Healthy Balance Sheet Gives Sligro Resources for M&A

Leading Dutch wholesaler Sligro Food Group reported third-quarter results below expectations in both the Netherlands and Belgium, but a "turning point" may have been reached in its financial trajectory.

For the first nine months of its fiscal year 2025, Sligro Food Group posted slightly weaker-than-forecast results. The wholesaler is now unlikely to achieve its anticipated operating profitability (EBTDA margin) for the full year, citing challenging market conditions and continued setbacks in its Belgian operations.

"We can remain very negative on this or take the view that margins do not pay the bill, but absolute EBITDA and cash do. And in that respect, SGF has turned the corner," highlighted Fernand de Boer, Senior Equity Analyst at Degroof-Petercam, in a research note.

De Boer forecasts double-digit annual growth (>10%) for the 2024–2027 period, driven by ongoing cost savings and a more favorable market environment for the foodservice industry. Sligro is maintaining its FY EBITDA margin guidance at 5.6% for 2025.

"With capex under control and a reversal of working capital in 2025, cash flow should be strong as well, which further strengthens its already healthy balance sheet. The healthy financial position allows for M&A and a step up in shareholder remuneration," the senior analyst predicted, expressing confidence that "the difficult years are behind us."

Sligro has endured a turbulent four-year stretch, grappling with the fallout from the pandemic, the energy crisis, high inflation, and labor shortages in the hospitality sector – all of which weighed on consumption and volumes. In Belgium, the company struggled with SAP integration issues and broader operational challenges, leading the share price to fall below its 2020 level.

The Amsterdam-listed company operates twelve outlets in the Belgian market under the Sligro and Sligro-M banners. These include nine former Metro stores acquired following the bankruptcy of Makro. At the end of last year, Sligro employed over 4,500 full-time staff and reported a total turnover of €2.89 billion (with a net profit of €24 million).

Trading update Q3 2025 Snapshot

Revenue	€664 million for the third quarter of 2025, down €61 million on the same period last year "due to the discontinuation of tobacco sales"; + €3 million "on the back of the acquisition of GEPU."
Growth	In the Netherlands, revenue excluding tobacco sales rose 2.5%, in line with this year’s average, with volumes up slightly and growth driven mainly by inflation. Revenue in Belgium remained flat compared to last year, which meant a cumulative drop of 5.0%.
Statements	"In Belgium, the summer period was challenging too, but we did manage to end the downward trend over the third quarter," said CEO Koen Slippens and CFO Rob van der Sluijs. "While the revenue base is indeed growing, the onboarding and expansion of new customers is progressing slower than we are used to in the Netherlands. We have therefore adjusted our expectations for the rate of revenue recovery in Belgium accordingly."
Guidance	"For now, we foresee a similar trend in the market for the coming months as well, and December will, as usual, still be essential for us in the Netherlands. The revenue trend is positive, though, and we are confident that we are on the path to recovery and growth. The profitability in Belgium will recover at the same pace as revenue."