-033 Lisbon | Share Capital: Euro 629,293,220.00 | Registered at the C.R.C. of Lisbon and Tax Number: 500 100 144 | www.jeronimomartins.com Jerónimo Martins, SGPS, S.A. Public Company | Head office: Rua Actor António Silva, n. º7, 1649-033 Lisbon | Share Capital: Euro 629,293,220.00 | Registered at the C.R.C. of Lisbon and Tax Number: 500 100 144 | www.jeronimomartins.com
REMARKABLE GROWTH AND INCREASED PROFITABILITY IN A CHALLENGING YEAR
PERFORMANCE OVERVIEW & KEY DRIVERS
The commitment of all Group banners to supply quality at low prices to consumers enabled total sales to grow 8.3% and exceed the 20 billion euros milestone in 2021.
This performance was achieved in a year full of challenges and uncertainty. Our teams, particularly those working under tough circumstances at the front line of the businesses, remained focused on serving our consumers.
The solid sales performance in all business areas, combined with careful management of margin mix and focus on operational efficiency, allowed us to i. limit the impact of the sales tax introduced in January 2021 in Poland; ii. benefit from operational leverage in Portugal; and iii. take important steps towards profitability in Colombia, with Ara delivering, for the first time, positive EBITDA (under IFRS16). At a Group level, the EBITDA margin increased to 7.6% in 2021 from 7.4% in 2020.
The outstanding operating performance resulted in strong cash generation. The Group ended the year with a net cash position (excluding capitalised operating lease liabilities) of one billion euros.
The increase in consolidated Pre-Tax ROIC to 21.5% (vs. 16.5% in 2020) marks 2021 as another year of profitable growth, one which Jerónimo Martins closed with a very solid financial position. The Group maintained a long-term view by guaranteeing support to its teams, consumers, suppliers, and the communities served by its store network. At the same time, the Group strengthened market positions in all countries where it operates.
We have also taken significant steps to deliver on the objectives outlined in our corporate responsibility pillars, for which we have received external recognition. Jerónimo Martins ended 2021 listed in more than 100 ESG indices, having i. entered, for the first time, CDP's "A List" of companies with the best performance in the "Climate change" and "Water security" programmes, and ii. been included, for the second consecutive year, in the Bloomberg Gender-Equality Index, with an improvement in the assessment compared to 2020.
Building on the progress we have made in recent years in implementing the TCFD recommendations, in December 2021 we submitted to the Science-Based Targets Initiative our commitment to define, by the end of 2023, an emissions-reduction target.
Despite the uncertainty that still prevails in our markets, this performance and the solid financial situation of the Group lead the Board of Directors to propose to the General Shareholders' Meeting the distribution of an exceptional payout of 100% of net income (without IFRS16), corresponding to a dividend payment of 493.3 million euros, equivalent to 0.785 euros per share (gross value).
MESSAGE FROM THE CHAIRMAN AND CEO - PEDRO SOARES DOS SANTOS
'Although in the light of the recent events in Ukraine 2021 seems already very far away, it is fair to recognise that our teams surpassed once again the challenges posed by the difficult circumstances. Still in a pandemic context, new sales records were set and the value and relevance for the consumer of our banners' proposals were confirmed. At the Group level, we added more than 1.5 billion euros to sales (around 2 billion euros at constant exchange rates). One more time, the most significant contribution came from Biedronka. But it is worth noting that Pingo Doce exceeded the historic milestone of 4 billion euros in sales, and Ara passed, for the first time, the 1 billion euros sales threshold. This growth dynamic resulted in extraordinary cash generation that further reinforced the already very solid financial position of Jerónimo Martins.
2021 closes a decade of remarkable value creation by thousands of teams that build our business every day and that I have had, and have, the privilege of leading. Since 2010, we have invested 6.5 billion euros, the majority of which was devoted to reinforcing Biedronka's leadership in Poland and building a new retail operation in Colombia. This operation, which already has more than 800 stores, gave us the joy of entering positive EBITDA territory in 2021, eight years after the inauguration of our first store. Our growth has created 70 thousand jobs directly in the last decade, most of them in Poland and Colombia. We will continue the effort made in the previous decade to continue investing in our people, improving our employees' remuneration and benefits packages. Our efforts in this regard and in the broader path of responsible performance earned us inclusion, at the end of the year, in more than 100 international sustainability indices.
We know that the road ahead is full of challenges and uncertainty that the military crisis only reinforces. As we go forward, we will rely on our balance sheet strength, on Biedronka's resilience and capacity to overcome adversity, on Ara's youth and expansion capabilities, and on the deep business know-how of our companies in Portugal. In Portugal, we expect to continue facing structural problems: an aging population, a fragile economy pressured by a high tax burden, the scarcity of productive investment, and the dearth of opportunities for young people. Nonetheless, in 2022 - the year when Jerónimo Martins celebrates 230 years since its foundation - I want to make clear that each one of our businesses counts for us. And that all will contribute to the future we envisage.'
OUTLOOK 2022
Adding to the ongoing uncertainty associated with the evolution of Covid-19 pandemic, the situation in Ukraine steps up the challenges ahead.
In the second week after the invasion of Ukraine by the military forces of the Russian Federation it is still too early to understand the full consequences over the region, over Europe and over the World.
Meanwhile the rapid increase in food, energy, and transportation prices are today exacerbated by the military conflict and by increased bottlenecks in international supply chains. Moreover, there is a visible depreciation of Eastern Europe currencies, namely of the zloty.
Flexibility and agility in responding to particularly demanding circumstances will continue to be core attributes of our teams, which have shown so far a remarkable mobilization to aid refugees.
With mounting food inflation, maintaining price competitiveness and creating saving opportunities through promotional activity is even more critical in all Companies' agendas.
Biedronka is aware of the extra difficulties of managing the balance between growth at sales level and profitability protection. In the current circumstances its key priority is to stand by the Polish consumers and live up to the banner's claim in a moment of decrease in disposable income. As such, and despite the insufficient visibility at this moment over the impact of recent events in Ukraine, particularly on the extension of cost inflation, Biedronka is prepared to further invest in prices to maintain competitiveness, which will increase pressure on margins.
At this point in time, Biedronka expects to be able to stick to its expansion plan for the year and open c.130 stores and a new distribution centre, as well as to remodel c.350 locations in 2022.
That being said, the current situation demands for an even closer monitoring and even higher adaptability. We will be continuously reassessing needs and priorities, making sure our number one goal in Poland is met: partnering with our suppliers to overcome likely constraints in the food chain and keep being the Poles' favourite food store, while supporting the Polish effort to help Ukrainians.
As for Hebe, its plan is to open c.30 stores in 2022, while continuing to focus on its online operation.
In Portugal, Pingo Doce will leverage its growth on the fresh-food categories. The emphasis will be put on ready-to-eat solutions, building on the competitive advantages of two central kitchens and professional dedicated teams.
The banner's investment programme includes the opening, in the year, of c.10 stores and the remodelling of c.30 locations in 2022.
Recheio will benefit from the recovery of the HoReCa channel, which should gain momentum with the likely recovery of some touristic flows. This year the banner expects to open a flagship store in Cascais.
Ara is starting 2022 from a position of price leadership and an offer tailored to Colombian consumers' needs. Ara's focus is on being the consumers' preferred store through a policy of
competitive prices, well-designed promotions, and an assortment crafted to drive an increased share of wallet.
The banner plans to end 2022 with more than 1,000 stores in its network and to leverage on its good sales momentum to improve profitability.
The strength of our balance sheet is paramount particularly in uncertain times. Although current circumstances do not advise accelerating moves towards new future growth paths, we retain the necessary financial flexibility to do so, while delivering the designed investment plan for the year (c.850 million euros) and paying the dividend proposed to the AGM.
Q4 UPDATE ON COVID-19 IMPACT
In Poland, after few containment measures in Q3, rising concerns around the new Omicron variant led the Polish Government to announce new restrictions at the end of November that were in force between 1 and 17 December. The occupancy capacity for cinemas, theatres, restaurants, and hotels became more restricted. The limits for supermarkets above 100 sqm were reintroduced as of the beginning of the year, with a maximum of one person per 15 sqm.
In Portugal, because of the need to contain the new variant, some limitations were reintroduced in mid-December, namely a maximum of one person per 5 sqm allowed inside commercial spaces and mandatory remote work.
In Colombia, in Q4, as in Q3, there were few containment measures in place.
PERFOMANCE ANALYSIS BY BANNER
POLAND
In Poland, the consumer environment remained positive throughout the year, with greater control of the pandemic situation and the consequent easing of restrictive measures. Biedronka benefited from increased in-store visits through a robust commercial programme, including promotions and innovative in&out campaigns. The company continued to improve its assortment and store network.
In 2021, sales in local currency grew 11.0%, including LFL at 8.3%. In euros, sales reached 14.5 billion, 8.0% ahead of 2020. The ongoing focus on price leadership and an intense promotional dynamic resulted in basket inflation of 0.6%, significantly below average food inflation in Poland, which reached 3.2%.
The sales growth recorded in 2021 produced a market share gain of 1.6 p.p..
The implementation of the retail sales tax in January 2021 added to the challenges created by the pandemic. Despite of these, sales growth, effective margin mix management and efforts to increase operating efficiency protected EBITDA margin, which reached 9.2% (9.3% in 2020). EBITDA increased 6.9% (+9.8% in local currency).
Biedronka, which had planned to add 100 stores to its network, ended up opening 135 new stores (net). It also opened 14 micro-fulfilment centres to support its Biek operation (ecommerce operation with ultra-fast deliveries) inaugurated in October.
Despite having been affected by containment measures, Hebe recorded strong sales growth. The online channel gained momentum and increased its contribution to 13.0% of total sales.
Sales in local currency grew 16.7%. Excluding the pharma business (closed in July 2020), sales increased 23.8%, with LFL at 17.5% (LFL includes online sales).
In euro, sales reached 278 million, 13.5% ahead of 2020.
The good sales performance allowed Hebe to recover operating leverage, improving the EBITDA margin to 9.0% (7.6% in 2020). EBITDA reached 25 million euros vs. 19 million euros in 2020.
Hebe opened 25 new stores in the year that marks its 10th anniversary.
PORTUGAL
In Portugal, the recovery of consumption was impacted by weak tourism activity that continued to affect the economy throughout the year.
Despite intermittent restrictions on the circulation of people and on the normal operation of restaurants and coffee shops in the first seven months of the year, Pingo Doce recorded solid sales performance in 2021, reaching the significant milestone of 4.0 billion euros, a growth of 4.6% vs. 2020, including LFL (excl. fuel) at 2.7%.
Intense promotions and price dynamics contributed to this performance and drove the banner to operate with negative basket inflation in the year.
With sales momentum driving operational leverage, Pingo Doce EBITDA reached 244 million, euros an increase of 9.7% relative to 2020. Despite the substantial investment in price positioning, the EBITDA margin was 6.0%, ahead of the 5.8% registered in 2020.
Pingo Doce opened 14 new stores (12 net additions) and renewed 15 locations.
Recheio's sales recovered progressively, despite the reduced tourism activity and the restrictions imposed throughout 2021 that, albeit less impactful than in 2020, continued to limit top-line growth.
The banner's sales grew 7.0% to 906 million euros, with LFL at 7.0%.
EBITDA reached 43 million euros, 30.3% ahead of 2020, and the respective margin increased from 3.9% in 2020 to 4.7% in 2021, reflecting a recovery in operational leverage.
COLOMBIA
In Colombia, the effects of the long lockdown in 2020 limited the pace of the country's economic recovery. In 2021, food inflation increased significantly from May onwards, fuelled in part by strikes and social protests, which disrupted the national supply chain.
In a generally unrestricted operating environment, the consistency of Ara's value proposition and investment in price resulted in a remarkable sales performance. The company confirmed its importance in the Group's growth strategy.
Sales increased 36.1%, in local currency, including LFL at 24.3%. In euros, sales reached 1.1 billion in 2021, 29.0% ahead of the previous year.
Sales growth together with the cost optimization implemented in 2020 delivered a remarkable improvement in the Company's profitability that, for the first time, registered positive EBITDA (under IFRS16) at 26 million euros (-20 million euros in 2020).
With a commitment to growth and confidence boosted by the consistency of daily performance, the Company focused on store openings and inaugurated 157 stores (156 net), exceeding the 100 stores outlined for the year.
CONSOLIDATED FINANCIAL HEADINGS
Group Sales grew 8.3% (+10.7% excluding the exchange rate effect) with LFL at 8.0%. The performance registered in all banners drove operational leverage improvement and resulted in EBITDA increasing 11.4% (+14.1% excluding the exchange rate effect). EBITDA includes additional direct costs of c.17 million euros (c.41 million euros in 2020) related to the pandemic.
The good operating performance of all Companies reflects strong competitive positions that led to market share gains in all countries. The Group closed 2021 with stronger business models in their ability to serve consumers and to adapt quickly to changes.
Financial Results amounted to -154 million euros, having decreased compared to the -180 million euros recorded in 2020. These include recognition of currency conversion losses of -3 million euros relating to value adjustments in the capitalisation of operating lease liabilities in Poland denominated in euros (-21 million euros in 2020).
Other Gains and Losses amounted to -34 million euros, reflecting, among others, restructuring costs and the payment of a recognition award to employees that worked at the front line in a total amount of c.19 million euros.
The investment programme reached a total of 690 million euros, with Ara and Biedronka opening more stores than initially planned. The investment programme remained at the centre of the Group's capital allocation priorities, contributing to the growth delivered in the year through new stores and through remodelling of store networks.
Cash Flow amounted to 723 million euros, increasing from 516 million euros generated in 2020. This strong performance reflects the growth in operating profit and careful management of working capital, which also benefited from a positive effect related to the year-end store openings.
Cash generation reinforced the already healthy Consolidated Balance Sheet which, at the end of the year, showed a cash position (excluding capitalised operating lease liabilities) of one billion euros.
DIVIDEND DISTRIBUTION PROPOSAL
Taking into consideration the consolidated net earnings for 2021, the solid financial situation of the Group (a 1 billion euros cash position at year end) and the business momentum, the Board of Directors will propose to the Annual General Shareholder's Meeting to distribute 493.3 million euros from profits for the year and from free reserves.
This amount represents an exceptional payout of 100% of consolidated net earnings (or 96% of the ordinary consolidated net earnings) excluding the effects of IFRS16, double the amount that would result from the Company's dividend policy.
The proposed distribution of profits for the year and free reserves corresponds to a gross dividend of 0.785 euros per share, excluding the 859,000 own shares in the portfolio.
After this distribution, the Company and the Consolidated Balance Sheet will remain strong. The Group retains the flexibility to continue investing in organic growth and to take advantage of potential acquisition opportunities.
KEY PERFOMANCE FIGURES
CONSOLIDATED RESULTS
| (€ Million) | 2021 | 2020 | ∆ | Q4 21 | Q4 20 | ∆ | ||||
|---|---|---|---|---|---|---|---|---|---|---|
| Net Sales and Services | 20,889 | 19,293 | 8.3% | 5,683 | 5,096 | 11.5% | ||||
| Gross Profit | 4,497 | 21.5% | 4,227 | 21.9% | 6.4% | 1,207 | 21.2% | 1,110 | 21.8% | 8.7% |
| Operating Costs | -2,912 -13.9% | -2,804 -14.5% | 3.9% | -767 -13.5% | -717 -14.1% | 6.9% | ||||
| EBITDA | 1,585 | 7.6% | 1,423 | 7.4% | 11.4% | 441 | 7.8% | 394 | 7.7% | 12.0% |
| Depreciation | -745 | -3.6% | -734 | -3.8% | 1.5% | -189 | -3.3% | -189 | -3.7% | -0.1% |
| EBIT | 840 | 4.0% | 689 | 3.6% | 21.9% | 252 | 4.4% | 205 | 4.0% | 23.2% |
| Net Financial Costs | -154 | -0.7% | -180 | -0.9% | -14.6% | -35 | -0.6% | -40 | -0.8% | -13.7% |
| 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 | -34 | -0.2% | -50 | -0.3% | n.a. | -26 | -0.5% | -29 | -0.6% | n.a. |
| EBT | 652 | 3.1% | 459 | 2.4% | 42.2% | 191 | 3.4% | 135 | 2.7% | 41.3% |
| Income Tax | -168 | -0.8% | -136 | -0.7% | 23.7% | -48 | -0.9% | -41 | -0.8% | 18.1% |
| Net Profit | 484 | 2.3% | 323 | 1.7% | 50.0% | 143 | 2.5% | 94 | 1.8% | 51.5% |
| Non-Controlling Interests | -21 | -0.1% | -11 | -0.1% | n.a. | -4 | -0.1% | -1 | 0.0% | n.a. |
| Net Profit Attributable to JM | 463 | 2.2% | 312 | 1.6% | 48.3% | 139 | 2.4% | 93 | 1.8% | 49.5% |
| EPS (€) | 0.74 | 0.50 | 48.3% | 0.22 | 0.15 | 49.5% | ||||
| EPS without Other Profits/Losses (€) | 0.77 | 0.55 | 39.5% | 0.25 | 0.18 | 38.2% |
BALANCE SHEET
| (€ Million) | 2021 | 2020 |
|---|---|---|
| Net Goodwill | 618 | 620 |
| Net Fixed Assets | 4,159 | 3,967 |
| Net Rights of Use (RoU) | 2,221 | 2,154 |
| Total Working Capital | -3,290 | -2,864 |
| Others | 145 | 133 |
| Invested Capital | 3,852 | 4,010 |
| Total Borrowings | 460 | 524 |
| Financial Leases | 22 | 11 |
| Capitalised Operating Leases | 2,365 | 2,262 |
| Accrued Interest | 0 | -3 |
| Cash and Cash Equivalents | -1,527 | -1,041 |
| Net Debt | 1,320 | 1,752 |
| Non-Controlling Interests | 254 | 249 |
| Share Capital | 629 | 629 |
| Reserves and Retained Earnings | 1,649 | 1,379 |
| Shareholders Funds | 2,532 | 2,257 |
CASH FLOW
| (€ Million) | 2021 | 2020 |
|---|---|---|
| EBITDA | 1,585 | 1,423 |
| Capitalised Operating Leases Payment | -277 | -270 |
| Interest Payment | -152 | -153 |
| Other Financial Items | 0 | 0 |
| Income Tax | -174 | -174 |
| Funds From Operations | 982 | 826 |
| Capex Payment | -604 | -510 |
| Change in Working Capital | 375 | 246 |
| Others | -29 | -46 |
| Cash Flow | 723 | 516 |
DISCLAIMER
Statements in this release that are forward-looking are based on current expectations of future events and are subject to risks and uncertainties that can cause actual results to differ materially from those expressed or implied by such statements. The risks and uncertainties, which have increased as a result of the Covid-19 pandemic and more recently due to the war in Ukraine, relate to factors that are beyond Jerónimo Martins' ability to control or estimate precisely, and include but are not limited to, general economic conditions, actions taken by governmental authorities to address Covid-19 effects and their impacts over the economy, competition, industry trends, credit markets, foreign exchange fluctuations, and regulatory developments.
Except as required by any applicable law or regulation, Jerónimo Martins assumes no obligation to update the information contained in this release or to notify a reader if any matter stated herein changes or becomes inaccurate.
APPENDIX
1. Financial Statements
INCOME STATEMENT BY FUNCTIONS
| IFRS16 | Excl. IFRS16 | ||||
|---|---|---|---|---|---|
| (€ Million) | 2021 | 2020 | 2021 | 2020 | |
| Net Sales and Services | 20,889 | 19,293 | 20,889 | 19,293 | |
| Cost of Sales | -16,392 | -15,067 | -16,392 | -15,067 | |
| Gross Profit | 4,497 | 4,227 | 4,497 | 4,227 | |
| Distribution Costs | -3,306 | -3,203 | -3,398 | -3,289 | |
| Administrative Costs | -351 | -334 | -352 | -336 | |
| Other Operating Profits/Losses | -34 | -50 | -34 | -50 | |
| Operating Profit | 806 | 639 | 713 | 552 | |
| Net Financial Costs | -154 | -180 | -22 | -32 | |
| Gains/Losses in Other Investments | 0 | 0 | 0 | 0 | |
| Gains in Joint Ventures and Associates | 0 | 0 | 0 | 0 | |
| Profit Before Taxes | 652 | 459 | 692 | 520 | |
| Income Tax | -168 | -136 | -174 | -146 | |
| Profit Before Non Controlling Interests | 484 | 323 | 517 | 374 | |
| Non-Controlling Interests | -21 | -11 | -24 | -13 | |
| Net Profit Attributable to JM | 463 | 312 | 493 | 361 |
INCOME STATEMENT (Management View)
| (Excl. IFRS16) | (Excl. IFRS16) | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (€ Million) | 2021 | 2020 | ∆ | Q4 21 | Q4 20 | ∆ | ||||
| Net Sales and Services | 20,889 | 19,293 | 8.3% | 5,683 | 5,096 | 11.5% | ||||
| Gross Profit | 4,497 | 21.5% | 4,227 | 21.9% | 6.4% | 1,207 | 21.2% | 1,110 | 21.8% | 8.7% |
| Operating Costs | -3,322 | -15.9% | -3,203 | -16.6% | 3.7% | -872 | -15.3% | -817 | -16.0% | 6.7% |
| EBITDA | 1,175 | 5.6% | 1,024 | 5.3% | 14.7% | 335 | 5.9% | 293 | 5.8% | 14.4% |
| Depreciation | -428 | -2.0% | -422 | -2.2% | 1.6% | -108 | -1.9% | -111 | -2.2% | -3.0% |
| EBIT | 747 | 3.6% | 602 | 3.1% | 24.0% | 227 | 4.0% | 182 | 3.6% | 25.0% |
| Net Financial Costs | -22 | -0.1% | -32 | -0.2% | -33.2% | -3 | 0.0% | -7 | -0.1% | -62.4% |
| 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 | -34 | -0.2% | -50 | -0.3% | n.a. | -26 | -0.5% | -29 | -0.6% | n.a. |
| EBT | 692 | 3.3% | 520 | 2.7% | 33.0% | 198 | 3.5% | 145 | 2.8% | 36.6% |
| Income Tax | -174 | -0.8% | -146 | -0.8% | 19.6% | -49 | -0.9% | -42 | -0.8% | 16.5% |
| Net Profit | 517 | 2.5% | 374 | 1.9% | 38.3% | 149 | 2.6% | 103 | 2.0% | 44.9% |
| Non-Controlling Interests | -24 | -0.1% | -13 | -0.1% | n.a. | -4 | -0.1% | -2 | 0.0% | n.a. |
| Net Profit Attributable to JM | 493 | 2.4% | 361 | 1.9% | 36.7% | 144 | 2.5% | 101 | 2.0% | 43.3% |
| EPS (€) | 0.78 | 0.57 | 36.7% | 0.23 | 0.16 | 43.3% | ||||
| EPS without Other Profits/Losses (€) | 0.82 | 0.63 | 30.1% | 0.26 | 0.19 | 33.9% |
BALANCE SHEET
| (€ Million) | (Excl. IFRS16) | ||||
|---|---|---|---|---|---|
| 2021 | 2020 | ||||
| Net Goodwill | 618 | 620 | |||
| Net Fixed Assets | 4,159 | 3,967 | |||
| Total Working Capital | -3,287 | -2,861 | |||
| Others | 121 | 115 | |||
| Invested Capital | 1,611 | 1,842 | |||
| Total Borrowings | 460 | 524 | |||
| Financial Leases | 22 | 11 | |||
| Accrued Interest | 0 | -3 | |||
| Cash and Cash Equivalents | -1,527 | -1,041 | |||
| Net Debt | -1,046 | -509 | |||
| Non-Controlling Interests | 262 | 255 | |||
| Share Capital | 629 | 629 | |||
| Reserves and Retained Earnings | 1,765 | 1,467 | |||
| Shareholders Funds | 2,657 | 2,351 |
CASH FLOW
| (€ Million) | (Excl. IFRS16) | ||||||
|---|---|---|---|---|---|---|---|
| 2021 | 2020 | ||||||
| EBITDA | 1,175 | 1,024 | |||||
| Interest Payment | -22 | -26 | |||||
| Other Financial Items | 0 | 0 | |||||
| Income Tax | -174 | -174 | |||||
| Funds From Operations | 979 | 824 | |||||
| Capex Payment | -604 | -510 | |||||
| Change in Working Capital | 375 | 246 | |||||
| Others | -26 | -44 | |||||
| Cash Flow | 723 | 516 |
EBITDA BREAKDOWN
| IFRS16 | Excl. IFRS16 | |||||||
|---|---|---|---|---|---|---|---|---|
| (€ Million) | 2021 | Mg | 2020 | Mg | 2021 | Mg | 2020 | Mg |
| Biedronka | 1,339 | 9.2% | 1,252 | 9.3% | 1,060 | 7.3% | 979 | 7.3% |
| Hebe | 25 | 9.0% | 19 | 7.6% | 0 | 0.1% | -4 | n.a. |
| Pingo Doce | 244 | 6.0% | 223 | 5.8% | 180 | 4.5% | 160 | 4.1% |
| Recheio | 43 | 4.7% | 33 | 3.9% | 38 | 4.2% | 28 | 3.3% |
| Ara | 26 | 2.3% | -20 | n.a. | -9 | n.a. | -53 | n.a. |
| Others & Cons. Adjustments | -92 | n.a. | -84 | n.a. | -94 | n.a. | -86 | n.a. |
| JM Consolidated | 1,585 | 7.6% | 1,423 | 7.4% | 1,175 | 5.6% | 1,024 | 5.3% |
NET FINANCIAL COSTS
| (€ Million) | IFRS16 | Excl. IFRS16 | |||
|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | ||
| Net Interest | -16 | -20 | -16 | -20 | |
| Interests on Capitalised Operating Leases | -130 | -127 | - | - | |
| Exchange Differences | -3 | -28 | 0 | -6 | |
| Others | -6 | -7 | -6 | -7 | |
| Net Financial Costs | -154 | -180 | -22 | -32 |
SALES BREAKDOWN
| (€ Million) | 2021 | 2020 | ∆ % | Q4 21 | Q4 20 | ∆ % | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| % total | % total | excl. FX | Euro | % total | % total | excl. FX | Euro | |||||
| Biedronka | 14,542 | 69.6% | 13,465 | 69.8% | 11.0% | 8.0% | 3,912 | 68.8% | 3,555 | 69.8% | 12.8% | 10.0% |
| Hebe | 278 | 1.3% | 245 | 1.3% | 16.7% | 13.5% | 84 | 1.5% | 65 | 1.3% | 32.6% | 29.5% |
| Pingo Doce | 4,046 | 19.4% | 3,869 | 20.1% | 4.6% | 1,090 | 19.2% | 1,025 | 20.1% | 6.4% | ||
| Recheio | 906 | 4.3% | 847 | 4.4% | 7.0% | 247 | 4.3% | 208 | 4.1% | 18.6% | ||
| Ara | 1,102 | 5.3% | 854 | 4.4% | 36.1% | 29.0% | 344 | 6.1% | 238 | 4.7% | 47.1% | 44.3% |
| Others & Cons. Adjustments | 14 | 0.1% | 14 | 0.1% | 0.7% | 6 | 0.1% | 4 | 0.1% | 28.1% | ||
| Total JM | 20,889 | 100% | 19,293 | 100% | 10.7% | 8.3% | 5,683 | 100% | 5,096 | 100% | 13.7% | 11.5% |
SALES GROWTH
| Total Sales Growth | LFL Growth | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Q1 21 | Q2 21 | H1 21 | Q3 21 | 9M 21 | Q4 21 | 2021 | Q1 21 | Q2 21 | H1 21 | Q3 21 | 9M 21 | Q4 21 | 2021 | |
| Biedronka | ||||||||||||||
| Euro | 3.9% | 9.8% | 6.8% | 8.1% | 7.3% | 10.0% | 8.0% | |||||||
| PLN | 9.2% | 10.4% | 9.8% | 11.2% | 10.3% | 12.8% | 11.0% | 6.5% | 8.8% | 7.7% | 8.1% | 7.8% | 9.8% | 8.3% |
| Hebe | ||||||||||||||
| Euro | -10.9% | 30.4% | 7.3% | 8.5% | 7.8% | 29.5% | 13.5% | |||||||
| PLN | -6.3% | 30.5% | 10.4% | 11.6% | 10.8% | 32.6% | 16.7% | 0.1% | 38.2% | 17.7% | 9.0% | 14.4% | 25.1% | 17.5% |
| Pingo Doce | -0.8% | 10.1% | 4.6% | 2.7% | 3.9% | 6.4% | 4.6% | -2.7% | 8.1% | 2.6% | 1.2% | 2.1% | 5.0% | 2.9% |
| Excl. Fuel | 0.3% | 9.4% | 4.8% | 2.5% | 4.0% | 5.9% | 4.5% | -1.6% | 7.3% | 2.8% | 1.0% | 2.1% | 4.4% | 2.7% |
| Recheio | -19.0% | 21.1% | -0.4% | 9.3% | 3.2% | 18.6% | 7.0% | -19.3% | 21.1% | -0.6% | 9.5% | 3.2% | 18.9% | 7.0% |
| Ara | ||||||||||||||
| Euro | 0.6% | 26.1% | 11.9% | 47.7% | 23.1% | 44.3% | 29.0% | |||||||
| COP | 10.5% | 32.8% | 20.9% | 53.6% | 31.6% | 47.1% | 36.1% | 3.7% | 22.8% | 12.6% | 39.5% | 21.5% | 31.5% | 24.3% |
| Total JM | ||||||||||||||
| Euro | 1.5% | 11.2% | 6.3% | 8.7% | 7.1% | 11.5% | 8.3% | |||||||
| Excl. FX | 5.7% | 12.0% | 8.8% | 11.1% | 9.6% | 13.7% | 10.7% | 3.2% | 10.1% | 6.6% | 8.1% | 7.1% | 10.5% | 8.0% |
STORE NETWORK
| Number of Stores | 2020 | Openings | Closings | 2021 | |||
|---|---|---|---|---|---|---|---|
| Q1 21 | Q2 21 | Q3 21 | Q4 21 | 2021 | |||
| Biedronka * | 3,115 | 21 | 32 | 22 | 89 | 29 | 3,250 |
| Hebe | 266 | 2 | 5 | 11 | 7 | 0 | 291 |
| Pingo Doce | 453 | 2 | 1 | 3 | 8 | 2 | 465 |
| Recheio | 42 | 0 | 0 | 0 | 0 | 0 | 42 |
| Ara | 663 | 26 | 15 | 23 | 93 | 1 | 819 |
* Excluding 14 Micro fulfilment Centres (MFC) to supply Biek's operation (ultra-fast delivery)
| Sales Area (sqm) | 2020 | Openings | Closings/ Remodellings |
2021 | |||
|---|---|---|---|---|---|---|---|
| Q1 21 | Q2 21 | Q3 21 | Q4 21 | 2021 | |||
| Biedronka * | 2,120,337 | 15,233 | 22,566 | 14,993 | 61,819 | -6,615 | 2,241,562 |
| Hebe | 69,338 | 515 | 1,184 | 2,694 | 1,599 | 166 | 75,164 |
| Pingo Doce | 523,136 | 1,450 | 125 | 1,279 | 8,280 | -1,577 | 535,847 |
| Recheio | 133,928 | 0 | 0 | 0 | 0 | -393 | 134,321 |
| Ara | 223,818 | 8,470 | 5,260 | 8,571 | 32,709 | 281 | 278,547 |
* Excluding the selling area related to Micro fulfilment Centres (MFC) to supply Biek's operation (ultra-fast delivery)
CAPEX
| (€ Million) | 2021 | Weight | 2020 | Weight |
|---|---|---|---|---|
| Biedronka | 438 | 63% | 302 | 64% |
| Pingo Doce | 104 | 15% | 91 | 19% |
| Recheio | 30 | 4% | 10 | 2% |
| Ara | 81 | 12% | 30 | 6% |
| Others | 37 | 5% | 37 | 8% |
| Total CAPEX | 690 | 100% | 470 | 100% |
WORKING CAPITAL
| IFRS16 | Excl. IFRS16 | |||
|---|---|---|---|---|
| (€ Million) | 2021 | 2020 | 2021 | 2020 |
| Inventories | 1,119 | 982 | 1,119 | 982 |
| in days of sales | 20 | 19 | 20 | 19 |
| Customers | 41 | 36 | 41 | 36 |
| in days of sales | 1 | 1 | 1 | 1 |
| Suppliers | -3,587 | -3,190 | -3,587 | -3,190 |
| in days of sales | -63 | -60 | -63 | -60 |
| Others | -864 | -693 | -860 | -689 |
| Total Working Capital | -3,290 | -2,864 | -3,287 | -2,861 |
| in days of sales | -57 | -54 | -57 | -54 |
TOTAL BORROWINGS
| (€ Million) | 2021 | 2020 |
|---|---|---|
| Long Term Borrowings | 347 | 364 |
| as % of Total Borrowings | 75.5% | 69.5% |
| Average Maturity (years) | 5.7 | 6.7 |
| Short Term Borrowings | 113 | 160 |
| as % of Total Borrowings | 24.5% | 30.5% |
| Total Borrowings | 460 | 524 |
| Average Maturity (years) | 4.5 | 5.1 |
| % Total Borrowings in Euros | 0.0% | 0.0% |
| % Total Borrowings in Zlotys | 46.6% | 41.7% |
| % Total Borrowings in Colombian Pesos | 53.4% | 58.3% |
- Notes 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).
Task Force on Climate-related Financial Disclosures (TCFD): is an initiative promoted by the financial sector that helps businesses quantify and disclose climate-related financial risks and opportunities, and their respective action plans.
CDP – Disclosure Insight Action (former Carbon Disclosure Project): is a non-profit organisation that encourages investors, companies and cities to measure and manage environmental impacts.
3. Reconciliation notes
INCOME SATEMENT
Following ESMA guidelines on Alternative Performance Measures from October 2015
| Income Statement in this release (Management View) |
Consolidated Income Statement by Functions (in Consolidated Financial Statements) |
|---|---|
| Net Sales and Services | Net sales and services |
| Gross Profit | Gross profit |
| Operating Costs | Includes headings of Distribution costs; Administrative costs and Other operating profits/losses, excluding the amount of €-745 million related with Depreciations and amortisations (note - Segments Reporting) |
| 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/Losses in disposal of business (when applicable) and Gains/Losses in other investments (when applicable) |
| EBT | Profit before taxes |
| Income Tax | Income tax |
| Net Profit | Profit before non-controlling interests |
| Non-Controlling Interests | Non-Controlling interests |
Net Profit Attributable to JM Net profit attributable to Jerónimo Martins Shareholders
BALANCE SHEET
Following ESMA guidelines on Alternative Performance Measures from October 2015
| Balance Sheet in this release |
Consolidated Balance Sheet (in Consolidated Financial Statements) |
|||
|---|---|---|---|---|
| Net Goodwill | Amount reflected in note - Intangible assets | |||
| Net Fixed Assets | Includes the headings Tangible and Intangible assets (excluding the Net goodwill - €618 million) and adding the Financial leases amount (€27 million) |
|||
| Net Rights of Use (RoU) | Includes the heading of Net rights of use excluding the Financial leases (€27 million) |
|||
| 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 €-15 million related to 'Others' due to its operational nature. Excludes the amount of €33 million of Short-term investments that don't qualify as cash equivalents (note - Debtors, accruals and deferrals) and, when applicable, the amount related with Interest accruals and deferrals heading (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 and Provisions for risks and contingencies. Excludes the value of €-15 million related to 'Others' due to its operational nature |
|||
| Invested Capital | ||||
| Total Borrowings | Includes the heading Borrowings current and non-current | |||
| Financial Leases | Financial lease liabilities (2021: €22 million; 2020: €11 million) according with IAS 17 in place before IFRS16 adoption |
|||
| Capitalised Operating Leases | Amount in the heading of Lease liabilities current and non current, excluding Financial leases (note above) |
|||
| Accrued Interest | Includes the headings Derivative financial instruments and when applicable, the amount related with Interest accruals and deferrals (note - Net financial debt) |
|||
| Cash and Cash Equivalents | Includes the heading Cash and cash equivalents, the amount of €33 million of Short-term investments that don't qualify as cash equivalents (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
CASH FLOW
Following ESMA guidelines on Alternative Performance Measures from October 2015
| Cash Flow in this release |
Consolidated Cash Flow Statement (in Consolidated Financial Statements) |
|---|---|
| EBITDA | Includes the headings Cash generated from operations before changes in working capital, including headings which did not generate cash flow, and excluding profit and losses that do not have operational nature (€29 million) |
| Capitalised Operating Leases Payment |
Included in the heading Leases paid, excluding the amount of €9 million related with the payment of financial leases according with previous accounting standards |
| 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 accounting standards (€-19 million), as well as, excludes net change in Short-term investments that don't qualify as cash equivalents (€33 million) |
| Change in Working Capital | Includes Changes in working capital added from headings which did not generate cash flow |
| Others | Includes the headings disposal of business (when applicable), profit and losses which generated cash flow, although not having operational nature, in the amount of €-29 million |
| Cash Flow | Corresponds to the Net change in cash and cash equivalents, deducted from Dividends paid and received, Net change in loans, Collateral deposits associated to financial debt and in Short-term investments that don't qualify as cash equivalents (€33 million). It also includes acquisitions of tangible assets classified as finance leases (€-19 million) and deducted from the payment of financial leases (€9 million), both according with previous accounting standards |