Jeronimo Martins, SGPS S.A. Unsponsored ADR

Strong operating resilience despite difficult macro (Group): 9M 2026 sales EUR 27.8bn (+4.8% reported / +3.8% CER; LFL +0.8%) and EBITDA EUR 1.9bn (+7.6%; margin +18 bps to 7%). Management attributed outperformance to disciplined cost control, better sales/mix, scale benefits and efficiency, while operating under food disinflation turning to deflation (especially Poland), intense competition/promotional intensity, and rising fuel/transport costs.

Poland (Biedronka) key story: volume-led growth under deep deflation: Despite very intense competition and basket deflation turning ~0.6% in Q3 (and Q3 basket deflation “above 6%”, ~~7% as later clarified), Biedronka delivered +5% volume growth; total sales +1.3% in local currency / +0.7% in EUR and market share ~30.8% YTD Aug. They also noted September deflation was slightly less negative than Q3 average, but Q4 inflation/deflation trajectory is uncertain due to competitive and pricing dynamics.

Q4 outlook: margin support likely, but visibility limited; difficult comps risk: Company reiterated outlook unchanged (as of July 29). For Biedronka, management stated it is not planning negative LFL, but acknowledged Q4 will be challenging because: (1) Christmas/NYE matters, (2) prior-year comparisons are tough (Biedronka performed well last year), and (3) it is difficult for basket deflation to inflect materially though it may slightly improve (less negative). They also flagged a gross margin one-off in 4Q last year that will not recur, making Q4 gross margin more challenging vs prior year, even if operational drivers continue.