Groupe Carrefour: Excellent results in 3Q 2020

Groupe Carrefour: Excellent results in 3Q 2020

Thanks to the transformation of its commercial model over more than two years, Carrefour is now able to capture buoyant market growth in its main countries. The market has benefited from a shift from out-of-home consumption towards consumption at home, particularly in view of the increase in home working.

Third-quarter gross sales up 8.4% on a like-for-like basis. The Group’s gross sales came to €19,690m pre-IAS 29, an increase of +5.5% at constant exchange rates. This increase includes an unfavorable petrol effect of -2.9%. After considering an unfavorable exchange rate effect of -8.0%, mainly due to the depreciation of the Brazilian Real and the Argentine Peso, the total variation in sales at current exchange rates amounts to -2.5 %.

The impact of the application of IAS 29 is -€49m.

Performances in Europe

France

In France, Q3 sales were up +3.8% LFL (+2.9% LFL in food and +9.9% LFL in non-food). Customers reacted quickly and positively to all initiatives aiming at improving purchasing experience and customer satisfaction. NPS® increased rapidly in all formats and growth accelerated.

  • Hypermarkets (+2.5% LFL) accentuated the good momentum that began post-confinement. Constant focus on execution and customer satisfaction bore fruit. The transformation is gaining traction. NPS® is clearly improving
  • Supermarkets (+4.9% LFL) continued to post a solid performance, benefiting from the repositioning initiated in 2018
  • Convenience (+5.3% LFL) remained very dynamic, although it felt the impact of lower summer tourism. Carrefour continues to expand this growth format with +56 openings in the third quarter
  • Promocash’s activities remained penalized by the decrease in B2B sales In Europe, LFL growth reached +1.9% in the quarter.

 

Spain

In Spain (+6.3% LFL), the Group confirmed its excellent momentum in a buoyant market. Carrefour stands out thanks to an attractive commercial model (fresh and Carrefour-branded products, price positioning) and a continuous improvement of customer satisfaction.

Italy

In Italy (-8.0% LFL), Carrefour was penalized by its exposure to tourist areas in the North, which were particularly affected during the summer season. The new country CEO, who arrived in early September, is tasked with placing seamless execution and customer satisfaction at the heart of the strategy.

Belgium

In Belgium (+5.4% LFL), Carrefour continued its market share gains initiated at the start of the year. The Group continued its price investments with the “Healthy Prices” campaign launched in early September.

Poland

In Poland (-1.4% LFL), large hypermarkets continued to be impacted by the drop in traffic in large shopping centers. Supermarket and proximity formats returned to growth.

Romania

In Romania (+0.0% LFL), the market was impacted by travel restrictions which limited the return home of foreign workers during the summer

 

Performances in South America

Commercial momentum accelerated in Latin America (+28.4% LFL).

Brazil

In Brazil, Carrefour benefited from a virtuous circle with dynamic traffic, market share gains and an increase in share of wallet among its customers. Q3 sales increased by +27.3% at constant exchange rates, with like-for-like growth of +26.0%, a contribution from openings of +4.0% and an unfavorable petrol impact of -2.6%. The currency effect was an unfavorable -37.9%.

  • Carrefour Retail (+26.6% LFL) posted record growth, with hypermarkets growing twice as fast as the market. Food (+15.4% LFL) was supported by the good momentum of Carrefour-branded products, while non-food (+43.6% LFL) benefited from the repositioning of the offer
  • Atacadão (+25.8% LFL) recorded exceptional growth of +31.3% at constant exchange rates.

Given the easing of restrictive measures, Q3 notably benefited from a resumption of B2B sales.

The banner strengthened its price competitiveness and continues to expand, with the opening of 2 stores in Q3.

Argentina

In Argentina (+41.4% LFL), good commercial momentum continued against a backdrop of slowing food inflation and a less buoyant market. Carrefour continued to gain market share thanks to its offensive commercial positioning and proximity with its customers

 

Performances in Asia

In Taiwan, sales rose +1.4% at constant exchange rates and +0.6% LFL in Q3. Carrefour achieved a solid commercial performance in an uncertain geopolitical environment.