Migration trend continues as Carrefour's international profits soar

By Anita Awbi

- Last updated on GMT

Related tags: Cent, Retailing, Carrefour

French retail chain Carrefour has translated overseas success into
a total year-end sales growth of 6.1 per cent - a pattern echoed
across the European food industry.

Citing a series of realignments in its domestic market and several successful overseas expansions as key, the world's second largest retailer attributed increased sales to a major "turnaround year"​.

And although the company saw its domestic market share climb for the first time in five years by 0.6 per cent, it was international operations that bolstered sales.

This follows the recent discovery that Germany's Metro Group relied on increased global sales to strengthen its disappointing domestic performance, as Western retailers find it increasingly tough in the saturated European market.

Carrefour's French business grew by a nominal 1.2 per cent in the fourth quarter, compared with a Latin American Q4 sales growth of 41 per cent and an Asian Q4 sales increase of 24.5 per cent.

Overall, sales growth outside France was up 7.5 per cent.

This was widely attributed to the retailer's ambitious expansion programme that saw 1,394 stores open last year, boosting the company's retail space outside France.

"Significant growth in new square metres in markets such as Poland, Greece, Turkey, Brazil, Columbia, China and Indonesia has underpinned market share and productivity gains, even if like-for-like growth has sometimes been impacted,"​ the company said in a statement.

French Q4 sales, which account for about half of group sales, were up to a lower-than-expected €10.9 billion, rising 0.6 per cent in like-for-like terms.

A series of aggressive price cuts positioned the firm in direct competition with the discount sector, which grew its share by only 0.2 per cent.

"We continue to win market share in France despite a difficult market,"​ Carrefour investor relations representative David Shriver told analysts.

"We remain confident and determined. We will see a new Carrefour taking shape in 2006."

Carrefour currently owns 12,055 stores worldwide, and enjoyed full year sales of €83.1bn up from 2004's €78.9bn.

Related topics: Market Trends

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