Carrefour reassures investors and keeps targets
Carrefour (CARR.PA: Quote, Profile, Research, Stock Buzz) bucked the sliding trend in the fortunes of European retailers on Friday when it stuck to its 2008 business forecasts and met key profit expectations for the first half despite consumer spending fears.
The world’s second largest retailer behind U.S. giant Wal-Mart (WMT.N: Quote, Profile, Research, Stock Buzz) posted first-half operating profit up 5.5 percent, lifted by strong performance in its Latin American growth markets, helping to send its shares up as much as 8 percent.
Investors had turned the spotlight on France’s biggest store chain, which issued a profit warning in June, after earnings from Dutch retailer Ahold (AHLN.AS: Quote, Profile, Research, Stock Buzz) and French rival Casino (CASP.PA: Quote, Profile, Research, Stock Buzz) disappointed on Thursday, hitting the whole sector.
But relief that Carrefour was not, at least for the time being, further trimming its forecasts for the rest of the year prompted a rebound in share prices in a flat market on Friday.
Oddo Securities analyst Nicolas Champs said that the share price had “reacted positively because some investors were reassured by the fact that Carrefour confirmed its profit objectives.”
The group’s operating profit rose 5.5 percent to 1.404 billion euros ($2.07 billion), in line with an average forecast of 1.401 billion euros in a Reuters poll of 11 analysts.
Carrefour shares were up 6.62 percent at 35.93 euros at 9:27 a.m fastcash. EDT while Casino gained 2.8 percent and Ahold 2.2 percent.
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