Financial analysis of the French company Carrefour

Résumé du document

Carrefour SA is a France-based company that is engaged in retail distribution. It was founded in 1959 and opened its first supermarkets and hypermarkets in
France in the 1960s. During the following two decades Carrefour expanded in Europe (UK, Italy) and widened its service range (consumer magazine, payment card, insurance policies). The 1990s were characterized by the establishment of markets all over the world (Italy, Greece, Mexico, Asian countries).

Carrefour is the world's second-largest retailer and the largest in Europe. Currently, the company operates four main grocery store formats: hypermarkets, supermarkets & hard discount, cash & carry and convenience stores. Carrefour hypermarkets and supermarkets have huge sales areas and offer a
wide range of food and non-food products sold at competitive prices. Hard discount stores offer food products at low prices in small stores. Cash and carry food service stores provide wholesale and retail self-service for businesses. Finally, convenience stores offer a range of food products and additional services such as home delivery, dry cleaning, ticket distribution, stamps, newspapers and more.

Extraits

[...] Financial Analysis of a big French company: Sommaire I. Presentation a. History & Activity b. Carrefour in the World c. Financial Strategy d. Financial Performance e. Prospects II. Operating performance a. Objectives b. Achievements c. Customer product strategy III. [...]

[...] d. Financial Performance EBITDA Net Sales Current Operating Income Net Income In 2010 Carrefour sales revenues reached 90.099 (increase of compared to 2009). Over the past five years Carrefour has continuously increased its sales revenues but during the financial crisis in 2009. Similar to the development of the sales revenue, EBITDA and current operating income have constantly risen over the past five years (except during the financial crisis of 2008-2009), whereas net income has significantly fallen between 2007 and 2009. [...]

[...] Advertising campaign of its direct competitor Carrefour activity is directly dependent on the private consumption and private income. Carrefour's competitors have paved the way in the public debate on purchasing power. Therefore, Carrefour had to decrease prices on over 200 products to try to undermine the advertising campaign of its direct competitor (Leclerc for instance). IV. Inventory Valuation Policy Walmart uses two main methods for its inventory valuation, one for its Walmart U.S segment's merchandise, and another for its international operations. [...]

[...] It reduces the consequences on inventory valuation of unexpected high or low materials prices, so the cost estimate is more stable. The forecasts of the company are extremely important in order to choose the more efficient method. Companies have to arbitrate between those methods following their aims. To instance the LIFO method can reduce the amount of taxes the company must pay, but it also reduces the amount of earnings, which is important for shareholders. [...]

[...] Stores will become Carrefour Express or Carrefour Market. - In China, Carrefour acquired 51% of Baolongcang, a hypermarkets' chain, which operates near Beijing. - Trying to be shown as an eco-friendly company, Carrefour opened the first Argentine ecologic store, which limits its impact on the environment The reason why Carrefour acts quickly can be attributed to its ambition to “become the preferred retailer wherever it operates.” c. Customer product strategy Carrefour is a company committed to quality and product safety. [...]