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Carrefour reports Q1 sales fall

French retailer Carrefour has reported that gross sales for Q1 reached EUR22.7 billion (USD30.51 billion), a decrease of 1.4% at constant exchange rates compared to the previous year. Q1 sales for its French hypermarkets declined by 5.4% on a like-for-like basis including petrol. Excluding petrol, like-for-like sales were down 2.5%. However, the retailer stated that revitalised commercial dynamics were beginning to pay off with a satisfactory winter sale period in January, strong catalogue offers and effective promotional campaigns, such as the "50% loyalty" campaign. Food sales declined by 2.4%, while non-food sales declined 2.7% on a like-for-like basis, an improvement over the performance reported throughout 2008. Meanwhile, strong performance was recorded at Carrefour Market, the supermarket division, with 385 stores converted to the new banner  by the end of March. Carrefour's French discount division reported an 8% decline in like-for-like sales. Internationally, the group said that it had a mixed performance. In Spain, the deterioration of the economic environment has impacted hypermarkets in particular, while there has been a strong performance of the Dia discount chain. In Latin America, continued growth (up 14.4% at constant exchange rates) was reported while Carrefour reported a slowdown in China (up 3.1% at constant exchange rates versus 6.9% in Q4 2008). Consumer trends observed in the fourth quarter extended into the first quarter of the year, with a decline in non-food purchases and a shift to Carrefour-branded products in food. Lars Olofsson, Chief Executive Officer of the Carrefour Group, stated: "Carrefour recorded a resilient first quarter sales performance in an environment that remains tough, thanks notably to our strengthened commercial dynamics. In 2009, we will continue to be on the side of our customers in order to win market share. The measures we have initiated to transform our way of operating and reduce our costs will produce their effects mainly in the second half of the year. The generation of free-cash flow remains a priority and we will achieve this through improved inventory management and heightened selectivity in capital expenditure. Carrefour teams are currently working on implementing the strategic guidelines we have defined in order to significantly improve the Group's performance."

www.planetretail.net

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