Sonae, owner of Portugal’s largest food retailer, reported a 21% jump in fourth-quarter net profit on Thursday as unexpected capital gains offset the impact of inflation and higher energy costs on its supermarkets.
The group, which has businesses in sectors ranging from retail to telecommunications, made a net profit of 132 million euros ($139.74 million) in the three months to December 31, after recording 142 million euros of exceptional capital gains, mainly from the sale of assets.
Margin pressure due to rising inflation and energy costs lowered the net profit of Sonae MC, which operates around 300 supermarkets and hypermarkets, down 16% to €56m, despite a 14% increase in sales, which amounted to €1.68bn.
Sunai said food prices rose 19.5 percent in the first quarter.
“To avoid further straining family budgets, our retail businesses have taken some of the inflationary pressure at the expense of their own profitability,” CEO Claudia Azevedo said in a statement.
Underlying consolidated earnings before interest, tax, depreciation and amortization (EBITDA) rose 4.9% to €195 million in the first quarter. However, the underlying EBITDA margin — a key measure of profitability — fell to 8.7% from 9.3% a year earlier.
($1 = 0.9446 euros)