Edgard Bonte, president of Auchan Retail (photo from Rayon Boissons archives)
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The Covid-19 epidemic, lockdowns and other health measures taken by the government, such as the closure of restaurants, have not made all the distributors happy. The proof with Auchan! While its competitors such as Carrefour (+ 3.6%) and Casino (+ 3.2%) saw their 2020 turnover increase on a comparable basis in France, the group headed by Edgard Bonte posted barely stable sales. Knowing that these are even down by 3.9% compared to the turnover published last year for the 2019 financial year.
Those are hypermarkets, which have long been the strength of Auchan Retail, which explain this phenomenon. Already in crisis, these have been severely damaged by the health crisis. On a French fleet of 117 Auchan hypermarkets, 19 sites account for 80% of the drop in format sales. They are located in large shopping centers, deserted by customers. Many of them also cross the border and have been deprived of their usual foreign clientele.
This fall in hypermarket sales “Was offset by the increase in revenue from other formats”, says Auchan Retail in a press release published on March 5. The group points in particular to the strong growth (+ 32%) in digital revenue which reached 12% of total turnover in France. “The profitable drive format is the main driver of this growth with + 33% in turnover without increasing square meters”, explains Auchan. Numerous tests were also carried out successfully over the period, such as click & collect in supermarkets or the pedestrian format, tested in the Lille metropolitan area. For 2021, the distributor is thus maintaining its ambition to have 300 click & collect collection points in the city center.
“A company now totally debt-free”
On hypermarkets, the ambition is more modest for this year. “I’m not going to tell you that the sales of our hypermarkets will increase from tomorrow morning., explained Edgard Bonte, during a press briefing last Friday. We are well aware of the problem with this format. The younger generations hardly attend it any more and we have no strong ambitions on this subject. We are therefore going to develop the turnover differently, bring it outside the walls and assess the food rates at the level of the living areas. ” On his site, the Linéaires magazine reviews this strategy.
Wider, at group level, the income from ordinary activities of Auchan Retail amounts to € 31.6 billion in 2020, down – 5.2 % in total and of – 0.2% on a comparable basis. In this context, the distributor was especially pleased to have cleaned up its financial situation, citing a “Company now fully debt-free with a sharply rising EBITDA rate”.
“As we committed to two years ago, the recovery work is bearing fruit, visible in today’s announcements., says Edgard Bonte, president of Auchan Retail. The 2020 results are well beyond the progress made in 2019, which already marked the start of an upturn. They are also and above all beyond the budget forecasts that we had set for ourselves. We are, on a number of points, a year ahead of our plan despite the health crisis we are experiencing. ”
Click here to view the entire Auchan Holding 2020 financial report online
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