Zabka grocer posts PLN 987 mln adj. EBITDA in Q4 2024; assumes mid-to-high single-digit LFL sales growth in 2025

"In line with the expectations clarified during the IPO, we plan to achieve a stable adjusted EBITDA margin near the upper end of the 12-13 percent range in the short to medium term and LFL sales growth in 2025 in the mid to high single-digit percentages," said the CFO of Zabka Group Marta Wrochna-Lastowska, quoted in the press release.

"We also expect further growth in net profit," she added.

Cumulatively, after four quarters of 2024, the Zabka Group recorded revenues of PLN 23.797 billion (EUR 5.7 bln), up 20.2 percent year on year and adjusted EBITDA of PLN 3.505 billion (EUR 838 mln), up 23.7 percent year on year. Net profit was PLN 593 million (EUR 141.8 mln), an increase of 66.4 percent year on year. Adjusted net profit in 2024 increased by 66 percent year on year to PLN 714 million (EUR 170.7 mln).

In 2024, Zabka's sales to the end-customer amounted PLN 27.277 billion (EUR 6.52 bln), up 19.8 percent year on year.

Adjusted EBITDA margin rose by 0.4 percentage points year on year to 12.8 percent, driven by cost efficiencies and falling energy prices.

LFL sales saw an increase of 8.3 percent, as a result of both higher sales volumes per shop and the favourable impact of inflation, Zabka Group explained in the press release. In 2023, LFL sales growth was 10.8 percent.

In the fourth quarter of 2024 alone, Zabka Group's revenue was PLN 6.072 billion (EUR 1.45 bln), up from PLN 5.034 billion (EUR 1.2 bln) in the prior year period and above the PAP Biznes consensus for revenue of PLN 5.945 billion (EUR 1.42 bln).

Sales to the end customer in the fourth quarter rose to PLN 6.885 billion (EUR 1.65 bln) from PLN 5.833 billion (EUR 1.4 bln) in the fourth quarter of 2023.

LFL sales grew by 7.1 percent in the period, against 10.6 percent growth in the prior year period.

The group posted 987 million (EUR 236 mln) of adjusted EBITDA in the last quarter of 2024, against PLN 836 million (EUR 199.9 mln) in the prior year period. The market had expected PLN 985.8 million (EUR 235.7 mln) of adjusted EBITDA. Reported EBITDA increased to PLN 891 million (EUR 213 mln) from PLN 804 million (EUR 192.24 mln) in the prior year period.

Net profit in the fourth quarter of 2024 was PLN 216 million (EUR 51.65 mln), against PLN 209 million (EUR 50 mln) in the prior year period.

The group generated PLN 1.5 billion (EUR 358.65 mln) of free cash flow in 2024 and its net debt/adjusted EBITDA ratio improved from 2.3x to 1.5x.

CAPEX last year amounted to PLN 1.675 billion (EUR 400.5 mln), up 24 percent year on year, of which PLN 623 million (EUR 148.96 mln) was spent in the fourth quarter of 2024 (up 35 percent year on year).

"In 2025, our priority remains to further increase shareholder value by strengthening the group's market position. We intend to consistently develop our sales network, strengthen our presence in digital channels and optimise our convenience ecosystem offering to fully realise the group's growth potential," Zabka Group's CEO Tomasz Suchanski said.

At the end of 2024, the Zabka Group's shop network comprised 11,069 locations, thanks to the opening of 1,166 new shops. In 2024, the group entered the Romanian market, opening 60 shops there by the end of last year.

"Our medium-term goal is to double the value of sales to the end customer between 2023 and 2028, realised by continuing to open more than 1,000 shops per year and increasing sales in existing locations (LFL) and digital channels. In the Digital Consumer Offering (DCO) area, we are targeting a 5-fold increase in sales to the end customer by 2028," said Zabka's Chief Strategy & Development Officer Tomasz Blicharski.

pel/ ao/