Jeronimo Martins — Interim / Quarterly Report 2009

Aug 26, 2009

INDEX

I – Consolidated Management Report
1. Performance Analysis	3
2. Sales Analysis	3
3. Results Analysis	5
4. Balance Sheet	6
5. Outlook	6
II – Consolidated Management Report Appendix
1. Stores Network	7
2. Sales Detail	7
3. Working Capital	8
4. Net Debt	8
5. Definitions	8
6. Information Regarding Individual Financial Statements	8
III – Other Informations	9
IV – Statement of Conformity	12
V – Consolidated Financial Statements
1. Financial Statements	14
2. Notes to the Consolidated Financial Statements	19
3. Auditor's Report	34

I. CONSOLIDATED MANAGEMENT REPORT

1. Performance Analysis

Key figures

• +6.6% growth (+21.6% excl. f/x effect) in Consolidated Sales which reached Euro 3,380.6 mn
• +10.2% growth (+26.0% excl. f/x effect) in Consolidated EBITDA which reached Euro 219.6 mn
• +12.5% growth in Net Profit attributable to JM which reached Euro 73.0 mn
• Net Debt reached Euro 942,0 mn

Consolidated net sales reached Euro 3,380.6 mn, reflecting i) a 3.7% LFL sales growth for the Group, ii) the increase of 20.0% in the sales area, with 330 more stores compared to the first semester last year and also iii) the depreciation of the zloty against the euro (22.1% decline on the average exchange rate for the period).

On the LFL sales evolution, it is important to highlight the strong performance of Pingo Doce supermarkets where the LFL sales growth of 0.6% in value becomes significant when considering the deflation registered in the period. Moreover Biedronka performed solidly with a 7.9% LFL in the semester.

Consolidated EBITDA increased by 10.2% to Euro 219.6 mn in H1 2009. EBITDA margin increased from 6.3% in H1 2008 to 6.5% in H1 2009.

The strong performance of consolidated EBITDA was driven by the scale synergies from the recent expansion accomplished by the Group and by cost efficiency, particularly remarkable in Retail in Portugal where EBITDA margin increased by 80b.p. leading the EBITDA generated by the business area to grow by 29.2% when compared with the first semester of 2008.

The operating performance of the Group led to a growth, in the first six months of the year, of 12.5% of the net result attributable to Jerónimo Martins, a significant +23.3% when excluding the non recurrent items.

Consolidated net debt reached Euro 942.0 mn in H1 2009 and the gearing reached 103.9%.

2. Sales Analysis

S AL ES GROWTH
		Total S ales G rowth			L F L S ales G rowth
	Q1 09	Q2 09	H1 09	Q1 09	Q2 09	H1 09
J MR	11.2%	12.8%	12.0%	‐4.6%	3.1%	‐0.7%
S upermarkets	16.1%	17.4%	16.8%	‐3.6%	4.6%	0.6%
Hypers *	‐12.9%	‐13.3%	‐13.1%	‐10.1%	‐8.4%	‐9.3%
R echeio	5.2%	7.7%	6.5%	1.8%	2.6%	2.2%
Madeira	‐4.3%	5.9%	0.8%	‐4.4%	0.4%	‐2.0%
B iedronka
E uro	5.2%	2.8%	3.9%
P LN	32.3%	34.3%	33.4%	7.7%	8.1%	7.9%
Manufacturing	‐8.2%	‐3.0%	‐5.5%	‐8.2%	‐3.0%	‐5.5%
Mkt. R epr. and R es t. S erv.	5.0%	19.4%	12.2%	‐7.3%	0.5%	‐3.4%

* excluding two s tores under revamping

Consolidated sales increased by 6.6% (+21.6% excluding f/x effect), reaching Euro 3,380.6 mn in the first semester of the year. This performance reflected the growth in the majority of the different business areas along with the increasing maturity of the expansion plan executed in the last two years.

In Portugal, food deflation (H109/H108) has accelerated in first two quarters of 2009 and Pingo Doce's average basket reflected this trend when comparing H1 2009 vs. H1 2008.

Net stores sales for Retail in Portugal increased, in the semester, by 12.0% to Euro 1,180.3 mn.

At Pingo Doce supermarkets, 0.6% LFL sales growth reflected a relevant volume growth considering the deflation registered in the period. The volume progression was particularly strong in the smaller stores. This growth trend was more remarkable in Q2 where LFL in value increased by 4.6%, and started to benefit from 1 month of sales in 44 ex-Plus stores (from a total of 75 acquired) and helped by some positive calendar effect (related to Easter in April).

In the hypermarkets of the Group, the LFL (-9.3% in H1 2009) evolution reflected mainly the decline in non food sales and deflation.

In Recheio, the improved competitive positioning fuelled by scale and productivity improvements has delivered in the semester LFL sales growth of +2.2%. The effect of a new store acquired in November 2008 has pushed total net sales to increase by 6.5% in the semester also contributing to increase Recheio market share.

In Madeira business area, although with a 2.0% reduction in value, LFL sales registered a very strong evolution of volumes as the result of the price repositioning initiated in H2 2008 that is contributing to enhance the competitive positioning of the company in the island.

In Poland, food inflation posted a slight acceleration in Q2 2009. Biedronka's average basket (less exposed to the current inflation) showed the same trend but at a smaller scale. Watching at the evolution of volumes in Q2, some decline in non food was registered especially in some seasonal products due to the bad weather at the beginning of the summer. The evolution of volumes in the rest of the categories remained solid. Total net sales at Biedronka increased, in local currency, by 33.4%.

With regards to Manufacturing the majority of the categories registered, in H1 2009, a positive progression of the volumes sold as the result of the work done in launching new products and improving competitiveness which led to the consolidation of market positions. In terms of value, sales registered, in the first semester, a decline of 5.5% when compared with the same period last year.

In the business area of Marketing, Representations and Restaurants, total sales increased by 12.2%, mainly reflecting two new brands in the portfolio since 2008.

3. Results Analysis

E B ITDA MAR G IN
		S ales & S ervic es (Tho. E uro)				E BITDA Marg in
	H1 09	H1 08	Δ %	H1 09	% total	H1 08	% total
R etail Mainland ‐ s tore sales	1.180.324	1.053.476	12,0%	5,9%	31,8%	5,1%	27,1%
Cash & C arry Mainland	324.698	304.798	6,5%	5,5%	8,1%	5,6%	8,5%
Madeira	60.772	60.266	0,8%	4,3%	1,2%	3,7%	1,1%
P oland ‐ B iedronka	1.682.186	1.618.787	3,9%	6,7%	51,0%	6,9%	55,8%
Mkt, R epr. and R es t. S ervices	40.309	35.912	12,2%	1,8%	0,3%	1,2%	0,2%
Manufacturing	118.169	124.985	‐5,5%	16,4%	8,8%	14,9%	9,3%
C ons olidation Adjus tments	‐25.884	‐26.535	‐2,5%	n.a	n.a	n.a	n.a
J M C ons olidated	3.380.573	3.171.689	6,6%	6,5%	100,0%	6,3%	100,0%

Operating Profit

Consolidated EBITDA grew by 10.2% (+26,0% excluding f/x effect) to Euro 219.6 mn. EBITDA margin increased to 6.5% from 6.3% in H1 2008.

In Retail in Portugal, EBITDA increased by 29.2% in the first semester of 2009 to Euro 69.8 mn. We highlight the strong evolution of the EBITDA margin (+80b.p to 5.9%) driven, apart from sales growth, by scale and operational improvements along with the cost dilution brought by the stores improving sales density on their way to maturity.

At Recheio, the strategy followed of strengthening competitive positioning through the investment of productivity improvements drove EBITDA to grow by 4.4% in the period.

In Biedronka, EBITDA (in local currency) increased by 29.2%. The EBITDA margin of 6.7% in H1 2009 (6.9% in the first semester of 2008) reflected some dilution caused by the increase in the weight of operating costs more exposed to the zloty depreciation.

In Manufacturing, the costs rationalisation processes allowed an EBITDA growth of 4.0% in H1 2009, with EBITDA margin improving from 14.9% to 16.4%.

Net Financial Costs

The evolution of financial charges, which decreased by 20.5% to Euro 35.1 mn reflected, on one hand, the increasing interest charges related with a higher debt position of the Group and, on the other, extraordinary costs related to hedging incurred in 2008 and lower average cost of debt in H1 2009.

Net Result

Net result attributable to Jerónimo Martins increased by 12.5% (+23.3% excluding nonrecurrent items), reaching Euro 73.0 mn.

4. Balance Sheet

BALANCE SHEET
(Thousand Euro)	H 1 09	2008 YE	H 108
Net Goodwill	712,838	734,126	559,275
Net Fixed Assets	1,942,516	1,967,459	1,874,386
Net Working Capital	-944,674	$-1,065,131$	$-936,235$
Others	137,725	140,521	134,025
Invested Capital	1,848,405	1,776,975	1,631,451
Financial Debt	974,150	946,018	861,488
Leasings	90,976	101,659	94,241
Accrued interest	15,503	21,811	60,475
Marketable sec. & Bank deposits	$-138,669$	$-223,638$	$-251,061$
Net Debt	941,960	845,850	765,143
Minority Interests	273,270	281,307	270,760
Share Capital	629,293	629,293	629,293
Reserves and Retained Earnings	3,881	20,525	$-33,745$
Shareholders Funds	906,444	931,125	866,308
Gearing	103.9%	90.8%	88.3%

The Invested Capital increased 72 million euros when compared with December 2008 (101 million euros, excluding exchange rate effect), essentially from Capex with new and remodelled stores as well as an increase of the Net Working Capital.

Net debt amounted to 942 million euros, raising the gearing to 103.9%. However due to the seasonality of Group's activity, a reduction is expected in the 2nd half of the year.

5. Outlook

Considering the current macroeconomic environment, Jerónimo Martins maintains, for the second semester of the year, prudent but positive expectations. The operating performance registered in the first semester reflected the strength of its business models, particularly in the Distribution area, through Pingo Doce supermarkets, Recheio and Biedronka. During the second semester of the year the Group expects to continue to count with the contribution from this increasing maturity of operations.

Lisbon, 24th July, 2009

The Board of Directors

II. CONSOLIDATED MANAGEMENT REPORT APPENDIX

1. Stores Network

NUMBER OF STORES
		Openings		Closings		Network
	08 YE	Q1 09	Q 2 09	H 1 09	H 109	H 1 08
J MR	343	$\mathbf{1}$	3	5	342	332
Supermarkets	334	$\mathbf{1}$	3	5	333	323
Hypers	9	0	0	0	9	9
Recheio	35	0	0	0	35	33
Madeira	15	0	0	0	15	15
Biedronka	1,359	27	42	20	1,408	1,090

S ALES AREA (s qm)

		Openings		Closings*		Network
	08 YE	Q1 09	Q2 09	H 1 09	H 109	H108
J MR	433,049	1,000	2,307	4,506	431,850	421,716
Supermarkets	350,396	1,000	2,307	4,321	349,382	339,063
Hypers	82,653	0	0	185	82,468	82,653
Recheio	115,724	0	0	0	115,724	109,634
Madeira	14,626	0	0	$\mathbf 0$	14.626	14,626
Biedronka	753,531	17,452	24,775	23,405	772,353	565,956

* including changes of s ales area due to remodellings

2. Sales Detail

NET SALES AND SERVICES
	H 109		H 108			$\Delta\%$	Q209		Q2 08		Δ%
	Eur Tho.	% total	Eur Tho.	% total	PIn	Euro	Eur Tho.	% total	Eur Tho.	% total	PIn	Euro
Retail Mainland	1.276.779	37,8%	1.141.394	36,0%		11,9%	664.611	37.4%	591.094	35,5%		12,4%
Cash & Carry Mainland	324.698	9.6%	304.798	9,6%		6,5%	171.061	9,6%	158.775	9,5%		7,7%
Madeira	60.772	1.8%	60.266	1,9%		0,8%	32.250	1,8%	30.453	1,8%		5,9%
Poland - Biedronka	1.682.186	49.8%	1.618.787	51,0%	33.4%	3,9%	886.529	49,9%	862.180	51.7%	34,3%	2,8%
Manufacturing	118.169	3.5%	124.985	3.9%		$-5,5%$	63.974	3.6%	65.955	4.0%		$-3,0%$
Mkt. Repr. and Rest. Serv.	40.309	1,2%	35.912	1,1%		12,2%	21.595	1,2%	18.092	1,1%		19,4%
Consolidation Adjustments	$-122.339$	$-3,6%$	$-114.454$	$-3,6%$		6,9%	-64.578	$-3,6%$	-59.770	$-3,6%$		8,0%
Total J M	3.380.573	100,0%	3.171.689	100,0%		6,6%	1.775.443	100.0%	1.666.778	100,0%		6,5%
p.m. Retail Mainland (store sales)	1.180.324		1.053.476			12,0%	613.751		544.159			12,8%

3. Working Capital

WORKING CAPITAL
(Thousand Euro)	H 109	2008 YE	H 108
Inventories	324,483	385,653	354,006
in days of sales	17	20	20
Customers	92,721	70,109	92,646
in days of sales	5	4	5
S uppliers	$-1,150,477$	$-1,273,131$	$-1,172,799$
in days of sales	-62	-66	-67
Working Capital Trade	$-733,273$	$-817,369$	$-726,147$
in days of sales	-39	-43	-42
Others	$-211,401$	$-247,762$	$-210,089$
Total Working Capital	-944,674	$-1,065,131$	$-936,235$
in days of sales	$-51$	-56	-54

4. Net Debt

DEBT BREAKDOWN
(Thousand Euro)
	H 109	2008
Long Term Debt	770,059	671,504
as % of Financial Debt	79.0%	71.0%
Bond Loans	375,000	270,000
Private Placement	151,007	151,007
Fair value adjustment	$-13,874$	$-9,160$
Commercial Paper	123,000	115,000
Other LT Debt	134,926	144,657
Short Term Debt	204,091	274,514
as % of Financial Debt	21.0%	29.0%
Financial Debt	974,150	946,018
Maturity	3.1	2.9
Average Cost of Debt	4.3%	5.7%

5. Definitions

Like For Like (LFL) sales: sales made by stores, which 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).

Cash Flow per share: (Net Profit + Depreciation – Deferred tax – Non-recurrent items) / Number of Shares

EBITDA: Earnings before interests, taxes, depreciations and amortisations. See the reconciliation with Operational Result in note 3 of the notes to the Consolidated Financial Statements.

Gearing: Net Debt / Shareholder Funds

6. Information Regarding Individual Financial Statements

In accordance with section b) of paragraph 3 of article 246 of the Portuguese Securities Code, the 1st Half individual financial statements of Jerónimo Martins SGPS, S.A. will not be disclosed as they do not include significant information.

III. OTHER INFORMATIONS

INFORMATION CONCERNING STAKES HELD IN THE COMPANY BY MEMBERS OF THE BOARD OF DIRECTORS AND STATUTORY AUDITOR AS AT JUNE 30th, 2009

(As provided in article 447 of the Portuguese Commercial Companies Code and under the terms of sub-paragraph b), paragraph 1 of article 7 of the Portuguese Securities Market Commission - CMVM - Regulation nº 24/2000)

BOARD OF DIRECTORS

Members of the Board of Directors	Held on 31.12.08		Increases during the year		Decreases during the year		Held on 30.06.09
	Shares	Bonds	Shares	Bonds	Shares	Bonds	Shares	Bonds
Elísio Alexandre Soares dos Santos 2	88,355	-	64,278				152,633	-
José Manuel da Silveira e Castro Soares dos Santos	-	-					-	-
Luís Maria Viana Palha da Silva	-	-					-	-
Pedro Manuel de Castro Soares dos Santos	198,305	-					198,305	-
António Mendo Castel-Branco Borges 1	-	-					-	-
Artur Eduardo Brochado dos Santos Silva	7,680	-					7,680	-
Hans Eggerstedt 1	19,700	-					19,700	-
Marcel Lucien Corstjens 3	n.a.	n.a.					-	-
Nicolaas Pronk	-	-					-	-
Rui Manuel de Medeiros d`Espiney Patrício 1	-	-					-	-

1 Also members of the Audit Committee.

2 The 64.278 shares were acquired between 21st of January and 10th of February of 2009, with an average unit price of EUR 3.77.

3 Appointed as member of the Board on 7th of April of 2009.

STATUTORY AUDITOR

As at June 30th, 2009, the Statutory Auditor PricewaterhouseCoopers & Associados, SROC, Lda., did not hold any shares and bonds of Jerónimo Martins, SGPS, S.A. and had not made any transactions with Jerónimo Martins, SGPS, S.A. securities.

LIST OF TRANSACTIONS MADE BY PERSONS DISCHARGING MANAGERIAL RESPONSABILITIES AND PEOPLE CLOSELY CONNECTED WITH THEM

Under the terms of paragraph 7 of Article 14 of CMVM Regulation 5 / 2008, Jerónimo Martins, SGPS, S.A. informs about all the transactions made by persons discharging managerial responsibilities in the first six months of 2009.

Sociedade Francisco Manuel dos Santos, SGPS, S.A.

Date	Nature	Code ISIN	Volume	Price	Local
08-01-2009	Acquisition	PTJMT0AE0001	10,000	3.71	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	1,496	3.70	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	5,167	3.70	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	1,861	3.70	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	1,476	3.70	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	1,190	3.68	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	300	3.68	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	893	3.68	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	2,617	3.68	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	872	3.68	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	4,128	3.68	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	1,204	3.65	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	3,416	3.65	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	342	3.65	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	5,000	3.65	Euronext Portugal
08-01-2009	Acquisition	PTJMT0AE0001	38	3.65	Euronext Portugal
12-01-2009	Acquisition	PTJMT0AE0001	1,619	3.69	Euronext Portugal
12-01-2009	Acquisition	PTJMT0AE0001	3,500	3.69	Euronext Portugal
13-01-2009	Acquisition	PTJMT0AE0001	3,255	3.55	Euronext Portugal
13-01-2009	Acquisition	PTJMT0AE0001	1,745	3.55	Euronext Portugal
13-01-2009	Acquisition	PTJMT0AE0001	624	3.54	Euronext Portugal
13-01-2009	Acquisition	PTJMT0AE0001	4,376	3.54	Euronext Portugal
14-01-2009	Acquisition	PTJMT0AE0001	4,824	3.42	Euronext Portugal
14-01-2009	Acquisition	PTJMT0AE0001	176	3.42	Euronext Portugal
14-01-2009	Acquisition	PTJMT0AE0001	3,002	3.46	Euronext Portugal
14-01-2009	Acquisition	PTJMT0AE0001	1,998	3.46	Euronext Portugal

E. Alexandre Soares dos Santos

Date	Nature	Code ISIN	Volume	Price
21-01-2009	Acquisition	PTJMT0AE0001	5,000	3.63
22-01-2009	Acquisition	PTJMT0AE0001	5,000	3.59
29-01-2009	Acquisition	PTJMT0AE0001	10,000	3.93
03-02-2009	Acquisition	PTJMT0AE0001	5,000	3.85
06-02-2009	Acquisition	PTJMT0AE0001	10,000	3.85
10-02-2009	Acquisition	PTJMT0AE0001	10,000	3.79
10-02-2009	Acquisition	PTJMT0AE0001	10,000	3.71
10-02-2009	Acquisition	PTJMT0AE0001	2,261	3.67
10-02-2009	Acquisition	PTJMT0AE0001	7,017	3.68

1st Half 2009

LIST OF SHAREHOLDERS WITH QUALIFYING STAKES AS AT JUNE 30th, 2009

(Under the terms of articles 447 and 448 of the Portuguese Commercial Companies Code and for the purposes of section e), paragraph 1 of article 6 of the Portuguese Securities Market Commission – CMVM - Regulation nº 11/2000 and in the terms of the Portuguese Securities Code)

Shareholder	Nº of shares held	% Capital	% of Voting Rights1
Sociedade Francisco Manuel dos Santos, SGPS, S.A.
Directly	353,119,573	56.114%	56.190%
Asteck, S.A. 2
Directly	62,929,500	10.000%	10.014%

• ¹ % Voting rights = No. Shares Held / (Total No. JM shares Own shares)
• ²Under the terms articles 16 and 20 of the Portuguese Securities Code (CVM), the stakes held by Asteck, S.A. must be attributed to Heerema Holding Company Inc., which has a 100% holding in that company.

Statement of Conformity

Dear Shareholders,

Within the terms of paragraph c) n.º1 of article 246 of Portuguese Securities Code, we hereby inform you that to the best of our knowledge:

(i) the information contained in the interim management report is a faithful statement of the evolution of the businesses, of the performance and of the position of Jerónimo Martins, SGPS, S.A. and the companies included within the consolidation perimeter, and contains a description of the main risks and uncertainties which they face; and

(ii) the information contained in the consolidated financial statements, as well as their annexes, was produced in compliance with the applicable accounting standards and gives a true and fair view of the assets and liabilities, the financial situation and the results of Jerónimo Martins, SGPS, S.A. and the companies included in the consolidation perimeter.

Lisbon, 24th July, 2009

Elísio Alexandre Soares dos Santos (President of the Board of Directors)

Luís Maria Viana Palha da Silva (President of the Executive Committee in charge of financial matters)

Pedro Manuel de Castro Soares dos Santos (Member of the Executive Committee – Responsible for Food Distribution Operations)

José Manuel da Silveira e Castro Soares dos Santos (Member of the Executive Committee - Responsible for Manufacturing Operations and Representation and Marketing Services)

António Mendo Castel-Branco Borges (Non-Executive Member)

Hans Eggerstedt (Non-Executive Member)

Rui de Medeiros d'Espiney Patrício (Non-Executive Member)

Artur Eduardo Brochado dos Santos Silva (Non-Executive Member)

Nicolaas Pronk (Non-Executive Member)

Marcel Lucien Corstjens (Non-Executive Member)

IV. CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT BY FUNCTIONS FOR JUNE 2009 AND 2008

				Euro thousand
	Notes	1st Half 2009	1st Half 2008	2nd Quarter 2009	2nd Quarter 2008
Sales and services rendered	3	3,380,573	3,171,689	1,775,442	1,666,778
Cost of sales		(2,731,978)	(2,570,002)	(1,431,558)	(1,345,365)
Supplementary income and costs	5	139,035	116,624	67,780	64,576
Gross profit		787,630	718,311	411,664	385,989
Distribution costs	6	(574,957)	(515,566)	(294,238)	(274,338)
Administrative costs	6	(74,897)	(77,313)	(39,390)	(42,171)
Exceptional operating profits/losses	10.1	(4,327)	126	(5,494)	(9,447)
Operating profit		133,449	125,558	72,542	60,033
Net financial costs	7	(35,077)	(44,170)	(17,536)	(19,484)
Profit in associated companies	15	(10)	14	(39)	5
Gains/Losses in other investments	10.2	(177)	(1,192)	207	(1,026)
Profit before taxes		98,185	80,210	55,174	39,528
Income taxes	9	(19,652)	(18,672)	(12,396)	(10,442)
Profit before minority interests		78,533	61,538	42,778	29,086
Attributable to:
Minority interests		5,556	(3,314)	2,318	(3,887)
Jerónimo Martins Shareholders		72,977	64,852	40,460	32,973
Basic and diluted earnings per share- Euros	23	0.1161	0.1032	0.0644	0.0525

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

CONSOLIDATED BALANCE SHEET AT 30 JUNE 2009 AND DECEMBER 2008

			Euro thousand
	Notes	2009	2008
Assets
Tangible assets	11	1,852,175	1,874,863
Investment properties	13	64,599	64,509
Intangible assets	12	803,179	826,721
Investments in associated Companies	15	832	854
Available-for-sale financial investments	16	7,292	7,470
Trade debtors and deferred costs	19	72,243	66,629
Derivative financial instruments	14	9,220	1,027
Deferred tax assets	18.1	60,535	63,170
Total non-current assets		2,870,075	2,905,243
Inventories	17	324,483	385,653
Taxes receivable	18.2	23,531	34,736
Trade debtors, accrued income and deferred costs	19	185,568	172,764
Derivative financial instruments	14	552	1,037
Cash and cash equivalents	20	143,065	227,132
Total current assets		677,199	821,322
Total assets		3,547,274	3,726,565
Shareholders' equity and liabilities		629,293	629,293
Share capital		22,452	22,452
Share premium		(6,060)	(6,060)
Own shares	22.1	37,802	58,295
Fair value and other reserves		(50,313)	(54,162)
Retained earnings
		633,174	649,818
Minority interests		273,270	281,307
Total Shareholders' equity		906,444	931,125
Borrowings	24	826,451	739,333
Derivative financial instruments	14	24,632	19,664
Employee benefits		29,399	28,195
Deferred profits- state grants		972	984
Provisions for risks and contingencies	25	24,653	25,892
Deferred tax liabilities	18.1	56,286	54,726
Total non-current liabilities		962,393	868,794
Trade creditors, accrued costs and deferred income	26	1,376,160	1,560,042
Borrowings	24	238,675	308,344
Taxes payable	18.2	63,523	58,178
Deferred profits- state grants		79	82
Total current liabilities		1,678,437	1,926,646
Total Shareholders' equity and liabilities		3,547,274	3,726,565

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

CONSOLIDATED STATEMENT OF GAINS AND LOSSES RECOGNISED IN EQUITY

Euro thousand 1st Half 2009 1st Half 2008 2nd Quarter 2009 2nd Quarter 2008 Currency translation differences (23,440) 21,805 17,905 16,028 Fair value of cash flow hedging (3,320) (155) 1,658 (65) Fair value of hedging instruments on foreign operations 5,119 (6,287) (1,591) (4,245) Fair value of available-for-sale financial investments - (1,217) - - Gains/losses directly recognised in equity (21,641) 14,146 17,972 11,718 Net profit 78,533 61,538 42,778 29,086 Total gains/losses recognised 56,892 75,684 60,750 40,804 Attributable to: Minority interests 4,408 (3,314) 2,805 (3,887) Jerónimo Martins Shareholders 52,484 78,998 57,945 44,691

				Shareholders' equity attributable to Shareholders of Jerónimo Martins, SGPS, S.A.
	Notes	Share Capital	Share Premium	Own Shares	Fair value and other reserves	Retained Earnings	Total	Minority Interests	Shareholders' Equity
Balance Sheet at 31 December 2007		629,293	22,452	(6,060)	92,814	(161,620)	576,879	287,326	864,205
Equity changes in 2008
Currency translation differences in the 1st Half of 2008	22.1				21,805		21,805		21,805
Revaluation of fixed assets:
- Disposals	22.1				(3,838)	3,838	-		-
Fair value of cash flow hedging	22.1				(155)		(155)		(155)
Fair value of hedging instruments on foreign operations	22.1				(6,287)		(6,287)		(6,287)
Fair value of available-for-sale financial investments	22.1				(1,217)		(1,217)		(1,217)
Gains/losses directly recognised in equity					10,308	3,838	14,146		14,146
Net profit in 1st Half of 2008						64,852	64,852	(3,314)	61,538
Total gains/losses recognised during the year					10,308	68,690	78,998	(3,314)	75,684
Dividends	22.2					(60,330)	(60,330)	(13,251)	(73,581)
Balance Sheet at 30 June 2008		629,293	22,452	(6,060)	103,122	(153,260)	595,547	270,761	866,308
Balance Sheet at 31 December 2008		629,293	22,452	(6,060)	58,295	(54,162)	649,818	281,307	931,125
Equity changes in 2009
Currency translation differences in the 1st Half of 2009	22.1				(23,440)		(23,440)		(23,440)
Fair value of cash flow hedging	22.1				(2,172)		(2,172)	(1,148)	(3,320)
Fair value of hedging instruments on foreign operations	22.1				5,119		5,119		5,119
Gains/losses directly recognised in equity					(20,493)		(20,493)	(1,148)	(21,641)
Net profit in 1st Half of 2009						72,977	72,977	5,556	78,533
Total gains/losses recognised during the year					(20,493)	72,977	52,484	4,408	56,892
Dividends	22.2					(69,128)	(69,128)	(12,445)	(81,573)
Balance Sheet at 30 June 2009		629,293	22,452	(6,060)	37,802	(50,313)	633,174	273,270	906,444

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

CONSOLIDATED CASH FLOW STATEMENT FOR JUNE 2009 AND 2008

Notes Operating Activities Cash received from Customers	2009 3,758,150 (3,566,014)	2008 3,529,564
Cash paid to Suppliers and Employees		(3,268,723)
Cash generated from operations 21	192,136	260,841
Interest paid	(43,791)	(58,534)
Income taxes paid	(14,002)	(16,336)
Cash Flow from operating activities	134,343	185,971
Investment activities
Disposals of tangible assets	658	46,987
Interest received	1,711	4,337
Dividends received	33	180
Acquisition of group and associated companies	-	(151,890)
Acquisition of tangible assets	(156,903)	(203,939)
Disposals of available-for-sale financial investments and
investment property	-	5,708
Acquisition of available-for-sale financial investments and
investment property	(17)	(541)
Acquisition of intangible assets Cash flow from investment activities	(4,560) (159,078)	(11,820) (310,978)
Financing activities
Received from loans	187,021	226,264
Reimbursement of loans	(157,831)	(66,990)
Dividends paid 22.2	(81,573)	(73,581)
Cash Flow from financing activities	(52,383)	85,693
Net changes in cash and cash equivalents	(77,118)	(39,314)
Cash and cash equivalents changes
Cash and cash equivalents at the beginning of 1st Half	227,132	268,639
Net changes in cash and cash equivalents	(77,118)	(39,314)
Effect of acquisition of subsidiaries	-	12,120
Effect of currency translation differences	(7,169)	13,050
Fair value of financial assets held for trade	220	-
Cash and cash equivalents at the end of 1st Half 20	143,065	254,495

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

CONSOLIDATED CASH FLOW STATEMENT FOR THE INTERIM PERIOD

	Notas	1st Half 2009	1st Half 2008	2nd Quarter 2009	2nd Quarter 2008
Cash Flow from operating activities		134,343	185,971	138,957	160,695
Cash Flow from investment activities		(159,078)	(310,978)	(53,080)	(236,718)
Cash Flow from financing activities		(52,383)	85,693	(22,518)	37,025
Cash and cash equivalents changes		(77,118)	(39,314)	63,359	(38,998)

1.	Activity 19
2.	Accounting policies 19
3	Segments reporting 20
4	Businesses Acquisitions and changes to the consolidation scope21
5	Supplementary income and costs 21
6	Distribution and administrative costs 21
7	Net financial costs 22
8	Financial instruments22
9	Income tax recognised in the income statement22
10	Exceptional operating profits/losses and gains/losses in other investments23
11	Tangible Assets23
12	Intangible Assets 24
13	Investment Property25
14	Derivative financial instruments 25
15	Investments in associated companies 26
16	Available-for-sale financial investments 26
17	Inventories27
18	Taxes 27
19	Trade debtors, accrued income and deferred costs 28
20	Cash and cash equivalents 29
21	Cash generated from operations 29
22	Capital and reserves 29
23	Earnings per share 30
24	Borrowings 30
25	Provisions and adjustments to the net realisable value32
26	Trade creditors, accrued costs and deferred income32
27	Contingencies 32
28	Related parties 33

1. Activity

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

Jerónimo Martins Group is essentially devoted to the production, distribution and sale of food and other fast moving consumer goods products. The Group operates in Portugal and Poland.

Head Office: Rua Tierno Galvan, Torre 3, 9º, J- 1099-008 Lisbon

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 (ex-Lisbon and Porto Stock Exchange) since 1989.

The Board of Directors approved these consolidated financial statements on 24th July 2009.

2. Accounting policies

The JMH consolidated financial statements were prepared in accordance with the interim reporting standard (IAS 34), 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).

The consolidated financial statements of JMH were prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and in accordance with the same standards and accounting policies adopted by the Group on the elaboration of the annual financial statements, including mainly 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 annual report are omitted because no changes occurred or they are not materially relevant for the understanding of the interim financial statements.

The following new standards, mandatory for the first time for the financial year beginning on 1st January 2009, were adopted:

• IAS 1 (revised), Presentation of Financial Statements, the Group choose to present separately an Income Statement by Functions and a Statement of Gains and Losses recognised in Equity;
• IFRS 8, Operating Segments. The segment information was presented following the internal management reporting.

The changes introduced to the IAS 23 – Borrowing costs, IFRS 2 – Share based Payments, IAS 32 – Financial Instruments – Presentation, IAS 39 – Financial Instruments – Recognition and Measurement, as well as the changes in interpretations to IFRIC 13 – Customer loyalty programmes, IFRIC 15 – Agreements for the construction of real estate, IFRIC 16 – Hedges of a net investment in a foreign operation, are mandatory starting on 1 January 2009, but they have no significant impact on the Group financial statements or they are not applicable to the Group activities.

The changes introduced to the IFRS 3 – Business Combinations, as well as IFRIC 17 – Distributions of non-cash assets to owners and IFRIC 18 – Transfers of assets from customers, only become mandatory for periods beginning after 1 July 2009. The Group will adopt these changes only in the period of 2010.

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

The amounts presented for quarters, and the corresponding changes are not audited.

2.1. 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 in equity.

The main exchange rates applied on the balance sheet date are those listed below:

	Rate on 30 June 2009	Average rate for the 1st Half
Polish Zloty (PLN)	€ 0,2246	€ 0,2237
US Dollar (USD)	€ 0,7124	-

3 Segments reporting

Information by segments is reported in accordance with internal management reporting. Based on this report, Management evaluates the performance of each segment and proceeds with resources allocation.

Management analyses segments performance according to a geographical perspective and business nature. According to the last point of view, segments of Portugal Retail, Poland Retail, Portugal Cash & Carry and Portugal Manufacturing were identified. Other segments were identified, but due to its reduced materiality were not reported separately.

Portugal Retail includes JMR business units (Pingo Doce supermarkets and Feira Nova hypermarkets). Portugal Cash&Carry includes Recheio wholesale business unit. Poland Retail contains Biedronka business area. Manufacturing includes a joint-venture with Unilever, consolidated by proportional method. Others and adjustments, includes i) business units with reduced materiality (Madeira, Marketing Services, Representations and Specialized Retail, and Poland pharmacies); ii) the Group Holding companies, and iii) the consolidation adjustments.

Management evaluates the segments performance based on information regarding earnings before interest and taxes (EBIT). This measure excludes the effects of non-recurrent results.

Reconciliation between EBITDA and Operational Result

	June 2009	June 2008
EBITDA	219,632	199,362
Amortisations and depreciations	(81,856)	(73,930)
Non recurrent results	(4,327)	126
Operational Result	133,449	125,558

Detailed Information by Business Segments at June 2009 and 2008

		Portugal Retail		Portugal Cash&Carry		Polónia Retail		Manufacturing		Others and adjustments		Total JM Consolidated
	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008
Net Sales and Services		1,276,778 1,141,394	324,698			304,798 1,682,186 1,618,787	118,169	124,985	(21,258)			(18,275) 3,380,573 3,171,689
Inter-segments	93,658	85,075	441	448	187	131	20,233	21,165	(114,365)	(106,699)	154	120
External Customers		1,183,120 1,056,319	324,257			304,350 1,681,999 1,618,656	97,936	103,820	93,107		88,424 3,380,419	3,171,569
Operational Cash-Flow (EBITDA)	69,758	53,990	17,787	17,043	112,084	111,335	19,323	18,587	680	(1,593)	219,632	199,362
Depreciations and Amortisations	(40,415)	(34,257)	(4,244)	(4,212)	(32,499)	(31,112)	(1,951)	(2,029)	(2,747)	(2,320)	(81,856)	(73,930)
Operational Result (EBIT)	29,343	19,733	13,543	12,831	79,585	80,223	17,372	16,558	(2,067)	(3,913)	137,776	125,432
Financial Results											(35,264)	(45,348)
Net Result Attributable to JM											72,977	64,852
TOTAL ASSETS (1)		1,826,021 1,853,543	291,245			299,833 1,093,668 1,221,703	229,211	197,647	107,129			153,839 3,547,274 3,726,565
TOTAL LIABILITIES (1)		1,272,456 1,283,533	247,378	260,604	672,569	816,652	153,870	108,039	294,557			326,612 2,640,830 2,795,440
Investments in Fixed Assets (1)	35,745	198,886	5,284	25,934	59,966	520,761	1,285	3,430	1,284	10,415	103,564	759,426

(1) The Comparative report is 31th December of 2008

Information by Geographical Segments at June 2009 and 2008

	Net Sales and Services
	2009	2008
Portugal	1,696,172	1,552,327
Poland	1,684,401	1,619,362
Total	3,380,573	3,171,689

4 Businesses Acquisitions and changes to the consolidation scope

On June 1st, 2009, the company Feira Nova – Hipermercados, S.A., was merged in the company Pingo Doce - Distribuição Alimentar, S.A..

With the focus on restructuring the Group Manufacturing area, it was started, during the 1st half of 2009, a process aiming the autonomization of the olive oil business. On the 3rd of July, the company Gallo Worldwide, Lda. was created, as a result of a demerger from Unilever Jerónimo Martins, Lda company. The Gallo Worldwide, Lda. company maintains the same shareholder structure as ULJM.

During the 1st Half of 2009, several companies were incorporated and acquired for the development of business in Poland, which do not represent materially relevant impact on the Group Consolidated Financial Statements.

Following the reported on the note 34 of the Annual Report, the only changes occurred in the consolidation scope are the integration of the following companies:

Company	Business area	Head office	% Owned
Integrator - Sp. z o.o.	Provision of services in the area of wholesale and retail distribution	Kostrzyn (Poland)	100,00
JM Nieruchomosci - Sp. z o.o.	Provision of services in the area of wholesale and retail	Kostrzyn	100,00
	distribution	(Poland)
JM Nieruchomosci - Sp. Komandytowo-akcyjna	Real estate management and administration	Kostrzyn	100,00
		(Poland)
JM TELE - Sp. z o.o.	Mobile virtual network operator	Kostrzyn	100,00
		(Poland)
	Provision of services in the area of wholesale and retail	Kostrzyn
JM Uslugi - Sp. z o.o.	distribution	(Poland)	100,00

5 Supplementary income and costs

	June 2009	June 2008
Supplementary gains	132,862	110,301
Cash discount received	17,951	16,631
Cash discount paid	(1,609)	(1,519)
Electronic payment commissions	(6,777)	(6,091)
Other supplementary costs	(3,280)	(2,734)
Provisions for debtors suppliers	(112)	36
	139,035	116,624

Supplementary gains concern to profits obtained by the Group through the distribution of goods, namely, rental of spaces, participation in birthday events, rental of shelf's, etc. Supplementary costs concern to the same nature of supplementary gains mentioned, paid by subsidiaries operating in the manufacturing and services segments.

6 Distribution and administrative costs

	June 2009	June 2008
Supplies and services	137,185	127,061
Advertising costs	29,756	32,801
Rents	79,308	58,796
Staff costs	280,591	256,919
Depreciations, amortisations and assets profit/loss	80,186	72,841
Transportation costs	43,077	43,904
Other operational profit/loss	(249)	557
	649,854	592,879

7 Net financial costs

	June 2009	June 2008
Interest expense	(35,203)	(34,642)
Interest received	1,122	4,245
Dividends	33	5
Net foreign exchange	(1,164)	307
Investment property:
Changes to fair value (note 13)	(9)	(9)
Other financial costs and gains	(2,622)	(1,799)
Fair value of financial investments held for trade
Derivative instruments (note 8)	2,546	(12,277)
Treasury bonds	220	-
	(35,077)	(44,170)

The interest expense heading includes the interests regarding loans measured at amortized cost, as well as interests on fair value and cash flow hedging instruments (note 14).

Other financial costs and gains include costs with debt issued by the Group.

The other financial costs and gains heading includes an amount of EUR 33 thousand (2008: EUR 130 thousand) regarding transfers from reserves for covering cash-flow.

8 Financial instruments

Fair value of derivative financial instruments

The impact in income statement, is as follows:

	June 2009	June 2008
Derivatives held for trading
Currency swaps	1,317	(6,824)
Interest rates swaps	1,229	(7,357)
Credit default swap	-	1,904
	2,546	(12,277)
Income tax recognised in the income statement	(675)	3,254
Minority interests	(381)	635
Amount recognised in profit/loss	1,490	(8,388)

The value recognised in reserves referred to hedging of investment in Poland is EUR 5,122 thousand (net of deferred tax).

Changes to the fair value of derivative instruments designated as fair value hedging (note 14) for the amount of negative EUR 4,714 thousand (2008: negative EUR 9,866 thousand) was offset by a symmetrical variation in value for the loan of USD 180 million (note 24.2).

9 Income tax recognised in the income statement

9.1 Income taxes

	June 2009	June 2008
Current income tax
Current tax of the year	(16,947)	(20,882)
Adjustment to prior year estimation	121	(2,160)
	(16,826)	(23,042)
Deferred tax (note 18.1)
Temporary differences created and reversed	(3,860)	4,236
Change to the recoverable amount of tax losses and temporary differences from previous years	1,034	134
	(2,826)	4,370
Total income taxes	(19,652)	(18,672)

9.2 Reconciliation of effective tax rate

		June 2009		June 2008
Profit before tax		98,185		80,210
Income tax using the Portuguese corporation tax rate	26.5%	(26,019)	26.5%	(21,256)
Fiscal effect due to:
Different tax rates in foreign jurisdictions	6.6%	6,509	8.8%	7,028
Non taxable or non recoverable results	(0.9%)	(862)	(1.0%)	(837)
Non-deductible expenses and fiscal benefits	0.5%	451	(0.1%)	(107)
Adjustment to prior year estimation	0.1%	121	(2.7%)	(2,160)
Change to the recoverable amount of tax losses and temporary differences of prior years	1.1%	1,034	0.2%	134
Results subject to special taxation	(0.9%)	(886)	(1.8%)	(1,474)
Income tax	20.0%	(19,652)	23.3%	(18,672)

10 Exceptional operating profits/losses and gains/losses in other investments

10.1 Exceptional operating profits/losses

	June 2009	June 2008
Gains/Losses with businesses disposals	-	17,047
Losses with organizational restructuring program	(3,207)	(15,415)
Real state disposal	-	10,242
Introduction of a plan on incentives for senior employees	-	(11,639)
Impairment of assets	(983)	-
Others	(137)	(109)
	(4,327)	126

10.2 Gains/Losses in other investments

	June 2009	June 2008
Losses in the fair value of available-for-sale financial investments	(177)	(1,014)
Losses with the disposal of available-for-sale financial investments	-	(178)
	(177)	(1,192)

11 Tangible Assets

11.1 Changes occurred during the year

2009	Land and natural	Buildings and other	Plants, machinery	Transport equipment and	Work in progress and	Total
Cost	resources	constructions	and tools	others	advances
Opening balance	396,538	1,347,245	869,824	179,728	117,866	2,911,201
Foreign exchange differences	(4,464)	(29,702)	(10,755)	(5,253)	(6,072)	(56,246)
Increases	2,949	9,786	31,267	3,722	49,015	96,739
Disposals	(80)	(13)	(2,828)	(1,231)	(39)	(4,191)
Transfers and write off's	5,771	59,009	2,331	1,176	(75,967)	(7,680)
Business acquisitions & restructuring	-	680	-	-	-	680
Transfers to investment properties					(82)	(82)
Closing balance	400,714	1,387,005	889,839	178,142	84,721	2,940,421
Depreciation and impairment losses
Opening balance	-	353,479	560,728	122,131	-	1,036,338
Foreign exchange differences	-	(8,921)	(5,606)	(3,085)	-	(17,612)
Increases	-	33,039	35,851	9,731	-	78,621
Disposals	-	-	(2,710)	(1,156)	-	(3,866)
Transfers and write off's	-	(2,888)	(2,126)	(221)	-	(5,235)
Closing balance	-	374,709	586,137	127,400	-	1,088,246
Net value
As at 1 January 2009	396,538	993,766	309,096	57,597	117,866	1,874,863
As at 30 June 2009	400,714	1,012,296	303,702	50,742	84,721	1,852,175

11.2 Guarantees

No tangible assets have been pledged as security for the fulfilment of bank or other obligations.

11.3 Revaluation

No changes occurred in the market value of land allocated to the operating activity.

12 Intangible Assets

12.1 Changes occurring during the year

2009	Goodwill	R&D expenses	Software, ind. property and other rights	Key money	Work in progress	Total
Cost
Opening balance	734,126	25,441	45,343	65,754	10,312	880,976
Foreign exchange differences	(20,794)	(1,320)	(1,443)	(2,015)	(445)	(26,017)
Increases	-	-	238	1,670	4,918	6,826
Disposals	-	-	(17)	-	(2,250)	(2,267)
Transfers and write off's	-	(239)	3,294	28	(3,497)	(414)
Business acquisitions & restructuring	(494)	-	-	-	-	(494)
Closing balance	712,838	23,882	47,415	65,437	9,038	858,610
Depreciation and impairment losses
Opening balance	-	23,492	3,807	26,956	-	54,255
Foreign exchange differences	-	(1,301)	(24)	(369)	-	(1,694)
Increases	-	519	631	2,085	-	3,235
Transfers and write off's	-	(239)	(83)	(43)	-	(365)
Closing balance	-	22,471	4,331	28,629	-	55,431
Net value
As at 1 January 2009	734,126	1,949	41,536	38,798	10,312	826,721
As at 30 June 2009	712,838	1,411	43,084	36,808	9,038	803,179

The Group identified as intangible assets of indefinite useful life, besides goodwill, the trademarks Pingo Doce and Feira Nova, for which there is no time limit for how long they will continue to create economic benefits to the Group. Their net value is EUR 13,717 thousand, which are not being depreciated and are subject to impairment tests annually.

12.2 Guarantees

No intangible assets have been pledged as security for the fulfilment of bank or other obligations.

12.3 Intangible assets in progress

The implementation of projects for processes simplification, business acquisition expenses and key money are considered in intangible assets work in progress.

12.4 Goodwill

Goodwill is allocated to the Groups' business areas as presented bellow:

Business Areas	June 2009	December 2007
Retail Portugal	239,386	239,386
Cash & Carry Portugal	82,521	82,335
Madeira	8,509	8,509
Manufacturing	93,809	93,809
Poland	288,613	310,087
	712,838	734,126

The additions in this heading include:

• adjustments to the fair value of assets acquired in the concentration processes of 2008, amounting negative EUR 494 thousand;
• as a consequence of the currency translation adjustment of assets in the Group's business in Poland, the Goodwill value related to this business, totalling PLN 1,287,928 thousand, was decreased by EUR 20,794 thousand.

13 Investment Property

	June 2009
Opening balance	64,509
Increases	17
Transfers from tangible assets	82
Changes to fair value	(9)
Closing balance	64,599

The investment property relates to plots of land initially acquired for use in Group operations and others actually used for that purpose for a period of time but which became redundant, either because they could not be used to build cash-generating units or because they became superfluous as a result of the restructuring of operations.

This category also includes recently acquired land, whose use has still not been determined, being, therefore, considered has investment expecting for a market value increase.

As non-current assets are all the investment properties that are not expectable to be sold within a period below 12 months.

14 Derivative financial instruments

		June 2009				December 2008
	Notional	Assets		Liabilities		Notional		Assets		Liabilities
		Current	Non Current	Current	Non Current		Current	Non Current	Current	Non Current
Derivatives held for trading
Interest rate swap	10 millions EUR	-	-	-	621	85 millions EUR	-	-	-	6,175
Fair value hedging derivatives
USD loan hedging	180 millions USD	-	-	-		13,785 180 millions USD	-	-	-	9,123
Cash flow hedging derivatives
Interest rate swap (EUR)	461.4 millions EUR	-	195	-	10,199	166.6 millions EUR	-	-	-	4,366
Interest rate swap (PLN)	90 millions PLN	-	95	-	27	-	-	-	-	-
Currency forwards	347 millions PLN	552	631	-	-	30 millions EUR	1,037	-	-	-
Foreign operation investments hedging derivatives
Currency swap	400 millions PLN	-	8,299	-		- 400 millions PLN	-	1,027	-	-
Total derivatives held for trading		-	-	-	621		-	-	-	6,175
Total hedging derivatives		552	9,220	-	24,011		1,037	1,027	-	13,489
Total assets/liabilities derivatives		552	9,220	-	24,632		1,037	1,027	-	19,664

In June 2009 the values shown include interest receivable or payable related with these financial instruments that are due. The net payable amount is EUR 1,108 thousand.

Derivatives held for trading

Interest rate swap

The Group enters into interest rate swaps with the intention of make an economic hedge of the interest rate risk on its future interest payments on the loans. At 30 June 2009, the total amount of loans was EUR 526,007 thousand (December 2008: 421,007 thousand), and the Group had in this category derivative financial instruments with a notional of EUR 10,000 thousand (December 2008: EUR 30,000 thousand). The fair value of

these instruments at 30 June 2009 was negative in EUR 621 thousand (December 2008: negative EUR 2,622 thousand). From the portfolio of instruments at the end of 2008, EUR 20,000 thousand were cancelled in 2009.

In 2008, following the acquisition of EUR 55,000 thousand of treasury bonds, the group entered into a interest rate swap (called "Asset Swaps") with a notional of EUR 55,000 thousand, to hedge the economic interest rate risk of bonds, while credit risk was not hedged. This instruments were cancelled during first half 2009. The fair value of these instruments at 31 December 2008 was EUR 3,553 thousand negative.

Fair value hedge

Currency swap

The Group hedges its exposure to the fair value of its loans in the total amount of USD 180 million, arising from interest rate risk and exchange rate risk, through two cross currency swaps that have the same characteristics as the debt that was issued. The objective of this hedge is to transform the fixed rate into a variable rate, and to hedge exposure to the US dollar, thus reflecting changes to the fair value of the debt that was issued. The credit risk is not hedged. The fair value of the two cross currency swaps at 30 June 2009 was negative EUR 13,785 thousand (December 2008: negative EUR 9,123 thousand).

Cash flow hedge

Interest rate swap

The Group partially hedges future interest payments on the loans, using for that interest rate swaps, in which pays fixed interest rate and receives variable interest rate, with a notional of EUR 461,425 thousand and PLN 90,000 thousand (December 2008: EUR 166,625 thousand). This is a hedging of interest rate risk associated with variable-rate interest payments arising from recognised financial liabilities. The hedged risk is indexed to the variable rate associated with the loans. The objective of the hedge is to convert the loans with variable interest rate into fixed interest rate. The credit risk is not hedged. The fair value of the interest rate swaps at June 30th 2009 was negative EUR 9,936 thousand (December 2008: negative EUR 4,366 thousand).

In August 2006, one of the hedges was discontinued. The amount recognized in equity at that time has been recycled to profit and loss and, at June 30th 2009, the recycling process from equity to profit and loss is completed (December 2008: EUR 33 thousand). During first half 2009, the amount of EUR 33 thousand (June 2008: EUR 130 thousand) was recognised in results.

Currency forwards

The Group hedges the economic risk of its exposure to the exchange rate of Zloty. To do this, the Group entered foreign exchange forwards, with monthly maturities till December 2010. The derivative financial instruments held at 30 June 2009 had a notional of PLN 347,000 thousand (December 2008: PLN 30,000 thousand). The fair value of these instruments at 30 June 2009 was positive EUR 1,183 thousand (December 2008: positive EUR 1,037 thousand).

Hedging of investments in foreign entities

The Group hedges part of its exposure to the variation of the zloty due to its net investment in Poland through an exchange rate swap for 400 million Zlotys (December 2008: 400 million Zlotys). This instrument qualifies for hedge accounting. The fair value of the derivative at June 30th, 2009 was EUR 8,299 thousand (December 2008: EUR 1,027 thousand). The changes in the fair value of the derivative were recognised in the currency translation reserve in equity.

15 Investments in associated companies

During the 1st half of 2009, the movement under this heading was as follows:

	June 2009
Opening balance	854
Equity method	(10)
Transfers	(12)
Closing balance	832

16 Available-for-sale financial investments

Non-Currents

	June 2009	December 2008
BCP shares	3,705	3,705
Advances on account of financial investments	4,988	4,988
Others	893	893
	9,586	9,586
Fair value adjustments - BCP shares (note 25)	(2,294)	(2,116)
	7,292	7,470

The listed available-for-sale financial assets were recognized at fair value at the date of the financial statements. Thus, an impairment loss was registered on results reflecting the change on its fair value.

The financial assets available-for-sale include non-listed capital instruments whose fair value cannot be reliably measured and so as such are recognised at cost to the value of EUR 5,881 thousand at 30 June 2009 (December 2008: EUR 5,881 thousand). At the date of preparing the financial statements, the Group does not intend to dispose of any of its investments.

The main financial investments measured at cost are set out in the table below:

	June 2009	December 2008
Investment in Uniarme	150	150
Investment in Mercado Abastecedor do Porto	646	646
Investment in AMS	63	63
Other investments	34	34
	893	893

There are no market prices available for the mentioned investments, and not being able to determine the fair value based on comparable transactions, the Group did not measured this instruments based on expected discounted cash flows since they can not be reasonably estimated.

17 Inventories

	June 2009	December 2008
Raw and subsidiary materials and consumables	5,950	4,638
Goods and work in progress	646	735
Finished and semi-finished goods	1,056	231
Goods	327,005	393,421
	334,657	399,025
Fair value adjustment (note 25)	(10,174)	(13,372)
Net inventories	324,483	385,653

No inventories have been pledged as guarantee for the fulfilment of contractual obligations.

18 Taxes

18.1 Deferred tax assets and liabilities

Change in deferred tax accounts

	June 2009
Opening balance	8,444
Currency translation difference (note 22.1)	(2,417)
Revaluation and reserves (note 22.1)	1,048
Result of the year (note 9.1)	(2,826)
Closing balance	4,249

Deferred taxes are presented in balance sheet as follows:

	June 2009	December 2008
Deferred tax assets	60,535	63,170
Deferred tax liabilities	(56,286)	(54,726)
	4,249	8,444

Movement in deferred taxes during the year

	Opening balance	Impact on results	Impact on equity	Currency translation differences	Closing balance
Deferred tax liabilities
Revaluation of assets	35,522	(1)	-	(322)	35,199
Deferred income for tax purposes	2,578	452	-	(171)	2,859
Differences on accounting policies in other countries	11,679	249	-	(782)	11,146
Other temporary differences	4,947	2,144	(9)	-	7,082
	54,726	2,844	(9)	(1,275)	56,286
Deferred tax assets
Excess over legal provisions	16,452	(431)	-	(740)	15,281
Revaluation of assets	1,240	-	-	-	1,240
Employee benefits	4,486	127	-	-	4,613
Costs with foreign exchange risk hedging operations	2,073	1,133	1,039	(1,846)	2,399
Recoverable losses	4,387	758	-	(31)	5,114
Profit in inventories	587	(99)	-	-	488
Fair value adjustments on inventories	2,547	(397)	-	(115)	2,035
Other deferred costs for tax purposes	26,521	(988)	-	(925)	24,608
Differences on accounting policies in other countries	523	119	-	(35)	607
Other temporary differences	4,354	(204)	-	-	4,150
	63,170	18	1,039	(3,692)	60,535
Net change in deferred tax	8,444	(2,826)	1,048	(2,417)	4,249

18.2 Receivable and payable taxes

Taxes receivable	June 2009	December 2008
Income tax receivable	7,159	8,268
VAT receivable	15,520	25,642
Others	852	826
	23,531	34,736
Taxes payable
Income tax payable	14,622	12,452
VAT payable	22,863	19,658
Income tax withheld	4,531	5,179
Social security	14,330	15,586
Other taxes	7,177	5,303
	63,523	58,178

19 Trade debtors, accrued income and deferred costs

Non-current	June 2009	December 2008
Other debtors	66,416	61,407
Deferred costs	5,827	5,222
	72,243	66,629
Current
Commercial customers	94,102	81,005
Associated companies	8	7
Suppliers	21,390	11,928
Staff	1,942	1,544
Other debtors	42,918	42,835
Accrued income	13,422	25,106
Deferred costs	11,786	10,339
	185,568	172,764

Non-current debtors balance of EUR 60,814 thousand is related to additional tax liquidation, as well as advances on account of tax. The Group has already contested the amount paid and made a legal claim for reimbursement.

Accrued income essentially respects to the recognition of supplementary gains contracted with suppliers, in the amount of EUR 10,313 thousand.

The debtor's amount is registered by the recoverable value, i.e., the Group constitutes provisions for impairment losses whenever there are signs of uncollectable amounts (note 25).

20 Cash and cash equivalents

	June 2009	December 2008
Bank deposits	91,572	148,025
Short-term investments	47,097	75,613
Cash and cash equivalents	4,396	3,494
	143,065	227,132

The short-term investments include short-term bank deposits and other negotiable funds for which provisions were booked to reduce it to the realizable value (note 25).

21 Cash generated from operations

	June 2009	June 2008
Net results	72,977	64,852
Adjustments for:
Minority interests	5,556	(3,314)
Taxes	19,652	18,672
Depreciations	81,856	73,930
Provisions	2,502	16,845
Net financial costs	35,077	44,170
Profit in associated companies	10	(14)
Profit/ Losses on financial investment disposals	177	1,192
Profit/ Losses on tangible assets disposals	1,115	(9,511)
	218,922	206,822
Changes in working capital:
Inventories	55,757	(58,853)
Trade debtors, accrued income and deferred costs	(21,932)	(19,219)
Trade creditors, accrued costs and deferred income	(60,611)	132,091
	192,136	260,841

22 Capital and reserves

22.1 Fair value and other reserves

	Land and buildings	Cash-flow Hedging reserve	Currency translation reserve	Total
Balance as at 1 January 2009	93,783	(1,082)	(34,406)	58,295
Fair value adjustment of financial investments: - Gross value - Deferred tax - Minority interests	- - -	(4,368) 1,048 1,148	6,966 (1,847) -	2,598 (799) 1,148
Currency translation differences: - In the year - Deferred tax	- -	- -	(22,870) (570)	(22,870) (570)
Balance as at 30 June 2009	93,783	(3,254)	(52,727)	37,802

	Land and buildings	Cash-flow Hedging reserve	Available-for sale financial investments	Currency translation reserve	Total
Balance as at 1 January 2008	76,397	308	1,217	14,892	92,814
Disposal of revaluated assets: - Gross value - Deferred tax - Minority interests	(10,102) 2,577 3,687	- - -	- - -	- - -	(10,102) 2,577 3,687
Fair value adjustment of financial investments: - Gross value - Deferred tax	- -	(211) 56	- -	(8,554) 2,267	(8,765) 2,323
Fair value adjustment of available-for-sale financial investments: - Gross value	-	-	(1,217)	-	(1,217)
Currency translation differences: - In the year - Deferred tax	- -	- -	- -	20,344 1,461	20,344 1,461
Balance as at 30 June 2008	72,559	153	-	30,410	103,122

22.2 Dividends

Dividends distributed in 2009 in the amount of EUR 81,573 thousand, were paid to Jerónimo Martins, SGPS, S.A. shareholders an amount of EUR 69,128 thousand and to minority interest in the Group companies an amount of EUR 12,445 thousand.

23 Earnings per share

23.1 Basic and diluted earnings per share

Basic net results per share are calculated based on the net profit of EUR 72,977 thousand (2008: profit of EUR 64,852 thousand) and on weighted average outstanding ordinary shares, numbering 628,434,220 (2008: 628,434,220).

23.2 Weighted average ordinary shares

	June 2009	June 2008
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
Shares issued during the year	-	-
Weighted average number of ordinary shares	628,434,220	628,434,220

23.3 Net results attributable to ordinary shareholders

	June 2009	June 2008
Weighted average ordinary shares	628,434,220	628,434,220
Net profit of the year attributable to ordinary
shareholders	72,977	64,852
Basic and diluted earnings per share – Euros	0.1161	0.1032

24 Borrowings

Throughout the first quarter, Jerónimo Martins, SGPS, S.A. issued a new commercial paper program in the amount of EUR 30,000 thousand. The program has maturity of 5 years and payment of 50% on the 4th year. Annually Jerónimo Martins has a call option and there isn't a put option from the bank.

On the second quarter Jerónimo Martins, SGPS, S.A. issue two new commercial paper programs in the amount of EUR 60,000 thousand. From this amount, EUR 10,000 thousand have a maturity of 3 years and the remaining has 5 years maturity.

On April, JMR, SGPS, S.A. issued a Bond Loan in the amount of EUR 105,000 thousand. The issue has a maturity of 5 years and payment of 50% in the end of the 4th year, and it was issued at floating rate.

During the 1st half of 2009, the Recheio SGPS, S.A. bond loan of 1 million bonds at nominal value of 50 Euros each, totalling EUR 50,000 thousand, was reimbursed.

New financial leasing operations were contracted for 60-month periods in the amount of EUR 7,000 thousand, with quarterly amortisation.

24.1 Current and non-current loans

	June 2009	December 2008
Non-current loans
Bank loans	257,926	259,657
Bond loans	512,133	411,847
Financial lease liabilities	56,392	67,829
	826,451	739,333
Current loans
Bank overdrafts	39,193	45,355
Bank loans	164,898	179,159
Bond loans	-	50,000
Financial lease liabilities	34,584	33,830
	238,675	308,344

24.2 Loan terms and maturities

	Average rate	Total	Less than 1 year	Between 1 and 5 years	More than 5 years
Bank loans
Commercial Paper in EUR	3.51%	223,500	100,500	123,000	-
Loans in EUR	3.51%	88,015	17,200	70,815	-
Loans in PLN	5.32%	111,309	47,198	64,111	-
Bond Loans
Loans	4.81%	526,007	-	526,007	-
Fair value adjustment		(13,874)	-	(13,874)	-
Bank overdrafts	3.29%	39,193	39,193	-	-
Financial lease liabilities	2.82%	90,976	34,584	55,746	646
		1,065,126	238,675	825,805	646

The amount of negative EUR 13,874 thousand, adjusted to the total of bond loans, refers to the updating of the bond loan for USD 180 million, for which the Group contracted a hedging instrument, presented in note 14, with a symmetrical value.

24.3 Financial debt

As the Group contracted several foreign exchange rate risk and interest risk hedging operations, as well as short-term investments, the net consolidated financial debt as at 30 June is as follows:

	June 2009	December 2008
Non-current loans (note 24.1)	826,451	739,333
Current loans (note 24.1)	238,675	308,344
Derivative financial instruments (note 14)	14,860	17,600
Interest on accruals and deferrals	643	4,211
Bank deposits (note 20)	(91,572)	(148,025)
Short-term investments (note 20)	(47,097)	(75,613)
	941,960	845,850

25 Provisions and adjustments to the net realisable value

	Opening balance	Provisions set up	Provisions used	Foreign exchange difference	Business acquisition & restructuring	Closing balance
Doubtful debtors (note 19)	25,627	546	(2,742)	(286)	-	23,145
Inventories (note 17)	13,372	14,228	(16,793)	(633)	-	10,174
Financial Investments (note 16)	2,116	178	-	-	-	2,294
Short terms investments	57	-	-	-	-	57
Total fair value adjustments	41,172	14,952	(19,535)	(919)	-	35,670
Employee benefits	28,195	1,870	(666)	-	-	29,399
Other risks and contingencies	25,892	4,054	(4,614)	(710)	31	24,653
Total of provisions	54,087	5,924	(5,280)	(710)	31	54,052

26 Trade creditors, accrued costs and deferred income

	June 2009	December 2008
Other commercial creditors	1,170,669	1,287,940
Other non-commercial creditors	40,612	111,567
Accrued costs	159,537	155,210
Deferred income	5,342	5,325
	1,376,160	1,560,042

27 Contingencies

Following the contingencies mentioned in the 2008 Annual Report, changes occurred on the headings c), d) and o), as well as new contingencies described bellow:

• c) In the case where Proherre Internacional, Lda is claiming compensation from Pingo Doce Distribuição Alimentar, S.A., alleging an unlawful termination of a lease agreement by the latter, the plaintiff asked the court to admit an increase of the compensation (around 4.1 million Euros, plus interests), due to the time elapsed since the suit was filed without having rented the store. Pingo Doce will oppose to this new claim, which is unacceptable under the Law.
• d) In the case of Sodisnasa against Lidosol II Distribuição de Produtos Alimentares, S.A. and João Gomes Camacho S.A. the first dispatch has been issued and the hearing is scheduled to January, 14, 2010.
• o) The Portuguese tax authorities have claimed EUR 532 thousands from Imoretalho Gestão de Imóveis, S.A., due to a supposed lack of VAT payment. Nevertheless, that claim is due to an error of the tax authorities, on the analysis of substitution VAT returns which did not generate any tax due. During the first Quarter 2009 the Portuguese tax authorities have already ruled in favour of Imoretalho.

During the first Half of 2009, the Portuguese tax authorities assessed Feira Nova – Hipermercados, S.A. and Pingo Doce – Distribuição Alimentar, S.A. the amounts of EUR 798 thousand and EUR 784 thousand, respectively. These additional assessments were issued because the tax authorities argue that some goods were sold at a lower VAT rate. These assessments respect to the years of 2005 and 2006. Feira Nova and Pingo Doce's Management, supported by their tax consultants, have challenged these assessments, believing that the tax authorities have no arguments to request these payments.

Similarly to other situations reported in the past (see heading k) of the 2008 Annual Report), Jerónimo Martins Group received a Corporate Income Tax additional assessment, issued by the Portuguese Tax Authorities, to the amount of EUR 9,362 thousand related to the tax year 2005 and regarding corrections made to companies taxed under Group's Special Tax Regime, lead by JMR – Gestão de Empresas de Retalho, SGPS, S.A..

The Jerónimo Martins Group, supported by its lawyers and tax advisors' opinion, considers that the arguments used by the Portuguese Tax Authorities are not valid and have no legal grounds and will use every means at its disposal to challenge them and to oppose any consequences that they may cause. Furthermore, the Group will not change its financial statements.

Tengelmann KG filed an arbitration procedure against the companies Jerónimo Martins, SGPS, S.A. and Pingo Doce Distribuição de Produtos Alimentares, S.A., before the German Institute of Arbitration, in Koln. The plaintiff argues that the price paid by Pingo Doce for the shares in Plus Portugal, Lda. should be increased in EUR 4.437 thousand, concerning an alleged error detected in determining the reference price at 30 April 2008.

The plaintiff also claims EUR 120 thousand and EUR 107 thousand concerning interests allegedly due by Pingo Doce based on the fact that the bank checks used to pay for the share were only credited a few days after the transaction.

In both cases, Jerónimo Martins and Pingo Doce believe that the claims are groundless and has answered accordingly. A preliminary dispatch from the Arbitration Court is awaited.

28 Related parties

56.11% of the Group is owned by the Sociedade Francisco Manuel dos Santos, and no transactions occurred between this Company and any other company of the Group in the 1st half of 2009, neither were there any amounts payable or receivable between them on June 30th, 2009.

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

	Sales and services rendered		Stocks purchased and services supplied
	June 2009	June 2008	June 2009	June 2008
Joint-Ventures	295	228	44,059	46,790
Associated companies	315	371	228	339

	Accounts payable		Accounts receivable
	June 2009	December 2008	June 2009	December 2008
Joint-Ventures	650	675	18,418	7,915
Associated companies	63	91	101	580

Balances and transactions with related parties not eliminated in the consolidation process, were as follows:

	Sales and services rendered		Stocks purchased and services supplied
	June 2009	June 2008	June 2009	June 2008
Joint-Ventures	154	120	24,232	25,734
Associated companies	315	371	228	339

	Accounts payable		Accounts receivable
	June 2009	December 2008	June 2009	December 2008
Joint-Ventures	344	356	10,129	4,353
Associated companies	63	91	101	580

All the transactions with companies consolidated using the proportional method (joint-ventures) or using the equity method were made under normal market conditions, i.e., the transaction value corresponds to prices that would be applicable between non related parties.

Lisbon, 24th July, 2009

The Certified Accountant The Board of directors

PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda. Palácio Sottomayor Rua Sousa Martins, 1 - 3º 1069-316 Lisboa Portugal Tel +351 213 599 000 Fax +351 213 599 999

Limited Review Report for Stock Exchange Regulatory Purposes in respect of the Consolidated Financial Information

(Free translation from the original version in Portuguese)

Introduction

1 We present our Limited Review Report on the consolidated information for the period of six months ended 30 June 2009, of Jerónimo Martins, SGPS, SA., included in: the Directors' Report, the consolidated balance sheet (which shows a total of euros 3.547.274 thousand, and a total shareholders' equity of euros 906.444 thousand, including minority interests of euros 273.270 thousand and a profit for the period of euros 72.977 thousand), the consolidated statement of income by functions, the consolidated statement of gains and losses recognised in equity, the consolidated statement of changes in equity and the consolidated cash flow statements for the period then ended and the respective notes.

2 The amounts in the consolidated financial statements, as well as the financial information, were obtained from the accounting records.

Responsibilities

3 It is the responsibility of the Company's Board of Directors: (a) to prepare the consolidated financial information that present a true and fair view of the financial position of the companies included in the consolidation and the consolidated results of their operations; (b) to prepare historical financial information in accordance with International Accounting Standard 34, "Interim Financial Reporting" as adopted by the EU that is complete, true, timely, clear, objective and licit, as required by the Portuguese Securities Market Code; (c) to adopt adequate accounting policies and criteria; (d) to maintain appropriate systems of internal control; and (e) to disclose any relevant matters which have influenced their activity, financial position or results.

4 Our responsibility is to verify the financial information included in the above mentioned documents, namely if, it is complete, true, timely, clear, objective and licit, as required by the Portuguese Securities Market Code, and to issue a professional and independent report based on our work.

Jerónimo Martins, SGPS, SA. 24 August 2009

Scope

5 Our work was performed, with the objective of obtaining moderate assurance about whether the financial information referred to above is free of material misstatement. Our work, which was performed in accordance with the Standard and Technical Recommendations approved by the Portuguese Institute of Statutory Auditors, was planned in accordance with that objective, and consisted mainly of inquiries and analytical procedures to review: (i) the reliability of the assertions included in the financial information; (ii) the adequacy of the accounting policies adopted considering the circumstances and their consistent application; (iii) the applicability, or otherwise, of the going concern basis of accounting; (iv) the presentation of the financial information; and (v) if, the consolidated financial information is complete, true, timely, clear, objective and licit.

6 Our work also covered verification of the consistency of the consolidated financial information included in the Directors' Report with the remaining documents referred to above.

7 We believe that our work provides a reasonable basis for issuing this report on the half yearly financial information.

Conclusion

8 Based on our work, which was performed with the objective of obtaining moderate assurance, nothing came to our attention that leads us to believe that the consolidated financial information for the period of six months ended 30 June 2009 is not free of material misstatements that affects its conformity with International Accounting Standard 34, "Interim Financial Reporting", as adopted by the EU and that it is not complete, true, timely, clear, objective and licit.

Lisbon, 24 August 2009

PricewaterhouseCoopers & Associados, S.R.O.C., Lda. represented by:

Jorge Manuel Santos Costa, R.O.C.