The Dino Group’s consolidated sales revenues in 2017 totaled PLN 4,515.9 million, up 34% from last year. The rapid revenue growth was driven by network roll-out to open new stores and sales growth in the existing store network (LfL), which in 2017 was 16.2% compared to 11.3% in the corresponding period of last year.
EBITDA in 2017 climbed 39% to PLN 401.4 million. In turn, the Group’s net profit was PLN 213.6 million, signifying 41% growth year on year.
At the end of December 2017, the Dino network numbered 775 stores, 147 more than in the corresponding period of last year. At the same time, Dino Polska has secured 495 sites to build new stores, i.e. 46% more than last year. 57 stores in total were opened in Q4 2017.
In 2017, the Group’s capital expenditures totaled PLN 457 million. The Group estimates its Capex in 2018 will be PLN 650 million. Dino will allocate these funds mainly to store rollout, expansion of its logistics infrastructure and the Agro-Rydzyna meat processing plant.
In 2017, the Group continued the ongoing rapid growth in the size of its business. The 34% growth rate posted in revenues (up PLN 1,146.4 million) year on year is primarily the effect of opening new stores in the Dino network (the network opened 147 stores in 2017) and the growth in sales revenues in existing stores (like for like, LfL) of 16.2% yoy.
In conjunction with its growing business size, the Group has posted robust profitability that is steadily climbing. Its EBITDA margin has edged up to 8.9% (+0.3 p.p. yoy).
THE DINO GROUP’S RESULTS:
|LfL sales||16.2%||11.3%||+4.9 p.p.|
|EBITDA margin||8.9%||8.6%||+0.3 p.p.|
The Group continues to pursue rapid expansion of the Dino supermarket network by opening new stores it owns and looking for new sites to continue its expansion. At the end of December 2017, the Group had 775 stores, signifying 147 openings and is a record-breaking number in the Group’s business history.
At the end of 2017, Dino Polska had enlarged its land bank to build new stores to 495 sites (consisting of purchased plots and preliminary agreements to buy plots). In accordance with its strategy, the Group plans to exceed 1,200 stores by the end of 2020.
Retail grocery market and new regulations
The retail grocery market in Poland is growing steadily. Robust market conditions, Poles’ growing income enhancing their purchasing power and consumer price growth are conducive to the growth of the overall sector and Dino’s segment – consisting of mid-sized supermarkets located close to customers’ places of residence.
According to the National Bank of Poland, Poland’s economic growth will be 4.2% in 2018 and 3.8% in 2019. The favorable market context is buoyant to the retail grocery industry in upcoming quarters.
“We are growing rapidly, faster than the market, while preserving a stable and robust level of profitability. In 2017 we generated very strong performance and we significantly enlarged our business size, thereby placing us among the top retail sales companies measured by pace of growth. Last year we opened a record-breaking number of new stores: 147. Our like for like sales in our existing store network at the end of the year and on a quarterly basis have remained persistently high at a double-digit level. We are also ramping up the number of secured sites in our pipeline to open more stores. We are poised to continue growth by opening more own stores. We continue to see extensive opportunities to increase the density of our network in the areas where we already have a presence and to expand into new regions in Poland. In 2018 we would like to exceed last year’s number of new store openings, says Szymon Piduch, CEO of Dino Polska S.A.
“We expect that the positive trends visible on the consumer market in 2017 will also persist in the upcoming quarters. The market environment is conducive to our efforts. We do not see any need to undertake any special measures as a result of the curtailment of Sunday trading. The effective business model we have adopted and our store format that is well-aligned to consumer trends allow us to think positively when it comes to ongoing network rollout”, adds Szymon Piduch.
 EBITDA adjusted for the non-recurring cost of the IPO