Jeronimo Martins Pe

Good morning, ladies and gentlemen, and thank you for joining this call dedicated to our first quarter results. In our corporate website, you can find the results release, a slide presentation, and a fact sheet for the periods. Our recently approved 2024 annual report is also available there, including our sustainability commitments for the 2024-2026 period. Unsurprisingly, 2025 started with a volatile and extremely uncertain landscape, further limiting visibility on consumers' behavior trends. Overall, the rise in minimum wages increased household disposable income in the countries where we operate. Notwithstanding, families remained cautious in their food spending and highly promotions-driven. In the light of this refrained context, we maintained our key strategic priorities. to ensure price competitiveness to earn the preference of consumers and continue to strengthen our market positions. Although basket inflation turned positive at our main food banners, the challenge, well known to us at this point, of operating with low top line inflation and high cost inflation persisted. Therefore, together with unwavering focus on sales, our teams maintain the tight control over all profitability drivers to mitigate the impact of margin pressure. With price competitiveness ensured, sales grew 3.8% or 1.9% at constant exchange rates. Following sales and even stricter cost management, EBITDA increased 3.8% or 1.2% at constant exchange rates, with the respective margins standing in line with prior year at 6.3%. This performance was achieved in a quarter marked by a negative calendar effect that for our main businesses ranged from 3 to 4 percentage points of sales growth. At the end of March, the group registered a positive cash position of €332 million. Looking now at the quarter P&L, I would like to draw your attention to a couple of highlights of the performance. First, Sales grew despite the already mentioned strong calendar effect, with a solid contribution from expansion. Second, gross margin increased, reflecting both the work undertaken by ARA throughout 2024 to improve margin, which will benefit 2025 figures, particularly in the first months of the year, and the easier comparable at Piedronka as a result of the banner-sharp response to a demanding and fast-changing context in Q1 24, with drastic weakening in consumer demands and more intense competition. Against last year's backdrop, our main banners stepped up investment in successful campaigns that drove outstanding volume growth, but visibly impacted the margin mix when now compared with Q1 25. All in all, at the group level, sales resilience and gross margin performance offset cost pressure driven by wage increases. As a result, consolidated EBITDA grew in line with sales and margin remained stable at 6.3%. Cash flow for the period was an outflow of €398 million. This reflects the normal business seasonality after Christmas and also the fact that Easter this year was in April and as such, did not benefit working capital as of 31st March. The group ended the quarter with a strong balance sheet and a positive cash position of 332 million euros when excluding IFRS 16. The general shareholders' meeting held on 24 April approved the proposal to distribute a dividend of 59 cents per share, a gross amount, totaling 370.8 million euros, which will be paid on 15 May. The shareholders also approved allocating 40 million euros from the 2024 results to the Jerónimo Martins Foundation. According to our statutory auditor, and in agreement with EIS 1, this amount will appear in the income statement for Q2 2025, booked as a cost in an autonomous heading. I will now guide you through the detail of the performance, starting with sales, which grew by 3.8%, 1.9% at constant exchange rates, to reach 8.4 billion euros. Our main banners are operating with very low basket inflation, albeit not negative. Group like Polite was at minus 2.2%, impacted by calendar effects and tough comparables at all banners, particularly at Biedronka. In this year, when we are celebrating the 30th anniversary of Biedronka in Poland, we are proud to acknowledge that it has been an amazing journey with regard to the evolution of its value proposition while, throughout the years, price leadership has been a constant delivery of our main banner's promise to Polish families. In the first quarter, Biedronka maintained a non-stop commercial dynamic to fuel its intense promotional activity and kept its well-recognized price competitiveness. As a result, sales grew by 3.4% to 5.9 billion euros, or 0.3% in local currency, with 0.3 percentage points of market share gain in the period. Like for Like was at minus 3.5%, impacted by the previously mentioned calendar effects and the very difficult comparable of Q1 24. Expansion continued to contribute solidly to top-line growth. The banner opened 56 stores over the three months and remodeled 27 locations. In March 2025, Biedronka also opened its first four stores in Słowackie and a distribution center, being now focused on evaluating the consumer's reaction to its value proposition in that country. Facing fiercer competition in the Polish health and beauty markets, Hebe operated with significant deflation to protect its top line. Sales grew 11.9% or 8.5% in local currency to reach 145 million euros with the online channel representing 21% of total turnover. Over the period, four Hebe stores were opened in Poland and one in Czech Republic. Pink Dulce's intense promotional activity, together with the contribution of the All About Food stores, delivered 2.8% sales growth to reach €1.2 billion in the period. Like Polike, excluding fuel, was at 1.1% despite the negative calendar effects. The banner opened one store and continued remodeling the network with 13 locations more now converted to the All About Food concept. In a tougher context, particularly felt by the ORECA channel, Recheio kept investing to protect sales. With Easter occurring outside the quarter and a heavy rainy season impacting one of its main categories, in this case beverages, sales declined slightly by 0.4% to €302 million, with like-for-like standing at minus 0.5%. ADA executed its commercial strategy marked by strong promotions to offer the best saving opportunities to the Colombian families. Sales grew 9.1% or 13% in local currency to reach 775 million euros and like for like was at 3%. Expansion remained as a solid contributor to top line growth. In the first quarter, ADA opened nine stores and one distribution center. Our Colombian banner remains on track to deliver its expansion target for the year that also includes the integration throughout Q2 of around 70 locations previously operated by call-subsidio. Consolidated EBITDA grew 3.8% or 1.2% at constant exchange rates to reach 528 million euros. Overall, all businesses posted a very solid underlying performance, being able to offset the pressure on the respective EBITDA margins, deriving mainly from higher labor costs. Group EBITDA margin was flat at 6.3%. At Piedronka, EBITDA margin was kept stable despite the rise in labor costs and the negative like-for-like. In addition to the even tighter cost control, I flag here the already mentioned effect of easier comps on the gross margin that in the quarter favored this stability. At Hebe, price investments and a low like-to-like impacted by strong deflation significantly pressured a BTA margin. In Portugal, a reference to the slight margin pressure mainly due to higher labor costs. And finally, ADA continued to protect the improved mixed dynamic created in 2024 and to strengthen cost control measures, I flag here that from an EBITDA margin perspective, ADA faces an easier comp in the first half of the year. We know that the first quarter only allows for a very limited understanding of the market trends, and this is particularly true having in mind the high level of uncertainty around geopolitics and socioeconomic dynamics. This said, and looking at the performance beyond the calendar impact, sales delivery was solid against the comparable that was extremely challenging to overcome. The work done by the companies to protect profitability paid off and was also supported by the easier comparable for gross margin. Looking ahead, we continue to see an extremely volatile landscape, a somehow sluggish and unpredictable consumer context, as well as sustained and high cost pressure. As we said on March 19 when presenting the outlook for 2025, which we fully reiterate today, we will remain focused on protecting price competitiveness to grow sales, and we also need to protect profitability by managing margin pressure deriving from higher personal costs and more intense competition. While we know how difficult it is to reach that balance, we are totally committed to delivering on this target. Thank you for your attention, operator. I am now ready to take questions.

Thank you so much. Dear participants, as a reminder, if you wish to ask a question, please press star 1 1 on your telephone keypad and wait for your name to be announced. To withdraw a question, please press star 1 1 again. Please stand by while we'll compile the Q&A roster.

This will take a few moments. And now we're going to take our first question.