RetailAnalysis
18 April 2017
Casino Q1: improvements in France driving growth

France-based Casino has announced first quarter results, which showed, at a Group level, a sequential improvement for total growth, but a slowing rate of increase in organic and same-store terms.

The retailer's total sales growth, which rose by 11.6% to €9.3 bn, was boosted by its performance in Latin America, where total growth increased by 30.2%.

France: continued progress in majority of channels

In its home market, total sales fell by 1.0% to €4.5 bn, with the performance mainly affected by the closure of convenience stores. Casino said there was a sequential improvement in organic sales, which contracted by 0.5% in Q1 2017 versus a decline of 0.6% in Q4 2016. Same-store growth was steady at 0.2% in Q1 2017, versus Q4 2016.

Casino said it benefited from a strong growth of food products, which rose 0.9% on a same-store basis. This was aided by a slower rate of deflation across the whole market, less promotional activity in its stores and a good performance for food at its Géant hypermarkets and Casino supermarkets.

By banner, Casino said:

Géant hypermarkets: contraction in sales in total, organic and same-store terms by -1.7%, -2.1% and -1.9% respectively. A good performance in food, which enjoyed same-store sales growth of 0.4%, aided by 'fresh market and organic ranges' offset a decline in non-food sales. The latter factor was affected by market conditions and a decline in selling space dedicated to the ranges. Overall Géant saw a 1.6% fall in total retail space.

Casino supermarkets: growth in sales in total, organic and same-store terms by 1.6%, 4.1% and 1.9% respectively. Food sales continued to drive overall performance, helping the banner to maintain the 'excellent tremds seem in 2016'. Casino spotlighted the strength of its fresh and counters, which helped support footfall growth, which was at 1.9% for the quarter.

Monoprix: growth in sales in total, organic and same-store terms by 1.6%, 2.4% and 2.1% respectively. The standout figure for the retailer was Monoprix's same-store sales growth, which was up strongly versus Q4 2016, when it rose 0.4%. Longer opening hours at some of the retailer's stores also boosted its performance.

The retailer said footfall increased by 2.9% during the quarter, aided by its on-going investment in food, and fresh specifically, and apparel, which boosted overall non-food sales. At Monoprix, underlining the wider positive reception from shoppers to online grocery solutions, it said that 'online food sales enjoyed double-digit growth, driven mainly by the implementation of same-day delivery service' Despite the positive performance online at Monoprix, Casino did note that food sales remained marginal at about €100m.

Franprix: the banner's performance was boosted by the continued updating of stores to the new Mandarine design, which is undergoing a further evolution. Casino said the changes, which had been completed at 65% at stores, were helping underpin a 4.1% rise in shopper traffic.

Latin America: Positive performance across all operations

Across all its operations in Latin America, Casino said total sales rose 30.2% to €4.3 bn, aided by organic sales growth of 7.7% and same-store sales growth of 4.6%. The retailer said that the performance was affected by a deceleration in the rate of inflation across its operations, excluding Argentina, echoing the perspective given by Carrefour in its Q1 results.

By subsidiary, Casino said:

Exito: its organic growth was aided by 'good same-store performances in Uruguay and expansion in all regions'.

GPA Food: organic and same-store sales increased by 9.8% and 5.8% respectively. Its Assaí atacajero banner continued to underpin its performance, while a recovery at its Extra hypermarkets aided the overall figure. At Assaí dynamic sales growth was helped by a 'double-digit growth' in customer traffic and the conversion of five Extra hypermarkets to the banner. Meanwhile, at Multivarejo volume growth at Extra was 2.0%, aided by an improvement in footfall, with good growth in food and non-food categories.

Cdiscount enjoys improved momentum

At Cdiscount, total gross merchandise volume (GMV) sales rose 5.2% to €770.4m, aided by a 7.7% growth in same-store sales. After a period of disposals and market exits, Cdiscount is a more focused banner for Casino. The retailer said that performance had continued to improve over the quarter with its GMV rising by 12% in March. Increasing traffic, which was up by 11.4% in the quarter, at the site was aided by a rise in penetration for mobile user, which rose by 25%. The share of sales accounted by its Marketplace also rose and stood at 32% at the end of the quarter.

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