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Carrefour poised to meet 2022 targets after robust H1 performance

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Capital Markets View – January 2021


Carrefour poised to meet 2022 targets after robust H1 performance

French supermarket operator Carrefour SA on July 26 said it is on track to achieve the targets under its Carrefour 2022 transformation plan after seeing progress in the first half of 2018.

The plan, which was announced in January, was adopted by the company to counteract declining hypermarket sales.

Carrefour confirmed all the objectives it set under the turnaround plan, including achieving an annual capital expenditure of €2 billion in 2018, cutting operating costs €2 billion annually by 2020, disposing non-strategic real estate assets for €500 million by 2020, and achieving €5 billion in food e-commerce sales and €5 billion in organic products sales in 2022.

For the first half of the year, the supermarket chain grew 5.8% in operating profits due to strong international sales despite sluggish performance in its home market due to increased competition.

Recurring operating profit reached €597 million at constant exchange rates, higher than the S&P Capital IQ mean consensus estimate of €545.2 million. However, adjusted net income from continuing operations slid to €131 million, compared to last year's €154 million.

The group also recorded a net loss of €861 million in the first half, compared to last year's net income of €78 million.

For the second half of the year, company plans to boost its omnichannel offerings by expanding its express delivery service to six new cities in France and rolling out its One Carrefour single e-commerce website in France, Italy and Belgium.

Carrefour also plans to accelerate the revamp of its store network within and outside France. It plans to open 10 new Atacadão stores in Brazil and more than 200 convenience stores will open in all countries.

Further, the company said it will continue its commitment to adopt more environment-friendly packaging solutions.