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Carrefour Revenue Rises 10.2 Percent

Robust sales in South America, Eastern Europe and China offset slower growth in France as Carrefour on Tuesday reported a 10.2 percent jump in first-quarter...

PARIS — Robust sales in South America, Eastern Europe and China offset slower growth in France as Carrefour on Tuesday reported a 10.2 percent jump in first-quarter sales.

The world’s second-largest retailer after Wal-Mart said sales, including value-added tax, tallied 23.38 billion euros, or $35.01 billion at average exchange rates for the period. Excluding acquisitions, group sales increased 6.8 percent.

It was the second consecutive quarter of gross double-digit growth for the hypermarket operator, which has been hamstrung by weakness in its home market.

In France, which accounts for roughly half of Carrefour’s business, sales grew 2.6 percent in the quarter, with a “solid” performance in food dented by a drop in other categories “as customers defer spending on discretionary purchases,” Carrefour said.

The retail giant highlighted a general weakness in non-food categories, which account for 27 percent of sales. “Current market conditions remain challenging and are tougher than we would have anticipated at the end of last year,” Carrefour said.

However, the company is gunning for sales growth of 6 to 8 percent, excluding acquisitions, with emerging markets compensating for trouble spots like Italy and Belgium. At constant exchange rates, sales leaped 51.2 percent in Poland, 49.4 percent in Romania and 48.4 percent in Argentina. China, where Carrefour has been the target of anti-French sentiments, recorded its best performance since 2001 with like-for-like growth of 14 percent.

Separately this week, Carrefour named Bernard Arnault, chairman and chief executive officer of LVMH Moët Hennessy Louis Vuitton, to its supervisory board, tightening the luxury titan’s grip on the mass market giant. Arnault fills the slot of Robert Halley, who resigned as the board’s chairman and stepped down as a member.

Carrefour said Halley, whose family once controlled the majority of the retailer’s shares, would become honorary chairman of the company.

Amaury de Sèze succeeds Halley as chairman of the supervisory board. Previously, he was vice chairman.

The changes came a month after Blue Capital, the investment fund owned by Groupe Arnault and Colony Capital, raised its stake in Carrefour to 10.7 percent, making the fund the retail giant’s largest single shareholder.

This story first appeared in the May 14, 2008 issue of WWD.  Subscribe Today.

At Carrefour’s annual shareholders’ meeting here last month, ceo Jose Luis Duran downplayed the impact of the shareholding shift. “We’ve lived with Blue Capital [on the board] for the last year,” said Duran. “I don’t expect any strategy changes.”