Groupe Casino has warned of likely 2023 losses for its core French business, due to a slower than expected turnaround at its hypermarkets business and the impact of investment costs.
Casino estimated that its 2023 earnings before interest, tax, depreciation and amortisation (EBITDA) after leases would range between a loss of €78 million and a loss of €140 million.
Casino had already reported last month a drop in its third quarter sales, as well as a cut to its full-year 2023 profit outlook.
The company also finalised in October a deal to avert bankruptcy through a debt restructuring agreed with its main creditors, led by Czech billionaire Daniel Kretinsky.
Liquidity Issues
Based on forecasts, the group added that it does not anticipate any liquidity issues until the completion of the financial restructuring, expected by the end of the first quarter of 2024. It said that it plans to maintain supplier credit, and the anticipated proceeds from the sale of Exito are set to contribute to liquidity.
However, the planned capital increases in the restructuring will result in substantial dilution of existing shareholders, which in turn will lead to Rallye losing control of Casino, it noted.
Casino noted that its supermarket business is currently experiencing an ongoing recovery, with a 10% increase in traffic and a 7% increase in volumes over the past week. In contrast, hypermarkets are undergoing a 'gradual turnaround', with a 3% decrease in customer numbers and a 12% decrease in volumes.
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Additional reporting by ESM
