Good day, and welcome to Jerónimo Martins' first nine-month 2024 results conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Ana Luísa Virgínia, Chief Financial Officer of Jerónimo Martins Group. Please go ahead, madam. Thank you, Pete. Good morning, ladies and gentlemen, and thank you for joining this call to present our nine-month results. In our corporate website, you can find the results release, a slide presentation, and a fact sheet for the period. 2024 has been, so far, extremely challenging. As expected, the combination of a rapid decrease in food inflation and significant cost increases, together with weak consumer demands, are driving more intense competition and pressuring margins. Despite this demanding context, we have delivered on our key strategic targets to grow sales and strengthen market positions. Our banners maintain their price competitiveness and continue to improve value propositions, ensuring consumer preference, consistently growing volumes, and gaining market share. Notwithstanding the strong volume performance, EBITDA margin for the first nine months was impacted by the operational deleverage generated from basket deflation and significant cost inflation. Still, the balance sheet remained solid, with net cash position, excluding IFRS 16, standing at EUR 430 million by the end of September. In the first nine months of the year, our markets faced a substantially low food inflation compared with the extremely high figures of 2023. In Poland, food inflation fell until March, then rose in April with the reintroduction of VAT on basic food products and has continued rising since then. Despite the increase in real income, consumer demand kept shy, and food retail sales remained subdued, further fueling price competition between the players. In Portugal, consumers continually highly focused on price opportunities and promotions in the food retail market, while the Horeca channel revealed a slowdown trend as it lapped a strong performance in the prior year comparatives. In Colombia, declining food retail volumes and trading down reflected the continued pressure over real household incomes in the country. In the first nine months of the year, and despite the Biedronka and Pingo Doce operating with basket deflation, sales grew 10.3%, 4.7% at constant exchange rates due to the contributions from volume increases and network expansion. The pressure on operational leverage largely reflects the headwind impact of basket deflation coupled with significant wage increases. All in all, EBITDA in euros increased 2.7%, a decline of 2.9% at constant exchange rates, with a margin pressure of 49 basis points. Execution of our CapEx program resulted in higher depreciation charges and increasing net financial costs due to the capitalization of leases. The financial costs also include the impact of higher average debt than in previous years and with increased rates of financing costs in Colombian pesos. Other profits and losses that were at EUR 74 million include the initial endowment of EUR 40 million to the Jerónimo Martins Foundation. It also incorporates the write-offs resulting from store remodeling projects and some restructuring costs. Net earnings per share, excluding other profits and losses of a non-recurrent nature, fell by 13.8%. In the Q3 P&L, we observed the same trends of the nine months. I want to make an important remark on the gross margin evolution. Despite the pressure on the Biedronka gross margin in Q3 from price investments, there were two positive effects that more than offset it at group levels. The first relates to Pingo Doce, which, although continuing to invest in price, benefited from a positive margin mix as the company successfully expanded the meal solutions and perishables categories. The second came from Ara, which is executing an assertive and selective commercial strategy. By introducing changes to its promotional activity while guaranteeing a leading price position, the company delivered a positive margin mix of impact. Cash flow generated in the period was negative in EUR 387 million, impacted to a significant extent by the slowdown in growth as we transitioned from very high food inflation to food deflation. I also flagged that September this year, contrary to September 2023 and also to June 2024, ended on a weekday rather than on a weekend, which brought a negative calendar impact to both stocks and suppliers. Relying on a solid balance sheet, we ended September with a positive cash position of EUR 430 million. I will now guide you through the detail of the performance, starting with sales. Total sales grew by 10.3%, 4.7% at constant exchange rates, to reach EUR 24.8 billion. All banners contributed to the additional EUR 1 billion of sales generated in the nine months of the year, if we exclude the currency effect. Group like-for-like was at 3.0%, with volume growth offsetting the important basket deflation of Biedronka. In Poland, price has been, more than ever before, the decisive shopping factor, and in this respect, Biedronka continues to lead the market, having even further reinforced its commercial strategy in face of a more intense competition. On top of its historically strong sales performance track record, the banner continued to deliver solid volume growth throughout the nine months. In the period, basket deflation significantly impacted like-for-like growth at a slightly lower rate in Q3 than in Q2. In a market that is experiencing negative sales volumes, Biedronka ended the period with a strengthened position. Having again guaranteed the preference of its vast consumer base, our main banner continued to outperform the market and increased its respective market share by 50 basis points year-to-date August. Total sales grew by 10.4%, plus 3.9% in local currency, to reach EUR 17.5 billion. In the nine-month period, Biedronka opened 104 stores, 90 net additions, and refurbished 156 locations. Hebe performed well across the period, and sales grew by 20.6% in local currency, including a like-for-like of 11%. E-commerce continued to develop, being a strong growth driver for our health and beauty banner. Pingo Doce increased sales by 4.7% to reach EUR 3.7 billion, including a 4.4% like-for-like. Without fuel, driven by strong performance in volumes. The banner also operated with basket deflation in the nine-month period. Pingo Doce kept an intense promotional activity while reinforcing its drivers of differentiation, meal solutions, and perishables through the ongoing rollout of the All About Food store concept. In the nine-month period, 50 more stores were refurbished to this new concept, and six stores were opened and had an increase of three. Recheio grew sales by 1.8% to reach EUR 1 billion. The Horeca channel in Portugal continued to be impacted by a weak domestic out-of-home consumption. However, Recheio intensified its commercial dynamics to protect sales performance and group clients in all segments. Ara adjusted its promotional activities to match the consumer's needs, maintaining an intense commercial dynamic and providing good saving opportunities to the Colombian families. The pressure on like-for-like reflects an extremely weak consumer demand in light of persistently high food prices. Nevertheless, Ara continues to advance the expansion of its network according to plan, taking advantage of the market opportunity to reinforce its presence in the neighborhoods. So far, 87 stores were opened this year. The banner remains on track to achieve its target of 150 new stores in 2024, with Q4 being typically the busiest quarter in terms of new store openings. In the period, sales increased by 10.9% in local currency, a 21.5% growth in euros to reach EUR 2.1 billion. Consolidated EBITDA grew by 2.7% in euros, a reduction of 2.9% at constant exchange rates, reaching EUR 1.6 billion. I would like to flag a couple of things here. At Biedronka, EBITDA evolution reflects the impacts of the very challenging combination of significant basket deflation and cost inflation. Reinforced price leadership adds to the pressure. The good work being done by Ara's team allowed for solid EBITDA improvement despite soft top-line performance, and on the central costs that in Q3 2024 were below the same period of 2023, please take note that this was only partially due to savings, as there are also some cost headings affected by calendar mismatch that can still take place in Q4. Group EBITDA margin fell to 6.6% from 7.1% in the nine months of 2023. At Biedronka, the pressure on margin was mainly driven by lower sales growth due to basket deflation and increased wage costs, essentially coming from the decision to significantly raise the wages of operational teams. Gross margin, though resilient in this context, was also down following price investments. Hebe's margin slightly improved as a result of good sales performance. In Portugal, despite the positive margin mix effect at Pingo Doce, price investment was a constant feature and was reinforced in Q3, particularly in the case of Recheio. And finally, in Colombia, as planned, Ara has been able to improve EBITDA margin by 127 basis points in the nine months. In summary, we have operated under challenging circumstances that combine basket deflation, high cost inflation, price investment, and unresponsive consumer contexts. Our teams have their strategies clear and are working relentlessly to deliver on their priorities by continuously enhancing our value propositions, pushing for sales in volumes by expanding the customer base, reinforcing market shares, and executing the expansion strategy as planned. There is also a lot of work being undertaken to protect the efficiency of our business models and help mitigate the pressure from operational deleveraging. Our banners did well and are well prepared to continue to deliver as we enter the last months of the year and get ready for the Christmas season under contexts that still face a lot of uncertainty and that show no signs of softening. Our outlook remains largely unchanged, though we now expect CapEx to be just over EUR 1 billion for 2024, down from the EUR 1.2 billion previously given as guidance, reflecting some timetable adjustments, namely on remodeling projects. Store expansion programs will be delivered as expected. Thank you for your attention. Operator, I am now ready to take questions. Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question on the phone, you'll need to press star 11 on your telephone keypad and wait for the name to be announced. To withdraw your question, please press star 11 again. We're going to take our first question from the queue. And our first question is coming from João Pinto from JB Capital. You're live. Please go ahead. Hi. Good morning, everyone. Thanks for taking my questions. The first one, could you please quantify the basket deflation in Q3 in Poland and how has it evolved through the quarter? I'm trying to understand if basket deflation has slowed down between July and September. Then three quick ones on costs. Can we assume that gross margin in Poland was flat? And could you tell us how big was the tailwind from energy costs, if that was relevant, and if you could quantify it, it would be great? And finally, on holding costs, you mentioned some mismatches in terms of calendar. How should we think about this line for the fourth quarter? Thank you very much. Good morning, João. So on basket deflation in Poland, as I referred, it's slowed down. So we still operate with quite significant basket deflation in Biedronka, but at a softer rate than in the first half. I believe that by then I told that we had slightly below 6%. Now we are slightly ahead of 4% on the third quarter. On the gross margins in Poland, as I also mentioned in this introduction, it was not flat. As anticipated and expected, we invested more in prices. Our gross margin was, in fact, down. We usually do not provide this. But as the mix may be misleading in terms of the consolidated numbers, I can tell you that we had to invest around 20 basis points in the gross margin for Poland. As for the tailwind energy cost, in fact, it's true that we had some savings in terms of the rates of energy costs on the P&L of Biedronka, but this is a minor tailwind compared with the decision or the impact, the decision to really follow the minimum wage increases and increase the operational team's wages by almost 20%. It's not really quite significant compared with that, but it has been or helping somehow to mitigate the other cost increases, namely on rents. As for the holding costs, as I mentioned, I think that you should not take this quarter as a proxy for the other quarters. As you may imagine, we do not have our costs in percentage of sales not that significant, in fact. Of course, when we are talking about a year where all costs matter, a slight change or increase or decrease is noticeable. In our case, each project that we entered and when we have to pay EUR 1 million, EUR 2 million, or EUR 3 million may be a difference depending on the timetables. I think that the good proxy is to maintain the same level as the yearly costs, so not looking so much at the quarter evolution, but the yearly costs with, of course, some inflation at least. Depending on the different projects on the IT, on sustainability, etc., we may flag some other adjustments, but there is only a mismatch. So there, as I mentioned, there are some savings, but they are not material to say that the costs will be very different from the prior year. Thank you. Thank you. We're now going to transfer to the next question in the line. The next question comes from Nicolas Champ from Barclays. You're live. Please go ahead. Good morning. Thanks for taking my questions. I have three. The have three. The first one is, in July, you guided towards higher EBITDA margin contraction in Poland in H2 versus H1. Is this guidance still relevant, or maybe do you expect a slightly more positive evolution given your Q3 performance? The second is about your slight reduction in your CapEx program from EUR 1.2 billion initially to just over EUR 1 billion. You said you maintained your new store opening program both in Poland and Portugal. You also kept your program of store remodeling in Poland and Colombia. So could you elaborate a bit more on where the stemming or the lower CapEx stem from? And a third question, if I may, could you update us on the current trading in Poland at the start of Q4? And maybe also give us some color regarding the sales evolution in Poland during the third quarter, more specifically in September, given the impact of flooding, for instance. Thank you very much. Good morning, Nicolas. So on the guidance on the EBITDA pressure, yes, it is true that it was a little bit better than we probably anticipated. I think that we have three months to go. We have to acknowledge that sales during these three months will be highly dependent on the Christmas season. Of course, usually, on average, they are higher than in other quarters. And of course, the type of cost increases is more or less the same as in previous quarters. So I think that we maintained the guidance to continue to have a pressure. If it's going to be higher than what it has been until now, it will only depend if the Christmas season will not be going as good as probably we will want it to be. On the slight reduction of the CapEx program, it's basically on the refurbishments and on, as I mentioned, some timetable adjustments. So the refurbishments of Pingo Doce will end up to be on the low end of the range that we had expected in the beginning of the year. We also adjusted slightly versus the beginning of the year the refurbishments in Poland. Some of the, as I mentioned, some adjustments in terms of calendar on the logistics investments, etc., are justifying this slight decrease in the CapEx guidance. It's only a matter really of timetable adjustments. We will continue for the future to refurbish stores and to maintain our store opening programs and logistic investments. On the current trading in Poland, as you can imagine, I cannot give you a color on that. What we see from the numbers, of course, and I will probably just make a comment on the September numbers because the market numbers, as you probably saw, are quite weak or continue to be quite weak. Of course, we have to take into consideration also for the market the calendar effects. As you can imagine, when the market is no longer growing quite significantly, so each difference in the number of days of trading, etc., makes a difference for the month and, of course, for the three-month period. That's why we usually are more worried, of course, with the total year, which is totally comparable, except, of course, if we have a leap year or not. It's one day on the 365 or 366. When we are talking about months or quarters, you can have these kind of mismatches. We have to take that into consideration. This being said, we do not see for now or until now really the consumer willing to spend much more on food. The price continues to be really relevant. The consumer has money. We know that the real income of the families has increased. The savings in Poland have been increasing, but we don't see people really spending much in certain categories, including in food. So it's also true that that happens in textiles, etc. But in food, definitely, they really want. It's an area where they want to save, and that continues to happen. The sales evolution, as I mentioned, throughout the quarter, I think it's really not worth to and looking at it can be, again, misleading because now each day of difference, each Sunday ban or each change between a Friday and a Saturday may have an impact. So I think that we have to overall see the evolution for the year and not be so concentrated in the quarters. Okay. Understood. Thank you. Thank you, Nicolas. Thank you. We're now going to transfer to our next question, and our next question is coming from José Rito from CaixaBank BPI. Your line is now open. Please go ahead. Yes. Hi, good morning to all. So I have three questions on Poland. The first one is in terms of LFL behavior, is there any change in Q3 or in October versus what was discussed in Q2? The second question related to this is volumes market evolution in October, if you can say something if the market remains with negative volumes, something that we have been seeing over the last month. And finally, question in terms of comparison base volumes-wise in Poland in Q4, how much difficulty is Q4 versus Q3, or is it broadly similar the comparison base? Thank you. Thank you, José. So in terms of competition, as we mentioned, the market continues to be highly aggressive and highly competitive. But I think that we cannot expect a change on this because the context or the circumstances, so the pressure on prices, the weak consumer demands, and of course, the pressure on the cost headings, particularly on the wages, affects all players. And of course, in this case, we don't see really a change, and that's why we continue really to invest in price, particularly this quarter, as I mentioned, also pressuring our gross margin percentage-wise. On volumes and market evolution, we don't have the numbers for the market in October. What we think is that we don't see really any change in the consumer behavior, and I don't think that there is any reason at this point for that to happen because the circumstances economic and political-wise or geopolitical-wise are exactly the same as they were until the first half of the year. As for the comparison base in Q4, yes, we flagged that the comps will become tougher in Q4. Last year, we grew significantly volumes. So probably if you look at the evolution of our inflation and we more or less flagged that throughout the year, we started the first quarter with 20% internal inflation and ended almost December with deflation already, so volumes went up by 4% in the fourth quarter of 2023, and so I think that growing with that basis, it's going to be challenging for Biedronka. We don't hide. Thank you. Thank you. Thank you. We're now going to move on to the next question in the line, and the next question is coming from Frederick Wild from Jefferies. Your phone is open. Please go ahead. Good morning, Ana Luísa. Thank you for taking my questions. First, could I ask about the outlook for food inflation next year and where we can see that going? Is the current sort of 4% industry level in your eyes a good guide? And then second, you mentioned that the pressure on Biedronka gross margin was about 20 basis points in Q3. Could you give a sense of what that was relative to Q2, whether it was a similar sort of pressure, and how we can expect that to evolve in Q4? Thank you. Hi, Fred. So on food inflation, again, this is a tough question for me. I always mention because according to the projections that we have from several sources, at least in Poland, which is, I believe, one of the few countries where we have the authorities mentioning the food inflation prospects, they continue to put inflation at a quite significant number or at least a strong single digit. I don't believe that that will happen in practice again because, as I said, the calculation has at least for Biedronka and for all the other players several things that don't take that are not so important for us. One, of course, has to do with the taxes. All the taxes are included, namely the VAT, and we have to deliver it. So for our net sales, that inflation or that component of inflation is not so important. The other thing is that all the promotions that are not, as we can call, universal, that are mentioned on the shelf and provided to all customers. So all those promotions that are done through loyalty cards or that are done through special discounts if you give a certain voucher to your consumer, they are not taken into consideration for the country food inflation. Nonetheless, have to be considered when we compute the evolution of the prices in our banners and also for the other banners. So it's a little bit just having or picking up on the food inflations. It may be misleading again on the numbers for the companies. As for the pressure on the gross margins, that again is a tough one. As I said, I only disclosed the pressure this quarter because on the consolidated, again, exactly what happens also with the like for like. The consolidated number, when we have negatives and positives, maybe the total number may be a little bit misleading. And I take the opportunity because Claudia called my attention that I mentioned the like-for-like for the consolidated numbers to be 3%. It was 0.3%. But again, it has to do really you have negatives in Biedronka and Ara. You have very positives in Portugal. So it's a little bit, as I said, misleading just to look at the consolidated number. For the gross margin, it's exactly the same. So you have really a positive mix in Portugal, also a management mix in Colombia that really pushed the gross margin up, and that compensated for the lower gross margin in Biedronka because it really invested more in prices. Thank you so much. Thank you, Fred. Thank you. We're now going to move on to the next question in line. The next question is coming from Izabel Dobreva from MS. Your line is open. Hello. Good morning. My first question is on the pricing environment. Would you expect that Biedronka's basket stays deflationary over 2025 given your current consumer outlook? And related to this, could you share your thoughts on the relationship between your current space openings and the market as a whole? On On the one hand, so the amount of new stores which are entering the market and what that will likely mean for the pricing environment given the volume outlook as we look over 2025. That's my first question. And then my second question is just regarding the working capital. Could you give a little bit more of a comment of what is driving the outflow? To what extent is this effectively driven by suppliers coming to you because of their own difficulties and effectively asking you for help? Or should we think about the payment terms as, let's say, another lever that you have in order to secure lower prices for consumers by shortening those payment terms and effectively continuing to implement your pricing strategy? Okay. Good morning, Izabel. For the pricing environment, of course, the evolutions from 2024 to 2025 will depend on several moving parts. And one we definitely do not control, which is the competition environment. We know that, as I mentioned, the market, when it comes or when it is impacted as it was from the slowdown in growth and the effect of deleveraging the P&L, and not only the P&L, even the balance sheet, because that also has an impact on the working capital. So the fact that you have deflation or lower food inflation than in prior periods, the comparison, at least in absolute terms, it becomes in terms of the evolution, it's more difficult. I would say that for now, we think that there may be some price increases in the commodities and some pressure on that. But depending on the competition environment, this does not ultimately mean that the prices will increase, at least our basket prices, because we will continue to be quite competitive in the market. So I think that's at least a flattish inflation or depending on the competitive environment. We don't exclude a scenario where we may have for some categories some deflation even in 2025, particularly in the first half. For the current market capacity, so we are opening stores, it's true, and I would say all the other players. Dino, Lidl, Aldi, Stokrotka, all players continue to see that there are some white spaces in the Polish market. We continue to also mention that opportunity, particularly in smaller towns. This, of course, means that we are entering in some markets where we were not previously. Others we may enter, but of course, we continue to analyze each location and what it can bring in terms of return on capital or on invested capital, which is our profitability measure. For now, I don't see that there will be really a need on capacity increase in the Polish market. People continue to see it as having opportunities. On the working capital, several effects here. We mentioned since the beginning, of course, and I don't hide that the payment terms can be a lever and a lever to more than to get better conditions, a lever to it may not be a direct impact, but it maintains alternatives open for us. So we want to be competitive and to have some bargaining power. You have to have alternatives. You cannot be just in the hands of one supplier. And so this is something that we prefer to have different alternatives. So we are willing to use the working capital as a weapon, as I usually say, to maintain open several options in terms of purchases. As for the specific situation of the working capital this quarter, as I mentioned, you have a calendar effect, which is almost two days, which in total explains half of the evolution. Then you have some correction in the payment terms, particularly of the smaller suppliers, true, because of the high interest rates, but particularly because they have constraints in getting credit. And so we are willing to do that. And of course, the other thing has to do really with the evolution of the prices even from the part of the suppliers. So if we were operating still in inflation, very high inflation last year, now we are operating even at the level of our purchases with a low inflation or even deflation in some cases. So that has an impact on the trading payables that stay at the working capital. Okay. Thank you. So just to clarify, you would expect a positive working capital inflow in 4Q because of the seasonality. Is that right? Yes. I would expect that. Thank you. Thank you. Okay. Thank you. There are no questions in the queue at this point, so I would like to hand it back to Ana Luísa Virgínia for any final comments. So we have been experiencing the materialization of the difficult circumstances that we anticipated early in the year. We stood firm in executing our strategy, and our teams are delivering on their key priorities. While we acknowledge the challenges and the pressure on the financial performance, we also believe this is the right strategy to guarantee long-term profitability market positions. Thank you for your questions and for attending this conference call. I wish you all a nice day. Thank you. In that case, we shall conclude today's conference call. Thank you for your participation. You may now disconnect. Thank you, Pete. Good morning, ladies and gentlemen, and thank you for joining this call to present our nine months' results. In our corporate website, you can find the results release, a slide presentation, and a fact sheet for the period. 2024 has been, so far, extremely challenging. As expected, the combination of a rapid decrease in food inflation and significant cost increases, together with weak consumer demands, are driving more intense competition and pressuring margins. Despite this demanding context, we have delivered on our key strategic targets to grow sales and strengthen market positions. Our banners maintain their price competitiveness and continue to improve value propositions, ensuring consumer preference, consistently growing volumes, and gaining market share. Notwithstanding the strong volume performance, EBITDA margin for the first nine months was impacted by the operational deleveraging generated from basket deflation and significant cost inflation. Still, the balance sheet remained solid, with net cash position, excluding IFRS 16, standing at EUR 430 million by the end of September. In the first nine months of the year, our markets faced a substantially low food inflation compared with the extremely high figures of 2023. In Poland, food inflation fell until March, then rose in April with the reintroduction of VAT on basic food products and has continued rising since then. Despite the increase in real income, consumer demand kept shy, and food retail sales remained subdued, further fueling price competition between the players. In Portugal, consumers continued to be highly focused on price opportunities and promotions in the food retail market, while the Horeca channel revealed a slowdown trend as it lapped a strong performance in the prior year comparatives. In Colombia, declining food retail volumes and trading down reflected the continued pressure over real household incomes in the country. In the first nine months of the year, and despite the Biedronka and Pingo Doce operating with basket deflation, sales grew 10.3%, 4.7% at constant exchange rates due to the contributions from volume increases and network expansion. The pressure on operational leverage largely reflects the headwind impact of basket deflation coupled with significant wage increases. All in all, EBITDA in euros increased 2.7%, a decline of 2.9% at constant exchange rates, with a margin pressure of 49 basis points. Execution of our CapEx program resulted in higher depreciation charges and increasing net financial costs due to the capitalization of leases. The financial costs also include the impact of higher average debt than in previous years and with increased rates of financing costs in Colombian pesos. Other profits and losses that were at EUR 74 million include the initial endowment of EUR 40 million to the Jerónimo Martins Foundation. It also incorporates the write-offs resulting from store remodeling projects and some restructuring costs. Net earnings per share, excluding other profits and losses of a non-recurrent nature, fell by 13.8%. In the Q3 P&L, we observed the same trends of the nine months. I want to make an important remark on the gross margin evolution. Despite the pressure on the Biedronka's gross margin in Q3 from price investments, there were two positive effects that more than offset it at group levels. The first relates to Pingo Doce, which, although continuing to invest in price, benefited from a positive margin mix as the company successfully expanded the meal solutions and perishables categories. The second came from Ara, which is executing an assertive and selective commercial strategy. By introducing changes to its promotional activity while guaranteeing a leading price position, the company delivered a positive margin mix of impact. Cash flow generated in the period was negative EUR 387 million, impacted to a significant extent by the slowdown in growth as we transitioned from very high food inflation to food deflation. I also flagged that September this year, contrary to September 2023 and also to June 2024, ended on a weekday rather than on a weekend, which brought a negative calendar impact to both stocks and suppliers. Relying on a solid balance sheet, we ended September with a positive cash position of EUR 430 million. I will now guide you through the detail of the performance, starting with sales. Total sales grew by 10.3%, 4.7% at constant exchange rates, to reach EUR 24.8 billion. All banners contributed to the additional EUR 1 billion of sales generated in the nine months of the year if we exclude the currency effect. Group like-for-like was at 3.0%, with volume growth offsetting the important basket deflation of Biedronka. In Poland, price has been more than ever before the decisive shopping factor, and in this respect, Biedronka continues to lead the market, having even further reinforced its commercial strategy in face of a more intense competition. On top of its historically strong sales performance track record, the banner continued to deliver solid volume growth throughout the nine months. In the period, basket deflation significantly impacted like-for-like growth at a slightly lower rate in Q3 than in Q2. In a market that is experiencing negative sales volumes, Biedronka ended the period with a strengthened position. Having again guaranteed the preference of its vast consumer base, our main banner continued to outperform the market and increased its respective market share by 50 basis points year-to-date August. Total sales grew by 10.4%, plus 3.9% in local currency, to reach EUR 17.5 billion. In the nine months' period, Biedronka opened 104 stores, 90 net additions, and refurbished 156 locations. Hebe performed well across the period, and sales grew by 20.6% in local currency, including a like-for-like of 11%. E-commerce continued to develop and being a strong growth driver for our health and beauty banner. Pingo Doce increased sales by 4.7% to reach EUR 3.7 billion, including a 4.4% like-for-like. Without fuel, driven by strong performance in volumes, the banner also operated with basket deflation in the nine months' period. Pingo Doce kept an intense promotional activity while reinforcing its drivers of differentiation, meal solutions, and perishables through the ongoing rollout of the All About Food store concept. In the nine months' period, 50 more stores were refurbished to this new concept, and six stores were opened and had an increase of three. Recheio grew sales by 1.8% to reach EUR 1 billion. The Horeca channel in Portugal continued to be impacted by a weak domestic out-of-home consumption. However, Recheio intensified its commercial dynamics to protect sales performance and group clients in all segments. Ara adjusted its promotional activities to match the consumer's needs, maintaining an intense commercial dynamic and providing good saving opportunities to the Colombian families. The pressure on like-for-like reflects an extremely weak consumer demand in light of persistently high food prices. Nevertheless, Ara continues to advance the expansion of its network according to plan, taking advantage of the market opportunity to reinforce its presence in the neighborhoods. So far, 87 stores were opened this year. The banner remains on track to achieve its target of 150 new stores in 2024, with Q4 being typically the busiest quarter in terms of new store openings. In the period, sales increased by 10.9% in local currency, a 21.5% growth in euros to reach EUR 2.1 billion. Consolidated EBITDA grew by 2.7% in euros, a reduction of 2.9% at constant exchange rates, reaching EUR 1.6 billion. I would like to flag a couple of things here. At Biedronka, EBITDA evolution reflects the impacts of the very challenging combination of significant basket deflation and cost inflation. Reinforced price leadership adds to the pressure. The good work being done by Ara's team allowed for solid EBITDA improvement despite soft top-line performance. And on the central costs that in Q3 2024 were below the same period of 2023, please take note that this was only partially due to savings, as there are also some cost headings affected by calendar mismatch that can still take place in Q4. Group EBITDA margin fell to 6.6% from 7.1% in the nine months of 2023. At Biedronka, the pressure on margin was mainly driven by lower sales growth due to basket deflation and increased wage costs, essentially coming from the decision to significantly raise the wages of operational teams. Gross margin, though resilient in this context, was also down following price investments. Hebe's margin slightly improved as a result of good sales performance. In Portugal, despite the positive margin mix effect at Pingo Doce, price investment was a constant feature and was reinforced in Q3, particularly in the case of Recheio. Finally, in Colombia, as planned, Ara has been able to improve EBITDA margin by 127 basis points in the nine months. In summary, we have operated under challenging circumstances that combine basket deflation, high cost inflation, price investment, and unresponsive consumer contexts. Our teams have their strategies clear and are working relentlessly to deliver on their priorities by continuously enhancing our value propositions, pushing for sales in volumes by expanding the customer base, reinforcing market shares, and executing the expansion strategy as planned. There is also a lot of work being undertaken to protect the efficiency of our business models and help mitigate the pressure from operational deleveraging. Our banners did well and are well prepared to continue to deliver as we enter the last months of the year and get ready for the Christmas season under contexts that still face a lot of uncertainty and that show no signs of softening. Our outlook remains largely unchanged, though we now expect CapEx to be just over EUR 1 billion for 2024, down from the EUR 1.2 billion previously given as guidance, reflecting some timetable adjustments, namely on remodeling projects. Store expansion programs will be delivered as expected. Thank you for your attention. Operator, I am now ready to take questions. Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question on the phone, you'll need to press star 11 on your telephone keypad and wait for the name to be announced. To withdraw your question, please press star 11 again. We're going to take our first question from the queue. And our first question is coming from João Pinto from JB Capital. You're live. Please go ahead. Hi. Good morning, everyone. Thanks for taking my questions. The first one, could you please quantify the basket deflation in Q3 in Poland and how has it evolved through the quarter? I'm trying to understand if basket deflation has slowed down between July and September. Then three quick ones on costs. Can we assume that gross margin in Poland was flat? And could you tell us how big was the tailwind from energy costs, if that was relevant, and if you could quantify, it would be great? And finally, on holding costs, you mentioned some mismatches in terms of calendar. How should we think about this line for the fourth quarter? Thank you very much. Good morning, João. So on basket deflation in Poland, as I referred, it's slowed down. So we still operate with quite significant basket deflation in Biedronka, but at a softer rate than in the first half. I believe that by then I told that we had slightly below 6%. Now we are slightly ahead of 4% on the third quarter. On the gross margins in Poland, as I also mentioned in this introduction, it was not flat. As anticipated and expected, we invested more in prices. So our gross margin was, in fact, down. We usually do not provide this. But as the mix may be misleading in terms of the consolidated numbers, I can tell you that we had to invest around 20 basis points in the gross margin for Poland. As for the tailwind energy cost, in fact, it's true that we had some savings in terms of the rates of energy costs on the P&L of Biedronka, but this is a minor tailwind compared with the decision or the impact to really follow the minimum wage increases and increase the operational team's wages by almost 20%. So it's not really quite significant compared with that, but it has been helping somehow to mitigate the other cost increases, namely on rents. As for the holding costs, as I mentioned, I think that you should not take this quarter as a proxy for the other quarters. As you may imagine, we do not have our costs in percentage of sales not that significant, in fact. Of course, when we are talking about a year where all costs matter, a slight change or increase or decrease is noticeable. In our case, each project that we entered and when we have to pay one or two or three million euros may be a difference depending on the timetables. I think that the good proxy is to maintain the same level as the yearly costs, so not looking so much at the quarter evolution, but the yearly costs with, of course, some inflation at least. And depending on the different projects on the IT, on sustainability, etc., we may flag some other adjustments, but there is only a mismatch. So there, as I mentioned, there are some savings, but they are not material to say that the costs will be very different from the prior year. Thank you. Thank you. We're now going to transfer to the next question in the line. The next question comes from Nicolas Champ from Barclays. You're live. Please go ahead. Good morning. Thanks for taking my questions. I have three. The have three. The first one is in July, you guided towards higher EBITDA margin contraction in Poland in H2 versus H1. Is this guidance still relevant, or maybe do you expect a slightly more positive evolution given your Q3 performance? The second is about your slight reduction in your CapEx program from EUR 1.2 billion initially to just over EUR 1 billion. You said you maintained your new store opening program both in Poland and Portugal. You also kept your program of store remodeling in Poland and Colombia. So could you elaborate a bit more on where the stemming or the lower CapEx stem from? And a third question, if I may, could you update us on the current trading in Poland at the start of Q4? And maybe also give us some color regarding the sales evolution in Poland during the third quarter, more specifically in September, given the impact of flooding, for instance. Thank you very much. Good morning, Nicolas. So on the guidance on the EBITDA pressure, yes, it's true that it was a little bit better than we probably anticipated. I think that we have three months to go. We have to acknowledge that sales during these three months will be highly dependent on the Christmas season. Of course, usually, on average, they are higher than in other quarters. And of course, the type of cost increases is more or less the same as in previous quarters. So I think that we maintained the guidance to continue to have a pressure. If it's going to be higher than what it has been until now, it will only depend if the Christmas season will not be going as good as probably we will want it to be. On the slight reduction of the CapEx program, it's basically on the refurbishments and on some, as I mentioned, some timetable adjustments. So the refurbishments of Pingo Doce will end up to be on the low end of the range that we had expected in the beginning of the year. We also adjusted slightly versus the beginning of the year, the refurbishments in Poland. And some of the, as I mentioned, some adjustments in terms of calendar on the logistics investments, etc., are justifying this slight decrease in the CapEx guidance. But it's only a matter really of timetable adjustments. So we will continue for the future to refurbish stores and to maintain our store opening programs and logistics investments. On the current trading in Poland, as you can imagine, I cannot give you a color on that. What we see from the numbers, of course, and I will probably just make a comment on the September numbers because the market numbers, as you probably saw, are quite weak or continue to be quite weak. Of course, we have to take into consideration also for the market the calendar effects. And as you can imagine, when the market is no longer growing quite significantly, so each difference in the number of days of trading, etc., makes a difference for the month and, of course, for the three-month period. And that's why we usually are more worried, of course, with the total year, which is totally comparable, except, of course, if we have a leap year or not. But it's one day on the 365 or 366. When we are talking about months or quarters, you can have these kind of mismatches. So we have to take that into consideration. This being said, we do not see for now or until now, really, the consumer willing to spend much more on food. So the price continues to be really relevant. So the consumer has money. We know that the real income of the families has increased. The savings in Poland have been increasing, but we don't see people really spending much in certain categories, including in food. So it's also true that that happens in textiles, etc. But in food, definitely, they really want. It's an area where they want to save, and that continues to happen. The sales evolutions, as I mentioned, throughout the quarter, I think it's really not worth it, and looking at it can be, again, misleading because now each day of difference, each Sunday ban or each change between a Friday or a Saturday may have an impact. So I think that we have to overall see the evolution for the year and not be so concentrated in the quarters. Okay. Understood. Thank you. Thank you, Nicolas. Thank you. We're now going to transfer to our next question. And our next question is coming from José Rito from CaixaBank BPI. Your line is now open. Please go ahead. Yes. Hi, good morning to all. So I have three questions on Poland. The first one is in terms of legal behavior. Is there any change in Q3 or in October versus what was discussed in Q2? The second question related to this is volumes and market evolution in October, if you can say something if the market remains with negative volumes, something that we have been seeing over the last month. And finally, the question in terms of comparison base volumes-wise in Poland in Q4, how much difficult is Q4 versus Q3, or is it broadly similar the comparison base? Thank you. Thank you, José. So in terms of competition, as we mentioned, the market continues to be highly aggressive and highly competitive. But I think that we cannot expect a change on this because the context or the circumstances, so the pressure on prices, the weak consumer demands, and of course, the pressure on the cost headings, particularly on the wages, affects all players. And of course, in this case, we don't see really a change, and that's why we continue really to invest in price, particularly this quarter, as I mentioned, also pressuring our gross margin percentage-wise. On volumes and market evolution, we don't have the numbers for the market in October. What we think is that we don't see really any change in the consumer behavior, and I don't think that there is any reason at this point for that to happen because the circumstances, economic and political-wise or geopolitical-wise, are exactly the same as they were until the first half of the year. As for the comparison base in Q4, yes, we flagged that the comps will become tougher in Q4. Last year, we grew significantly volumes. So probably, if you look at the evolution of our inflation and we more or less flagged that throughout the year, we started the first quarter with 20% internal inflation and ended almost December with deflation already. So volumes went up by 4% in the fourth quarter of 2023. And so I think that growing with that basis, it's going to be challenging for Biedronka. We don't hide. Thank you. Thank you. Thank you. We're now going to move on to the next question in the line. And the next question is coming from Frederick Wild from Jefferies. Your phone is open. Please go ahead. Good morning, Ana Luísa. Thank you for taking my questions. First, could I ask about the outlook for food inflation next year and where we can see that going? Is the current sort of 4% industry level in your eyes a good guide? And then second, you mentioned that the pressure on Biedronka gross margin was about 20 basis points in Q3. Could you give a sense of what that was relative to Q2, whether it was a similar sort of pressure, and how we can expect that to evolve in Q4? Thank you. Hi, Fred. So on food inflations, again, this is a tough question for me. I always mention because according to the projections that we have from several sources, at least in Poland, which is, I believe, one of the few countries where we have the authorities mentioning the food inflation prospects, they continue to put inflation at a quite significant number or at least a strong single digit. I don't believe that that will happen in practice again because, as I said, the calculation has at least for Biedronka and for all the other players several things that are not so important for us. One, of course, has to do with the taxes. All the taxes are included, namely the VAT, and we have to deliver it. So for our net sales, that inflation or that component of inflation is not so important. The other thing is that all the promotions that are not, as we can call, universal, that are mentioned on the shelf and provided to all customers. So all those promotions that are done through your loyalty cards or that are done through special discounts if you give a certain voucher to your consumer, they are not taken into consideration for the country for the inflation. Nonetheless, they have to be considered when we compute the evolution of the prices in our banners and also for the other banners. So it's a little bit just having or picking up on the food inflations. It may be misleading again on the numbers for the companies. As for the pressure on the gross margins, that again is a tough one. As I said, I only disclosed the pressure this quarter because on the consolidated, again, exactly what happens also with the like-for-like. The consolidated number, when we have negatives and positives, maybe the total number may be a little bit misleading. And I take the opportunity because Claudia called my attention that I mentioned the like-for-like for the consolidated numbers to be 3%. It was 0.3. But again, it has to do really. You have negatives in Biedronka and Ara, you have very positives in Portugal. So it's a little bit, as I said, misleading just to look at the consolidated number. For the gross margin, it's exactly the same. So you have really a positive mix in Portugal, also a management mix in Colombia that really pushed the gross margin up, and that compensated for the lower gross margin in Biedronka because it really invested more in prices. Thank you so much. Thank you, Fred. Thank you. We're now going to move on to the next question in line. And the next question is coming from Izabel Dobreva from MS. Your line is open. Hello. Good morning. So my first question is on the pricing environment. Would you expect that Biedronka's basket stays deflationary over 2025 given your current consumer outlook? And related to this, could you share your thoughts on the relationship between your current space openings and the market as a whole? On the one hand, so the amount of new stores which are entering the market and what that will likely mean for the pricing environment given the volume outlook as we look over 2025. That's my first question. And then my second question is just regarding the working capital. Could you give a little bit more of a comment on what is driving the outflow? To what extent is this effectively driven by suppliers coming to you because of their own difficulties and effectively asking you for help? Or should we think about the payment terms as, let's say, another lever that you have in order to secure lower prices for consumers by shortening those payment terms and effectively continuing to implement your pricing strategy? Okay. Good morning, Izabel. For the pricing environment, of course, the evolutions from 2024 to 2025 will depend on several moving parts. One we definitely do not control, which is the competition environment. We know that, as I mentioned, the market, when it comes or when it is impacted as it was from the slowdown in growth and the effect of deleveraging the P&L, and not only the P&L, even the balance sheet, because that also has an impact on the working capital. So the fact that you have deflation or lower food inflation than in prior periods, the comparison, at least in absolute terms, it becomes in terms of the evolution, it's more difficult. I would say that for now, we think that there may be some price increases in the commodities and some pressure on that. But depending on the competition environment, this does not ultimately mean that the prices will increase, at least our basket prices, because we will continue to be quite competitive in the market. So I think that's at least a flattish inflation or, depending on the competitive environment, we don't exclude a scenario where we may have, for some categories, some deflation even in 2025, particularly in the first half. For the current market capacity, so we are opening stores, it's true, and I would say all the other players. Dino, Lidl, Aldi, Stokrotka, all players continue to see that there are some white spaces in the Polish markets. We continue to also mention that opportunity, particularly in smaller towns. This, of course, means that we are entering in some markets where we were not previously. Others we may enter, but of course, we continue to analyze each location and what it can bring in terms of return on capital or on invested capital, which is our profitability measure. For now, I don't see that there will be really a need on capacity increase in the Polish market. People continue to see it as having opportunities. On the working capital, several effects here. We mentioned since the beginning, of course, and I don't hide that the payment terms can be a lever and a lever to more than to get better conditions, a lever to it may not be a direct impact, but it maintains alternatives open for us. So we want to be competitive and to have some bargaining power. You have to have alternatives. You cannot be just on the hands of one supplier. And so this is something that we prefer to have different alternatives. So we are willing to use the working capital as a weapon, as I usually say, to maintain open several options in terms of purchases. As for the specific situation of the working capital this quarter, as I mentioned, you have a calendar effect, which is almost two days, which in total explains half of the evolution. Then you have some correction in the payment terms, particularly of the smaller suppliers, true, because of the high interest rates, but particularly because they have constraints in getting credit. And so we are willing to do that. And of course, the other thing has to do really with the evolution of the prices even from the part of the suppliers. So if we were operating still in inflation, very high inflation last year, now we are operating even at the level of our purchases with a low inflation or even deflation in some cases. So that has an impact on the trading payables that stay at the working capital. Okay. Thank you. So just to clarify, you would expect a positive working capital inflow in four Q because of the seasonality. Is that right? Yes. I would expect that. Thank you. Thank you. Okay. Thank you. There are no questions in the queue at this point, so I would like to hand it back to Ana Luísa Virgínia for any final comments. So we have been experiencing the materialization of the difficult circumstances that we anticipated early in the year. We stood firm in executing our strategy, and our teams are delivering on their key priorities. While we acknowledge the challenges and the pressure on the financial performance, we also believe this is the right strategy to guarantee long-term profitability market positions. Thank you for your questions and for attending this conference call. I wish you all a nice day.