New store boost for Carrefour

Related tags Cent United states dollar Currency Carrefour

Carrefour, the world's number two retailer, has made no secret of
its ambitious expansion programme, and with new stores giving a
significant boost to third quarter sales, the company's strategy
cannot be faulted - especially as exchange rates continue to

In the last week alone, Carrefour​ has unveiled plans to expand its business in Japan, Korea and Norway, and the logic behind the French group's continued expansion was strengthened by a 4.6 per cent increase in third quarter sales boosted by new store openings.

The company said that third quarter revenues were €19.79 billion, up from €18.9 billion in the previous year and ahead of analysts' forecasts of €19.74 billion. Excluding the impact of currency exchange rates, sales growth was 5.8 per cent.

The company, Europe's biggest food retailer, said that the improvement had come despite the fact that there were fewer sales days in France than in the same period a year earlier. France accounts for around half the company's revenues.

Sales for the first nine months of the year were €57.3 billion, some 2.5 per cent higher than in the same period a year earlier, or 6.2 per cent higher at constant exchange rates. The impact of currency translation has improved steadily over the three quarters of the year, in part prompting the company to kick start its overseas expansion programme.

Sales in France were €9.99 billion during the quarter, up 1.5 per cent on a like-for-like basis or 2.1 per cent overall, driven by strong gains from the discount store unit (+13 per cent) in particular. Price promotions - the Ticket Cash scheme - also helped improve Carrefour's figures, although the negative calendar impact of 0.9 per cent took its toll on hypermarket sales in particular.

In the rest of Europe (Belgium, Greece, Spain, Italy, Romania), third quarter sales were up 8.3 per cent at €7.06 billion, helped in particular by a 4.5 per cent gain from new stores. Like-for-like sales at Spanish hypermarkets was 5.1 per cent, while the hard discount business there also improved.

In Latin America, where the company has been hardest hit by exchange rates, sales were up 2.9 per cent to €1.4 billion, despite a 5.3 per cent negative impact from currency translation, an excellent performance in a part of the world where the economic situation remains volatile: the impact of currencies in the first half of the year was a negative 39 per cent, for example.

Brazilian operations continued to improve during the quarter, but Argentina remained difficult, with like-for-like sales there falling by 3.9 per cent during the three month period.

Asia, where Carrefour is expected to grow rapidly over the next year, already benefited from the company's expansion there during the quarter, with growth of 19.6 per cent from new stores offsetting a negative 14.1 per cent impact from exchange rates.

Total sales of €1.3 billion in Asia, up 5.9 per cent, were driven by gains in China and Taiwan, though Korea, where the company plans to open numerous stores in the next few months, saw like-for-like sales drop 5.8 per cent during the quarter, in line with expectations.

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