French retail group Casino saw its comparable revenue increase in the third quarter, but continued to struggle in its home market. Analysts doubt whether the retailer will be able to benefit from the new French lockdown.
Tourists stayed away
Casino achieved a turnover of 7.5 billion euro, an increase of 6.2% on a comparable basis. This seems positive, but on the important French home market, the retailer was unable to grow: turnover stagnated, while direct competitors such as Carrefour were able to record good growth, partly thanks to increased home consumption. In the second quarter, Casino had made good progress, but the problem is that the retailer is very active in Paris and the South-West of the country, regions that normally have a high proportion of tourists during the summer months. And they stayed away this year. However, Casino saw strong growth for organic (+8%) and online shopping (+44%). In Latin America, comparable turnover increased by 11.6%, but that figure is coloured by high inflation.
Thanks to productivity gains and cost savings, however, the operating result improved significantly. This is not unimportant, as Casino’s priority remains the reduction of its high level of debt. The question is whether Casino will be able to benefit in the fourth quarter from the new lockdown that has just been announced in France. Analysts seem to doubt this: the different formats of the group (besides the hypermarkets and supermarkets of the same name also Géant, Monoprix and Franprix) have an unfavourable price image.
