France's Carrefour has raised its savings target as Europe's largest retailer delivered cost cuts of €1 billion last year, helping it fund e-commerce investments and price cuts for customers.
It posted a well-flagged 7.4% rise in 2019 operating profit, reflecting savings in its domestic market and a robust performance in Brazil, its second-largest market after France.
"The Carrefour 2022 plan is generating solid results and sets the group on a profitable growth trajectory," Chairman and CEO Alexandre Bompard said in a statement.
Carrefour is in the midst of a five-year plan to cut costs and jobs as well as boost e-commerce investment to lift profits and sales, and as it seeks like many peers to tackle competition from major online rivals such as Amazon.
The French firm kept its annual dividend unchanged at €0.46 and set a new target to sell €300 million worth of non-strategic real estate assets by 2022. It had already hit a goal of disposing of €500 million of non-strategic assets by 2019, one year ahead of schedule.
Carrefour said it was now targeting cost savings of €2.8 billion on an annual basis by end-2020 against a previous target of €2.6 billion, having achieved €2 billion to date. It also promised more savings beyond 2020.
Its 2019 recurring operating profit reached €2.088 billion, in line with the company's own guidance for €2.090 billion provided in January.
In France, where Bompard has made reviving flagging sales at hypermarket stores a priority, operating profit rose 15.6%, also in line with company guidance.
Carrefour is reaping the benefit in its home market of purchasing alliances with Britain's Tesco and France's Systeme U.
Its turnaround plan includes having fewer sales promotions in France, scaling back on non-food items and a greater focus on organic food.
In Brazil, where Carrefour agreed earlier this month to buy 30 stores from smaller rival Makro, operating profit rose 6.5% in 2019.
The group kept all its other targets under its 2022 restructuring plan, including reducing hypermarket sales areas by 350,000 square meters and having Carrefour-branded products account for one-third of sales.