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LISBON Dec 11 Portuguese food retailer Jeronimo
Martins expects double-digit annual sales growth over the next
three years, fuelled by 2.5 billion euros of capital spending as
it continues to expand its core business in Poland, the company
said on Tuesday.
In an 'investor day' presentation the company said sales
growth will be driven by its Polish business B iedronka, where it
has plans to increase the number of stores by 50 percent to
3,000 by 2015. By that time Biedronka will contribute 80 percent
of group sales from 61 percent currently, the company said
recently. [ID:n L5E8LQ6BL]
The planned overall investment is higher than the 2.2
billion euros envisaged under the company's previous strategic
plan for 2012-14, with the increase following a decision
announced late last year to open a retail business in Colombia,
where it aims to be among the top three food retailers in five
Shares in Jeronimo were 3.4 percent higher at 14.92 euros by
1122 GMT on Tuesday, when the Lisbon PSI 20 index was
up 1.4 percent.
"The company has reassured the market of the continuation of
its growth, driven by Poland which will receive 70 percent of
the investment, and showed it is very optimistic with a forecast
of average annual sales growth of 10 percent," said Albino
Oliveira, an analyst at the Fincor brokerage.
It also said earnings before interest, taxes, depreciation
and amortisation should grow at "at least" the same pace as
sales in 2013-15. In October the company reported a 5.4 percent
rise in EBITDA to 228 million euros on a 10.8 percent rise in
sales to 2.85 billion euros.
The company plans to open over the next three years at least
150 stores in Colombia - a new market for Jeronimo Martins which
it is due to enter next year. Its investment will total 400
million euros over the period, starting next year with 100
million euros to be spent on opening the first 30 to 40 stores.
"We expect solid growth in net results even considering the
investment in Colombia," the company said, adding that the first
three years of penetrating the new market would cost the group
less than 5 percent of EBITDA.
Jeronimo Martins said it would maintain its dividend
distribution policy. It provided no further details but this
year it is paying out 50 percent of net profits. The company
also intends to continue reducing net debt and hopes to have no
debt in 2015.
(Reporting By Patricia Rua; Writing by Andrei Khalip; Editing
by Greg Mahlich)