PARIS – Carrefour Group reported a 3.3 percent leap in first-half net profits and said sales growth and profitability would accelerate in coming years.
The world’s second largest retailer after Wal-Mart also said it would start leveraging its vast real estate assets, with a plan to list a property arm as early as 2008.
Carrefour has come under pressure to maximize returns from shareholders – which include luxury goods titan Bernard Arnault, who last March took a joint 9.1 percent stake in the supermarket operator with investment fund Colony Capital.
The plan is for Carrefour to list 60 percent of its property holdings, valued at between 20 billion and 24 billion euros, or $27.2 billion to $32.6 billion.
Meanwhile, the retail giant, which has been hampered by anemic demand and deflationary pressures in its home market, was upbeat about its prospects and vowed to bump up its cash flow.
“We can look ahead to faster growth from 2008 to 2010,” Carrefour chairman Jose Luis Duran told analysts in a conference call. “I have confidence in the potential of the group.”
Net income for the six months ended June 30 increased to 729 million euros, or $969.2 million, versus 706 million euros, or $868.1 million, a year ago on a sales rise of 5.5 percent to 38.85 billion euros, or $51.64 billion. Profits from recurring operations inched up 0.1 percent to 741 million euros, or $985.1 million, meeting its targets. Currency conversions were made at average exchange rates for the respective periods.
For complete coverage, see Friday’s issue of WWD.