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    CO   FR0000125585

CASINO, GUICHARD-PERRACHON

(CO)
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Casino Guichard Perrachon : First-half 2021 results and second quarter 2021 net sales

07/29/2021 | 01:47am EDT

FIRST-HALF 2021 RESULTS

AND SECOND-QUARTER 2021 NET SALES

Further increase in profitability

Trading profit up +24% at constant exchange rates, of which +9% in France and +33% in Latin America Net sales for first half stable (-0.5%) on an organic basis

In France, success in the transformation of banners with trading margin up +81 bps and 353 stores opened,

laying the foundation for a strong return to growth in H2

In France

Contribution to consolidated EBITDAin €m

Contribution to consolidated trading profitin €m

H1 2020

H1 2021

Change

Change %

H1 2020

H1 2021

Change

Change %

Retail banners

501

543

+43

+9%

Impact of transformation

97

146

+49

+50%

Margin (%)

plans

6.8%

7.9%

+114 bps

-

1.3%

2.1%

+81 bps

-

Vindémia

22

-

-22

-

Sold in June 2020

22

-

-22

-

GreenYellow

34

28

-7

-20%

Change in business

31

19

-12

-40%

model

Property development

4

3

-2

-41%

-

4

2

-2

-47%

Total France Retail

561

573

+12

+2%

154

166

+12

+8%

Cdiscount

43

48

+5

+13%

-

6

7

+1

+12%

Total France

604

622

+18

+3%

160

173

+13

+9%

Margin (%)

6.9%

8.0%

+105 bps

1.8%

2.2%

+39 bps

Retail banners1:

  • Strong increase in profitability across all banners with trading margin up +81 bps to 2.1%. Trading profit rose by +50%1 (+€49m) thanks to the Group's transformation plans and reduced Covid- related costs, in a context of lower net sales relative to the very high basis of comparison due to the first lock-downduring H1 2020.
  • Net sales represented a same-store change of -8.4% in Q2 2021, due to the high basis of comparison in 2020 (+6.0% in Q2 2020), the temporary drop of tourism and public health restrictions in H1 2021 (closure of non-essential product sections, curfew). Looking beyond these temporary challenges, the Group continued to activate its growth drivers:
    • Faster delivery on the strategic priorities of: (i) expansion, with the opening of 353 convenience
      stores during H1 (initial target: 300 stores), and (ii) E-commerce, with same-store sales up +103% over two years, outperforming the market (+59%2), and continued roll-outof the Ocado and Amazon partnerships and quick-commerce solutions from 800 stores.
  • Outlook for H2 2021: growth in profitable formats, with (i) expansion of the store base (400 openings in local formats Franprix, Vival, Naturalia, etc.) and (ii) acceleration in E-commercethanks to our exclusive partnerships (Ocado, Amazon) and the solutions deployed at our stores.
    • Inflection since early July with sales down -4.0%3 on a same-store basis vs. -8.4% in Q2, i.e. an improvement of +4.4 pts, and an increase in Cdiscount GMV of +13.5%.

Cdiscount: H1 2021 EBITDA of €48m4. Further growth in the marketplace in H1 of +33% over two years (+10% year-on-year)and growth in digital marketing of +72% over two years (+44% y-o-y).

  • Outlook for H2 2021: further progress on priority strategic plans (marketplace, digital marketing, Octopia) resulting in strong EBITDA growth.

GreenYellow: strong business momentum, with a photovoltaic pipeline of 809 MWp (+85% vs. H1 2020) and 3.5 GWp in additional opportunities.

  • Outlook for H2 2021: growth in EBITDA.

RelevanC: growth in net sales of +32% in Q2 2021. Signing of a commercial partnership with Google Cloud and Accenture.

  • Outlook for H2 2021: accelerated expansion in France and internationally.

Disposal plan: signing with BNPP of a partnership and an agreement for the disposal of Floa for a total amount of €179m5 and securing of a €99m6 earn-out,bringing total disposals to €3.1bn.

  • The Group is maintaining its target of €4.5bn in asset disposals in France.

Improved financial terms, revised covenants and extension of €1.8bn of Casino's main syndicated credit facility to July 2026. At 30 June 2021, the Group comfortably complied with the covenant7, with headroom of €359m on EBITDA after lease payments (2.1x vs. limit of 3.5x).

In Latin America

Strong growth in profitability with H1 EBITDA and trading profit up +21% and +33% respectively at constant exchange rates. Organic growth in net sales of +5.5% in Q2, driven by Assaí (+22%).

Two-fold increase in Latam asset value since the Assaí spin-off was announced8.

  1. France Retail excluding GreenYellow, real estate development and Vindémia (sold on 30 June 2020)
  2. Source: Nielsen, YTD P06 2021, over two years
  3. Same-storechange in sales for the four weeks to 25 July 2021
  4. Contribution to consolidated EBITDA. Data published by the subsidiary: EBITDA of €49m (stable vs. H1 2020)
  5. Including €129m relating to the sale of shares and an additional €50m notably linked to the renewal of commercial agreements between Cdiscount, Casino banners and FLOA
  6. As part of the real estate disposals made in 2019
  7. Secured gross debt to EBITDA after lease payments on France Retail + E-commerce perimeter excluding GreenYellow (see press release dated 19 July 2021)
  8. Announcement of the Assaí spin-off on 9 September 2020

Thursday, 29 July 2021 1

Key figures

Change at

In €m

H1 2020

H1 2021

Change

CER

Net sales - Group

16,140

14,480

-10%

-0.5%1

o/w France (incl. Cdiscount)

8,739

7,810

-11%

-7.2%1

o/w Latam

7,401

6,670

-10%

+6.9%1

EBITDA - Group

1,063

1,0992

+3%

+11%

o/w France (incl. Cdiscount)

604

622

+3%

+3%

Margin (%)

6.9%

8.0%

+105 bps

+108 bps

o/w Latam

459

4772

+4%

+21%

Margin (%)

6.2%

7.2%

+96 bps

+91 bps

EBITDA after lease

595

6282

+5%

+15%

payments - Group

287

296

+3%

+4%

o/w France (incl. Cdiscount)

3.3%

3.8%

+51 bps

+54 bps

Margin (%)

308

3312

+7%

+25%

o/w Latam

4.2%

5.0%

+80 bps

+77 bps

Margin (%)

Trading profit - Group

399

4442

+11%

+24%

o/w France (incl. Cdiscount)

160

173

+8%

+9%

Margin (%)

1.8%

2.2%

+39 bps

+41 bps

o/w Latam

239

2712

+13%

+33%

Margin (%)

3.2%

4.1%

+84 bps

+85 bps

Underlying net profit,

(95)

(72)

+23

n.m.

Group share

Profit (loss) from continuing

(340)

(35)

+306

n.m.

operations, Group share

In €m

FCF excl. disposals - Group

o/w France (incl. Cdiscount, excl. GreenYellow) o/w Latam

H1 2020

H1 2021

Change

(885)

(1,021)

-136

(297)

(346)

-50

(629)

(615)

+14

Gross debt - Group

8,554

8,477

-77

o/w France (incl. Cdiscount)

5,542

5,105

-438

o/w Latam

3,012

3,372

+360

Net debt before IFRS 5 - Group

6,347

6,344

-3

o/w France (incl. Cdiscount, excl. GreenYellow)

4,792

4,633

-158

o/w Latam

1,726

1,767

+41

Net debt after IFRS 5 - Group

4,837

5,482

+644

o/w France (incl. Cdiscount, excl. GreenYellow)

3,395

3,837

+4413

o/w Latam

1,636

1,702

+66

The France Retail and E-commerce (Cdiscount) segments are presented together, to be consistent with the metrics used to track operating performance.

Free cash flow presented on the France Retail and E-commerce perimeter, excluding GreenYellow, in line with the new perimeter of banking covenants. GreenYellow's development and transition to an asset holding model is ensured by its own resources.

Leader Price, which was sold on 30 November 2020, is presented as a discontinued operation in 2020 and 2021. The gradual conversion of the stores sold to Aldi is expected to be completed by September 30, 2021.

The financial statements for the first half of 2020 have been restated following the retrospective application of the IFRS IC decision on the determination of the lease term and the depreciation period for fixtures and fittings under IFRS 16 - Leases.

  1. Organic growth excluding fuel and calendar effects
  2. Of which €6m in tax credits
  3. The difference compared to the change in net debt excluding IFRS 5 (-€158m) is mainly due to the decrease in IFRS 5 related to the sale of Leader Price, which was classified under IFRS 5 at June 30, 2020

Thursday, 29 July 2021 2

FIRST-HALF 2021 RESULTS

Consolidated net sales amounted to €14,480m in H1 2021, stable (-0.5%) on an organic basis1 and down -10.3% after taking into account the effects of exchange rates and hyperinflation for -7.2%, changes in scope for -2.2% and fuel for +0.5%.

On the France Retail scope, net sales were down -7.3% on a same-store basis. Including Cdiscount, same- store growth in France came to -6.3%.

E-commerce (Cdiscount) gross merchandise volume (GMV) came to nearly €2bn, a year-on-year increase of +2.3%2 (+14%2 over two years), led by the expansion of the marketplace.

Sales in Latin America were up by +6.9% on an organic basis1, mainly supported by the very good performance in the cash & carry segment (Assaí), which grew by +22%2 on an organic basis.

Consolidated EBITDA came to €1,099m, an increase of +3% including currency effects and +11.1% at constant exchange rates.

France EBITDA (including Cdiscount) amounted to €622m, including €573m on the France Retail scope and €48m for Cdiscount. France Retail banners EBITDA (France Retail excluding GreenYellow, property development and Vindémia) was up +9% to €543m. GreenYellow generated EBITDA of €28m3 and property development operations delivered €3m.

France EBITDA margin (including Cdiscount) came to 8.0%, an increase of +105 bps.

In Latin America, EBITDA rose by +21.1% excluding currency effects and including tax credits4 for €6m. EBITDA excluding tax credits4 was up +19.8%.

Consolidated trading profit came to €444m (€438m excluding tax credits4), an increase of +11.4% including currency effects and +23.5% at constant exchange rates (+22% excluding tax credits).

In France (including Cdiscount), trading profit stood at €173m, including €166m on the France Retail scope and €7m for Cdiscount. France Retail banners trading profit (France Retail excluding GreenYellow, property development and Vindémia) grew by a strong +50% to €146m. Trading profit came to €19m for GreenYellow and to €2m for property development operations.

Trading margin in France (including Cdiscount) was up +39 bps at 2.2%, supported by an improvement from France Retail, which recorded a +45 bps increase in trading margin to 2.4%.

In Latin America, trading profit totalled €271m, an increase of +13.5% (+29.9% excluding tax credits and currency effects), driven by the continued strong sales momentum at Assaí, the transfer of sales to E-commerceand the repositioning of hypermarkets at Multivarejo, and the continued profitability and positive effect of real estate development at Éxito.

Underlying net financial expense and net profit, Group share5

Underlying net financial expense for the period came to -€398m(-€244m excluding interest expense on lease liabilities) vs. -€404min H1 2020 (-€239mexcluding interest expense on lease liabilities). In France Retail, net financial expense include, as for the refinancing of the Term Loan B of April 2021, (i) a non- recurring expense of €40m mainly non-cash,and (ii) a permanent reduction in financial expenses of €9m over the full year. E-commercenet financial expense was virtually stable compared with 2020. In Latin

America, financial expense was down.

Underlying net profit, Group share was up +€23m versus H1 2020.

Diluted underlying earnings per share6 stood at -€1.00, vs. -€1.20 in H1 2020.

The Group recorded a sharp improvement in other operating income and expenses of +€257m (+€11m in H1 2021 vs. -€246m in H1 2020). In France, excluding the asset disposal plan and GreenYellow, non- recurring expenses declined by 29% (from -€107m in H1 2020 to -€76m in H1 2021). In Latin America, other operating income and expenses amounted to a net expense of -€34m in H1 2021 (vs. -€18m in H1 2020).

  1. Excluding fuel and calendar effects
  2. Data published by the subsidiary
  3. Contribution to consolidated EBITDA. Data published by the subsidiary: EBITDA of €37m in H1 2021
  4. Tax credits restated by subsidiaries in the calculation of adjusted EBITDA
  5. See definition on page 13
  6. Underlying diluted EPS includes the dilutive effect of TSSDI deeply-subordinated bond distributions

Thursday, 29 July 2021 3

Consolidated net profit (loss), Group share

Net profit (loss) from continuing operations, Group share improved by a sharp +€306m to -€35m,from -€340min H1 2020.

Net profit (loss) from discontinued operations, Group share came out at -€170min H1 2021, compared with -€162min H1 2020.

Consolidated net profit (loss), Group share amounted to -€205mvs. -€502min H1 2020.

Financial position at 30 June 2021

-

Consolidated net debt excluding the effect of IFRS 5 was stable compared with 30 June 2020, at €6.3bn, reflecting stable net debt in both France and the Latam region. Including the impact of IFRS 5, consolidated net debt came to €5.5bn versus €4.8bn in H1 2020.

At 30 June 2021, the Group's liquidity in France (including Cdiscount) was €2.6bn, with €528m in cash and cash equivalents and €2bn confirmed undrawn lines of credit, available at any time. The Group also has €339m in a segregated account for gross debt redemptions.

Thursday, 29 July 2021 4

FIRST-HALF 2021 HIGHLIGHTS

-

Retail banners: increased profitability and progress in priority areas of expansion and E-commerce

Profitability continued to improve for the retail banners1, with trading profit margin up +81 bps to 2.1% in H1 2021. Trading profit increased by +50% in H1 2021, to €146m (vs. €97m in H1 2020), supported by a reduction in the cost base of €30m per quarter thanks to the transformation plans initiated in Q3 2020, which drove productivity gains at the head office and in stores.

Expansion of the store base and digitalisation

Expansion of the Group's store base continued during the period, with 353 convenience stores opened in urban, semi-urban and rural areas, of which 26 Naturalia. In Q2 2021, the Group opened 238 stores, in line with the initial target of 200 openings.

The Group had 613 stores equipped with autonomous solutions as of end-June 2021 (vs. 533 as of end- 2020), facilitating evening and weekend openings. 63% of payments in Géant hypermarkets and 58% at Casino Supermarkets were made by smartphone or automatic check-out as of end-June 2021 (vs. 61% and 48% respectively as of end-2020).CasinoMax app users accounted for 24% of sales in hypermarkets and supermarkets in Q2 (vs. 22% as of end-2020).

Food E-commerce

Food E-commerce2 posted same-store sales growth of +15% for the period and +103% over two years, outperforming the market (+59%3). The expanded offering now covers the full spectrum of home delivery solutions, through partnerships with high-tech players that are leaders in their field:

  • Next-daydelivery from the O'logistique warehouse (automated with Ocado technology) via
    Monoprix Plus (30,000 items) and Casino Plus (24,000 items) ;
  • Same-daydelivery/in-store click & collect solutions picked up pace with the launch of an Amazon click & collect service within 2 hours from Géant Casino and Casino Supermarkets (target of 180 stores). In addition, new deployments of Amazon lockers are planned, in addition to the 600 already installed to date in the Group ;
  • Delivery within two hours: extension of the partnership with Amazon to Montpellier and Strasbourg, in addition to Paris, Nice, Lyon and Bordeaux ;
  • Delivery within 30 minutes: roll-out of a quick-commerce offering across 800 stores thanks to
    Franprix's delivery services and the partnerships with Deliveroo and Uber Eats ;
  • Launch of a food marktetplace on the Casino.fr website

Sales initiatives

The Group's banners are adapting their offering to new consumer trends by developing a series of initiatives designed to meet their customers' expectations:

Expansion of Monoprix's range of services based on three key areas: (i) health, through Santé Au Quotidien spaces dedicated to health and well-being, with advice from a qualified pharmacist and a range of CBD products; (ii) local products, both food and non-food, from less than 100km away, and (iii) a sustainable mobility offering including bikes, kick scooters, a service station and a range of accessories (helmets, connected devices and fashion accessories)

Development of Franprix in suburban areas with 150 store openings scheduled over two years and specific customer services (newspapers and magazines, parcel receipt, hot meals and cooked dishes for the evening, and electric bike rental in partnership with Véligo)

Evolution of concepts within Géant Casino and Casino Supermarkets: both banners have introduced artificial intelligence into the operational management of their stores, and partnerships have been signed with some fifteen brands and start-ups to introduce innovative concepts (artisanal products in short circuits: juices, honeys, dairy products). Géant has deployed expanded fruit and vegetable areas, cash & carry spaces, developed electric mobility corners and will soon launch toy corners with La

  1. France Retail operations excluding Vindémia, real estate development and GreenYellow
  2. Food E-commerce = E-commerce France excluding Cdiscount
  3. Source: Nielsen, YTD P06 2021, over two years

Thursday, 29 July 2021 5

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Casino Guichard Perrachon SA published this content on 29 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2021 05:46:08 UTC.


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Sales 2021 30 602 M 35 859 M 35 859 M
Net income 2021 280 M 328 M 328 M
Net Debt 2021 9 300 M 10 898 M 10 898 M
P/E ratio 2021 9,02x
Yield 2021 2,36%
Capitalization 2 585 M 3 027 M 3 029 M
EV / Sales 2021 0,39x
EV / Sales 2022 0,36x
Nbr of Employees 202 955
Free-Float 47,0%
Chart CASINO, GUICHARD-PERRACHON
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Casino, Guichard-Perrachon Technical Analysis Chart | CO | FR0000125585 | MarketScreener
Technical analysis trends CASINO, GUICHARD-PERRACHON
Short TermMid-TermLong Term
TrendsNeutralBearishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 12
Last Close Price 23,95 €
Average target price 27,89 €
Spread / Average Target 16,5%
EPS Revisions
Managers and Directors
Jean-Charles Henri Naouri Chairman & Chief Executive Officer
David Lubek Chef Financial Officer
Julia Perroni Deputy Director-Finance
Julien Lagubeau Chief Operating Officer
FrÚdÚric Saint-Geours Lead Independent Director
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