Carrefour: 2012 Full-Year Results
Carrefour: 2012 Full-Year Results
Growth in sales and net income, Group share
Strengthened financial structure
Business Wire
BOULOGNE-BILLANCOURT, France -- March 7, 2013
Regulatory News:
Carrefour (Paris:CA)
2012 key figures
* Growth in sales: +0.9% to €76.8bn, driven by emerging markets
* Resilient Recurring Operating Income of €2,140m, with France up by 3.5%
and Latin America up by 14.2%
* Significant rise in Net Income, Group share: €1,233m (vs. €371m in 2011),
including capital gains from disposals
* Improved free cash flow
* Strong improvement in financial structure: net debt of €4.3bn, an
improvement of €2.6bn
* Proposed dividend of €0.58 per share, payable in cash or shares, in line
with the payout policy announced in March 2012
(€ million) 2011 ^1 2012 ^2 Var.
Sales ex. VAT 76,067 76,789 +0.9%
Recurring Operating Income before D&A (EBITDA) 3,748 3,688 -1.6%
EBITDA Margin 4.9% 4.8%
Recurring Operating Income 2,197 2,140 -2.6%
Recurring Operating Margin 2.9% 2.8%
Net income from continuing operations, Group -1,865 113
share
Net Income, Group share 371 1,233 x 3.3
Free Cash flow 215 279
Net debt at close 6,911 4,320 -€2.6bn
Net debt/ EBITDA 1.8x 1.2x
2012: A refocused and strengthened Group
* Refocusing of the Group on countries where it holds leading positions and
has a multi-format profile
* After the sale by Carrefour of its stake in their joint venture to
Marinopoulos, its Greek partner becomes the exclusive Carrefour
franchisee in Greece, Cyprus and the Balkans
* Singapore : Closure of the Group’s two stores
* Disposal of Colombian operations to Cencosud for a total
consideration of €2bn
* Disposal of Malaysian activities to Aeon for €250m
* Disposal of Carrefour‘s stake in its Indonesian unit to its partner
CT Corp for €525m. CT Corp becomes Carrefour’s exclusive franchisee
in the country
* Strengthening of operations in France, Brazil and Argentina
* Global consolidation of Guyenne & Gascogne as of June 1, 2012
following the success of the tender offer
* Finalization of the financial services partnership with Itaú Unibanco
in Brazil
* Acquisition of 129 Eki stores in Argentina, consolidating Carrefour’s
leadership in the country
2012 performance by zone
Sales ex. VAT Recurring Operating
Income
Change at
constant
€ million 2011 ^3 2012 Change exch. 2011 2012 Change
Rates, ^3
including
petrol
France 35,179 35,341 +0.5% +0.5% 898 929 +3.5%
Europe 21,536 20,873 -3.1% -2.7% 640 509 -20.6%
Latin 13,551 14,174 +4.6% +12.1% 532 608 +14.2%
America
Asia 5,801 6,400 +10.3% +0.5% 187 168 -10.3%
Global -61 -74
functions
Total 76,067 76,789 +0.9% +1.6% 2,197 2 -2.6%
,140
France
In France, sales were up 0.5%, with food sales holding up well. The price
repositioning had only a slight impact on commercial margin thanks to an
improved mix between everyday prices, promotions and loyalty. SG&A were lower
both in value and as a percentage of sales. Recurring operating income rose
3.5% to €929m.
Europe
In Europe, sales decreased by 2.7% at constant exchange rates (-3.1% at
current exchange rates), reflecting the decline in consumption, particularly
in southern Europe. Belgium continues to record growing sales. Recurring
operating income in the zone amounted to €509m, a decrease of 20.6%, largely
explained by the economic context in Spain and Italy. In Spain, investment in
prices was not fully compensated by the significant reduction in SG&A.
Latin America
Sales growth in Latin America remained strong (+12.1% at constant exchange
rates and +4.6% at current exchange rates), supported by solid performances in
LFL in Brazil and Argentina. Commercial margin increased. Recurring operating
income increased sharply by 14.2% to €608m.
Asia
Overall, sales in China and Taiwan grew by 0.5% at constant exchange rates
(+10.3% at current exchange rates). The commercial margin was resilient.
Continued productivity gains did not fully offset the increase in distribution
costs linked to expansion and wage inflation in China. Recurring operating
income was down by 10.3% to €168m.
2012 results: Key points
Income Statement
* Sales increased by 1.6% at constant exchange rates vs. 2011 restated for
disposals. At current exchange rates, the change was +0.9%.
* Recurring operating income was stable at constant exchange rates and down
by 2.6% to €2,140 at current exchange rates, due to the following:
* Stable gross margin from current operations at 22.1% of sales.
* SG&A costs under control, up by 1.3%, +10 bp as a percentage of
sales.
* The Group’s operating income reached €1,434m vs. a loss of €140m in 2011
after accounting for non-current expenses amounting to €707m in 2012.
Capital gains on asset disposals of €234m partially offset €285m of
restructuring costs, €236m of asset impairments and €419m of other costs,
largely due to a revaluation of provisions.
* Net income, Group share improved significantly to €1,233m vs. €371m in
2011.
* Net income from recurring operations, Group share stood at €113m, due
to the following:
* An increase in net financial expenses of 25.1% to €882m, largely
due to an exceptional expense of €216m linked to our management
of interest rate position.
* A decrease in tax charge to €388m, down 58.3% vs. 2011. The
effective income tax rate (restated for exceptional items) comes
out at 35.7%.
* Net income from discontinued operations, Group share, amounted to
€1,120m, mainly linked to the asset disposals closed in 2012.
Cash flow statement & debt
* Free cash flow was €279m, including:
* Cash flow from operations (excluding discontinued operations) of
€2,180, down by 8%, mainly due to cash outflows linked to preexisting
tax litigation and restructuring.
* A slight increase in working capital requirements, improving compared
to 2011, thanks to better operating working capital after a
significant gain in days of inventories.
* Capital expenditure, constrained at €1,547m, down by 27% vs. 2011. A
third of the investments went towards growth in emerging market,
stable compared to 2011 in volume.
* Changes in the Group’s scope generated a net cash inflow of €2bn in 2012:
* The impact of discontinued activities, principally the disposals of
our activities in Colombia and Malaysia, is a cash inflow of €1,960m.
* The disposal of Altis led to a cash inflow of €153m.
* The acquisition of the shares of Guyenne & Gascogne’s parent company
generated a cash outflow of €96m.
* The net cash outflow linked to the dividend payment amounted to €137m, as
around 60% of the 2012 dividend was paid out in Carrefour shares.
* Net debt improved by €2.6bn to €4,320m at December 31, 2012, strengthening
the Group’s financial structure. The net debt over EBITDA ratio
significantly improved to 1.2x in 2012 vs. 1.8x in 2011.
Proposed dividend of €0.58 per share
The Board of Directors decided at its meeting on March 6, 2013 to submit for
approval to the Annual General Meeting to be held on April 23, 2013 a dividend
of €0.58 per share for the year ending December 31 2012, payable in cash or in
Carrefour shares.
The proposed dividend amounts to a payout ratio of 45% of net income, Group
share, adjusted for exceptional items, in line with the policy set out in
March 2012.
2013 Priorities
* Development of the multi-local, multi-format model
* France: Continued action plans in all formats, with priority given to
improvement of the offer and of price perception, store
refurbishments, Drive roll-out and multi-channel development
* Europe: Adaptation of the offer and costs to face the tough economic
environment
* Emerging markets: Continued expansion in Latin America and Asia
* New momentum in the development of real estate assets
* Decentralization and empowerment
* Simplify structures and decision-making process
* Re-empower stores
* Place the client at the core of the business
* Continued strict financial discipline
* Stable dividend payout policy
* Controlled increase of capital expenditure (expected between €2.2bn
and €2.3bn in 2013)
* Control of working capital
AGENDA
Q1 2013 sales: April 18, 2013
Annual General Meeting: April 23, 2013
APPENDICES
CONSOLIDATED INCOME STATEMENT
(in millions of euros) 2011^4 2012 % change
Sales, net of taxes 76,067 76,789 +0.9%
Loyalty program -810 -662 -18.3%
Other revenues 2,224 2,333 +4.9%
Total Revenues 77,481 78,460 +1.3%
Cost of sales -60,673 -61,523 +1.4%
Gross margin of current operations 16,809 16,937 +0.8%
SG&A -13 060 -13 249 +1.4%
Current operating incomes before D&A (EBITDA) 3 748 3 688 -1.6%
Depreciation & amortization -1 552 -1 548 -0.3%
Recurring operating income (ROI) 2 197 2 140 -2.6%
Non-current income and expenses -2 337 -707 -69.8%
Operating income -140 1 434
Financial expenses -705 -882 +25.1%
Profit before tax -845 552
Income tax -931 -388 -58.3%
Companies accounted for by the equity method 64 72 +13.0%
Net income from continuing operations -1,713 235
Net income from discontinued operations 2,116 1,081
Net income 404 1,316
Of which Net income – Group share 371 1,233
Of which net income from continuing operations -1,865 113
Of which net income from discontinued 2,237 1,120
operations
Attributable to non-controlling interests 33 83
Of which net income from continuing operations 153 122
Of which net income from discontinued -120 -39
operations
MAIN RATIOS
2011^4 2012
Gross margin from current operations / Net sales 22,1% 22,1%
SG&A / Net sales 17,2% 17,3%
Recurring operating income / Net sales 2,9% 2,8%
Operating income / Net sales -0,2% 1,9%
CONSOLIDATED BALANCE SHEET
(in millions of euros) 2011 2012
ASSETS
Intangible assets 9,706 9,409
Tangible assets 13,771 11,509
Financial investments 1,713 1,509
Deferred tax assets 745 752
Investment properties 507 513
Consumer credit from financial-services companies – long 2,236 2,360
term
Non current assets 28,676 26,052
Inventories 6,848 5,658
Trade receivables 2,782 2,144
Consumer credit from financial-services companies – short 3,384 3,286
term
Tax receivables 468 520
Other receivables 969 795
Current financial assets 911 352
Cash and cash equivalents 3,849 6,573
Current assets 19,211 19,328
Assets held for sale 44 465
TOTAL 47,931 45,844
LIABILITIES
Shareholders equity, Group share 6,618 7,487
Minority interests in consolidated companies 1,009 874
Shareholders equity 7,627 8,361
Deferred tax liabilities 586 580
Provisions for contingencies 3,680 4,000
Borrowing – long term 9,513 8,983
Bank loans refinancing – long term 419 1,966
Non current liabilities 14,198 15,529
Borrowings – short term 2,159 2,263
Trade payables 15,362 12,925
Bank loans refinancing – short term 4,482 3,032
Tax payables & others 1,319 1,040
Other debts 2,785 2,422
Current liabilities 26,106 21,682
Liabilities related to assets held for sale 0 273
TOTAL 47,931 45,844
CONSOLIDATED CASH FLOW STATEMENT
(in millions of euros) 2011 ^5 2012
NET DEBT OPENING -7,998 -6,911
Gross cash flow (ex. discontinued activities) 2,381 2,180
Change in working capital -240 -42
Impact of discontinued activities 207 -171
Cash flow from operations (ex. financial services) 2,348 1,967
Capital expenditures -2,119 -1,547
Asset disposals (business related) 131 153
Change in payables to fixed asset suppliers 191 -166
Impact of discontinued activities -336 -127
Free Cash Flow 215 279
Financial investments -71 -209
Proceeds from disposals of subsidiaries and from other 385 240
tangible & intangible assets
Others -61 34
Impact of discontinued activities 1,482 1,960
Cash Flow after investments 1,950 2,304
Dividends paid by Carrefour -708 -137
Dividends paid to minorities and others -87 -115
Acquisition and disposal of investments without change of -13 -9
control
Treasury shares -126 0
Others 93 420
Impact of discontinued activities 206 122
Consumer credit impact -229 7
NET DEBT CLOSING -6,911 -4,320
CHANGES IN SHAREHOLDER EQUITY
Total Shareholders’ Minority
(in millions of euros) shareholders’ equity, interests
equity Group share
At December 31, 2011 7,627 6,618 1,009
Net income for the year 1,316 1,233 83
Other comprehensive income after -362 -354 -8
tax
Share-based payments 9 9 0
2011 dividends -257 -137 -121
Change in capital and additional 194 188 6
paid-in capital
Impact of changes in perimeter and -167 -72 -95
other movements
At December 31, 2012 8,361 7,487 874
NET INCOME, GROUP SHARE, ADJUSTED FOR EXCEPTIONAL ITEMS
(in millions of euros) 2011 ^6 2012 % change
Net income, Group share 371 1,233 x 3.3
Restatement for non-current income and expenses 2,337 707
(before tax)
Restatement for exceptional items in net 151 284
financial expenses
Tax impact of restated elements (172) (122)
Restatement for exceptional items recorded in (5) (1)
income tax
Minority interest on restated elements 419 (60)
Restatement of Net income from discontinued (2,337) (1,120)
operations
Net income, Group share, adjusted for 864 921 +6.6%
exceptional items
PRO FORMA H1 2011 AND H1 2012 INCOME STATEMENT (UNAUDITED)
(in millions of euros) H1 2011 ^7 H1 2012 ^7
Sales, net of taxes 37,042 37,285
Loyalty program -449 -373
Other revenues 1,062 1,169
Total Revenues 37,654 38,081
Cost of sales -29,658 -30,051
Gross margin of current operations 7,996 8,030
SG&A -6,417 -6,526
Recurring operating income before D&A (EBITDA) 1,579 1,504
Depreciation & amortization -778 -764
Recurring operating income (ROI) 801 740
Non-current income and expenses -829 -63
Operating income -28 677
Financial expenses -319 -326
Profit before tax -347 351
Income tax -469 -122
Companies accounted for by the equity method 24 23
Net income from continuing operations -793 253
Net income from discontinued operations 552 -273
Net income -241 -21
PRO FORMA H2 2011 AND H2 2012 INCOME STATEMENT (UNAUDITED)
(in millions of euros) H2 2011 ^7 H2 2012
Sales, net of taxes 39,025 39,504
Loyalty program -361 -289
Other revenues 1,162 1,164
Total Revenues 39,827 40,379
Cost of sales -31,015 -31,472
Gross margin of current operations 8,813 8,907
SG&A -6,643 -6,723
Recurring operating income before D&A (EBITDA) 2,170 2,184
Depreciation & amortization -774 -784
Recurring operating income (ROI) 1,396 1,400
Non-current income and expenses -1,508 -644
Operating income -112 757
Financial expenses -386 -556
Profit before tax -498 201
Income tax -462 -266
Companies accounted for by the equity method 40 49
Net income from continuing operations -920 -18
Net income from discontinued operations 1,564 1,354
Net income 645 1,337
PRO FORMA RECURRING OPERATING INCOME BY REGION (UNAUDITED)
H1 2011 Recurring operating income (in Reported Restated ^8
millions of euros) August 30, 2012
France 299 295
Europe ex. France 220 218
Latin America 222 205
Asia 121 106
Global functions -24 -23
Total 838 801
H2 2011 Recurring operating income (in Reported Restated ^8
millions of euros) August 30, 2012
France 606 604
Europe ex. France 425 423
Latin America 360 328
Asia 117 81
Global functions -40 -38
Total 1,468 1,396
FY 2011 Recurring operating income (in Reported Restated ^8
millions of euros) August 30, 2012
France 905 898
Europe ex. France 645 640
Latin America 582 532
Asia 238 187
Global functions -64 -61
Total 2,306 2,197
H1 2012 Recurring operating income (in Reported Restated ^8
millions of euros) August 30, 2012
France 279 275
Europe ex. France 150 148
Latin America 245 232
Asia 116 105
Global functions -20 -19
Total 769 740
H2 2012 Recurring operating income (in Reported
millions of euros) March 7, 2013
France 654
Europe ex. France 361
Latin America 376
Asia 62
Global functions -55
Total 1,400
FY 2012 Recurring operating income (in Reported
millions of euros) March 7, 2013
France 929
Europe ex. France 509
Latin America 608
Asia 168
Global functions -74
Total 2,140
2012 DIVIDEND PAYMENT PROCEDURE
The ex-dividend date has been set as May 2, 2013. The period during which
shareholders may choose the option of the payment of dividend in cash or in
shares will begin May 2, 2013 and end May 23, 2013, included. Payment of the
cash dividend and settlement of the stock dividend will occur on June 7, 2013.
DEFINITIONS
* Gross margin from current operations
Gross margin from current operations is the difference between the sum of net
sales, other income, reduced by loyalty program costs and the cost of goods
sold. Cost of sales comprises purchase costs, changes in inventory, the cost
of products sold by the financial services companies, discounting revenue and
exchange gains and losses on goods purchases.
* Recurring Operating Income Before Depreciation and Amortization (EBITDA)
Recurring Operating Income Before Depreciation and Amortization (EBITDA) is
defined as the difference between the gross margin from current operations and
sales, general and administrative expenses. It excludes non-recurring items as
defined below.
* Recurring Operating Income (ROI)
Recurring Operating Income is defined as the difference between the gross
margin from current operations and sales, general and administrative expenses,
depreciation and amortization.
* Operating Income (EBIT)
Operating Income (EBIT) is defined as the difference between gross margin from
current operations and sales, general and administrative expenses,
depreciation, amortization and non-recurring items
Non-recurring income and expenses are certain material items that are unusual
in terms of their nature and frequency, such as impairment, restructuring
costs and expenses related to the revaluation of preexisting risks on the
basis of information that the Group became aware of during the accounting
period.
* Free Cash Flow
Free cash flow is defined as the difference between funds generated by
operations, the variation of working capital requirements and capital
expenditures.
DISCLAIMER
This press release contains both historical and forward-looking statements.
These forward-looking statements are based on Carrefour management's current
views and assumptions. Such statements are not guarantees of future
performance of the Group. Actual results or performances may differ materially
from those in such forward-looking statements as a result of a number of risks
and uncertainties, including but not limited to the risks described in the
documents filed with the Autorité des marchés financiers as part of the
regulated information disclosure requirements and available on Carrefour's
website (www.carrefour.com), and in particular the Annual Report (Document de
référence). These documents are also available in English language on the
company's website. Investors may obtain a copy of these documents from
Carrefour free of charge. Carrefour does not assume any obligation to update
or revise any of these forward-looking statements in the future.
^1 In accordance with IFRS 5, income and expenses from discontinued activities
(Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified
on the line “Net income from discontinued operations” of the consolidated
income statement in 2011 and 2012.
^2 The 2012 social and consolidated accounts were approved by the Carrefour
Board of Directors, which met on March 6, 2013. The accounts were audited by
the Group’s auditors.
^3 In accordance with IFRS 5, income and expenses from discontinued activities
(Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified
on the line “Net income from discontinued operations” of the consolidated
income statement in 2011 and 2012.
^4 In accordance with IFRS 5, income and expenses from discontinued activities
(Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified
on the line “Net income from discontinued operations” of the consolidated
income statement in 2011 and 2012.
^5 In accordance with IFRS 5, cash flows from discontinued activities (Greece,
Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the
line “Impact of discontinued activities” of the consolidated cash flow
statement in 2011 and 2012.
^6 In accordance with IFRS 5, income and expenses from discontinued activities
(Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified
on the line “Net income from discontinued operations” of the consolidated
income statement in 2011 and 2012.
^7 In accordance with IFRS 5, income and expenses from discontinued activities
(Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified
on the line “Net income from discontinued operations” of the consolidated
income statement in 2011 and 2012.
^8 In accordance with IFRS 5, income and expenses from discontinued activities
(Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified
on the line “Net income from discontinued operations” of the consolidated
income statement in 2011 and 2012.
Contact:
Carrefour
Investor relations:
Réginald Gillet, Alessandra Girolami, Matthew Mellin
Tel : +33 (0)1 41 04 26 00
or
Shareholder relations:
Céline Blandineau
Tel : 0 805 902 902 (n° vert en France)
or
Group Communications
Tel : +33 (0)1 41 04 26 17
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