With 90 stores in Rio Grande do Sul, a state that is experiencing flooding and flooding due to heavy rain, Carrefour Brasil (CRFB3) announced that it will freeze the prices of all its products until the end of May.
“We can freeze prices for a month without disturbing our global results too much. It is obvious that we have to take care of our activities there, but the priority now is to help the population”, said Stéphane Maquaire, CEO of the company.
To analysts and investors, during a results conference call, to comment on the balance of the first quarter, the executive stated that the State’s participation in the group’s total operations, with the Carrefour, Atacadão, Sam’s Club and Nacional brands, is around 5%. to 6%.
Continues after advertising
Carrefour (CRFB3): stores impacted
According to Eric Alencar, Carrefour’s financial director, among the company’s units in Rio Grande do Sul, six Atacadão stores and one Sam’s had a relevant impact.
“They represent less than 1% of our sales. We have insurance policies, we are evaluating the net impacts, but we believe it will not be financially material.”
Maquaire also stated that, since last week, 20 stores in the South have been made available to receive collections.
Continues after advertising
Keeping an eye on the results
Speaking of the company’s performance in the first quarter, Carrefour’s balance sheet was considered “mixed” by analysts.
XP, for example, highlighted the performance of cash and carry on the positive side, with Atacadão, which returned to positive territory, with sales growing 1.8% in the year, benefiting from the increase in food inflation and the recomposition of volumes between consumers. On the other side, however, was retail, with the Carrefour banner itself, whose sales fell 1.4%, as the company reduced its sales area, closing and converting stores.
Bank of America mentions that the maturation of stores and the gain in synergies with the BIG Group, acquired in the past, helped to boost Ebitda, of R$ 1.4 billion (up 36.6% in the year), and its margin, 5.7% (up 1.5 percentage points).
Continues after advertising
“The worst may be over for CRFB following the closure of loss-making locations, improved food inflation and as acquired units mature further. Additional asset sales and promising development opportunities can also mitigate the risk of labor contingencies. Financing costs may also have more room for improvement”, says the team at the American institution.