Portugal's second-largest retailer Jerónimo Martins has posted a 14% rise in third-quarter net profit, as soaring inflation drove sales higher, and the company warned of an uncertain outlook for prices.
Jerónimo Martins netted €157 million ($157.97 million) between July and September.
Chief executive Pedro Soares dos Santos warned that "with two months until year-end, the geopolitical instability and the supply chain constraints resulting from the pandemic make the outlook on food, energy, and fuel prices very uncertain".
As the company tries to contain prices that have soared since Russia's invasion of Ukraine on 24 February, the cost of inflation will further pressure margins, it said.
Consolidated sales in the third quarter rose 22.7% to €6.5 billion, driven by the company's market-leading Polish retail chain Biedronka, that posted a sales increase of 21.6% to €4.4 billion. Annual food inflation in Poland clocked 19% in September.
Even though Poland’s consumers grew more cautious and price-sensitive, spending on food has increased, outpacing food inflation.
Health and beauty retailer, Hebe posted sales growth of 33.6%, that benefitted from the previous year's low base.
At home, supermarket chain Pingo Doce posted a 13.4% rise in sales to €1.1 billion and Colombia's Ara booked €467 million in sales, up a steep 64% from a year earlier.
The company said it also increased its investment programme to €950 million from €850 million due to Ara's more ambitious expansion plan, with 230-250 new stores planned instead of 180, and the higher cost of construction and equipment in all its markets.
News by Reuters, additional reporting by ESM. For more retail news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.