November 13, 2019 / 7:41 PM / a month ago

Portugal's Sonae profit falls 16% after one-off gain last year

LISBON, Nov 13 (Reuters) - Portugal’s largest retailer Sonae reported on Wednesday a 16% fall in net profit attributable to shareholders for the first nine months of the year, after a one-off gain from the sale of a stake in software company Outsystems last year.

The company said the profit came in at 88 million euros ($97 million) for the nine month period this year.

“We had the (Outsystems) transaction last year which was an extraordinary event and led to a very significant gain (in 2018),” Chief Financial Officer Joao Dolores told Reuters.

The conglomerate, which runs 174 Continente hypermarkets and large supermarkets, Worten consumer electronics stores, Sportzone stores and other retail chains, said in a statement its underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 20.9% to 485 million euros.

The EBITDA margin increased 0.9 percentage points to 10.5%.

Even though the net profit attributable to shareholders dropped, the group’s total net profit increased 17.8% to 131 million euros in the nine month period, boosted by strong sales and improved operating profitability.

Sales increased 10.2% compared with the same period in 2018, reaching around 4.6 billion euros, with sales from food retailer Sonae MC increasing 9.5% to 3.4 billion euros.

“This strong level of growth was mainly driven by Sonae MC but also by a series of acquisitions made over the last 12 months,” said Sonae’s Chief Executive Claudia Azevedo.

Capital expenditure amounted to 275 million euros, with the group highlighting the acquisition of Spanish parapharmacy and cosmetics network Arenal.

Sonae shares closed 0.27% lower before the results were released.

$1 = 0.9074 euros Reporting by Catarina Demony and Sergio Goncalves; Editing by Mark Potter

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