Electronics group Fnac Darty has achieved a small turnover growth in the first quarter of 2018. The group also says it took major steps in its recovery plan: before the end of 2018, it seeks 130 million euro in synergies.
Collaborations with Google and Carrefour
Fnac Darty’s main goal this year is to create synergy profits thanks to collaboration deals and a further Fnac and Darty integration. By the end of the year, the group aims to generate about 130 million euro in synergies this way. It says it is well on its way to reach that goal, partially thanks to strategic collaborations with Carrefour and Google.
French retail groups Fnac Darty and Carrefour signed an electronics purchase deal late last year, and the effects are showing rapidly, according to Fnac Darty: the retailers are already talking to suppliers together and have also created a joint sustainability policy.
Earlier this month, the merger group also launched a strategic collaboration with Google, which will get its own corner in every store. Fnac Darty will get front-seat access to Google’s launches, including artificial intelligence and voice assistants. It also improved its ties with telecom company Orange in the past quarter in order to distribute audio books.
Chains’ integration well underway
In the meantime, the Fnac-Darty integration continues: the transfer into a new main office is almost finished and it has also expanded Fnac’s photo processing service to twenty Darty stores as well. “Despite a weak consumer market, Fnac Darty had turnover growth and once again proved the solidity of its business model”, CEO Enrique Martinez said.
At a group level, turnover grew 0.6 % to 1.69 billion euro, but there was a slight 0.3 % drop in its French-Swiss home territory to 1.3 billion euro. That was mainly because of the negative impact from Darty store closures in 2017 and a weaker Swiss franc. Another eleven new franchise stores were insufficient to counter this drop.
Strong Benelux growth
There was considerable growth in the Benelux region: turnover grew 4.2 % (and 2.2 % on a like-for-like basis) to 231 million euro. Belgium experienced sharp online growth, but its household appliance sales also contributed. The BCC chain, active in the Netherlands, also reaped the benefits from its transformation plan: despite store closures (including two in 2018), turnover increased. Its online sales grew considerably as well, thanks to a new marketing strategy.
The French electronics giant also published growth in the Iberian peninsula: the market was worth 152 million euro (+ 3.4 %). The group’s press release emphasized that it managed to obtain new and improved credit conditions, as a sign of the banks’ renewed faith in the company.