Quick Take: Dino H1-26 - Deflation impact as bad as expected

Research evidence excerpt

20 August 2026

Richard Trainor

European Food Retail

Dino Polska SA

William Woods

Rating

Underperform

Alice Buckley

Price Target

DNP.PW

25.00 PLN

Rhea Gudiwala

Quick Take: Dino H1-26 - Deflation impact as bad as expected

Dino reported H1-26 results this afternoon. As expected, price deflation weighed on

like-for-like growth (LFL), which fell to +0.3% in Q2 from +4.4% in Q1. Overall results

were worse than expected for Q2 LFL (-84bps vs. consensus) and Q2 Revenue (-0.5% vs.

consensus); but slightly better than expected on the bottom line, with H1 EPS of PLN 0.73,

+1.8% vs. consensus. There is no change to the company’s guidance or its approach (to

invest in prices to support volumes). We do not expect a significant share price reaction

in the morning.

Gross Margin was flat on the year but EBITDA margin declined to 7.0% from 7.5%,

suggesting that the pricing environment prevented Dino from offsetting wage

increases in the quarter. The company’s approach remains to maximise volumes rather

than protect short-term margins. Management continues to expect that when deflation

eases, margins will recover over time. Forward-looking guidance of (1) store openings to

grow by a percentage in the teens; and (2) PLN 2.5bn Capex in 2026 was repeated.

Q2 EBITDA was in line with expectations at +0.3% vs. consensus, but Q2 EPS was +2.6%

ahead, helped by lower net finance costs (a PLN 14m improvement vs. last year) and lower

tax (a PLN 5m improvement). The reduction in finance costs appears to be driven by lower

interest rates impacting both bond and bank loan costs.

These results reflect an intense but temporary period of deflation caused by low producer

prices in Poland. However, our medium-term view remains that (1) as Dino grows, its

stores will increasingly compete with Biedronka stores and come off worse, and (2)

Dino's return on capital will consequently decline. See our initiation here.

A call will take place tomorrow (Friday 21st August) at 2.00pm CET (1.00pm UK / 8.00am

ET). Registration link here.

Close Date

20 Aug 2026

DNP.PW Close Price (PLN)

32.29

Price Target (PLN)

25.00

Upside/(Downside)

(23)%

52-Week Range

50.68/26.89

EDME

1,616.62

FYE

Dec

Div Yield

NA

…