(AOF) – Carrefour’s Board of Directors has unanimously decided to propose to the next General Meeting, which will meet on May 26, 2023, to renew Alexandre Bompard’s term of office in advance in order to align him over the duration of the “Carrefour 2026” strategic plan. This mandate, which was to expire at the end of the General Meeting to be held in 2024, would thus be renewed for a period of three years, until the General Meeting of 2026.
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Key points
– First European food distributor and second in the world;
– Activity of €90.8 billion concentrated in three major markets, France for 46% of sales, the rest of Europe -Belgium, Spain, Italy, Poland, Romania- for 28% and Latin America -Brazil and Argentina -for 26%;
– Ambition to become the world leader in the food transition with a focus on fresh and organic products (eating healthy, local and accessible to all) and rebalancing of activity in Latin America and Europe (Brazil, France and Spain;
– Capital marked by the strong presence of 5 shareholders: the Moulin family, also owner of Galeries Lafayette (12.91% of the shares and 17.75% of the voting rights), Peninsula Europe (7.61% and 11.83% ), Cervina Europe (4.99% and 7.67%) and Bunt (3.17%), the 16-member Board of Directors being headed by Alexandre Bompart, Chairman and Chief Executive Officer;
– Controlled financial situation which will be strengthened in 2023 by the sale of the Taiwanese establishments: net debt of €3.4 billion and free cash flow of €1.3 billion.
Challenges
– 2023 strategy based on 3 pillars:
–
€2.7 billion in annual investments, vs. €2 billion in 2022, free self-financing of more than €1.7 billion and cumulative cost savings of €5 billion (including €1 billion in 2022),
– positioning on products accessible to customers: own brand at 40% of revenues vs 33% in 2022, acceleration of discount store formats: more than 470 Atacadão in Brazil and 1
time
opening of Atacadão in France in 2023,
– operation of non-commercial assets: joint venture with Publicis to become Europe’s No. 1 in retail media and real estate development through mixed projects in France and the 1
time
South American real estate in Brazil;
– “Data-centric, digital first” innovation strategy around 4 axes: acceleration of e-commerce, ramp-up of data & retail media, digitalization of financial services and distribution operations
– €2.8 billion of investments in information systems,
– strategic partnerships for the Carrefour Links platform
-30% multi-channel customers and €10 billion in e-commerce revenue in 2026 vs €4.2 billion in 2022)
;
– “Act for food” 2025 environmental strategy aiming for carbon neutrality by 2050:
– reduction of indirect emissions by 35% in 2025 and 40% of direct emissions,
– bond to 100 1
ers
suppliers to adopt a 1.5C trajectory by 2026,
– €8 billion in sales of sustainable food products, including €500 million of plant origin and 50,000 sustainable agriculture partners vs. 30,000,
– issues of “green” loans and, from 2023, an employee shareholding plan to finance CSR projects;
– From. 2017, continued market share gains in the 3 key countries (Brazil, France and Spain, i.e. 8/10ths of current operating income);
– Savings in equity through lease-management and the franchise of hypermarkets and supermarkets in France.
Challenges
– Lasting impact of inflation in transport, energy and food materials, offset by cost savings, strengthening of Carrefour brand products, highly accessible product ranges and loyalty programs;
– Confirmation of the success of the integration of the Brazilian Grupo BIG: after conversion of 59 stores to the Carrefour banner, finalization of the total program in 2023 and confirmation of 2 Brl of total synergies in 2025;
– After an 8.5% growth in sales, the 2023 objective of improving the operating margin and free cash flow;
– Dividend of €0.56 and share buyback program of €800 million.
Find out more about the “supermarket” sector
Two major challenges for the sector
The turnover of the retail brands increased by 6.6% in the third quarter of 2022 according to the panelist IRI. Such a performance had not been recorded since the 2020 confinements. However, since the end of September, volumes have been falling following the rise in prices. The results of the French players, rather spared until now, should therefore suffer. Moreover, in the United States, Walmart and Target issued warnings about their results.
Another challenge: logistical disruption. According to data from NielsenIQ, the stock-out rate rose further on the shelves to 5.8% at the end of October. This represents a shortfall of 3.5 billion euros since the start of the year. According to System U, these disorders have never been observed for more than fifty years. The reasons are multiple: both climatic, geopolitical, logistical, inflationary, and also linked to the behavior of consumers, who stock certain items. On the other hand, the strike in the refineries seems to have had little impact because the brands have managed to organize themselves.