Spain’s DIA has posted a 24% decline in operating profit in the nine month period to September 2018, of €281 million.
Like-for-like sales at the business grew by 2.7%, excluding calendar effects, it said, however reported sales were impacted by the depreciation of the Brazilian and Argentinian currencies.
Gross sales under banner were €6.95 billion for the nine month period, a drop of 9.0%.
Earlier this month, both Moody's and S&P issued a ratings downgrade on the Spanish retailer.
Time To Look Forward
Announcing the results, DIA chief executive Antonio Coto said that the group wanted to make clear that this is “a time to look ahead.
“I want to promote a DIA where the entire value chain must be put at the service of clients listening them to know their preferences and tastes, so they can find in our stores quality products at the best price with excellent service”.
DIA increased its capital expenditure in the period, with total capex rising to €269.1 million, and capex in its core Spanish market standing at €196 million, an increase of 71% on the same period the previous year.
Looking ahead to the full financial year DIA is expecting to report adjusted EBITDA of between €350 million and €400 million, compared to €586 million the previous year.
Coto added that the group’s aim is to consolidate its leadership position in Spain.
“We will concentrate our efforts in Spain, our main market, with a realistic and strict operating change plan in the short term, in order to reverse the current trend,” he said. “We will focus on customer’s satisfaction and on cash generation”.
Coto also added that the “group’s intrinsic value is beyond doubt, and its more than 7,000 stores continue to do business as usual, with good sales volumes and cash flow generation”.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.