Dino Polska (DNP) Q3 2024 earnings summary

Executive summary

• Sales revenue for Q1–Q3 2024 reached PLN 21,522 million, up 13.5% year-over-year, with Q3 revenue at PLN 7.61 billion, a 10.6% increase over Q3 2023.

• Net profit for Q1–Q3 2024 was PLN 1.08 billion, up 2.4% year-over-year; Q3 net profit was PLN 438.5 million, up 3.4% from Q3 2023.

• EBITDA for Q1–Q3 2024 was PLN 1,686.1 million, a 0.4% increase year-over-year, with margin declining to 7.8% from 8.9% in 2023.

• Store network expanded to 2,572 locations as of September 2024, with 167 new stores opened year-to-date and increased regional coverage.

• Significant investments in renewable energy, with 2,386 stores equipped with photovoltaic installations, generating 78 GWh and reducing CO2 emissions by 54,000 tons in 1Q-3Q 2024.

Financial highlights

• Gross profit for Q1–Q3 2024 was PLN 4.98 billion, up 13.4% year-over-year.

• Operating profit for Q1–Q3 2024 was PLN 1.39 billion, down 2.1% year-over-year; Q3 operating profit was PLN 567.8 million, up 1.7%.

• Net cash from operating activities for Q1–Q3 2024 was PLN 1,739 million, up 15.8% year-over-year.

• Capex for Q1–Q3 2024 was PLN 1,131–1,250 million, representing 67% of EBITDA, mainly for new stores and warehouse expansion.

• Net debt as of September 2024 was PLN 568.3 million, with net debt/EBITDA at 0.25x, down from 0.41x in 3Q 2023.

Outlook and guidance

• Management expects store count to grow by a low double-digit percentage in 2024, with capex of PLN 1.5–1.6 billion.

• LFL sales growth in Q4 2024 is expected to be at a single-digit level due to price deflation and competition.

• Emphasis on maintaining LFL sales growth and improving profitability despite margin pressures.

• Operating expenses are anticipated to rise due to low unemployment and higher salaries.

• The pace of network development is expected to accelerate in 2025.