FY16 Sales

French retail giant Carrefour reported FY16 sales growth of 3.3% at constant currency and excluding fuel. As reported and including fuel, group sales were down 0.7%, broadly in line with the consensus expectation of a 0.6% fall in net revenues. This took revenues to €85.7 billion including VAT and fuel. Excluding fuel and calendar effects, comps were +3.0%—Carrefour noted that this was the fifth consecutive year of comparable sales growth and the best yearly performance over the period.

4Q16 Sales

4Q16 sales were up 3.5% at constant currency ex fuel. Comps were +2.9%. Growth in the quarter was driven mainly by LatAm and the European markets excluding France.

Performance by Geography

France

• FY16: Ex-fuel sales in France declined by 0.5%. Comparable sales were up 0.3%. Carrefour highlighted that it managed to increase its comps in a “persistently difficult environment.”
• Carrefour pointed to its omnichannel momentum, noting that the gross merchandise value of its food and nonfood e-commerce activities in the country exceeded €1 billion for the year.
• 4Q16: Ex-fuel sales in France declined by 0.3% and comps were 0.7%, which the company characterized as a “solid performance.” However, this marked a softening from French comps of +1.2% in the previous quarter.
• Supermarkets and convenience/other format stores once again outperformed, with comps of +3.3% and +2.9%, respectively, in the quarter. This was slightly below the rates recorded in 3Q16.
• Comparable sales in hypermarkets comps were down 1.2% in the quarter, marking a slight sequential weakening from (1.0)% in the previous quarter.
• The company said that the conversion of stores acquired from Dia, to the Carrefour banner, is nearly complete.

Other European Countries:

• FY16: Ex-fuel sales grew by 2.3% at constant exchange rates and comps were +2.0%.
• 4Q16: Ex-fuel sales increased by 3.9% at constant currency and comps were +2.5%. Carrefour noted that every country in this segment posted positive comps, with comparable sales growth in Spain, the retailer’s third-largest market, of 4.1%.

Latin America

• FY16: Carrefour’s LatAm businesses posted strong double-digit growth in FY16 as well as in 4Q16. In FY16, ex-fuel sales grew by 16.8% at constant currency and comps came in at +13.5%.
• 4Q16: Ex-fuel sales increased by 14.3% at constant currency and comps grew by 10.8%. Comps in Argentina were particularly strong at +15.1% and in Brazil were a solid 9.0%. Carrefour mentioned that the currency effect across the LatAm segment was positive at +3.2%.

Asia

• FY16: Performance for the year in Asia was more disappointing, as ex-fuel sales fell 4.1% at constant currency and segment comps were (5.0)%.
• 4Q16: The decline in ex-fuel sales slowed to (2.3)% at constant currency and comps were (4.2)%. Comparable sales in China were down by 5.4%, but this was a sequential improvement from prior periods. Comps in Taiwan were +0.2%, representing an increase for the eighth consecutive quarter.

Outlook

The company did not provide further information on its full-year results, which it is expected to report on March 9, 2017. For FY16, analysts expect EBIT to fall by 0.6% to €2.43 billion and GAAP EPS to climb 5.1% to €1.43.