Carrefour has reported a 1.9% increase in like-for-like sales in its home market of France in the second quarter of its financial year.
Other European countries also performed well for the group in the quarter, rising by +8.6% in total and +3.4% like-for-like. Latin America saw second-quarter sales up +6.9% like-for-like and +20.0% in total, boosted by favourable currency effects.
In Asia however, sales were down 4.7% on a like-for-like basis, and 2.3% overall.
First Half Performance
Overall, group sales were up 3.3% at constant exchange rates to €43.05 billion in the first half of the year, or 6.2% on a current currency basis, with currency having a favourable effect of +2.8%.
The retailer opened 352 stores under banner in the first half, of which some 290 were convenience stores, mainly in Europe. It was a period that also saw the successful integration of Eroski stores in Spain and Billa stores in Romania into the group.
Looking ahead to the full year, Carrefour said that its FY 2017 results were likely to be ‘impacted by our H1 performance and an operating environment that will remain difficult in H2 in some countries. At current exchange rates, our full year 2017 ROI evolution vs 2016 should be roughly in line with the evolution we saw in H1 2017.’
What The Analysts Said
Commenting on the retailer’s performance, Barclays European Food Retail Equity Research said, “Although Carrefour's weak 1H results are admittedly partly related to some external or non-recurring factors (integration of Eroski stores in Spain, change in credit regulation in Brazil), they also illustrate the group's structural challenges, including its strong exposure to the competitive and irrational French food retail market.
“Even though these lacklustre performances might prompt Carrefour's new CEO to take tough decisions, including costs saving initiatives in France, we consider that the impact of this new strategy is unlikely to be visible before 2H18 at the earliest.”
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up for ESM: The European Supermarket Magazine.