Carrefour SA

PARISCarrefour SA, the world’s second-largest retailer after Wal-Mart Stores, Inc., said on Friday it has named Alexandre Bompard as chairman and chief executive officer, succeeding Georges Plassat, who said a year ago he was preparing his succession.

Bompard, 44, is considered a whizkid in retail circles after spearheading the spinoff of French retailer Fnac from its parent company PPR, now known as Kering, and its subsequent merger with electrical goods chain Darty, beating rival bidder Steinhoff.

His nomination was approved by Carrefour’s board of directors on Friday and will be effective July 18.

Plassat, 68, took over as ceo in 2012 and implemented a turnaround plan that involved withdrawing from several emerging markets, implementing price cuts and opening more convenience stores. He took a medical leave of three months in 2015.

The outspoken executive, who joined Carrefour from retail group Vivarte, had said he was in favor of an internal candidate to succeed him.

Carrefour’s main shareholders are LVMH Moet Hennessy Louis Vuitton chairman and ceo Bernard Arnault, through his investment vehicle Groupe Arnault; the Moulin family, owners of Galeries Lafayette, and Península Participações, the investment firm of Brazilian billionnaire Abílio Diniz.

Among the main tasks facing Bompard is reviving Carrefour’s underperforming hypermarkets division, which has dragged down sales in its key domestic market, which accounts for almost half of revenues.

Carrefour said earlier this year it plans to decrease the format’s share in its business to less than 50 percent by 2020, compared with 58 percent back in 2012 and 51 percent last year, to focus on smaller stores.

The new ceo is also expected to accelerate Carrefour’s digital transformation, following its recent investment in e-commerce sites like Rue du Commerce. The retailer plans to triple its e-commerce sales by 2020, when it is targeting four billion euros, or $4.48 billion at current exchange, in online sales, compared with 1.2 billion euros, or $1.32 billion, in 2016.

Carrefour aims to grow sales by 3 to 5 percent at constant exchange rates in 2017. Market conditions allowing, it plans to list its property arm Carmila and its activities in Brazil this year.

The retailer posted net sales of 76.6 billion euros, or $84.8 billion, in 2016, up 2.7 percent at constant exchange. Operating profit fell 3.2 percent to 2.35 billion euros, or $2.60 billion – its first drop since 2012.

Carrefour is due to hold its annual general meeting on June 15.

 

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