Auchan returns to profitability, despite sales drop

Auchan Retail has seen its comparable sales drop by 2 % in the first half of the year. However, profitability did improve for the distribution branch of Elo.

An above-average decline in France

In the first six months of the year, Auchan Retail suffered greatly from Covid restrictions – especially in the larger shopping centres, where the company has many hypermarkets. Revenues dropped 2 % to 14.9 billion euros on a comparable basis. In France, where the group generates 60 % of its sales in malls of more than 20,000 sqm, it saw revenues decline by 4.2 % to almost 300 million euros, French newspaper Les Echos writes.

“40 % of the decline in sales can be attributed to ten hypermarkets (out of 117) because of their location at the border, in either tertiary or tourist centres”, newly appointed chairman Yves Claude explained. In Central and Eastern Europe, sales increased by 3 %. Over the past two years, online sales grew by 45 %: they now represent 7.4 % of total revenues.

Despite the decline in sales, Auchan’s gross operating profit (EBITDA) increased by 3.7 % to 594 million euros. In France and Russia, EBITDA rose by 25 % and 66 %, respectively. “Our recovery, which began more than two years ago, is now a reality”, Claude concludes.