Supermarket giant Carrefour reported a 2% drop in turnover in Belgium in the first half of this year, compared to an 11.3% growth in the first six months of 2023, according to a statement released on Wednesday.
Global turnover also registered a slight decrease but profitability increased, Carrefour said.
In Belgium, the company experienced a 3.8% decline in the second quarter of this year, but says the comparison base was "exceptional."
Lower turnover but higher profitability
Sales had grown by 12.5% in the second quarter of 2023 due to significant disruptions at a competitor, Delhaize, which underwent a major strike following a franchise plan announcement. “Over two years, the (Belgium) dynamic is positive,” Carrefour noted in Wednesday's statement.
Carrefour’s Europe operating profit fell to €84 million, compared to €164 million in the first half of 2023. However, it improved in Belgium, “thanks to the good commercial momentum over several quarters,” commented the retailer.
Overall, the supermarket giant reported a slight decrease in turnover by 1.3% to €44.9 billion for the first half of 2024, but has improved its profitability. It attributes its sales decline to reduced prices in France, which have allowed “a stabilisation of market share since May.”
Tight volumes in Europe, a clear recovery in Brazil
It made a net profit of €25 million, compared to €867 million in the first half of 2023, which included the disposal of its Taiwan operation.
However, its operating profit, a measure of profitability, rose from €700 million in the first half of 2023 to €743 million this year.
Matthieu Malige, CFO, noted in a press call that markets are “very different on both sides of the Atlantic,” with “tight volumes in Europe” and “a clear recovery in Brazil.”
CEO, Alexandre Bompard stated in a press release that Carrefour has presented “a very good performance in its two key countries”: in France, where it ramped up its reduced pricing while preserving profitability, and in Brazil which showed strong profit growth.
Target: 40% own-brand food sales by 2026
Sales in France were €20.1 billion, down by 3.2%; they were €12.4 billion in the rest of Europe (- 0.2%); and €12.36 billion in Latin America, (+ 0.9%).
Carrefour, which finalised the purchase of Cora and Match chains in early July, has restated its modest targets for the year, particularly focusing on improving its profitability indicators.
The company also achieved 37% of its food sales via Carrefour-branded products, typically more profitable for retailers. Its aim is to reach 40% of its food sales with own brands by 2026.
