Carrefour has delivered a decent set of first-quarter numbers this morning, achieving a rise in group like-for-like sales of 3.1%.

Much of this uplift was driven by the company’s international business, where like-for-likes advanced 5.3%.

As predicted by Planet Retail, the French operations saw a slight worsening in like-for-like performance as it annualised some tough comparatives.

The business posted flat numbers, although only very slightly below what it achieved in its fourth quarter, which must be seen as a decent performance in a challenging market.

As explained by the company’s senior management team this morning, promotional activity across the French market remains high – and Carrefour is one of the most promotional operators.

This is clearly having a dampening effect on top-line numbers. Carrefour’s French market share has also slipped during the quarter, although management didn’t seem too worried.

Big-box woes

Looking in more detail at the channels in which Carrefour operates, the business continues to struggle to get its core hypermarket format motoring once again.

“Carrefour is proving itself to be adaptable with regards to trialling new hypermarket concepts in an effort to solve the big-box problem”

David Gray, Planet Retail

It delivered a 0.6% drop in like-for-likes, compared with a rise of 0.7% for supermarkets and a 1.1% uptick within convenience formats.

This, however, is by no means an issue just affecting Carrefour. Hypermarket formats in Western Europe have been challenged for some time as consumers increasingly top-up locally at convenience stores.

We are fairly confident Carrefour will be able to get this format back on track via its store refurbishment programme.

The group is proving itself to be adaptable with regards to trialling new hypermarket concepts in an effort to solve the big-box problem.

This is an issue that it must resolve, of course, as this is where Carrefour France generates the vast majority of its sales and profits.

Positives overseas

The international numbers were where the real positives could be found this morning, although China – a market where Carrefour has been struggling for some time – proved the obvious exception.

Again, this is not just a problem for Carrefour. Many foreign operators have struggled to crack the Chinese market for some time.

In Europe, all of Carrefour’s key businesses achieved like-for-like growth – a positive sign considering many economies in the region are still facing economic challenges.

There was good progress in southern Europe in particular, with Spain doing well and Italy well on the road to recovery, recording like-for-like increases of 3.4% and 4.5% respectively.

Latin America showed especially strong growth, a big factor in the impressive overall international performance. Here, like-for-likes climbed 13.5%, with Brazil delivering an increase of 9.5%.

Carrefour’s mix of operations around the world from Europe to Latin America is currently helping to shield it from an arduous trading environment back home in France.

This is a clear advantage against some of its Franco-focused competitors like E Leclerc or Intermarché, for example.

It also means that when, as opposed to if, Carrefour begins to see real positive returns from its revamped big-box stores, it will genuinely be a force to reckon with.