Casino Group: 2019 Full Year Results
2019 FULL YEAR RESULTS
Consolidated trading profit of €1,292m, up +5.5% at
constant exchange rates (excluding tax credits)
In France, Retail trading margin of 3.8% (+0.5pt vs.
2018)
Reduction in France net debt to €2.3bn
Acceleration of strategic repositioning of
operations in France
In France
- Acceleration of strategic repositioning to focus on
buoyant formats with the disposal of Leader Price,
bringing the total proceeds from signed disposals under the
disposal plan to €2.8bn
- Gross sales under banner up +1,9% on a same-store
basis
- 24% of the activity done through E-commerce in Q4
2019 vs 18% in 2018
- Retail trading margin up +0.5pt to 3.8%,
with trading profit up +12% to €622m1
- Reduction in net debt to €2.3bn driven by the
disposal plan, with recurring free cash flow (excluding the
disposal and Rocade plans) of €367m2 (€576m excluding
non-recurring items)
- Major milestone achieved in retail business
modernisation, with faster development of
automated checkout systems (smartphone,
self-service checkouts, autonomous stores) and growth in
home delivery services (Ocado warehouse launched
on a test basis on 18 March 2020)
In Latin America
- Simplified Group structure in
Latin America, with all businesses placed under the
umbrella of the GPA subsidiary
- Assaí’s excellent momentum confirmed, with
sales up +22%3 and margin up +20bps3
- Success of Éxito’s new formats and a 20bps3
improvement in margin
- Digital transformation and strong growth in
E-commerce, up nearly +40%3
In the context of the Covid-19 crisis,
Casino Group is focusing on its core mission of
ensuring that all communities have uninterrupted food
supplies
- The key priority is the implementation of necessary
measures to protect the health of employees and clients at
all workplaces and in all areas open to the public: distribution of
face masks and hydro-alcoholic gels, installation of plexiglass
screens at check-outs, respect of social distancing measures
between clients, promotion of automatic payment solutions (up to
50% of payment flows in the hypermarkets in France)
- Like other food retailers4, the Group is
faced with unprecedented demand, both in stores
and for Drive or home delivery services. In
France, demand in large cities is particularly
high in the convenience stores and on E‑commerce sites.
With a network of 7,200 stores and the Cdiscount E-commerce banner,
the Group is ready to fulfil its mission
- A crisis management unit has been set up and
is in continuous contact with suppliers and public authorities to
ensure supply chain continuity and to secure
operations in the stores and E-commerce fulfilment
centres
- Initiatives to help the most vulnerable
populations have been launched (shopping hours reserved
for over 65s and care-givers, ready-to-deliver baskets, telephone
orders, expanded Cdiscount food offering)
2019 Key figures
In €m, post-IFRS 16 |
2018 restated |
2019 |
Reportedchange |
Changeat constant exch.
rates |
Net sales |
34,329 |
34,645 |
+0.9% |
+4.2%5 |
EBITDA |
2,669 |
2,640 |
-1.1% |
+0.6% |
Trading profit |
1,364 |
1,292 |
-5.3% |
-3.1% |
Trading profit excl. tax credits |
1,252 |
1,292 |
+3.2% |
+5.5% |
Underlying net profit, Group share |
327 |
212 |
-35.4% |
-34.9% |
Underlying diluted earnings per share |
2.57 |
1.62 |
-37.2% |
-34.6% |
Net debt |
(3,378) |
(4,053) |
-675 |
n.m. |
o/w France Retail |
(2,724) |
(2,282) |
+441 |
n.m. |
The Board of Directors met on 24 March 2020 to
approve the statutory and consolidated financial statements for
2019. The 2018 and 2019 financial statements are presented in
accordance with IFRS 16 – Leases, the Group having elected to
apply the “full retrospective” transition method. Via Varejo,
which was sold on 14 June 2019, is presented as a discontinued
operation in 2018 and from January 1st to June 30 2019, in
accordance with IFRS 5. In light of the decision made in 2019 to
divest Leader Price, this business is presented as a discontinued
operation in 2019, in accordance with IFRS 5. The 2018 financial
statements have been restated to permit meaningful comparisons with
2019. The auditors have completed their audit procedures on the
financial statements and are in the process of issuing their
report.
During the year, the Group continued its
development in France focused on its strategic
priorities and on buoyant formats.
Premium and convenience formats
- The sale of Leader Price represents a
key milestone in the Group’s strategy of
repositioning its operations to focus on
buoyant formats.
- Relaunch of expansion in convenience
(including premium) with 213 stores opened.
- Launch of commercial synergies between Monoprix and
Franprix.
- Net sales in the organic segment increased
sharply to €1.1bn, driven by the general
banners, which recorded growth in sales of +11% (share of
organic sales of +14% at Monoprix), and by the expansion of
Naturalia.
E-commerce and digital solutions
- 24% of the activity done through E-commerce in Q4 2019 vs. 18%
in 2018.
- The Group extended its leadership in non-food
E-commerce via Cdiscount, which recorded
GMV of nearly €4bn6 in 2019. The +9.1%1 organic increase of GMV was
driven by continued expansion of the marketplace,
which accounted for 38.1%1 of GMV, and by B2C services.
- The Group continued to develop the food
E-commerce7 segment, up +11% to
€353m, led by the successful partnership
with Amazon. Food E-commerce has been accelerating
strongly over the last few weeks. The Ocado
warehouse has been operating on a test basis since
18 March 2020.
- The Group has over 300 autonomous stores
at end-2019 generating a 0.8% Q4 increase in customer traffic in
France, including 2.3% growth in supermarket traffic. Openings are
facilitated by the CasinoMax app whose penetration
is strong with 20% of sales generated by users in the last two
months of the year8. The new "CasinoMax Extra" subscription loyalty
program reserved for users of the application has 80,000
subscribers at the end of 2019. In addition, 45%9 of payments in
hypermarkets and 36%4 in supermarkets are now made by smartphone or
automatic check-out corresponding to a profound evolution of the
model particularly adapted in the current period.
In Latin America, very good performance
in the Cash & Carry segment and refurbished
formats; sharp acceleration in E-commerce.
In Latin America,
GPA’s performance was driven by the Cash &
Carry business (Assaí), which recorded organic growth of +22%1, and
by the refurbished and convenience formats.
E‑commerce sales were up +40%1. In
Colombia, the Éxito Wow, Carulla Fresh Market and
Surtimayorista formats met with resounding success. Growth in the
E-commerce business came to +37%1.
The Group has sped up development
of its new B2B businesses, which serve as
additional growth levers.
GreenYellow
In 2019, GreenYellow
accelerated the development of its photovoltaic business, resulting
in a threefold increase in its pipeline to 451MWp
at end-2019 and EBITDA of
€76m.
GreenYellow has made strong
international expansion (in Asia, Latin America, Africa
and the Indian Ocean region) and has continued to diversify
its customer portfolio alongside public authorities and
manufacturers (such as Schneider Electric and STMicroElectronics).
The subsidiary has forged major strategic
partnerships: Reservoir Sun which is now
the key player in solar self-consumption in France (over 100MWp
secured in one year), and Allego which intends to deploy France’s
largest network of ultra-fast electric vehicle charging
stations.
Data and Data
Centers
The Data and Data Centers
division generated €67m in sales, up +51% from 2018.
In the Data business, the two
Casino Group’s entities, 3W.relevanC and Maxit, are being
combined to form relevanC, a key player in digital
marketing. relevanC will provide brands and retailers with
customer acquisition and retention solutions, based on targeting
strategies and impact measurement, via two divisions:
- relevanC advertising (formerly 3w.relevanC): media and
marketing solutions, enhanced by transactional data, insights and
measurement, to meet all the multi-channel marketing challenges
related to target shoppers, and;
- relevanC retail tech (formerly Maxit): technological solutions
enabling retailers to optimise the performance of their marketing
campaigns by using their data to personalise the
customer relationship.
In the Data Centers business,
ScaleMax has diversified its portfolio of external
customers (notably including BNP Paribas, Natixis and Mac
Guff) and deployed 20,000 cores in one year.
The Group also sped up the
execution of key strategic and financial plans, resulting in a
reinforced financial structure.
The Group recorded €2.8bn in
non-strategic assets sold since June 2018, of which €1.8m
in proceeds had been collected by end-2019. Disposals that are
signed but not yet collected represent an amount of €1bn, that will
help the Group to reimburse or buyback the bonds maturing in
2021-2022 (with a total of €1.1bn in bonds to be redeemed after the
refinancing operation).
The sale of Leader Price10
completes the Rocade plan initiated at the end of
2018. The Group has sold 17 integrated hypermarkets and
14 integrated supermarkets, and closed 4 loss-making
integrated supermarkets. Excluding Leader Price, the impact on
sales is -€500m on a full year basis, partly offset by the rallying
of franchisees with a gross sales under banner of nearly €300m. The
full year impact of the Rocade plan on trading profit is a positive
€50m (a positive €18m in 2019).
As announced in Q4 2019, the Group has
finalised its refinancing plan in
France and completed the reorganisation of its operations
in Latin America under Brazilian subsidiary GPA, which has
been listed on the Novo Mercado since 2 March 2020.
2019 Full Year Results
In 2019, Group consolidated net
sales amounted to €34.6bn,
up +4.2% on an organic basis11 and up +0.9%
after taking into account the effects of exchange rates and
hyperinflation of -1.9% and the effect of changes in scope of
-0.8%.
In France,
sales were up +0.3% on a same-store
basis. Including Cdiscount, gross sales under banner in
France were up +1.9% on a same-store basis.
E-commerce (Cdiscount)
gross merchandise volume (“GMV”)
came to €4bn, a year-on-year increase of +9.1%12
on an organic basis, led by the expansion of the marketplace.
Sales in Latin America were up
sharply by +9.7% on an organic basis1, mainly supported by the very
good performance in the Cash & Carry segment
(Assaí), which recorded organic growth of
+22%2.
Consolidated trading profit
came to €1,292m, a change of -5.3% including the
impact of currency effects and a change of -3.1% at constant
exchange rates. Excluding tax credits in Brazil,
consolidated trading profit was up +3.2% in total
and +5.5% at constant exchange rates.
In France, EBITDA
margin improved by +57bps to 9.0% of
sales. Retail trading profit came to
€622m, up +11.6%, i.e. a retail trading
margin of 3.8%. Pre-IFRS 16 retail
trading profit improved by +4.9% to €517m. The
effects of the Rocade plan and the cost-saving plans more than
offset the €68m increase in rental expenses related to the
disposals of store properties.
E-commerce (Cdiscount) EBITDA
amounted to €69m, an increase of +€30m driven primarily by the
marketplace and increased monetisation revenue in both B2B and B2C
services. EBITDA margin improved by +153bps to
reach 3.5% of net sales.
In Latin America, the
trading profit excluding tax
credits amounted to €612m, almost stable
excluding exchange rate effects (-1,0% at constant exchange rates).
In Brazil, Assaí’s trading margin excluding tax credits improved
and Multivarejo was impacted by investments in promotional
campaigns. Éxito’s trading margin increased driven by the success
of new concepts and E-commerce. Latin America
trading profit including tax credits and
exchange rate effects was down -19.3% due to the absence
of tax credits in 2019 and a currency effect of nearly -4%.
Underlying net financial expense and net
profit, Group share13
Underlying net financial
expense for the period came to -€716m
(-€448m excl. interest expense on lease
liabilities) vs. -€629m in 2018 (-€411m excl. interest
expense on lease liabilities). In France, the
underlying net financial expense excluding interest expense on
lease liabilities is stable. The underlying net financial expense
in E-commerce is stable vs. 2018. In Latin
America, net financial expense increased in line with the
financing of GPA in the context of the takeover bid on Éxito.
Underlying net profit from continuing
operations, Group share totalled €212m,
compared with €327m in 2018 mainly due to a decrease in trading
profit in Brazil related to the absence of tax credits and a change
in tax expense in France due to lower activations of tax loss
carryforwards than in 2018 (notably Cdiscount) and the
transformation of the CICE into an taxable social expense.
Diluted underlying earnings per
share14 stood at €1.62, vs. €2.57 in 2018.
Consolidated net profit (loss), Group
share
Profit (loss) from continuing
operations, Group share came out at -€384m, compared with
-€60m in 2018, reflecting an increase in non-recurring non-cash
costs relating to the disposal plan. Profit (loss) from
discontinued operations, Group share came
out at -€1,048m, compared with -€57m in 2018, mainly due to
goodwill impairment.
Consolidated net profit (loss), Group
share amounted to -€1,432m, vs. -€117m in 2018.
Financial position at 31 December
2019
Consolidated cash flow from continuing
operations came to €2,172m vs. €2,414m in 2018.
Casino Group consolidated net
debt stood at €4.1bn at 31 December
2019 vs. €3.4bn at 31 December 2018. The increase in
consolidated net debt reflects the net impact of the reorganisation
in Latin America (repurchase of Éxito's share in GPA by Casino,
GPA's takeover bid for Éxito), while France net debt
decreased to €2.3bn (vs. €2.7bn at end-2018) and
E-commerce debt was close to stable.
At 31 December 2019, Casino in France15 had
€4.0bn in liquidity, composed of
a gross cash position of €1.7bn
and confirmed undrawn lines of credit of
€2.3bn. The Group also had €193m in an
escrow account for the repayment of the bond that matured
early March 2020.
2020 outlook
The Casino Group is fully
committed to secure the supply of populations, while
ensuring the protection of employees and clients.
The Group’s strengths (convenience,
E-commerce, automatic payment solutions) are being
deployed to meet customers’ needs in the safest
possible manner.
The Group will pursue the accelerated
adaptation of its operating processes and the development of new
offers responding to the current unprecedented
situation.
Consolidated net sales by
segment
Net sales In €m, post-IFRS 16 |
2018 restated |
2019 |
Change |
Change at constant exch. rates |
France Retail |
16,786 |
16,322 |
-2.8% |
- |
Latam Retail |
15,577 |
16,358 |
+5.0% |
+9.7%16 |
E-commerce (Cdiscount) |
1,965 |
1,966 |
+0.0% |
- |
Group total |
34,329 |
34,645 |
+0.9% |
+4.2%1 |
Consolidated EBITDA by
segment
EBITDA In €m, post-IFRS 16 |
2018 restated |
2019 |
Change |
Change at constant exch. rates |
France Retail |
1,413 |
1,467 |
+3.8% |
+3.9% |
Latam Retail |
1,217 |
1,104 |
-9.3% |
-5.7% |
E-commerce (Cdiscount) |
39 |
69 |
+77.5% |
+77.5% |
Group total |
2,669 |
2,640 |
-1.1% |
+0.6% |
Consolidated trading profit by
segment
Trading profit In €m, post-IFRS 16 |
2018 restated |
2019 |
Change |
Change at constant exch. rates |
France Retail |
618 |
676 |
+9.4% |
+9.6% |
Latam Retail |
758 |
612 |
-19.3% |
-15.5% |
E-commerce (Cdiscount) |
(12) |
4 |
n.m. |
n.m. |
Group total |
1,364 |
1,292 |
-5.3% |
-3.1% |
Change in net debt by
entity
In €m, post-IFRS 16 |
2018 restated |
Change |
2019 |
France Retail |
(2,724) |
+441 |
(2,282) |
E-commerce (Cdiscount) |
(199) |
-22 |
(221) |
Latam Retail |
(1,018) |
-532 |
(1,550) |
o/w GPA |
(200) |
-1,775 |
(1,975) |
o/w Éxito |
(423) |
+1,060 |
638 |
o/w Segisor |
(389) |
+204 |
(185) |
Latam Electronics |
563 |
-563 |
- |
Total |
(3,378) |
-675 |
(4,053) |
Group net debt – 2019
In €m, post-IFRS 16 |
2018 restated |
2019 |
Group net debt as of 1 January |
(4,069) |
(3,378) |
Free cash flow17 |
2,104 |
1,786 |
Interest expense (including interest on lease liabilities) |
(629) |
(617) |
Dividends paid to shareholders and holders of TSSDI
deeply-subordinated bonds |
(491) |
(299) |
Share buybacks and transactions with non-controlling interests |
129 |
(1,011) |
Other net financial investments |
61 |
(240) |
Repayment of lease liabilities |
(617) |
(713) |
Other non-cash items |
(493) |
(83) |
Assets held for sale recognised in accordance with IFRS 5 |
628 |
503 |
Group net debt as of 31 December |
(3,378) |
(4,053) |
France net debt – 2019
In €m,
post-IFRS 16 |
2018 restated |
2019 |
France net debt as of 1 January |
(3,703) |
(2,724) |
Free cash flow18 + net proceeds from
disposal and Rocade plans |
1,066 |
1,057 |
Interest expense (excluding interest on lease liabilities) |
(133) |
(161) |
Dividends paid to shareholders and holders of TSSDI
deeply-subordinated bonds |
(400) |
(211) |
Share buybacks and transactions with non-controlling interests |
(97) |
(90) |
GreenYellow capital increase |
149 |
- |
Other net financial investments (excl. disposal plan and
Rocade) |
69 |
(439)19 |
Other non-cash items |
(459) |
(20)20 |
o/w non-cash financial expenses |
(11) |
(6) |
Assets held for sale recognised in accordance with IFRS 5 |
585 |
503 |
Segisor |
200 |
(198) |
Change in net debt |
980 |
441 |
France net debt as of 31 December |
(2,724) |
(2,282) |
2019 Results21
In €m, post-IFRS 16 |
2018 restated |
2019 |
Net sales |
34,329 |
34,645 |
EBITDA |
2,669 |
2,640 |
Trading profit |
1,364 |
1,292 |
Trading profit and share of profit of equity-accounted
investees |
1,424 |
1,338 |
Other operating income and expenses |
(402) |
(719) |
Operating profit |
962 |
574 |
Net finance costs |
(320) |
(356) |
Other financial income and expenses |
(356) |
(394) |
Income taxes |
(188) |
(137) |
Share of profit of equity-accounted investees |
60 |
46 |
Net profit (loss) from continuing operations, Group share |
(60) |
(384) |
Net profit (loss) from discontinued operations, Group share |
(57) |
(1,048) |
Net profit (loss), Group share |
(117) |
(1,432) |
Underlying net profit, Group share |
327 |
212 |
Underlying net profit
In €m, post-IFRS 16 |
2018 restated |
Adjustments |
2018 underlying |
2019 |
Adjustments |
2019 underlying |
|
Trading profit |
1,364 |
0 |
1,364 |
1,292 |
0 |
1,292 |
|
Other operating income and expenses |
(402) |
402 |
0 |
(719) |
719 |
0 |
|
Operating profit |
962 |
402 |
1,364 |
574 |
719 |
1,292 |
|
Net finance costs |
(320) |
0 |
(320) |
(356) |
0 |
(356) |
|
Other financial income and expenses22 |
(356) |
47 |
(310) |
(394) |
34 |
(360) |
|
Income taxes23 |
(188) |
(13) |
(201) |
(137) |
(116) |
(253) |
|
Share of profit of equity-accounted investees |
60 |
0 |
60 |
46 |
0 |
46 |
|
Net profit (loss) from continuing operations |
159 |
436 |
594 |
(268) |
637 |
369 |
|
xx |
xx |
xx |
xx |
o/w attributable to non-controlling interests24 |
218 |
49 |
267 |
116 |
41 |
157 |
|
o/w Group share |
(60) |
387 |
327 |
(384) |
596 |
212 |
|
Underlying net profit corresponds to net profit
from continuing operations, adjusted for (i) the impact of
other operating income and expenses, as defined in the "Significant
accounting policies" section in the notes to the consolidated
financial statements, (ii) the impact of non-recurring
financial items, as well as (iii) income tax expense/benefits
related to these adjustments and (iv) the implementation of IFRIC
23.
Non-recurring financial items include fair value
adjustments to equity derivative instruments (such as total return
swaps and forward instruments related to GPA shares) and the
effects of discounting Brazilian tax liabilities.
Simplified balance sheet –
2019
In €m, post-IFRS 16 |
2018 restated |
2019 |
Non-current assets |
24,197 |
22,524 |
Current assets |
18,450 |
12,320 |
Total assets |
42,647 |
34,844 |
Total equity |
11,709 |
8,291 |
Non-current financial liabilities |
6,782 |
8,100 |
Other non-current liabilities |
5,602 |
5,560 |
Current liabilities |
18,554 |
12,892 |
Total equity and liabilities |
42,647 |
34,844 |
ANALYST AND INVESTOR
CONTACTS
Régine GAGGIOLI – +33 (0)1 53 65
64 17 rgaggioli@groupe-casino.fr
or
+33 (0)1 53 65 24 17
IR_Casino@groupe-casino.fr
PRESS CONTACTS
Casino Group – Communications
DepartmentStéphanie ABADIE – sabadie@groupe-casino.fr –
+33 (0)6 26 27 37 05
or
+33 (0)1 53 65 24 78 –
directiondelacommunication@groupe-casino.fr
Agence IMAGE 7Karine ALLOUIS –
+33 (0)6 11 59 23 26 – kallouis@image7.frFlore LARGER – +33(0)6 33
13 41 50 - flarger@image7.fr
Disclaimer
This press release was prepared solely
for information purposes, and should not be construed as a
solicitation or an offer to buy or sell securities or related
financial instruments. Likewise, it does not provide and should not
be treated as providing investment advice. It has no connection
with the specific investment objectives, financial situation or
needs of any receiver. No representation or warranty, either
express or implied, is provided in relation to the accuracy,
completeness or reliability of the information contained herein.
Recipients should not consider it as a substitute for the exercise
of their own judgement. All the opinions expressed herein are
subject to change without notice.
1 Post-IFRS 16. Pre-IFRS 16, France
retail trading profit was up +5% and retail trading margin up +0.2
pt.2 Free cash flow excluding the disposal plan and the Rocade
plan, before dividends paid to owners of the parent and holders of
TSSDI deeply-subordinated bonds, excluding financial expenses,
including rental expense (repayments of lease liabilities and
interest on leases). Pre-IFRS 16: €380m.3 Data published by
the subsidiary4 Source: NielsenNote: The 2018 and 2019 financial
statements are presented in accordance with IFRS 16 – Leases,
the Group having elected to apply the “full retrospective”
transition method. In addition, the 2018 financial statements have
been restated to exclude Leader Price, which has been classified as
a discontinued operation, in accordance with IFRS 5.
5 Change in net sales presented on an organic basis
6 Data published by the subsidiary
7 Food E-commerce = France E-commerce excluding Cdiscount
8 Data for the 2 last months of 2019
9 Data for February and March 2020
10 For an enterprise value of €735m, including a €35m earn-out
contingent on the achievement of certain operating indicators
during the transition period.
11 Excluding fuel and calendar
effects
12 Data published by the subsidiary
13 See definition on page 12.
14 Underlying diluted EPS includes the dilutive effect of TSSDI
deeply-subordinated bond distributions.
15 Casino Group's holding structure, including the French
activities and wholly-owned holding companies
16 Organic change excluding calendar and fuel effects
17 Before dividends paid to the owners of the parent and holders
of TSSDI deeply-subordinated bonds, and before financial
expenses
18 Before dividends paid to owners of the parent
and holders of TSSDI deeply-subordinated bonds, excluding financial
expenses, including rental expense (repayments of lease liabilities
and interest on leases)
19 Mainly including -€193m paid into an escrow
account dedicated to the repayment of the March 2020 bond maturity
(neutral impact on net debt with a compensation in "other non-cash
items") and - €109m paid to unwind the GPA forward contract
20 Mainly including the current account with
Leader Price and the escrow account dedicated to the repayment of
the March 2020 bond maturity
21 The 2018 and 2019 financial statements are
presented in accordance with IFRS 16 – Leases, the Group
having elected to apply the “full retrospective” transition
method. Via Varejo, which was sold on 14 June 2019, is presented as
a discontinued operation in 2018 and from January 1st to June 30
2019, in accordance with IFRS 5. In light of the decision made in
2019 to divest Leader Price, this business is presented as a
discontinued operation in 2019, in accordance with IFRS 5. The 2018
financial statements have been restated to permit meaningful
comparisons with 2019.
22 Other financial income and expenses have been
restated, primarily for the impact of discounting tax liabilities,
as well as for changes in the fair value of the total return swaps
on GPA shares and the GPA forward
23 Income taxes have been restated for tax
effects corresponding to the above restated financial items and the
tax effects of the restatements
24 Non-controlling interests have been restated
for the amounts relating to the restated items listed above.
- 20200326 - PR - 2019 Full Year Results
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