He faces the second half of the year with “optimism” after completing the transformation process of stores in Spain and Argentina
Grupo Dia reduced its losses by 35.8% during the first half of this year, to 67 million euros, due to business results as well as the sale of stores to Alcampo in Spain, as reported by the chain on Thursday. of supermarkets to the National Securities Market Commission (CNMV).
The adjusted gross operating result (Ebitda) reached 65 million euros in the first half of the year, 27% more than a year ago, and increases the margin by 0.3 percentage points, up to 1.8%, which reflects “ongoing operational management improvement and cost control.”
Net sales grew by 4% compared to the first half of 2022, to 3,602 million euros, offsetting the negative currency effect in Argentina and the 5% reduction in the store network during part of the year.
Likewise, the group increased comparable sales ‘like-for-like’ by 5.7% compared to the same period in 2022, highlighting the growth of the business in Spain.
Specifically, net sales in Spain increased by 6.9%, to 2,241 million euros, and the like-for-like sales by 12.8%, which would reach 13.3% if stores are excluded sold to Alcampo and the Clarel operation. Thus, adjusted Ebitda in the domestic market rises by 44.8%, up to 65 million euros.
In Argentina, where Dia store number 1,000 has been opened this semester, net sales rose 7.6%, to 701 million euros, maintaining the adjusted Ebitda margin at 2.5%, while in Brazil they were reduced by 15.9%, mainly affected by the change in the assortment started at the end of 2022 and the reduction of 2% in the store network.
For its part, net invoicing in Portugal, a country that it will leave after selling its business to Auchan, improved by 4.1% in the semester, to 295 million euros, with comparable sales that advanced 7.8%, showing the resilience from the business to a challenging scenario due to the entry and expansion of new players in the market.
“The positive trend of our business underlines that Grupo Dia’s focus on local food distribution is the right one. In a complex scenario, we have completed a positive semester in which the company shows consistent growth, with an improvement in adjusted Ebitda and sales that allow us to embark on a new phase of consolidation of growth”, pointed out the global CEO of Grupo Dia, Martín Tolcachir.
Tolcachir has highlighted that Spain has gained market share on a comparable area, while Argentina has improved global market share thanks to the “differential value proposition that seeks to offer a first-class experience to customers.”
THE TRANSFORMATION PROCESS IN SPAIN AND ARGENTINA COMPLETES
On the other hand, the supermarket chain has confirmed that during the first half of the year it has focused on completing the ‘turnaround’ process in Spain and Argentina, on developing the new value proposition in Brazil, and on accelerating the ‘online’ channel. ‘, supported by the new ‘app’ in Argentina and the renewal of dia.es and the ‘app’ in Spain.
In this way, the group at the end of June had a total of 5,435 stores in Spain, Argentina, Brazil and Portugal, 62% of them managed by franchisees. In addition, thanks to the 57 openings and 430 renovations carried out during the semester, 64% of the company’s global network already operates with its new value proposition.
By markets, in Spain 16 openings and 264 remodelings have been carried out, while in Argentina there have been 41 openings and 157 remodelings. In Brazil, nine stores were transformed during the first semester, bringing to 15 the establishments operating in the country under the new value proposition.
Regarding the sale ‘online’, the supermarket chain has specified that this channel already accounts for 2.7% of revenue globally. In this sense, in Spain the ‘online’ channel already reaches 84% of the population.
The supermarket chain has underlined that in a semester marked by economic uncertainty that has reduced the amount of the average basket (-2.9% compared to the same period in 2022), the positive trend in store visit frequency continues, with an increase in the number of tickets of 4.8%.
OPTIMISTIC FACING THE SECOND HALF OF THE YEAR
On the other hand, Grupo Dia has reduced its net financial debt by 22%, equivalent to 118 million euros, to 426 million, thanks to the positive generation of cash and working capital, as well as the sale of assets to Alcampo, which has partially offset the strong investment effort made between January and June of this year.
In this way, the company has shown itself to be “optimistic” for the second half of the year, focused on its commitment to proximity and simplicity to continue improving the operational and financial variables with the aim of the company recovering the path of growth in the short term.
“Milestone by milestone, we have fulfilled a roadmap that has allowed us to complete the ‘turnaroud’ in Spain and Argentina, and begin to define the appropriate path for Brazil. In the second semester, our focus will be the consolidation of these advances supported by our great strength, proximity, and with an eye on the company’s digital transformation to be an omnichannel player that offers a first-rate service to our customers”, Tolcachir said.
In this way, the group’s chief executive has reiterated his commitment to simplifying the group’s portfolio. “The recent agreement with Auchan for the sale of our operation in Portugal, the sale of Clarel and the simplification of the network in Spain are strategic decisions that follow this orientation and that we are sure will allow us to advance in our objectives”, has stressed he.
