Renta 4 | El Economista newspaper publishes an interview with DIA’s Chief Financial Officer, Guillaume Gras, in which he reviews the current situation and business outlook. Among the main messages, we highlight:
- EBITDA margin target of between 7.5% and 8% in 2029, based on three fundamental pillars: increasing sales density, expanding the franchise model, increasing its weight in the store network from around 65% currently to 75% by the end of the EP, which improves staff management and merchandise losses in stores; and transformation of the logistics network, tripling, modernising and streamlining capacity, achieving significant savings in maintenance costs and optimising transport costs.
- DIA has around £800 million in tax losses from the restructuring period and asset sales since 2018, representing around £200 million in tax savings for the coming years.
- M&A. Although inorganic growth is not contemplated in the 25-29 business plan, it is an option in such a fragmented market where consolidation could occur. Among the required criteria are that it be a healthy business, growing in a sustainable and profitable manner, with a model that fits with DIA’s and with significant synergy potential and limited integration costs.
- Argentina. They are leaders in the proximity format and third in terms of market share, with 15%. Eighty-five per cent of the stores have been refurbished and those that do not meet the profitability criteria are in the process of being closed. In addition, it is a business with a very strong own brand and no debt, with net cash of more than €50 million at the end of the last quarter. They expect consumption to recover gradually in 2026 and to return to profitability levels close to 6%.
Assessment: News with no impact on the share price, as it reviews the Company’s current situation and expected future catalysts. We reiterate our OVERWEIGHT recommendation and P.O. of €40.5 per share.
