Carrefour Brasil has reported a nearly 60% year-on-year decline in net profit for the third quarter, hit mainly by lower sales in its retail unit.
Net sales from the group fell 3.3% to 25.51 billion reais (€4.79 billion), as its retail operations saw a 14.2% decline in sales due to a conversion of 32 retail stores into wholesale.
Like-for-like sales for the July-to-September period shrunk for both the retail and wholesale units, Carrefour said.
"With food deflation pressuring revenue, we drew on our unique experience, negotiating with suppliers, implementing efficiency measures and cutting costs to protect profitability," said the firm's CEO, Stephane Maquaire, in a statement.
Operating expenses landed at 3.69 billion reais (€690 million), growing 3.3% from the previous year, but 2.8% below the previous three months.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 13.4% to 1.47 billion reais (€280 million). Profitability, measured by the adjusted EBITDA margin, stood at 5.7%, losing 0.7 percentage points from the previous year.
The retailer's net cost of debt was 698 million reais (€131 million) in the period, up 9.9% on the previous year, mainly due to higher interest on loans.
Atacadão Coming To France
In September, Carrefour trademarked its new wholesale format logo in France, which was imported from the Brazilian market. The company has confirmed that the design of the Atacadão banner in France will differ from the one used in Brazil and Morocco.
Carrefour has also announced its plans to launch the first Atacadão store in France in the first quarter of 2024.
Additional reporting by ESM