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Retail

Carrefour Brasil Posts Fourth-Quarter Loss Following Store Closures

By Reuters
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Carrefour Brasil Posts Fourth-Quarter Loss Following Store Closures

Carrefour Brasil posted a 565 million real (€105.7 million) net loss in the fourth quarter, compared with a 426 million real (€79.7 million) profit a year earlier, driven by expenses and non-cash impairments related to store closures.

Carrefour Brasil decided late last year to close 123 stores, with 104 closures completed by the end of January, chief financial officer Eric Alencar told journalists on Monday, noting the accounting write-off of these stores was made fully in the fourth quarter.

"They were structurally bad, and we need to focus on the company's growth through greater-potential stores," he said.

Adjusted Net Profit

The firm, the Brazilian arm of French retail giant Carrefour with more than 1,000 stores, reported adjusted net profit, which excludes the effects from the closures, at 520 million reais in the final quarter of 2023.

Net sales fell 0.3% from a year earlier to 28.1 billion reais (€5.26 billion).

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Atacadao, a cash and carry brand that generates about 70% of Carrefour Brasil's sales, posted fourth quarter sales up 3.2% year-on-year, with the EBITDA margin rising 0.9 percentage points.

Abilio Diniz

The results were released a day after the death of Carrefour Brasil's deputy chair Abilio Diniz, who held a stake at the company through his private investment company Peninsula and was also a board member at Carrefour.

Asked about Carrefour Brasil's plans going forward without Diniz, the key architect of the company's strategy, Alencar said at this moment the executives "had no mind" to discuss such topics.

The company reported adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) landed at 1.88 billion reais in the quarter, above the forecast of analysts polled by LSEG of 1.72 billion reais.

Its adjusted EBITDA margin fell 0.3 percentage points to 6.7%.

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