Carrefour, the world’s second-largest food retailer, today (28 August) stuck to its forecast of an up to 18% fall in annual profits after seeing half-year earnings slump.
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The French retail giant is investing heavily in price promotions and the launch of a discount, own-label range as it looks to shed its image as an expensive retailer.
For the six months to the end of June, operating profit tumbled 28% to EUR1.01bn (US$1.45bn) and Carrefour said annual operating profit would reach EUR2.7-2.8bn – equating to a fall of up to 18%.
Impairment and restructuring charges hit Carrefour’s bottom line during the first half of the year.
The company made a net loss of EUR58m due to a EUR400m impairment charge for its Finiper business in Italy, EUR60m of restructuring costs and some EUR17m in “rebranding and integration costs”.
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By GlobalDataNeverthless, Carrefour CEO Lars Olofsson insisted the retailer had put in a “resilient” performance.
Turnover fell 1.6% to EUR41.28bn but underlying sales – excluding fuel and adjusted for calendar effects – were up 1.9%.
“In a challenging environment, Carrefour posted resilient first-half sales and market-share gains, notably in France, highlighting the successful acceleration of our brand convergence programme and the relevance of our multi-format model,” Olofsson said.
Click here for the full first-half release from Carrefour and check back this afternoon for further comment from the retailer.
