PARIS — Carrefour SA, the world’s second-largest retailer behind Wal-Mart Stores Inc., said Thursday that it recorded overall growth in the second quarter as strong sales in emerging economies such as China and Brazil offset weakness in Western Europe.
In the three months ending June 30, sales rose 6.3 percent to 24.92 billion euros, or $31.8 billion. During the first half, sales were up 5.9 percent to 48.88 billion euros, or $65 billion. Dollar figures have been converted at average exchange rates for the periods to which they refer.
“In a contrasted environment, we posted solid sales in the first half, with continued market-share gains in France, strong growth in Latin America and faster growth in Asia,” chief executive officer Lars Olofsson said.
The group, which will publish half-year results on Aug. 31, said it expected its first-half operating profit to be close to 1.1 billion euros, or $1.4 billion. That figure included a positive impact of about 45 million euros, or $60 million, of the business tax on added value and a negative impact of 36 million euros, or $48 million, from disruptions caused by labor movements in Belgium after Carrefour’s announcement of a restructuring of its operations there.
Operating profit was expected to total 3.1 billion euros, or $3.9 billion at current exchange rates, in 2010 as a whole, the company said.
Revenue in France, which accounts for 40 percent of the group’s sales, rose 2.7 percent in the second quarter, compared with a 2.1 percent increase in the first quarter. Carrefour’s Promo Libre discount program, in place since February, has had a positive impact on its price image and average basket, chief financial officer Pierre Bouchut told analysts in a conference call.
Sales in Europe, excluding France, fell 5 percent during the period as Spain continued to suffer from deflationary pressures on food and weak household spending.
“Our business has definitely been affected in southern Europe — Greece, Spain, Italy, Romania — by the recent austerity measures, which result in reduced consumption,” Bouchut said.
Business in Belgium was disrupted by repeated strikes in the run-up to a deal between management and unions on July 2 that plans for the closure of 16 unprofitable stores, among other measures.
However, sales in Latin America jumped 34.1 percent during the quarter, while China saw a 24.1 percent increase. Carrefour said it planned to address recent weakness in its Brazilian hypermarket business, but reported its discount chain Atacadao was performing well.
The group announced it had signed an agreement to acquire 51 percent of Chinese hypermarket operator Baolongcang as part of its strategy to reinforce its presence in countries where Carrefour has a leadership position. Baolongcang operates 11 hypermarkets in the region of Hebei close to Beijing, clocking net sales of around 113 million euros, or $157 million, in 2009. Bouchut said Carrefour would be looking for other similar opportunities in China.
Overall, the group was on target with the 2010–2012 objectives contained in the transformation plan implemented by Olofsson to cut costs and improve its price image, he said
“We expect the environment to remain challenging,” Bouchut said. “Growth in China and Latin America should remain solid, but we remain prudent about the outlook in the G4 countries and other southern European countries like Greece or Romania.”
The group has declined to comment on reports that it is looking for buyers for its units in Malaysia, Thailand and Singapore, in line with its stated policy of pulling out of countries where it has no realistic prospect of becoming market leader. Since Olofsson took the helm last year, the company has exited Russia and southern Italy and is studying selling its Portuguese operations, in addition to closing or disposing of part of its Belgian operations.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty