French market hit by price deflation for Carrefour

Full-year sales at Carrefour grew 3.2 per cent to Eu81.39 billion (£56.8 billion). However, like-for-like sales were up only 0.8 per cent. The retailer admitted that like-for-like sales in France dropped 1 per cent over the year, as it adopted a policy of investing in price competitiveness, reducing the value of the average basket.

Outside France, the retailer said sales growth was robust, despite price deflation. Carrefour stores did well in Greek, Portuguese, Brazilian, Argentinean, Korean, Thai and Indonesian markets.

The retailer said 'We are in the process of creating a stronger platform for sales growth in French hypermarkets. We are developing new engines for growth outside France and have begun to divest non-core and non-profitable assets. We have met our targets for growth in new square metres and net debt reduction, even while buying back 11.2 million of our shares.'

In September, Carrefour pledged to reduce net debt by at least Eu500 million (£348.9 million) a year, which it achieved last year. It expects to have divested further assets, with a cash-in of Eu1 billion (£697.9 million) by the end of this year.