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Portugal's Sonae CEO optimistic as third-quarter profit jumps

LISBON, Nov 11 (Reuters) - Portugal’s Sonae, which owns the country’s largest food retailer, reported late on Wednesday a 32.5% jump in its third-quarter net profit, supported by solid sales after the gradual easing of the coronavirus restrictions.

Sonae said it posted a net profit of 96 million euros ($111.01 million) in July-September when the country continued the process of gradual lifting of coronavirus restrictions.

The group, which runs around 300 Continente brand hypermarkets and large supermarkets and other retail chains, said its consolidated sales rose 3.3% to 1.79 billion euros in the third quarter, showing “resilience despite the challenging context”.

The sales of its food retail unit Sonae MC grew 5.3% to 1.38 billion euros, despite a drag from limitations on the number of people allowed inside the stores, it said in a statement.

After “a first semester marked by lockdown measures, the third quarter was already a period with encouraging signs,” Chief Executive Officer Claudia Azevedo said.

“Sonae’s business portfolio continued to show very positive results ... based on this performance, we face the future with enormous confidence,” she said.

“There are new challenges ahead, but also very exciting opportunities. Today, our businesses are better prepared.”

Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 33.9% to 239 million euros in the quarter. The EBITDA margin - an important measure of profitability - improved to 13.3% from 10.3% a year earlier.

It said operating capex increased 10.1% to 182 million euros in the first nine months of the year, compared with the same period last year.

As of September, the company’s net debt amounted to 857 million euros, falling 375 million euros from a year-ago period.

Portuguese rival Jeronimo Martins reported a 20% increase in third-quarter net profit two weeks ago.

$1 = 0.8648 euros Reporting Sergio Goncalves; Editing by Nathan Allen and Sherry Jacob-Phillips

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