Ibersol SGPS (IBS) Q3 2024 earnings summary

Executive summary

• Turnover from continued operations reached €346.4M for 9M 2024, up 11.7% year-over-year, driven by new openings, delivery segment growth, and integration of 34 KFC units from NRS.

• EBITDA from continued operations was €69.7M (20.1% margin), up 25% year-over-year; net profit from continued operations was €9.1M, slightly down from €9.5M in 9M 2023.

• Consolidated net profit reached €12.2M, including €3.1M from discontinued operations, mainly from the sale of 8 Burger King restaurants.

• Total number of restaurants at quarter-end was 536, with 479 owned and 57 franchised units.

Financial highlights

• Gross margin remained stable at 76.1% of turnover; personnel costs increased to 30.6% of turnover due to new concessions and salary growth.

• External supplies and services costs fell to 26.6% of revenue, down 2.7 p.p. year-over-year, mainly due to IFRS16 application.

• Amortisation, depreciation, and impairment rose to €51.9M, up €15.5M year-over-year, mainly from rights of use.

• Financial result was negative €8.2M, impacted by higher interest on leases; financial income increased by €1.4M due to better investment returns.

• Capex totaled €25.2M, with €19.9M for expansion and airport conversions, and €3.7M for restaurant modernization.

Outlook and guidance

• GDP growth in Portugal and Spain forecast at 1.6% and 2.8% for 2024, with inflation slowing and moderate interest rate reductions expected.

• Ongoing geopolitical risks and airport concession conversions will continue to pressure profitability until April 2025.

• Expansion to continue for Pizza Hut, KFC, Taco Bell, and Pret A Manger, with the latter opening its first unit in Portugal in October.