Ladies and gentlemen, thank you for standing by. I am Constantinos, your Chorus Call operator. Welcome, and thank you for joining the Jumbo conference call and live webcast to present and discuss the first half 2026 financial results. All participants will be in listen only mode, and the conference is being recorded. The presentation will be followed by a question and answer session. Anyone who wishes to ask a question may press star followed by one on their telephone. For the webcast participants, you can submit your questions in English. Should anyone need assistance during the conference call, you may signal an operator by pressing star and zero on your telephone.
At this time, I would like to turn the conference over to Mr. Apostolos-Evangelos Vakakis , Chairman of the Board of Directors, Mr. Polys Polycarpou, CFO, and Ms. Karamitsoli Amalia, Head of Investor Relations. Ms. Karamitsoli, you may now proceed.
Thank you, Constantinos. Good afternoon. Thank you for joining us. Today, I will take you through Jumbo's first half results, the performance of our main markets, and the priorities for the rest of the year. I will keep this presentation brief so we could have enough time for the questions at the end. Let me start with our main numbers. Group sales reached EUR 590 million in the first half, an increase of 4% year-on-year. Net profit was EUR 121 million, up 3%. Gross margin was at 53.5, 33 basis points lower than the last year. The main pressure in the gross margin came from Romania. We absorbed the VAT increase, and we faced a weaker local currency. On the other hand, more favorable euro/dollar exchange rate, manageable freight costs during most of the period, and sales mix helped to offset some of this pressure.
Sales for the first eight months increased by 6%. Our full year outlook remains around 5% sales growth and net profit of EUR 310 million to EUR 320 million. Performance differs across the markets. Greece, which represents 60% of the group sales, grew by 7%. Cyprus grew by 4%. Bulgaria remained strong, with sales up to 11%. Romania was the most challenging market, with sales down by 6.5%. Inflation, pressure on the RON, fiscal measures, and the VAT increase affected consumer demand. Separately, sales to franchise partners increased to about EUR 43 million from EUR 38 million last year. At this point, I would like to highlight the balance sheet. At the end of June, cash stood EUR 546 million. Group has no debt. That give us the capacity to invest in the business while continuing to return cash to the shareholders.
We have already paid EUR 1.20 per share this year, EUR 0.50 in March, EUR 0.70 in dividend in July. And yesterday, the board resolved to pay for further cash distribution of EUR 1 per share. Including that amount, the total cash distribution in 2026 will reach EUR 2.20 per share or approximately EUR 296 million. Looking ahead, we expect a new Baia Mare hyper store in Romania to open in October. We also plan openings in Romania and Cyprus in 2027. In Greece, four stores are in preparation, with opening expecting in 2028. Bulgaria remains in our plans for one additional hyper store within the next two years. Over the longer term, our objective in Romania is to double the number of stores. We are also developing a small pop-ups format for selected locations, with the first opening targeting in 2027 and 2028.
Finally, we plan to launch the Hungary online store towards the end of this year, supported by existing infrastructure in Romania. Our franchise partners currently operate 48 Jumbo-branded stores in seven countries. Our revenue, this activity has two parts, sales of products to the partners and royalty income. BALFIN plans its first store in Moldova this year and has extended our cooperation to six additional markets. For those new markets, BALFIN Group will manage the supply chain through the hub in China. Fox Group operates Jumbo brand stores in Israel, and it is targeting to first stores in Toronto by the end of 2026. Our investment focus on logistic capacity, the store network, and our systems. In Romania, the progress of acquiring a 60,000 square meter giga distribution center is progressing.
Also in Thessaloniki, the new 50,000 square meter facility is expected to be completed in 2027. We are also investing in cybersecurity and modernize our systems. All these projects support the long-term efficiency of the business. To sum up, the first half delivered growth, both in sales and profits. Greece and Bulgaria performed well, while Romania remained challenging. We have maintained our full year outlook, and we continue to invest in the network and logistics while returning cash to the shareholders. Thank you for your attention.
Now, Mr. Vakakis will take your questions.
Good afternoon.
Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question using telephone audio conference may press star followed by one on their telephone. If you wish to remove yourself from the question queue, then you may press star and two. For the webcast participants, you can submit your written questions in English. Audio conference participants, please use your handset when asking your question for better quality. Anyone who has a question may press star one at this time. In the interest of time, please limit yourselves to one question and one follow-up question. One moment for the first question, please. The first question comes from the line of Stamatios Draziotis with Eurobank Equities. Please go ahead.
Yes. Hello there, and thank you for taking my questions. Let me start with the first one, which is on the gross margins. You mentioned the gross margin was down 33 bps in H1. Could you maybe help us quantify the main moving parts, i.e., FX, freight, franchise mix, Romania, and more importantly, how much of the favorable procurement backdrop is left to flow through in the second half, please? Thank you.
I understood nothing. I am confused. What exactly are you asking?
What drove the 33 bps margin contraction in H1 is the first leg of the question.
I would say that the impact, the reduction you mean, on the gross margin, I would say that it came all from Romania. While improvements of the gross margin in other markets have rebalanced that a little bit upwards. But all in all, we lost about half a percentage point, which is within our budgeted numbers.
Based on the rates that you have secured for the second half of the year, how do you expect gross margins to evolve, please? Thank you.
We expect the gross margin to be flat. It would be in line with the first six months. Having said that, everything goes. We see a little bit now the dollar strengthening against the euro. We see that the cost of transport is holding steady and in some cases increasing. My opinion, which is subjective and not objective, is in the direction that all these changes will not impact negatively the gross margin on the remaining months of the year.
That's great. Thank you. Just a final question on shareholder returns. You've said you've distributed or are about to distribute a total of more than EUR 2 per share in 2026. With the group still carrying a very large net cash position, how should we think about the sustainable annual cash return from here? Should we view, I don't know, EUR 1.5, EUR 2 per share as a reasonable range during a period when growth is not as it used to be a few years ago? Thank you.
Again, I'm a little bit confused. The direction of the company is towards growth, generic growth. We are working towards this goal. If market conditions do not allow this to happen in the short term, the only alternative is to pay dividends. If we have the option to direct money towards further investments and growth potential, this is our first option. We live in turbulent times and therefore one can have to be very careful in what he says because market realities may force him towards a different direction.
All in all, however, despite the roughness of the trip, we seem to be coping in line with the last 20, 25 years of the past. We don't feel more unsecure, let's put it this way.
Great. Thank you.
The next question comes from the line of Iakovos Kourtesis with Piraeus Securities. Please go ahead.
Yes, good afternoon. My first question has to do with Hungary and the fact that you plan to launch the first online store in the country by the end of the year. If you could, assuming that things will go as you expect to go in the country, would the next step be the deployment of physical store subs you mentioned in previous times? What will be the timing back gap before we see this happening?
What we have said is that we will remain focused on markets that we are currently operating. For somebody who reads our announcement, it says that we are back into rapid growth of new stores between 2027 and 2028. More in 2028, but we are building currently a lot of stores and buying, securing land and property around. To put into the work plan also Hungary would be not a prudent option. We would stay with a shop, read the market, learn from the shop, and then we will be ready later. I don't believe that we will see an activity happening in Hungary in a period less than three years.
Okay. Since you have mentioned that you are in the progress of preparing four stores in Greece, would it be too much to ask where are these locations that you plan to open these stores in 2028?
Deliberately, we have not announced that because we believe that that doesn't help the way we approach authorizations and the rest. There is no need to create further resentment than the absolute necessary.
Okay. If I may, one last question. Would you be kind enough to let us know what's happening with Oinofyta? Do you have the land plot there? Did you acquire it?
Yes, we have acquired. All lots have been already bought.
Okay.
We don't announce a new store unless we have secured the land.
Okay. Since you acquired the land plot there and you seem to reassess the logistics center there due to, as far as I understand, you plan to apply the BALFIN Group model with Fox Group, or this is maybe your intention. What do you plan to do with it going forward?
The idea is that we are refocusing on our own stores. Regarding the franchise activity, we want to rebalance it against our main activity. We see a danger in our franchise activity growing too fast, too quickly, that this may infringe our growth potential of our own properties and our own markets and stores. For this reason, we have made alliances with Fox Group and Group BALFIN in order to take some pressure out of that and refocus into our main activity, which is generic growth of our own destinations and properties.
Thank you very much.
The next question comes from the line of Yiannis Kalogeropoulos with Beta Securities. Please go ahead.
Hello. I have a question regarding your new smaller stores that you mentioned that you would operate in 2027 and 2028. Would you consider that this marks a shift on Jumbo's current operating model with the bigger or the hyper stores now that you are expanding in touristic or popular areas with smaller stores, as you say? Would you predict that these new stores would enhance, dilute, or do not affect your operating profitability margins? Thank you.
If one wants to elaborate a little bit more as part of his activity towards areas that are more expensive to operate, it makes sense to run smaller stores and product ranges that have the gross margin to support such an alternative option. Although it is early to say, our planning is based on the assumption that increased costs of smaller stores would be counterbalanced by a better gross margin on these stores.
Okay.
Have I confused you?
Yeah. It's quite helpful. Do you consider this switch to smaller type of stores in more density or more popular or more touristic areas, something like a change in Jumbo's operating model? Because up to now, your strategy, I think, was both for Greece and the Balkans, Romania, Bulgaria, and wherever, to operate big or hyper stores. Now that you are switching to smaller ones, isn't it roughly like becoming a more oriented, I don't know if it's proper to say, like a supermarket retailer?
No. Our strategy is a little bit like the e-commerce strategy. We hope to approach areas that were not approachable in the past for the reason that, first of all, you cannot find locations with the magnitude of the size that we are talking about Jumbo, without paying your share. You will need to run a limited range of products that will house the necessary gross margin, as I said, that will finance the additional costs. We see this operation as a complementary one, as an add-on exercise, rather than as a competing exercise to the existing network of stores.
Plus the fact that Greece's future, whether we like it or not, will be based on tourism more and more. The store has to approach the tourist rather than the tourist the store.
Okay. Very clear. Thanks for your answers.
As a reminder, if you would like to ask a question, please press star and one on your telephone. The next question is a follow-up question from the line of Iakovos Kourtesis with Piraeus Securities. Please go ahead.
Hi again. As a follow-up to Yiannis' questions, if I may ask, taking into account that these pop-up stores will be small stores, should we assume that they should have some proximity to existing large stores that will help them with logistics and inventories? Does this make sense?
No. No, it does not make sense. They would be freestanding operations. When we say small stores, this is a relative term. Smaller than existing stores. We are not talking about small stores because we are not a boutique concept. But anything over 2,000 to 3,000 m would be considered as a possible option for us to operate if the demographics, the location, and the cost implications make sense. If they do not make sense, of course, we will shy away. We are not changing the model. We are adding to the model a twist. What would be the future? Nobody knows.
Also, you have to always bear in mind that we have, in areas, franchise operations also in Greece, that in the future may be substituted by our own stores. The whole idea is that all the profit should benefit the company if the numbers support that.
Okay. Thank you very much.
Ladies and gentlemen, there are no further audio questions at this time. We will now move on to the webcast questions. The first webcast question comes from Nicolas Gourdain with Lexcor Capital, and I quote: "You had mentioned the possible acquisition of a new large distribution center in Romania. Is there any update on that you can share with us? Thank you.
As a matter of fact, we paid the advanced payment today. It is ours now, and we are going through the due diligence in order to pay the balance, and we hope to have that concluded within the next 1.5 month . We can now announce that that was a big factory in Ploiesti, which was owned by a Chinese company called Haier. It's almost a brand-new building with ultra-modern facilities and the rest. The way we see it is that we are investing heavily in Romania since we have a plan of doubling our store presence there, and we need the infrastructure to support such moves. Also, I want to make a small mention here.
For us, Romania going through a turbulent period is an opportunity, not a threat. We are very strongly believing in the Romanian market, and we believe that we are offered now opportunities to acquire assets at prices that would make sense in the future. The strategy of Jumbo is never to buy its turnover, but when the going in an area or in a country is rough, we increase our investment in this country, and therefore we have the benefit of a windfall also from the asset appreciation. Although, we never reflect this asset appreciation in our books since this is the vehicle to do our business, and we will never dispose it. But it helps on the numbers, it helps on the gross margin and on our profitability, which remains on the upper end of the industry.
The next webcast question comes from Uriya Cohen with Kai Capital, and I quote: At what CAGR, approximately, you see revenue growing in the next five years? Thank you.
I've never thought of five years ahead, but I would be disappointed if we didn't have a revenue increase, which compounded with, let's say, strong single-digit number per year.
The next webcast question comes from Giorgos Andriopoulos with Piraeus Asset Management, and I quote: Hi, and thank you very much for taking my questions. First question, does the new EUR 3 EU customs duty on direct-to-consumer parcels in effect from July show up yet in your competitive position against platforms like Temu and Shein? That was the first part of the question. Thank you.
Yeah, this is common sense. Europe has reacted, and it's going to react further, making the environment more fair. Because before we had an environment where the competition, coming from other retailers, was to a degree unfair because they had a lower cost implication for them. Now, Europe is taking steps and has announced that it will take further steps to balance this. But as I keep saying, this is a, let's say, benefit for our numbers, while at the same time, we also face conditions without the same benefit, but a negative implication. But the plus-minus of this operation makes us relatively confident that we can reproduce successfully what we have been doing up to now.
Second part of the question, what like-for-like growth do you think Greece can sustain?
That is a good question. Greece is currently over-performing against all logic. What will happen in the future will depend on how Greece will balance after the next year's election. This is something for the Greek population to decide, and we will just follow their decision. It is premature for somebody to say something more than that. It is a surprise that Greece over-performs.
Third question, for the new smaller pop-up stores, what is the sales per square meter, versus hyper stores? Thank you.
The idea is to have the same sales per square meter as in a bigger store. But as I said, since we will be running a reduced portfolio of products, we will be more selective towards higher contributing gross margin options.
The next webcast question comes from Jonathan Neuscheler with Abilitato GmbH, and I quote: Good afternoon. Will the new pop-up stores comparable to the Action stores, or will they be better? Thank you.
Action stores as well as other competitor stores, have a completely different philosophy. They are relatively small stores focusing on a relatively limited product range. They are direct competitors to mom-and-pop stores, not to our stores. Gradually they substitute this type of stores into the market. As far as we are concerned, the competition we face from them is very helpful because practically it helps us get better. We are not inactive. We follow them very closely, and we are very sure that we cannot be beaten by small joints like the ones you mentioned.
Next question comes from Maxim Nekrasov with Citi, and I quote: How much of the benefit from the stronger euro to United States dollar has already reached gross margin? How much benefit is still left for the second half 2026 and 2027? Thank you.
We don't have a clue. Currently, we face a situation that the dollar is strengthening against logic or within logic because nobody knows these things. If we see vicious change, this will be reflected on the prices, and it will be for everybody. As it hovers within a range, I would say that the impact has been relatively positive up to now, and since now, relatively unpositive, but nobody knows what would happen after the midterm elections in U.S. We don't lose too much sleep with currencies because, as you know, we are hedged with products, and if conditions in the market change, prices of products will change.
However, if we hover within what we call acceptable ranges, for us, we pass every advantage to the consumer. Otherwise, in markets where the demographics don't help, we wouldn't have like-for-like growth.
Next question is a follow-up question from Maxim Nekrasov, and I quote: What sales margins and returns do you expect from new stores and the pop-up format? Could pop-ups meaningfully speed up store expansion? Thank you.
No. Pop-up stores are like drones, for example, supporting aircrafts or airplanes, fighter airplanes. They cannot substitute them, at least in the foreseeable future. Jumbo is a unique concept. It is well-received and well-accepted by the consumer, and I don't think it would be affected by, let's say, variations in our strategy the same way that it has not been affected by the e-commerce activity.
The next question is a follow-up question from Jonathan Neuscheler. Cash is at EUR 550 million and keeps accumulating. That is a lot more than 25% of revenues. What does Jumbo plan to do with excess cash. Thank you.
In the short term, we are paying a dividend, an extraordinary dividend. In the medium and long term, we have either the option of paying, let's say, bigger dividends or expanding in what we call generic opportunities around border countries that we involve ourselves. I have always indicated that my first option is expansion, but never to buy the turnover. If the market creates opportunities for mid to long-term expansion, we would take them proactively, and this is what we are doing, for example, in Romania, where some people may question why the hell are we investing if the market is retracting.
The answer is that the market very logically retracts until it rebalances, and then people who have invested in new cities or new warehouses or new formats of retail opportunities would benefit better than other people who got frightened and stopped doing so.
The next question comes from Georgios Papadopoulos , and I quote: Is Hungary e-commerce pilot similar to Turkey, or do you have more confidence that this can be a candidate for Jumbo-owned stores in the future, given it is in the EU. Thank you.
Turkey, in order to defend itself against platforms like Temu and other platforms that were importing directly into Turkey, it created an environment which was totally unfriendly for such activity. I am sure that it will come a time that they will revisit their strategies and then Turkey will become a future candidate for e-commerce activity. Definitely, we do not intend to establish a warehouse in Turkey, and the answer is that we don't like to involve ourselves into countries that are not part of the EU strong currency environment. Therefore, it won't be, let's say, a first option for us in the future.
Now we have involved ourselves into another country, and then maybe another country, but always our mind would be open for any store in Turkey on the assumption that we will not warehouse products in Turkey.
The next question comes from Harry Whelpton with Vergent AM, and I quote. The first part of the question is, can you please share your expectations for growth rates for each market for second half 2026?
I would say that they would be in line with the first part. The only area that secretly I would like to see an improvement is Romania. All other areas are growing very strongly, and as a result, we don't want anything more than that.
Second part of the question is, CapEx spend seems light year to date. Why is that?
Pardon? What is CapEx?
CapEx spend seems light.
Light?
YTD, I suppose, year to date. Why is that?
Why is what? Is it higher or smaller? I do not follow this number very closely because our CapEx number really is a three-year number, since this is the way we approach store investment strategy. A store cannot be active before 2.5 years of pre-investment activity. I do not have a clue how much is our CapEx for this year. I think it must be a little bit smaller up to now than necessary. But now we bought a new distribution center, so that will rebalance.
The next question. What is your outlook for margins in each segment for the rest of the year?
What is the what?
What is your outlook for margins in each segment for the rest of the year?
I cannot understand the question.
[audio distortion] Margins by geography.
Margins by geography. More or less, we try to keep them constant by altering the product mix. With the exception of Romania, all other countries, either we enjoy the margin or we do not sell the product.
The next question. Why was franchise sales per franchise store down - 3.6%?
These are numbers that are marginal. We do not control the franchise operation ourselves directly. This has to do more with the activity of the owners of the franchise themselves. I would say that all in all, I do not see any resentment of any unhappiness in this part of business. Although it is an area that we do not want to grow ourselves. We try to discourage people from entering franchise agreements with us.
The next question. Details behind improved working capital cycle and whether this should remain.
What?
Any details behind improved working capital cycle and whether this should remain.
I do not know what answer. I have not understood the question. One second.
Because the working capital was better in the first half of this year. That's what the question is.
If conditions turn in our favor, which is something that we have not experienced up to now because the cost of transportation is high and the cost of the war is high. One would say that we should not be over-aggressive, but we believe better times will come. We cannot have infinite, let's say, periods of war or infinite periods of distribution destruction. I think we are well-balanced all in all. We don't have any, let's say, vicious number alterations.
Next question is, with the business growing its franchise model, do you think the level of cash required to sustain operations will be lower in the future than it has been in the past? Thank you.
Depends how much of this cash will be redistributed to shareholders or invested in properties owned by us. Definitely we don't want to hold significantly more cash than necessary, but the model that we have in our mind is for a company that can sustain also a very big crisis. Jumbo is in a position to sustain a very big crisis, although, we don't have signs of such a crisis. But, as you know better than me, crises come when no one expects them.
Next webcast question comes from Luca Baroni with ORSA. I quote, "Looking a few years ahead, would you consider entering directly the most successful countries?
We don't have the size or the appetite for what we call bigger growth to the one that we have planned. We want to consolidate our act. I keep saying that Jumbo flies as a plane and not as a rocket, and we have no intention of changing the strategy that has supported the company for many years.
The next webcast question comes from Thang Hoang with FNZ, and I quote, "Hi, thank you for your presentation. I have a question. How is the group planning to control the inventory given it has been increasing since second half 2025? Are you expecting it to be significantly down once the distribution center has been finished in Romania? Thank you.
My feeling is that the inventory is coming down, not coming up. We are running with 3% less inventory than last year up to now. As a matter of fact, we want to beef up this inventory, but the market does not give us the opportunity to be more aggressive because of the indirect cost still affecting this direction. Staying stable or even marginally reducing the inventory levels is the correct strategy in the current environment.
The next webcast question is a follow-up question from Jonathan Neuscheler, and I quote, "Is Jumbo successful in buying more rented stores to lower the rent expenses? Any progress on the 30% of the stores that are currently rented? Thank you.
Yeah. We are always around if somebody wants to sell the store. Up to now, a lot of funds think about that, but the question is that they have to sell it cheap. We are open to calls, but we are not Santa Claus. We do not buy at any price, and we do not buy our name. The building is a building. We have the strength of the brand.
The next webcast question comes from Dimitra Manifava with Kathimerini, and I quote, "Could you give us more details regarding the pop-up stores, number, square meters, countries? Thank you.
A concept that it is successful gradually will be employed in every direction that it makes sense. As we stand today, we are still on a project and it is at its infancy. Practically speaking, I think it is premature to talk too much about that. I would be happy if by next year we have three, four, five pop-up stores, and that is it. Then another year, maybe a few more, and so on.
The next question is a follow-up question from Dimitra Manifava, and I quote, "Will the pop-up stores be open the whole year or only during the summer? Thank you.
All year, since there would be always central stores in highly populated areas and malls or freestanding. As a result of that, they should be viable year-round.
The next webcast question comes from George Athanasakis with Pantelakis Securities, and I quote, "Romania real estate. Do you see any opportunities to expand your store network more aggressively now, given the macro political difficulties the country is going through? What do you mean when you say the process to acquire a giga distribution center in Romania is progressing? Have you bought it or not? Thank you.
I mentioned earlier that today we paid for it. It was bought today. Of course, we still have to go through a due diligence that all the legal implications are correct. Assuming that we don't find any hurdle coming from anywhere, we will totally pay the property in the near future. So it's ours.
The next webcast question comes from George Manetas with OTGR. I quote, "Thank you for the presentation. How concerned are you about the fact that Greece is heading towards national elections? Has this affected any of your major investment decisions? What is your view on the upgrade of the Athens Stock Exchange, and what kind of inflows do you expect it to generate for your stock? Thank you.
The company does not involve itself into politics. As a result of that, it is the Greek voter who decide who will manage the country in the future. Definitely, we have not refrained in any form of an investment. As a matter of fact, on the contrary, we are putting back Greece into the picture because of the numbers that we generate out of Greece. I said that to our surprise, numbers are better than expected, which means that either the competition is getting weaker or tourism helps towards a direction.
The next webcast question comes from Kostis Christodoulou with CNN Greece. I quote, "If journalists are allowed to ask questions, I'd like to ask about the Hungarian market, where you stated in your presentation that you plan to enter with an online store by the end of 2026. Is there a possibility of opening brick-and-mortar stores depending on how the online store performs? Thank you.
I said previously that we have no intention to involve ourselves into Hungarian market before three years from now. A lot would depend also on how strong the Romanian market rebalances.
The next question.
Romania is a very strong country, well-populated, very strong. As a result of that, we see the difficulties in the Romanian market as temporary.
The next webcast question comes from Jonathan Neuscheler. It is a follow-up question. In the last weeks, oil prices increased again. Do you see a slower revenue growth in September? Thank you.
The answer is no. September has been one of our good months, in line with the growth that we experienced in July and August. We have no such signs. Bear also in mind that we have a much more, let us say, strong company now because of the various difficulties. We are a better company than what we used to be, let us say, one or two years ago. Difficulties serve us well.
The next webcast question comes from [Taher Araham] with Reading People Limited, and I quote, "Could you elaborate about your expectations from the Canada franchise? Thank you.
Again, we don't have a clue. We are going there to win the war. We are partners indirectly. We are going there through a franchise. If somebody needs to answer this question, it's the franchisee, not us. We will do whatever is humanly possible to support him, but it's up to his will and expertise to execute the work plan.
The next webcast question comes from George Athanasakis with Pantelakis Securities, and I quote, "Temu, how do you expect them to react given the reportedly severe blow to their business after the EUR 3 charge implemented by the European Union? Thank you.
What's that?
EUR 3 levy. This was answered before.
EUR 3 levy?
EUR 3 that was imposed by the European Union, but we have answered this before, so we can skip to the next question.
What we said is that definitely this works in our favor. Definitely it creates problems that need to be solved by our competitors who, let's say, utilize various loopholes that gradually are closing. But these are strong companies and strong competitors, and they would come back with a revised work plan on their part. We never lost sleep from the previous, let's say, unfair competition. And we would not go to sleep because now we have been gradually protected by such moves. Our competitors are formidable, and they will find ways to rebalance their act.
I am a strong believer of competition. I believe that we all work to serve the consumer. I am against oligopolies, and I am against all forms of, let's say, protectionism.
The next webcast question is a follow-up question from Dimitra Manifava with Kathimerini, and I quote, "What is the surcharge on your operating cost because of the crisis in Middle East, how this surcharge will affect prices? Thank you.
All these surcharges have been reflected on our gross margin. Practically speaking, we have improved our productivity, and successfully we have asked the support from our suppliers to counterbalance this, let's say, hidden cost of the war. This is a situation that cannot stay forever. You cannot teach your dog not to eat. It will die. But in the short term, we can do many things to counterbalance problems that lie around. I am very confident that we are going through a period that the serious implications of the war will gradually eclipse. I am of the firm belief that after the midterm elections in the States, all necessary actions that need to be taken in order to make things happen would be taken.
It is a fallacy to believe that after the midterm elections, activity towards resolving these type of issues will subside. On the contrary, I think that we would seek a completely different environment once politicians take out the weight of the election implications.
The next webcast question comes from Georgios Papadopoulos , and I quote, "You now have multiple examples of Action stores opening close to your Jumbo stores in Romania. For example, Oradea. Can you tell us what the impact was on your sales in stores where Action opened nearby? Thank you.
As I said, nobody pays any attention on such activity. We really don't consider them as direct competitors. I mean, a big hypermarket or a big discounter or whatever, are much more strong competitors than them. They make a living on a different concept, a different strategy. Before Action, there were many more before them that even exist very close to our stores all around the world.
The next webcast question is a follow-up question from Luca Baroni with ORSA, and I quote, "I was meaning to buy out the most successful franchises over time." I suppose he's referring to his previous question and consequently your answer.
The answer is no. We only focus ourselves on what we call generic growth within the EUC market. We don't offer franchise opportunities within EUC market. The franchise, let's say, action, which we want to redivert into an indirect support for them and not support them through our infrastructure ourselves, are there as a complementary exercise towards our overheads. They are not part of a long-term strategy.
The next webcast question comes from Xanthi Gounari with Capital.gr, and I quote: "You said that Greece is currently over-performing against all logic. What exactly are you seeing in your data that makes you say that? Is it higher traffic, a bigger average basket, stronger tourist spending, or market share gains from competitors? Thank you.
Everything and nothing. Everything and nothing, because let's not be misquoted. We were expecting Greece to do worse than what it's doing, but not much worse. We are in a position to benefit from, let's say, a little bit better environment than what we have expected. A little bit of everything is the answer. We believe also our competitors are doing relatively okay.
The next webcast question is a follow-up question from Thang Hoang , and I quote: "Sorry, a follow-up question from my side. But I see the cost of goods sold caught up at the same level within inventory also, which were not the cases before second half 2025. Is it something that in the attention of the company, and are you expecting these numbers to be down? Thank you.
I have answered them. I said that they are already down. I don't see where you read these numbers. Numbers are only one type of numbers. There can't be two types of numbers. And our overall inventory, I think it's 3% less than last year.
The next webcast question is from Uriya Cohen with Kai Capital, and I quote: "Why the company doesn't repurchase stocks in current low prices. Thank you.
Pardon? If we will buy back? This is the third option. First option is generic growth, second option is return dividends, third option is buy back stock. Since we have a positive view about the near future, I think our first option, which is generic growth, is the one that it's in favor within the management team.
The next question is from Nikolaos Kakavas with Retail Investor. He's an MBA student. I quote: "Given the new EU duty on low-value Chinese parcels and your strong cash position, would you consider a more aggressive e-commerce strategy? Thank you.
The answer is no. Our e-commerce activity would always be complementary because we want to encourage customers to enter the store, and this is where our strong competitive advantage lies. So complementary activity, yes. A competing activity, no.
Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Vakakis for any closing comments. Thank you.
Okay. Thank you for listening to me. My personal view is that companies that do their homework every day, only have to benefit out of various types of crisis. If one runs a balance act and does not try to buy his turnover or to fool his business partners, is a better horse to ride than a donkey. Having said that, it is also true that we live in turbulent times, and we may have unexpected shocks that nobody can envision today. My personal view is that we will not have so, but this is not an objective view, this is a personal view, and I always repeat that most of the times I am wrong. My personal view is optimistic. It is not pessimistic. Good afternoon, and thank you for listening to us.