PARIS — Carrefour SA was literally left out in the rain in the third quarter, as adverse weather conditions in Europe and especially France — its biggest market — hampered the retailer’s growth.
“We rarely dwell on the weather,” acknowledged its chief financial officer Pierre-Jean Sivignon during a conference call Thursday, “but we had to. July and August were the rainiest since 1959; we saw twice the amount of precipitation, and this significantly impacted [our figures].”
The world’s second-largest retailer behind Wal-Mart Stores Inc. reported sales edged down 0.1 percent to 21.1 billion euros, or $27.9 billion at average exchange, in the three months ended Sept. 30.
Excluding petrol and calendar impacts, however, Carrefour’s organic growth in the three-month period was up 2.8 percent, which prompted Sivignon to call it a “solid quarter.
Carrefour’s domestic sales in the quarter fell 1.1 percent to 10 billion euros, or $13.3 billion. On a like-for-like basis, revenues in France were down 0.2 percent on the back of high comps but also a drop in petrol prices, which dented its revenues by 1.5 percent, the company said.
Sivignon said the other element in the equation was “a significant cyclical decrease” in the price of fruits and vegetables.
Bad weather and price pressures did not go unnoticed in other European countries either. There, sales fell 1.8 percent to 5.3 billion euros, or $7 billion, but proved stable in Poland and edged up in Romania.
Sivignon observed that given the lack of outdoor possibilities this summer, non-food sales in Europe were “resilient, but also impacted” and “slightly negative” in France, with apparel, camping and sporting goods taking a hit.
The executive viewed the category positively nonetheless, citing Italy, a problem zone, as an encouraging example. “Italy is a very tough place in terms of consumption, but we are now on par with our competitors there,” he said, enthusing about a second consecutive quarterly rise in like-for-like sales in the non-food category.
This follows the group’s efforts to improve its offer of textiles, general merchandise and electronics. “It’s starting to deliver,” Sivignon said, although he admitted that a drop of 5.2 percent in like-for-like sales overall in Italy was clearly “not a good number. We did our homework there last year, but we didn’t do enough,” he added.
Sivignon noted that the group had an “exceptional performance in Argentina and to a lesser extent in Brazil,” only offset by the depreciation of the Argentine peso, while in Brazil, where it is now present in 25 of the country’s 26 states, the group continues to pursue its multiformat strategy.
In Latin America, revenues were up 6.9 percent to 3.96 billion euros, or $4.5 billion. Stripping out the impact of currency variations, they rose 17.5 percent.
Meanwhile, sales in Asia fell 3.6 percent amid a persistently frugal consumption environment in China, driven mostly by lower non-food and alcohol spending.
Organic sales were down 3.7 percent in the region, though Sivignon assured that “no drastic changes” had occurred in the group’s market share. “We are stable in two out of the four regions that we track there, and marginally down in the other two,” he said.
Although he would not provide any official guidance, he upheld analyst forecasts that the group’s recurring operating income would total 2.38 billion euros, or $3.02 billion at current exchange, by yearend.