Groupe Casino: First Quarter Organic Sales Growth of 3.7%

SAINT-ETIENNE, France--(BUSINESS WIRE)--

Regulatory News:

Groupe Casino (Paris:CO):




Consolidated net sales


Q1 2006

(€m)





Q1 2007

(€m)





% change 








Reported




Organic*




Continuing operations


5,360.1 




5,480.4 




+2.2%




+3.7%




France


4,177.1 




4,238.9 




+1.5%




+1.5%




International


1,183.1 




1,241.5 




+4.9%




+11.7%

*At constant scope of consolidation and exchange rates

Consolidated net sales for the first quarter of 2007 amounted to €5,480.4
million, an increase of 2.2% over the year-earlier period. Divestment of
operations in Taiwan reduced sales by 0.9% while the currency effect was
a negative 0.6%. Excluding these effects, organic growth came to 3.7%,
led by a strong 11.7% increase in international markets.

In France, sales were up 1.5%. All formats performed
satisfactorily during the quarter, with the exception of Franprix-Leader
Price where an action plan to revitalise sales growth will be
implemented in the next few weeks.

In a deflationary environment, the Group is reaping the benefits of its
differenciated marketing strategy. The strategy focuses on:



strengthening private label lines, which have been posting
double-digit sales growth for three years in a row.


targeted price cuts, for a list of products determined with the
assistance of dunnhumby and comprising some 600 national brand items
as well as 400 private label and value line items.


expanding and improving the fresh produce offering.

These initiatives fuelled a sharp rise in the proportion of hypermarket
and supermarket sales made by loyalty cardholders. This in turn led to
an increase in the average basket, as cardholder customers tend to spend
significantly more than other customers.

As a result, the hypermarkets and supermarkets reported same-store sales
up 0.8% and 3.8% respectively, excluding gasoline.

Monoprix leveraged its unique market position to achieve sustained 2.9%
same-store growth and to speed up its expansion.

The superettes maintained a sustained pace of openings with some 18,000
square meters added during the quarter and posted a satisfactory 1.6%
increase in sales.

Franprix-Leader Price sales contracted 3.8% over the quarter, mainly due
to an 11% decline in same-store sales at Leader Price.

Organic growth in International markets came to 11.7%. This
robust performance was attributable to strong gains in the Group’s
two priority host regions – Latin America (up
14.2%) and Asia (up 11.6%). All countries reported increased same-store
sales.

The Group confirms its objectives announced on 15 March 2007:



further growth in trading profit in 2007


continued improvement in the financial structure to reach a net debt
to EBITDA ratio of less than 2.5 by year-end.

FRANCE

In France, first quarter sales rose 1.5% over the year-earlier period.
The 0.5% favourable calendar effect was offset by the 0.4% negative
impact of lower gasoline sales.

During the quarter, the Group opened 43,000 square meters of retail
sales area, primarily reflecting sustained expansion of the supermarket
and superette formats.




€ millions


First quarter




2006 




2007 




Change




Net sales, France


4,177.1 




4,238.9 




+1.5%




Géant Casino hypermarkets


1,447.9 




1,447.7 




+0.0%




Convenience stores


1,470.8 




1,530.2 




+4.0%




Casino supermarkets


693.5 




730.0 




+5.3%




Monoprix


419.3 




436.7 




+4.1%




Superettes


357.9 




363.5 




+1.6%




Franprix-Leader Price


1,021.5 




982.3 




-3.8%




Other businesses


237.0 




278.7 




+17.6%






Same-store sales


First quarter 2007




 


Including gasoline




Excluding gasoline




Géant Casino hypermarkets


- 0.2%




+ 0.8%




Casino supermarkets


+ 2.5%




+ 3.8%




Franprix


- 1.2%




N/A 




Leader Price


- 11.0%




N/A 




Monoprix


+ 2.9%




+ 2.9%

Hypermarkets

Géant Casino hypermarket sales were stable in first-quarter 2007.
Excluding gasoline, same-store sales rose 0.8%. Growth was led by a 1.5%
increase in the average basket, attesting to the success of the banner’s
strategy to raise the number of loyalty cardholders, who spend on
average over 50% more than other customers. Over the last twelve months,
the percentage of sales realised with loyalty cardholders has gained
nearly five points.

Food sales rose 2%, reflecting higher volumes and an improved sales mix,
which was attributable to an assertive strategy of innovation in private
label products.

Non-food sales were down 1.6% due to the ongoing rationalisation of the
portfolio, which is sharpening the focus on the most promising and
highest -margin product families, as well as a reduction in promotional
offers thanks to improved inventory management. The sales trend improved
compared with 2006, thanks to the good results reported by the stores
that have implemented the new non-food concepts.

Géant Casino’s market share held firm during
the quarter (source: Secodip P3 – IRI P2).

Convenience stores

Supermarkets

Casino Supermarkets continued to enjoy sustained growth, with sales up
5.3% compared with first-quarter 2006. The Group benefited from the
assertive expansion strategy implemented in 2006 and pursued during the
quarter with the opening of some 12,000 square meters. Same-store growth
excluding gasoline stood at 3.8%, reflecting a 1.6% rise in customer
traffic and a 2.2% increase in the average basket. Growth in the average
basket was primarily attributable to a roughly four-point rise in the
percentage of sales realized with loyalty cardholders.

The increase in sales translated into a 0.1-point market share gain over
the quarter (source: Secodip P3 and IRI P2).

Monoprix

Monoprix delivered another solid performance, with same-store sales up
2.9%.The banner stepped up the pace of expansion, rolling out its new
concepts with the opening of three Monop’
outlets. In all, some 4,000 square meters were opened during the
quarter. Reported sales rose 4.1% over the period.

Superettes

Superette sales were up 1.6%. The format continued to expand rapidly,
with some 18,000 square meters opened during the quarter.

Discount stores

Franprix-Leader Price sales for the quarter were down 3.8% over the
year-earlier period.

Franprix’s same-store sales contracted
1.2%, while Leader Price showed no sign of improvement, reporting
an 11% decline in same-store sales. After appointing a new Franprix
management team in March 2007, the Group announced on 10 April that it
was taking over the executive and operational management of Leader
Price, with the priority objective of implementing an action plan to
rapidly reverse the decline in sales.

Other businesses

The contribution of other businesses (C’discount,
Mercialys, Casino Cafétéria and Banque Casino) for the quarter was up
17.6%, led by C’discount, which reported more
than a 25% gain in sales.

INTERNATIONAL

Sales in international markets rose 4.9% in the first quarter compared
with the same period of 2006. Changes in scope of consolidation had a
negative impact of 4.4%, primarily corresponding to the disposal of
operations in Taiwan. The currency effect was a negative 2.4%,
reflecting the euro’s appreciation against
Latin American currencies.

Organic growth remained high, at 11.7%, led by advances of 14.2% in
Latin America and 11.6% in Asia. These two regions accounted for 84% of
consolidated sales in international markets in the quarter.

Same-store sales growth was strong in Latin America and satisfactory in
Asia and the Indian Ocean.




Consolidated net sales – Q1 2007




Reported




Organic




Same-store




Latin America




+ 7.8%




+ 14.2%




+ 13.5%




Asia




+ 1.0%




+ 11.6%




+ 3.3%




Indian Ocean




+ 2.9%




+ 4.0%




+ 2.8%






Net sales of associates – Q1 2007




Reported




Organic




Same-store




Colombia




+ 17.8%




+ 25.9%




+ 14.4%




Netherlands (Super de Boer)




N/A 




+ 3.3%




+ 3.1%

In Latin America, organic growth stood at 14.2%, with same-store
sales up 13.5%. All countries in the region reported very satisfactory
same-store growth.

The marketing strategy implemented by CBD in Brazil to improve its price
competitiveness helped to deliver a 5.5% increase in same-store sales,
sustained by rising customer traffic since September 2006. CBD also
continued to expand its Extra Perto convenience format, opening four
stores during the quarter.

Exito, which is accounted for by the equity method, enjoyed another
period of double-digit growth, with same-store sales up 14.4%. The
assertive expansion strategy implemented in recent months lifted organic
growth to 25.9%.

Organic growth in Asia stood at 11.6%, including same-store
growth of 3.3%. Thailand’s Big C reported
satisfactory organic and same-store growth. In Vietnam, a new
hypermarket was opened during the quarter, raising the total number of
stores to six. In a very buoyant market, same-store sales rose sharply.

In the Indian Ocean region, organic growth came to 4%, led by a
2.8% increase in same-store sales.

In the Netherlands, Super de Boer reported a further improvement
in performance, with same-store sales up 3.1% over the quarter.

Main changes in the scope of consolidation



Disco (Uruguay) was proportionately consolidated on a 55% basis from 1
April 2006 (compared with 50% previously), and a 58% basis from 1
October 2006.


In accordance with IFRS 5 relating to proportionately consolidated
companies, sales from operations in Taiwan (FEG) are no longer
included in consolidated net sales since 14 September 2006 when the
FEG joint venture was classified under “Assets
held for sale”


In accordance with IFRS 5:




Sales of the Polish stores that have been sold or are in the process
of being sold have been reclassified under “Discontinued
operations”, while sales of the retained
stores are included in International sales under “Other”.


Sales of the US stores (Smart & Final) in the process of being sold
have also been reclassified under “Discontinued
operations”.





 


First quarter




Change




2006

(€m)





2007

(€m)





Reported




At constant exchange rates




FRANCE


4,177.1 




4,238.9 




+ 1.5%








Of which:

Géant Casino hypermarkets

1,447.9 

1,447.,7 

+ 0.0%









Convenience stores


1,470.8 




1,530.2 




+ 4.0%








Casino supermarkets


693.5 




730.0 




+ 5.3%








Monoprix


419.3 




436.7 




+ 4.1%

Superettes and Franchiseoutlets



357.9 




363.5 




+ 1.6%








Franprix–Leader Price


1,021.5 




982.3 




- 3.8%








Other businesses


237.0 




278.7 




+ 17.6%






















 




INTERNATIONAL


1,183.1 




1,241.5 




+ 4.9%




+ 7.3%




Of which:


















Latin America


629.7 




678.8 

+7.8%





+ 14.5%




Asia


357.4 




361.0 

+ 1.0%





- 3.8%




Of which Asia excluding Taiwan


308.0 




361.0 

+ 17.2%









Indian Ocean


195.7 




201.4 

+ 2.9%

4.0%





Other


0.3 




0.3 

 

 

NET SALES – CONTINUINGOPERATIONS



5,360.1 




5,480.4 




+ 2.2%




+ 2.8%




NET SALES - DISCONTINUEDOPERATIONS


579.6 




363.7 


























 




CONSOLIDATED NET SALES


5,939.7 




5,844.1 




 




 




NET SALES OF ASSOCIATES


















(accounted for by the equity

 









method)

 









Of which: Colombia (100%-basis)


319.2 




376.0 

17.8%

+25.9%





Netherlands (100%-basis)


808.0 




472.2 

N/A 

 







Average exchange rates


Q1 2006




Q1 2007




Change




United States (USD/EUR)


0.8319 




0.7631 




- 8.3%




Poland (PLN/EUR)


0.2609 




0.2573 




- 1.4%




Argentina (ARS/EUR)


0.2715 




0.2465 




- 9.2%




Uruguay (UYP/EUR)


0.0344 




0.0314 




- 8.6%




Venezuela (VEB/EUR) (x1.000)


0.3867 




0.3555 




- 8.1%




Thailand (THB/EUR)


0.0212 




0.0225 




6.1%




Taiwan (NTS/EUR)

Vietnam (VND/EUR) (x1.000)



0.0257

0.0516 





0.0232

0.0462 





- 9.9%

- 10.5%





Colombia (COP/EUR) (x1.000)


0.3673 




0.3437 




- 6.4%




Brazil (BRL/EUR)


0.3788 




0.3622 




- 4.4%






France

March 31,2006

Dec 31,2006

March 31,2007





Géant Casino hypermarkets

Of which French affiliates

International affiliates

Service stations





127

5

10

99 





128

6

10

99 





127

6

9

99 





Casino supermarkets

Of which French franchise affiliates

International franchise affiliates

Service stations





364

73

12

132 





367

73

12

136 





375

81

16

131 





Franprix supermarkets

Of which Franchise outlets





629

294 





637

299 





634

293 





Monoprix supermarkets

Of which Franchise outlets/Affiliates





303

64 





310

56 





316

55 





Leader Price discount stores

Of which Franchise outlets





429

171 





471

209 





476

212 

Total supermarkets and discount stores

Of which Franchise outlets/storesoperated under
business leases





1,725

614 





1,785

649 





1,801

657 





Petit Casino superettes

Of which Franchise outlets





2,095

26 





2,017

31 





2,025

28 





Eco Services superettes

Of which Franchise outlets





78

57 





42

35 





30

28 





Spar superettes

Of which Franchise outlets





817

667 





862

684 





876

699 





Vival superettes

Of which Franchise outlets





1,440

1440 





1,553

1553 





1,624

1624 





Casitalia and C’Asia superettes




14 




17 




20 

Other franchise stores

(Casino Supermarket corners, Relay,Shell, Elf,
Carmag, etc.)





1,149

23

1126 





1,161

13

1148 





1,190

12

1178 

TOTAL CONVENIENCE STORES

Of which Franchise outlets/storesoperated under
business leases





5,593

3339 





5,652

3464 





5,765

3569 





Other affiliate stores

Of which French Affiliates

International Affiliates





117

115

2 





105

103

2 





102

100

2 





Other businesses

Imagica

Cafeterias





281

33

248 





292

31

261 





295

31

264 





TOTAL France




7,843 




7,962 




8,090 




Hypermarkets

Supermarkets

Discount stores

Superettes and other stores

Other





127

1,296

429

5,710

281 





128

1,314

471

5,757

292 





127

1,325

476

5,867

295 

HM : hypermarkets SM : supermarkets DIS :
discount SUP : superettes MAG : stores DIV :
other LGA : stores operated under business leases




International

March 31,2006

Dec 31,2006

March 31,2007





ARGENTINA

Libertad hypermarkets

Leader Price discount stores

Other businesses





61

13

25

23 





62

13

25

24 





61

13

25

23 





URUGUAY

Géant hypermarkets

Disco supermarkets

Devoto supermarkets





48

1

25

22 





48

1

25

22 





49

1

25

23 





VENEZUELA

Exito hypermarkets

Cada supermarkets

Q Precios discount stores





66

6

41

19 





65

6

40

19 





64

6

39

19 





BRAZIL

Extra hypermarkets

Päo de Açucar supermarkets

Sendas supermarkets

Barateiro discount stores

Extra Perto supermarkets

Eletro (other businesses)





554

80

183

66

175

 

50 





551

84

165

62

186

4

50 





550

83

164

62

183

8

50 





TAIWAN

Géant hypermarkets





14

14 

 





 




THAILAND

Big C hypermarkets

Leader Price discount stores





50

45

5 





55

49

6 





55

49

6 





VIETNAM

Big C hypermarkets





3

3 





5

5 





6

6 





INDIAN OCEAN

Jumbo hypermarkets

Score/Jumbo supermarkets

Cash and Carry supermarkets

Spar supermarkets

Other businesses





44

10

20

5

5

4 





45

11

19

5

6

4 





45

11

19

5

6

4 





COLOMBIA

Exito hypermarkets

Ley, Pomona and other supermarkets

Q Precios discount stores





98

29

66

3 





111

47

58

6 





111

47

58

6 





NETHERLANDS

Konmar supermarkets

Super de Boer supermarkets

Edah discount stores





685

44

365

276 





380

2

357

21 





360

1

358

1 





TOTAL INTERNATIONAL




2,170 




1,575 




1,555 




Hypermarkets

Supermarkets

Discount stores

Other businesses





219

1,092

782

77 





216

1,014

263

82 





216

1,014

240

85