The DIA Group, an international distribution group that owns the Minipreço chain in Portugal, closed the second quarter of 2020 with net sales of 1.819 million euros, an increase of 6,3% compared to the 1.711 million euros achieved in the same period of 2019, "Thanks to the positive effect of the transformation initiatives and the consumer behavior regarding the confinement of Covid-19, although with a reduction in the chain of stores and with the adverse monetary effects caused by the Brazilian and Argentine currencies".
Comparable sales ('like-for-like') of the distribution group operating in Portugal, Spain, Brazil and Argentina registered an increase of 14,9% in the period under review compared to the second quarter of 2019, “with all markets positive for the first time since the 4th quarter of 2016, driven by an increase in the average purchase basket that offset the decline in the number of 'tickets' ”.
Gross profit amounted to 403 million, against 303 million euros in the second quarter of 2019, which represents a 4,4% increase in the percentage of net sales, “due to the increase in sales and the first positive results of the excellence program operational put into operation in the second half of 2019 ”.
Grupo DIA's personnel costs in the period under review stood at 191 million, “which represents a slight increase since the impacts of the personnel efficiency measures implemented in 2019 were neutralized by the
bonus payments and staffing needs related to the Covid-19 situation ”.
In turn, operating expenses saw a decrease of 1,4% in the percentage of net sales, "thanks to the adoption of cost reduction measures and the decrease in investment in advertising during the confinement caused by Covid-19".
The group's adjusted EBITDA in the second quarter of this year amounted to 60 million, an improvement over the negative 67 million euros recorded in the same period of 2019 ″, a behavior “driven by the increase in sales volume and the improvement in gross margin provided by firm cost discipline ”.
The DIA Group's net profit was negative by 45 million euros, against a negative 267 million euros in the second quarter of 2019, “with an improvement in interest expenses and a negative monetary effect of 16 million”.
The retail group's available liquidity at the end of the second quarter of this year remained stable, at 435 million euros, compared to the 425 million euros at the end of the second quarter of last year, “with an improvement in the maturity profile of the debt after the refinancing agreement reached in 2019 ”.
The DIA Group's net financial debt dropped to 1.253 million.
DIA Group officials highlight the “optimization of the commercial assortment: Implementation in about 500 stores in Spain during the first half of 2020, prioritizing the supply of fresh fruit and vegetables” and the fact that the private label was guided by “ development and introduction of new products in Spain and Brazil,
marking a new proposal that combines quality, quality / price ratio and more attractive packaging ”.
Regarding online sales and urgent delivery, the DIA administration notes that this aspect is “in operation in the four countries after its introduction was accelerated to respond to customer demand during the Covid-19 confinement period and subsequently as a priority to satisfy the trends
long-term customer purchasing power ”.
As for franchises, the highlight is the “introduction of an improved franchise model based on incentives and with a focus on the customer, implemented in 470 establishments in Spain and the start of a
adapted offer in other markets ”.
The operational plan was “centered on cost efficiency and on reducing complexity in the relationship with suppliers, stocks, logistics and purchasing and supply management; beginning of new logistical plans and renegotiation of rentals in all markets.
“The financial results for the second quarter demonstrate the positive impact of the response adopted in the situation of Covid-19 and the transformation of the business that we were already carrying out. Customers are responding to our attractive proximity offer and our new online sales capabilities, and the positive numbers of like-for-like sales in June and July, after confinement, are a good indicator of this progress ”, Highlights DIA President Stephan DuCharme.
According to this official, “we controlled costs in the face of increasing demands across the sector regarding protection measures and staffing, thanks to efficiency decisions adopted in 2019, at the same time as the main financial indicators, such as improvement of working capital and positive cash flows, have evolved in the right direction ”.
“Regarding the future, we will continue to implement transformation initiatives included in the strategic plan in the second half, focusing on the fundamental pillars of our franchise model and improved commercial value proposal, which are supported by the optimization of operational efficiency”, assures Stephan DuCharme .