Sonae, which owns Portugal's largest food retailer, said fourth-quarter net profit rose 46% after most coronavirus restrictions were lifted, though challenges remain.
Sonae, whose businesses range from food retail to telecoms, earned €109 million from October to December, up from €75 million a year earlier, when the pandemic still restricted private consumption.
Consolidated sales rose 6.7% to €2 billion in the fourth quarter, it said in a statement.
Inflation On The Rise
As the effects of the pandemic wane, the company faces the consequences on the Portuguese economy of the war in Ukraine, which include inflation as a result of shortages of food commodities.
Sales from its food retail unit Sonae MC, which runs around 300 hypermarkets and large supermarkets under the Continente brand, grew by 8.9% to €1.5 billion, though the war in Ukraine and rising energy costs "could put pressure on its businesses," the statement said.
Chief executive Claudia Azevedo said that in 2022 the uncertainty and challenges "will not be lower" than those of the last two years of the pandemic, but Sonae has a "very stable financial situation, which allows it to explore new and attractive opportunities".
Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 7.9% to €208 million in the quarter, while its EBITDA margin remained stable at around 10.3%.
For the whole of 2021, Sonae's profit almost quadrupled to €268 million, while EBITDA increased 18% to €738 million
Its debt was cut almost in half to €563 million in 2021, while operating capex increased by 5.8% to €279 million, it said.
Portuguese rival Jeronimo Martins reported a 49% increase in fourth-quarter net profit last week.