Retailer Carrefour Eyes More Savings as 2020 Core Profits Rise

PARIS (Reuters) – Carrefour unveiled new cost savings and cash flow targets, which it said reflected its confidence in the future after Europe’s largest retailer delivered on its goal to achieve 3 billion euros ($3.6 billion) in cost cuts by 2020.

The French food retailer, whose possible takeover by Canada’s Alimentation Couche-Tard unravelled last month after opposition from the French government, also reported a 16.7% rise in 2020 recurring operating profit to 2.173 billion euros at constant exchange rates.

Its 2020 sales grew 7.8% on a like-for-like basis to 78.609 billion euros, Carrefour’s best performance in at least 20 years.

This reflected strong sales in the key markets of Brazil and France, with food retailers across the world also benefiting from stronger demand as more consumers stay at home during the COVID-19 crisis.

Carrefour said it now targeted 2.4 billion euros in additional cost savings on an annual basis by 2023 and net free cash flow generation above 1 billion euros per year from 2021.

Carrefour is in the midst of a five-year plan to cut costs and jobs, and boost E-commerce investment in an effort to lift profits and sales and tackle the competition from E-commerce giant Amazon.

($1 = 0.8302 euros)

(Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta)