“Colruyt will become one of Europe’s leading distributors”

“Colruyt will become one of Europe’s leading distributors”

The stock market analysts of Citigroup seem to have lost faith in a number of European large distributors. For five of the eleven companies the analysts follow closely, they lowered their advise. Four others fare better, with a striking role for Belgian Colruyt; which could "become part of a small group of European leaders".

Five companies drop in stature

Citigroup ascertained that, without taking inflation and price evolution into account, the profit of the sector dropped 12% over the past decade. The group also expects this negative trend to continue due to the economic crisis and the ever more difficult macro-economic circumstances.

 

This is why Citigroup lowered its advises for French Casino, British Sainsbury’s and German Metro from “Neutral” to “Sell”. Belgian Delhaize and British Morrison dropped from “Buy” to “Neutral”.

 

Shares take hits

The consequences were immediately visible on the trading floors: the share of Delhaize took a hit of 4.55% (far worse than the -2.33% of the Bel20 in Brussels), while Casino (-2.05%) also did worse than Parisian CAC40 (-1.71%). Even Carrefour, with its unchanged advice (even though Citigroup is expecting an organic growth below expectations), had to take a hit: the share of Carrefour dropped 4.24% at the exchange in Paris.

 

The German company Metro had its biggest loss in a single day for three months in Frankfurt (-5.43%, while the DAX ‘only’ lost 1.24%). According to Citigroup the explanation can be found in the growth slowdown in Russia, a region responsible for a quarter of the operational cash flow of the company.

 

“Colruyt to become leading distributor”

Some distributors however will get better through the crisis than others, predict the analysts of Citigroup. In that respect they are looking at Portuguese retailer Jeronimo, British Cash & Carry group Booker and Dutch company Ahold.

 

Colruyt will also be part of that group: together with the three other companies, the Belgian distributor should become part of a “small group of European leaders within ten years”, says Citigroup. That however does not guarantee success on the short term: Colruyt lost 2.92% yesterday - and Ahold lost even more with 4.16%.

Questions or comments? Please feel free to contact the editors


Martin Winkler is Falke Group’s new CEO

19/07/2017

Falke Group, known for its leg fashion brand Falke, announced Martin Winkler will become its new CEO, succeeding Uwe Bergheim, who will retire.

Marc O’Polo gets new CEO

19/07/2017

Current fashion brand Marc O’Polo CEO, Alexander Gedat, will step down on 31 August and Dieter Holzer will succeed him. He has plenty of experience as a leading figure in the fashion industry.

Multiple companies interested in Jimmy Choo

19/07/2017

Luxury shoe brand Jimmy Choo is attracting several interested buyers, apparently including Michael KorsInterparfums and Hony Capital.

Puma increases profit forecast again

18/07/2017

For the second time this fiscal year, German sports brand Puma increased its profit forecast. A strong first quarter prompted the first adjustment and this second quarter was also above expectations apparently.

C&A divest from Russia

18/07/2017

Textile chain C&A will fully divest from Russia. It currently collaborates with Russian Trade Group to manage its local store network, but it has pulled the plug on that deal. Mexx has also decided to shut down every Russian store.

Zalando reveals Prime-like subscription service

18/07/2017

In the second quarter of 2017, web shop Zalando’s turnover did not grow as much as it did in previous quarters, according to the company’s preliminary results. Zalando also announced a new subscription service.

Back to top