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Retailer Carrefour Eyes More Savings As 2020 Core Profits Rise

Carrefour is in the middle of a five-year plan to cut costs and jobs, as well as boost e-commerce investment in order to lift profits and sales and tackle competition from e-commerce giant Amazon.

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Carrefour unveiled new cost savings and cash flow targets after Europe's largest retailer said it had achieved its goal of 3 billion euros ($3.6 billion) in cost cuts by 2020.

The French food retailer, whose possible takeover by Canada's Alimentation Couche-Tard unravelled last month after opposition from the French government, also reported a 16.7% rise in 2020 recurring operating profit to 2.173 billion euros at constant exchange rates.

Its 2020 sales grew 7.8% on a like-for-like basis to 78.6 billion euros, Carrefour's best performance in at least 20 years.

Carrefour also said it would propose a dividend of 0.48 euros per share, a 4.3% hike from 2019.

This reflected strong sales in the key markets of Brazil and France, with food retailers across the world benefiting from stronger demand as more consumers stay at home during the French food retailer.

The strong performance reflected "three years of flowless roll-out of our transformation", Chairman and Chief Executive Alexandre Bompard said in a statement.

"We are confident for the future, and translate this confidence into new operational and financial commitments."

Carrefour said it now targeted 2.4 billion euros in additional cost savings on an annual basis by 2023 and net free cash flow generation above 1 billion euros per year from 2021.

Carrefour is in the middle of a five-year plan to cut costs and jobs, as well as boost e-commerce investment in order to lift profits and sales and tackle competition from e-commerce giant Amazon.

In France, where Bompard has made reviving flagging sales at hypermarket stores a priority, operating profit rose 13.2% to 629 million euros on sales that rose 3.6% like for like. All store formats in France, including hypermarkets, saw sales rise.

(Reuters)


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