France-based Auchan has announced full year results saying that consolidated revenue, excluding taxes, rose 0.7% at constant exchange rates to €52.8 bn. In organic terms, Auchan said sales rose 0.9%. The company said the results were ’solid’ and in line with expectations. During 2016 Auchan initiated its 2025 Vision as it builds its foundations for the future.
Sales rose in 11 out of 14 countries in 2016
Auchan said that its strength as a price-focused retailer, it said it was the cheapest banner in 12 of its countries of operation, was helping it to win. It noted that revenues rose in local currency terms grew in 11 of the 14 countries where it owns and operates stores itself. Its price focus had been aided by continued expansion, it opened 126 stores in 2016, and its sustained investment in its stores.
The highlight for Auchan was China, where its Sun Art division saw revenues grow by 4.2%. Sun Art, which has already announced its full year results, saw revenue growth driven by the addition of 40 hypermarkets and aided by an improving like-for-like performance, -0.3% in 2016 versus -3.6% in 2015.
In Western Europe, the retailer said that it had chosen ‘to favour profitability over non-profitable revenue [growth]’ in its home market. The point was stressed by Auchan as it noted that while revenues had fallen by 1.1%, gross profits had risen by 0.2 percentage points. Elsewhere, Auchan said that revenues rose in Spain and Portugal, while in Italy it was ‘ in line once again with market trends’.
In Eastern Europe Auchan said that it had enjoyed a positive performance. The retailer highlighted Hungary, Poland, Romania and Ukraine as benefiting from ‘strong sales performances’. Growth in the region was offset, though, by Russia, where revenue fell due to what it said was a ‘significant fall in [shoppers] purchasing power’. Auchan said it remained positive about the market’s prospects given improving macro-economic trends.
2016 a year of change and progress
Auchan pointed to its evolving strategy, which was implemented in 2016, as providing it with confidence for the future. The retailer said that it had begun to implement its single banner strategy in France, Russia, Vietnam and Senegal, with the results proving to be ‘promising’. Auchan also accelerated its digital transformation to hasten its conversion to a multichannel retailer. It said that it had been able to integrate its online store with all its store formats in all its markets, except for Senegal and Vietnam.
2017 to see continued embedding of Vision 2025
In the short to medium term, Auchan is set to focus on embedding its Vision 2025 strategy and roll out the initiatives encompassed by that to all its markets of operation. Vision 2025 has been formed to meet two main aims:
to be an active player of the phygital revolution with a multi-format augmented by the strength and the agility of digital; and
to bring innovative and sustainable answers to the new expectations of employees and consumers