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Jeronimo Martins 2011 Net Rises Less Than Analysts Estimated

March 7 (Bloomberg) -- Jeronimo Martins SGPS SA, Portugal’s biggest retailer by market value, said full-year profit rose 21 percent, less than analysts expected

Net income gained to 340 million euros ($446 million) in 2011, Lisbon-based Jeronimo Martins said today in a regulatory filing. That missed the 363.5 million-euro average of 10 analysts’ estimates compiled by Bloomberg.

A weak economy in Portugal, where Jeronimo Martins owns the Pingo Doce hypermarket and Recheio wholesale brands, has prompted the rerailer to focus its investments in Poland, where its Biedronka chain is the biggest discount grocer, and Colombia, its third market.

Jeronimo Martins fell as much as 4.1 percent in Lisbon trading. The stock declined as much as 56 cents to 13.05 euros, and traded at 13.175 euros at 8:20 a.m. in the Portuguese capital.

Sales increased 13 percent to 9.8 billion euros in 2011. The board will propose increasing the gross dividend 31 percent to 27.5 cents a share.

“We expect 2012 to be another good year, driven by the strong growth of Biedronka in Poland,” the company said. “In Portugal our main targets are to increase market share whilst trying to protect profitability.”

The Biedronka unit will open about 250 new stores in 2012, Jeronimo Martins said. The company plans to invest about 650 million euros in 2012, of which 80 percent will be invested in Biedronka.

Polish Expansion

Jeronimo Martins said on Nov. 2 it will invest 2.2 billion euros between 2012 and 2014 as its Polish unit expands and operations begin in Colombia this year. The retailer will spend 400 million euros in Colombia in that period and increase its Biedronka chain in Poland to 3,000 stores in 2015.

“In Colombia, we are optimizing our plans to start operations in the country,” Jeronimo Martins said, without providing details.

To contact the reporters on this story: Joao Lima in Lisbon at jlima1@bloomberg.net; Henrique Almeida in Lisbon at halmeida5@bloomberg.net

To contact the editor responsible for this story: Jerrold Colten at jcolten@bloomberg.net

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