Logista Is Paying a Dividend Bigger Than Its Earnings
The tobacco distributor’s FY26 resilience is real, but the story is shifting from cost recovery to float income, balance-sheet payouts, and two live M&A deals.
LOG.MC · Earnings Call · 2026-11-06
The dividend is now the story
Logista’s fiscal 2026 print looks reassuringly dull: revenue of €13.8 billion, up 2%; economic sales of €1.8 billion, up 1.7%; adjusted EBIT of €391 million, up 3.3%; net profit of €282 million, up 0.3%. The cash generation supported a proposed dividend of €2.17 per share, 3.8% higher after two flat years and a record €288 million distribution. Then comes the wrinkle: EPS was €2.12. The company is paying out more than it earned.
“we are talking about a dividend per share of EUR 2.17 per share, whereas the EPS, it's EUR 2.12 per share. We are talking about EUR 7 million difference.” — Pedro Agustín Losada Hernández · 2026-11-06
Seven million euros is small against a €5.4 billion market cap, but the signal matters. This is a mature tobacco distributor whose core volumes are shrinking; the dividend is now a balance-sheet promise as much as an earnings payout. CFO Pedro Losada did not hide it:
we have more than EUR 1.3 billion reserves and more than EUR 2.2 billion cash. It's true that we are reaching almost 100% payout with this financial figures.
The bridge to sustainability is the end of PPA amortization in France next year, which should leave more spare net profit from 2028. Until then, the payout leans on reserves, cash, and financial income. Investors have heard this before. On the prior call, management called the dividend a priority and a cornerstone while conceding it could manage the current payout level; the question of DPS versus EPS is not new, but the gap is now explicit.
Financial income is doing more of the work
The quieter engine is Financial income. It rose to €81 million from €73 million even though the average remuneration rate, including the contractual spread, fell to 3.26% from 3.54%. The offset was a bigger cash pile: average cash of €2,294 million versus €1,985 million. Management credited timing effects:
“Despite the fact that the average interest rate for the whole year has been lower, the impacts, the positive impacts throughout the year, particularly coming from changes on VAT payments in France and excise taxes in Italy has allowed the company to maintain a high average cash...” — Pedro Agustín Losada Hernández · 2026-11-06
That is a float story, not a logistics-margin story. Logista carries no financial debt and earns income on cash tied to tobacco tax and payment cycles. It is a high-quality annuity while rates are high, but it is also sensitive to lower interest rates and to any normalisation of tax-timing balances. The Imperial Brands treasury agreement adds a date to watch: it runs to June 2027 at six-month Euribor plus 75 basis points, and management must decide by December 2026 whether to extend. As of today, we are evolving positively with Imperial, Losada said, but the decision is not yet done. Prior calls show the same seasonal cash pattern: Q4 financial income has repeatedly been boosted by the tobacco cash cycle.
The operating core: less bad, not yet fixed
The defensive business mix is still working. Iberia economic sales rose 1.1% to €1,183 million and adjusted EBIT grew 6.3% to €202 million, helped by Pharma and the recovery in transport. Italy grew economic sales 5.3% to €457 million and adjusted EBIT 5.1% to €141 million. France remained the weak spot: economic sales fell 2.1% to €207 million and tobacco volumes dropped 6.5%. The profit on inventory contribution fell to €36 million from €45 million, so the reported adjusted EBIT growth of 3.3% flatters the underlying picture less than the ex-POI mid-single-digit guide suggests.
Tobacco volumes in Spain and Portugal fell 1.3%; Italy was down only 0.9%, with new-generation products now close to 25% of distributed tobacco volume and heat-not-burn representing about 80% of that NGP mix. That is the structural offset: traditional cigarettes shrink, but nicotine pouches and heat-not-burn are growing, and Logista’s distribution density remains hard to replicate.
Transport is the swing factor. El Mosca has been the problem child for several calls. Management has changed management, tightened compliance and data, improved tariffs and fuel surcharges, cut fleet, renegotiated rentals and rationalised bids. Carbó is now inside Logista Parcel, with unit last-mile costs down 3% and unit long-haul costs down 8.1%. But the timeline has stretched. A year ago, the CFO said: “We will probably need the whole 2026 to turn this around.” — Pedro Agustín Losada Hernández, Chief Financial Officer (CFO) · 2025-11-06 On this call, the guide was: “We hope to be close to the finalization of the integration by the end of next year.” — Pedro Agustín Losada Hernández · 2026-11-06 That is not a disaster, but it is a reminder that the transport turnaround is a multi-year grind, with €13 million of restructuring in FY26 and more expected in Italy in 2027.
France is similar: better than before, not reversed. The prior CEO call was blunt — “to reverse the situation in the tobacco sector is almost impossible.” — Íñigo Amusco · 2024-11-06 Current management now talks about network optimisation and minimising margin damage, not a turnaround. “we have some headroom through the optimization of the network to try to maintain or at least to minimize the negative impact in our margins in France” — Íñigo Amusco · 2026-11-06
M&A finally has names attached
The most concrete new item is M&A. For several quarters, Logista has said it was looking at bolt-ons, with pharma and transport often mentioned. This time, CEO Íñigo Meirás gave specifics: one French contract-logistics target, DERET, was lost on price to GEODIS; two other opportunities are live, one in Spain and one in a new European geography, both outside transport and pharma, with price agreed and no red flags so far.
“In one case, we lost out on price. That was an operation in France. The name of that company was DERET... At the end, the winner was GEODIS, the French group. They won on price.” — Íñigo Amusco · 2026-11-06
The two remaining deals could broaden the defensive business mix beyond tobacco and transport, but they are still small and unproven. The CEO framed them as within our core businesses and not a new diversification. That is the tension: Logista needs non-tobacco growth, but it is shopping carefully, and the first public process ended in a loss. An update is promised in the first half.
What to watch
The FY26 report is not an operating breakout. It is a balance-sheet and portfolio story: a defensive compounder using cash, float income and reserves to keep a rising dividend while it slowly fixes transport and searches for acquisitions. The cost recovery mechanisms and cost control are real, but they are offsetting volume decline rather than creating much growth.
Three dates matter. First, December 2026, when Logista must agree an extension of the Imperial treasury line. Second, the first-half M&A update on the two live deals. Third, FY27, when restructuring costs in Italy and France are supposed to fade. If rate cuts compress financial income while the payout stays above 100% of earnings, the dividend debate will return with force. For now, the market is being paid to wait — but it is being paid partly out of the balance sheet.