Casino Looks for French Revival After Profit Beats EstimatesAndrew Roberts and Gabi Thesing
Casino Guichard-Perrachon SA, the owner of France’s Monoprix and Geant supermarket chains, said it aims to revive sales in its home market after 2012 earnings beat analysts’ estimates, driven by the international business.
Trading profit from continuing operations increased 29 percent to 2 billion euros ($2.7 billion), the Saint-Etienne, France-based company said today in a statement. Earnings exceeded the 1.94 billion-euro average of 11 estimates compiled by Bloomberg. Casino said on Jan. 15 that sales rose 22 percent to 42 billion euros.
Competition between grocers is intensifying in Europe as consumers tighten their belts amid an economic contraction. Casino, which forecast that 2012 profit would be more than 1.94 billion euros, can probably cut prices in France this year after weak household consumption led to declining sales in the country in the fourth quarter, the grocer said last month.
The main driver of profit was Casino’s international division, whose earnings gained 65 percent to 1.32 billion euros, while in France, trading profit fell 8.6 percent to 685 million euros.
Internationally, “growth should continue in 2013, sustained by the emergence of numerous middle classes whose purchasing power is growing,” Casino said today.
In France, the company is counting on “stabilizing or reviving retail” and will focus on price cuts in hypermarkets, cost reductions and expansion of its main formats, the retailer said.