Carrefour Q3 Results

Shares of Carrefour (EPA:CARR) traded lower on Thursday after the retail giant posted weaker-than-expected Q3 results, revealing a slower pace of recovery than analysts had anticipated.

Excluding Argentina’s hyperinflation, Carrefour’s like-for-like (LFL) sales fell by 0.5%, falling short of consensus estimates that had predicted a slight rise of 0.1%.

> “The offset to this is clearly improving volume trends across much of Europe (particularly France and Spain) in September and October, helping underpin Q4 numbers,” said analysts at Jefferies in a note.

Carrefour reported group sales of €24 billion for the quarter, narrowly missing expectations of €24.05 billion. While LFL growth, excluding Argentina, slowed, analysts noted some recovery in consumer behavior in France and Spain during the latter half of the quarter.

However, France, Carrefour's largest market, saw an LFL drop of 3%, which was worse than the anticipated 2.4% decline.

The country’s hypermarkets performed particularly poorly, with a 6.1% drop, while the supermarket and convenience segments fared slightly better, falling by 1.5% and gaining 1.5%, respectively.

Analysts believe the company’s price investment strategy, aimed at making its stores more competitive, is beginning to show results, especially in the final weeks of the quarter.

Outside of France, Carrefour’s European operations saw mixed results. Sales in Spain, Italy, and Belgium improved from the previous quarter but still posted declines of 1.1%, 3.1%, and 2.2%, respectively.

Meanwhile, the company continued to face pressure in Poland, where LFL sales fell 3%. Romania was the standout performer, matching expectations with a 1.5% LFL increase.

In Latin America, Carrefour's performance remained robust, though slightly below forecasts. The company reported 36.4% LFL growth in the region, driven largely by hyperinflationary conditions in Argentina, where sales surged by 186%. Brazil, however, grew by only 5.8%, missing expectations of 6.5%.