Carrefour Group announces solid results in H1 2022
Romania registers the second highest growth LFL at European level with +4.1% in H1 and +6.4% in Q2
- At group level, the growth was strongly supported by Q2 results, up 17.2% from the same period in 2021, +7.3% like-for-like (LFL– without the stores opened in the last 12 months) on a high comparable basis
- Reported sales growth of +13.2% in H1, +5.4% LFL, driven by continued market share gains in all key countries
- Accelerating e-commerce in Q2 2022 with GMV growth of +22% after +10% in Q1 2022
- Recurring operating income (ROI) up +10.0% (+1.6% at constant exchange rates) to 814 M€ in H1, with stable 2.1% margin
French Group Carrefour announces a solid financial performance for the first half of the year, registering an increase in sales of 13.2% compared to the same period of last year, a 22% advance of the e-commerce sector and ROI increasing by 10%. The values of the local market in comparable terms (+4.1% for H1 and +6.4% for Q2) positions Carrefour Romania second in terms of the evolution of the turnover, at the European level.
The Carrefour Group registers strong results in the first half of the year, focusing on customer satisfaction first and foremost and gaining steady market shares in the Group’s key countries, notably France, Spain, and Brazil. Combined with a granular pricing strategy and strong cost discipline, it enabled the Group to live up to the commitment made at the beginning of the year: Protect the purchasing power of its customers while consolidating its economic model. This is reflected in a stable ROI margin at 2.1% over the half-year and by a marked improvement of +€110 million in net free cash flow.
Alexandre Bompard, Chairman and CEO, declared: “In a context of accelerating inflation, Carrefour performed strongly and continued to post growing results, confirming the solidity of its model and the relevance of its commercial strategy to its customers, with continued market share gains in all of its key geographies. This good commercial momentum is the result of the unfailing mobilization of the teams. Coupled with strict cost control, it allows us to look to the second half with confidence. At the same time, the Group continues its transformation. The acquisition of Grupo BIG is now finalized and the Group is making rapid progress in the integration process. We recently announced the sale of Carrefour Taiwan to our partner Uni-President, which will be a value-enhancing operation for the Group. We continue to implement our digital plan with significant progress, notably for Carrefour Links. Last, we are strengthening our CSR commitment, for example with a proactive approach to reducing our energy consumption. Carrefour continues its forward march and will present its new strategic plan on November 8, initiating its 2026 trajectory and reinforcing its long-term ambitions.”
As expected, consumer price indexes gradually accelerated in all Group’s countries, reflecting inflation in raw materials, production costs and distribution costs. In this context, consumption patterns proved resilient. During the second quarter, Carrefour observed a slight evolution in consumer purchasing behaviour, particularly in European countries where inflation is the most pronounced such as Spain and Romania, reflecting growing consumer attention to purchasing power constraints. Carrefour addresses this well with:
- an unparalleled diversity of formats, notably those offering the biggest discounts (hypermarkets, Supeco)
- Carrefour-branded products, that offer excellent value for money, as well as the enhanced range of very accessible Simpl’ products. The share of private label products increased in line with historical patterns, and now accounts for more than 32% of sales
- a particularly competitive price positioning on the most sensitive staple products for customers, with, for example, the “The Weekend receipt” in Romania or “30 products for €30” campaigns in France
- the attractiveness of its loyalty program and the strengthening of its promotional dynamics, both in terms of number of promotions and in discount level
Main financial results for the first half of 2022
|(in €m)||H1 2022 vs 2021|
|Sales inc. VAT||+5.4% LFL|
|Recurring operating income (ROI)||+10.0%, i.e. +1.6% (+€12m) at constant FX|
|Recurring operating margin||–|
|Operating income||+12.1% / +€80m|
|Adjusted net income, Group share||€(12)m|
|Net Free Cash Flow||+€110 m|
|Net financial debt (at June 30)||+€1,008 m (incl. FX impact)|
The second quarter of the year closes with strong results. Group sales increased by +7.3% LFL in Q2 (+8.1% LFL in food, +2.9% LFL in non-food), reflecting solid commercial momentum, in an inflationary context, and the relevance of our multi-format and omnichannel model. This performance was achieved against high comps with +3.6% LFL in Q2 2021 and +6.3% in Q2 2020.
Distribution costs improved to 15.3% of net sales, compared to 16.3% in H1 2021, despite a marked increase in costs related to raw materials (energy, paper, etc.). They benefited from the good sales momentum and cost-savings plans. Group Recurring Operating Income (ROI): +10.0%, or +1.6% at constant exchange rates (the currency effect was positive, notably due to the appreciation of the Brazilian Real). Operating margin stood at 2.1%, in line with H1 2021.
PROGRESS ON THE 2026 DIGITAL STRATEGIC PLAN: Carrefour has set itself the ambition of being a world leader in Digital Retail. Carrefour Links continues to grow rapidly, with 302 active partners at end-June vs. 235 at end-April, and an increasing contribution to ROI. The digitization of financial services, driven by Brazil, is progressing in line with expectations. E-commerce continued to grow on a high comparable base, with a +16% increase in GMV in H1 2022. Q2 saw an acceleration with +22% growth after +10% in Q1.
CARREFOUR, A COMMITTED COMPANY – CSR INDEX: 108% in the first half. Carrefour confirms its objectives for the 2022-2025 period.
A strong position for Romania
The value of the local market in comparable terms (+4.1%) positions Romania 2nd in terms of the evolution of the turnover, at the European level for H1. And looking at the second quarter, in Romania (+6.4% LFL), Carrefour progressed strongly again, after +8.4% LFL growth in Q2 2021.
In line with the global strategy and omnichannel vision, Carrefour Romania closes the second quarter of 2022 with 377 stores in all formats at the end of June 2022 – hypermarket, market and express, as well as online presence with delivery for the entire product portfolio. Thus, in the first half of the year, there were 11 store openings, including one discounter (Supeco) and 10 Carrefour Express, alongside an extension of the digital footprint together with a strategic e-commerce partner – Glovo Romania, adding to the already strong partnership with Bringo in this area. The recorded figures continue the ascending trend of the business, after Carrefour registered in 2021 an increase in turnover of 2%, compared to by 2020, reaching a total of 2,3 billion euros.
Régis Moratin, CFO Carrefour Romania: „The main challenge that we faced this year, as every retailer in Europe, was managing inflation. Our priority was addressing our customers purchasing power restrictions with a large offer of private label and entry price products, as well as commercial activations, investing the results from our continued cost discipline in our prices to maintain competitiveness and operating margins. In this sense, the private label portfolio extended all throughout the year, with over 125 new articles launched in H1 and cover 91% of the total sales of new products. We are happy to have been able to make a positive contribution at group level with the support of our 16,000 colleagues. We will continue to strengthen our multiformat strategy and digital transformation to better connect with our customer and continue our consistent growth.”