The start of the year was very positive for Sonae, with all our businesses posting strong growth and improving their profitability levels until February, proving yet again the robustness of our strategies and value propositions. At the end of February, Sonae Sierra completed the Prime transaction, a very important milestone in its capital recycling strategy which further strengthened Sonae’s capital structure.
In March the Covid-19 pandemic hit our main geographies and we began experiencing an unprecedented and challenging situation. Although all our businesses have been strongly impacted by this situation, I am proud to say that our reaction has been quite outstanding.
In the last two months, I have witnessed the way in which each of our businesses and teams has rapidly adjusted to this new context. Since day one, our main concern has been the health and safety of our people, while continuing to provide essential services to society and to support our communities. Early on, we implemented solutions to protect our people who are in the frontlines and also remote working for all office functions. However, and despite all the implemented safety measures, some of our people were naturally hit by this virus. Once again, we strictly followed all the recommendations from the national health authority to ensure that our people have the best possible care, while minimizing the possibility of contagion. This is a daily and permanent monitoring process which we will continue to follow until we are free from this pandemic.
Thank you to our people again for their generosity and perseverance. And I would also like to take this opportunity to acknowledge the efforts and commitment of our ecosystem of partners, without whom we would not have been able to continue to fulfil our mission.
This situation puts us all to the test and our collective response is testament to the ability that we have to join forces and act together for a common purpose. I would like to highlight, in particular, the remarkable efforts we have made to: (i) maintain our grocery and electronics stores open, (ii) revamp our entire e-commerce operations to sustain a sudden 3-5x surge in online sales, and (iii) keep our telco networks operating under record traffic levels.
This context proves the quality and resilience of our portfolio of assets. In challenging times for many companies around the World, Sonae’s diversified portfolio of leading businesses provides great reassurance that we will navigate this storm and come out of it stronger. This confidence is amplified by our conservative approach to leverage and financing, which allows us to face the coming months with our eyes set in the aftermath of the downturn.
Nevertheless, the coming months will be harsh and all our businesses will be materially affected in one way or another. Therefore, and out of prudence, we have already registered significant non-cash contingencies in Q1 so as to anticipate future impacts, namely at NOS, Sonae Fashion, Worten and Sonae Sierra. Additionally, all our businesses are implementing cash preservation initiatives at this stage while honouring previously assumed commitments and without losing sight of attractive investment opportunities.
Given the ability that our people and our businesses have shown to adapt to these changing circumstances, I am more certain than ever that we will overcome this adversity and be prepared to readily respond to the structural changes that will undoubtedly shape our future.