Carrefour: 2012 Full-Year Results
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http://pdf.reuters.com/htmlnews/8knews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20130307:nBw066558a http://www.businesswire.com/news/home/20130306006558/en Growth in sales and net income, Group share Strengthened financial structure BOULOGNE-BILLANCOURT, France--(Business Wire)-- Regulatory News: Carrefour (Paris:CA) 2012 key figures * Growth in sales: +0.9% to €76.8bn, driven by emerging markets * Resilient Recurring Operating Income of €2,140m, with France up by 3.5% and Latin America up by 14.2% * Significant rise in Net Income, Group share: €1,233m (vs. €371m in 2011), including capital gains from disposals * Improved free cash flow * Strong improvement in financial structure: net debt of €4.3bn, an improvement of €2.6bn * Proposed dividend of €0.58 per share, payable in cash or shares, in line with the payout policy announced in March 2012 (€ million) 2011 1 2012 2 Var. Sales ex. VAT 76,067 76,789 +0.9% Recurring Operating Income before D&A (EBITDA) 3,748 3,688 -1.6% EBITDA Margin 4.9% 4.8% Recurring Operating Income 2,197 2,140 -2.6% Recurring Operating Margin 2.9% 2.8% Net income from continuing operations, Group share -1,865 113 Net Income, Group share 371 1,233 x 3.3 Free Cash flow 215 279 Net debt at close 6,911 4,320 -€2.6bn Net debt/ EBITDA 1.8x 1.2x 2012: A refocused and strengthened Group * Refocusing of the Group on countries where it holds leading positions and has a multi-format profile * After the sale by Carrefour of its stake in their joint venture to Marinopoulos, its Greek partner becomes the exclusive Carrefour franchisee in Greece, Cyprus and the Balkans * Singapore : Closure of the Group`s two stores * Disposal of Colombian operations to Cencosud for a total consideration of €2bn * Disposal of Malaysian activities to Aeon for €250m * Disposal of Carrefour`s stake in its Indonesian unit to its partner CT Corp for €525m. CT Corp becomes Carrefour`s exclusive franchisee in the country * Strengthening of operations in France, Brazil and Argentina * Global consolidation of Guyenne & Gascogne as of June 1, 2012 following the success of the tender offer * Finalization of the financial services partnership with Itaú Unibanco in Brazil * Acquisition of 129 Eki stores in Argentina, consolidating Carrefour`s leadership in the country 2012 performance by zone Sales ex. VAT Recurring Operating Income € million 2011 3 2012 Change Change at 2011 3 2012 Change constant exch. Rates, including petrol France 35,179 35,341 +0.5% +0.5% 898 929 +3.5% Europe 21,536 20,873 -3.1% -2.7% 640 509 -20.6% Latin America 13,551 14,174 +4.6% +12.1% 532 608 +14.2% Asia 5,801 6,400 +10.3% +0.5% 187 168 -10.3% Global functions -61 -74 Total 76,067 76,789 +0.9% +1.6% 2,197 2 ,140 -2.6% France In France, sales were up 0.5%, with food sales holding up well. The price repositioning had only a slight impact on commercial margin thanks to an improved mix between everyday prices, promotions and loyalty. SG&A were lower both in value and as a percentage of sales. Recurring operating income rose 3.5% to €929m. Europe In Europe, sales decreased by 2.7% at constant exchange rates (-3.1% at current exchange rates), reflecting the decline in consumption, particularly in southern Europe. Belgium continues to record growing sales. Recurring operating income in the zone amounted to €509m, a decrease of 20.6%, largely explained by the economic context in Spain and Italy. In Spain, investment in prices was not fully compensated by the significant reduction in SG&A. Latin America Sales growth in Latin America remained strong (+12.1% at constant exchange rates and +4.6% at current exchange rates), supported by solid performances in LFL in Brazil and Argentina. Commercial margin increased. Recurring operating income increased sharply by 14.2% to €608m. Asia Overall, sales in China and Taiwan grew by 0.5% at constant exchange rates (+10.3% at current exchange rates). The commercial margin was resilient. Continued productivity gains did not fully offset the increase in distribution costs linked to expansion and wage inflation in China. Recurring operating income was down by 10.3% to €168m. 2012 results: Key points Income Statement * Sales increased by 1.6% at constant exchange rates vs. 2011 restated for disposals. At current exchange rates, the change was +0.9%. * Recurring operating income was stable at constant exchange rates and down by 2.6% to €2,140 at current exchange rates, due to the following: * Stable gross margin from current operations at 22.1% of sales. * SG&A costs under control, up by 1.3%, +10 bp as a percentage of sales. * The Group`s operating income reached €1,434m vs. a loss of €140m in 2011 after accounting for non-current expenses amounting to €707m in 2012. Capital gains on asset disposals of €234m partially offset €285m of restructuring costs, €236m of asset impairments and €419m of other costs, largely due to a revaluation of provisions. * Net income, Group share improved significantly to €1,233m vs. €371m in 2011. * Net income from recurring operations, Group share stood at €113m, due to the following: * An increase in net financial expenses of 25.1% to €882m, largely due to an exceptional expense of €216m linked to our management of interest rate position. * A decrease in tax charge to €388m, down 58.3% vs. 2011. The effective income tax rate (restated for exceptional items) comes out at 35.7%. * Net income from discontinued operations, Group share, amounted to €1,120m, mainly linked to the asset disposals closed in 2012. Cash flow statement & debt * Free cash flow was €279m, including: * Cash flow from operations (excluding discontinued operations) of €2,180, down by 8%, mainly due to cash outflows linked to preexisting tax litigation and restructuring. * A slight increase in working capital requirements, improving compared to 2011, thanks to better operating working capital after a significant gain in days of inventories. * Capital expenditure, constrained at €1,547m, down by 27% vs. 2011. A third of the investments went towards growth in emerging market, stable compared to 2011 in volume. * Changes in the Group`s scope generated a net cash inflow of €2bn in 2012: * The impact of discontinued activities, principally the disposals of our activities in Colombia and Malaysia, is a cash inflow of €1,960m. * The disposal of Altis led to a cash inflow of €153m. * The acquisition of the shares of Guyenne & Gascogne`s parent company generated a cash outflow of €96m. * The net cash outflow linked to the dividend payment amounted to €137m, as around 60% of the 2012 dividend was paid out in Carrefour shares. * Net debt improved by €2.6bn to €4,320m at December 31, 2012, strengthening the Group`s financial structure. The net debt over EBITDA ratio significantly improved to 1.2x in 2012 vs. 1.8x in 2011. Proposed dividend of €0.58 per share The Board of Directors decided at its meeting on March 6, 2013 to submit for approval to the Annual General Meeting to be held on April 23, 2013 a dividend of €0.58 per share for the year ending December 31 2012, payable in cash or in Carrefour shares. The proposed dividend amounts to a payout ratio of 45% of net income, Group share, adjusted for exceptional items, in line with the policy set out in March 2012. 2013 Priorities * Development of the multi-local, multi-format model * France: Continued action plans in all formats, with priority given to improvement of the offer and of price perception, store refurbishments, Drive roll-out and multi-channel development * Europe: Adaptation of the offer and costs to face the tough economic environment * Emerging markets: Continued expansion in Latin America and Asia * New momentum in the development of real estate assets * Decentralization and empowerment * Simplify structures and decision-making process * Re-empower stores * Place the client at the core of the business * Continued strict financial discipline * Stable dividend payout policy * Controlled increase of capital expenditure (expected between €2.2bn and €2.3bn in 2013) * Control of working capital AGENDA Q1 2013 sales: April 18, 2013 Annual General Meeting: April 23, 2013 APPENDICES CONSOLIDATED INCOME STATEMENT (in millions of euros) 20114 2012 % change Sales, net of taxes 76,067 76,789 +0.9% Loyalty program -810 -662 -18.3% Other revenues 2,224 2,333 +4.9% Total Revenues 77,481 78,460 +1.3% Cost of sales -60,673 -61,523 +1.4% Gross margin of current operations 16,809 16,937 +0.8% SG&A -13 060 -13 249 +1.4% Current operating incomes before D&A (EBITDA) 3 748 3 688 -1.6% Depreciation & amortization -1 552 -1 548 -0.3% Recurring operating income (ROI) 2 197 2 140 -2.6% Non-current income and expenses -2 337 -707 -69.8% Operating income -140 1 434 Financial expenses -705 -882 +25.1% Profit before tax -845 552 Income tax -931 -388 -58.3% Companies accounted for by the equity method 64 72 +13.0% Net income from continuing operations -1,713 235 Net income from discontinued operations 2,116 1,081 Net income 404 1,316 Of which Net income - Group share 371 1,233 Of which net income from continuing operations -1,865 113 Of which net income from discontinued operations 2,237 1,120 Attributable to non-controlling interests 33 83 Of which net income from continuing operations 153 122 Of which net income from discontinued operations -120 -39 MAIN RATIOS 20114 2012 Gross margin from current operations / Net sales 22,1% 22,1% SG&A / Net sales 17,2% 17,3% Recurring operating income / Net sales 2,9% 2,8% Operating income / Net sales -0,2% 1,9% CONSOLIDATED BALANCE SHEET (in millions of euros) 2011 2012 ASSETS Intangible assets 9,706 9,409 Tangible assets 13,771 11,509 Financial investments 1,713 1,509 Deferred tax assets 745 752 Investment properties 507 513 Consumer credit from financial-services companies - long term 2,236 2,360 Non current assets 28,676 26,052 Inventories 6,848 5,658 Trade receivables 2,782 2,144 Consumer credit from financial-services companies - short term 3,384 3,286 Tax receivables 468 520 Other receivables 969 795 Current financial assets 911 352 Cash and cash equivalents 3,849 6,573 Current assets 19,211 19,328 Assets held for sale 44 465 TOTAL 47,931 45,844 LIABILITIES Shareholders equity, Group share 6,618 7,487 Minority interests in consolidated companies 1,009 874 Shareholders equity 7,627 8,361 Deferred tax liabilities 586 580 Provisions for contingencies 3,680 4,000 Borrowing - long term 9,513 8,983 Bank loans refinancing - long term 419 1,966 Non current liabilities 14,198 15,529 Borrowings - short term 2,159 2,263 Trade payables 15,362 12,925 Bank loans refinancing - short term 4,482 3,032 Tax payables & others 1,319 1,040 Other debts 2,785 2,422 Current liabilities 26,106 21,682 Liabilities related to assets held for sale 0 273 TOTAL 47,931 45,844 CONSOLIDATED CASH FLOW STATEMENT (in millions of euros) 2011 5 2012 NET DEBT OPENING -7,998 -6,911 Gross cash flow (ex. discontinued activities) 2,381 2,180 Change in working capital -240 -42 Impact of discontinued activities 207 -171 Cash flow from operations (ex. financial services) 2,348 1,967 Capital expenditures -2,119 -1,547 Asset disposals (business related) 131 153 Change in payables to fixed asset suppliers 191 -166 Impact of discontinued activities -336 -127 Free Cash Flow 215 279 Financial investments -71 -209 Proceeds from disposals of subsidiaries and from other tangible & intangible assets 385 240 Others -61 34 Impact of discontinued activities 1,482 1,960 Cash Flow after investments 1,950 2,304 Dividends paid by Carrefour -708 -137 Dividends paid to minorities and others -87 -115 Acquisition and disposal of investments without change of control -13 -9 Treasury shares -126 0 Others 93 420 Impact of discontinued activities 206 122 Consumer credit impact -229 7 NET DEBT CLOSING -6,911 -4,320 CHANGES IN SHAREHOLDER EQUITY (in millions of euros) Total Shareholders` Minority shareholders` equity, interests equity Group share At December 31, 2011 7,627 6,618 1,009 Net income for the year 1,316 1,233 83 Other comprehensive income after tax -362 -354 -8 Share-based payments 9 9 0 2011 dividends -257 -137 -121 Change in capital and additional paid-in capital 194 188 6 Impact of changes in perimeter and other movements -167 -72 -95 At December 31, 2012 8,361 7,487 874 NET INCOME, GROUP SHARE, ADJUSTED FOR EXCEPTIONAL ITEMS (in millions of euros) 2011 6 2012 % change Net income, Group share 371 1,233 x 3.3 Restatement for non-current income and expenses (before tax) 2,337 707 Restatement for exceptional items in net financial expenses 151 284 Tax impact of restated elements (172) (122) Restatement for exceptional items recorded in income tax (5) (1) Minority interest on restated elements 419 (60) Restatement of Net income from discontinued operations (2,337) (1,120) Net income, Group share, adjusted for exceptional items 864 921 +6.6% PRO FORMA H1 2011 AND H1 2012 INCOME STATEMENT (UNAUDITED) (in millions of euros) H1 2011 7 H1 2012 7 Sales, net of taxes 37,042 37,285 Loyalty program -449 -373 Other revenues 1,062 1,169 Total Revenues 37,654 38,081 Cost of sales -29,658 -30,051 Gross margin of current operations 7,996 8,030 SG&A -6,417 -6,526 Recurring operating income before D&A (EBITDA) 1,579 1,504 Depreciation & amortization -778 -764 Recurring operating income (ROI) 801 740 Non-current income and expenses -829 -63 Operating income -28 677 Financial expenses -319 -326 Profit before tax -347 351 Income tax -469 -122 Companies accounted for by the equity method 24 23 Net income from continuing operations -793 253 Net income from discontinued operations 552 -273 Net income -241 -21 PRO FORMA H2 2011 AND H2 2012 INCOME STATEMENT (UNAUDITED) (in millions of euros) H2 2011 7 H2 2012 Sales, net of taxes 39,025 39,504 Loyalty program -361 -289 Other revenues 1,162 1,164 Total Revenues 39,827 40,379 Cost of sales -31,015 -31,472 Gross margin of current operations 8,813 8,907 SG&A -6,643 -6,723 Recurring operating income before D&A (EBITDA) 2,170 2,184 Depreciation & amortization -774 -784 Recurring operating income (ROI) 1,396 1,400 Non-current income and expenses -1,508 -644 Operating income -112 757 Financial expenses -386 -556 Profit before tax -498 201 Income tax -462 -266 Companies accounted for by the equity method 40 49 Net income from continuing operations -920 -18 Net income from discontinued operations 1,564 1,354 Net income 645 1,337 PRO FORMA RECURRING OPERATING INCOME BY REGION (UNAUDITED) H1 2011 Recurring operating income (in millions of euros) Reported Restated 8 August 30, 2012 France 299 295 Europe ex. France 220 218 Latin America 222 205 Asia 121 106 Global functions -24 -23 Total 838 801 H2 2011 Recurring operating income (in millions of euros) Reported Restated 8 August 30, 2012 France 606 604 Europe ex. France 425 423 Latin America 360 328 Asia 117 81 Global functions -40 -38 Total 1,468 1,396 FY 2011 Recurring operating income (in millions of euros) Reported Restated 8 August 30, 2012 France 905 898 Europe ex. France 645 640 Latin America 582 532 Asia 238 187 Global functions -64 -61 Total 2,306 2,197 H1 2012 Recurring operating income (in millions of euros) Reported Restated 8 August 30, 2012 France 279 275 Europe ex. France 150 148 Latin America 245 232 Asia 116 105 Global functions -20 -19 Total 769 740 H2 2012 Recurring operating income (in millions of euros) Reported March 7, 2013 France 654 Europe ex. France 361 Latin America 376 Asia 62 Global functions -55 Total 1,400 FY 2012 Recurring operating income (in millions of euros) Reported March 7, 2013 France 929 Europe ex. France 509 Latin America 608 Asia 168 Global functions -74 Total 2,140 2012 DIVIDEND PAYMENT PROCEDURE The ex-dividend date has been set as May 2, 2013. The period during which shareholders may choose the option of the payment of dividend in cash or in shares will begin May 2, 2013 and end May 23, 2013, included. Payment of the cash dividend and settlement of the stock dividend will occur on June 7, 2013. DEFINITIONS * Gross margin from current operations Gross margin from current operations is the difference between the sum of net sales, other income, reduced by loyalty program costs and the cost of goods sold. Cost of sales comprises purchase costs, changes in inventory, the cost of products sold by the financial services companies, discounting revenue and exchange gains and losses on goods purchases. * Recurring Operating Income Before Depreciation and Amortization (EBITDA) Recurring Operating Income Before Depreciation and Amortization (EBITDA) is defined as the difference between the gross margin from current operations and sales, general and administrative expenses. It excludes non-recurring items as defined below. * Recurring Operating Income (ROI) Recurring Operating Income is defined as the difference between the gross margin from current operations and sales, general and administrative expenses, depreciation and amortization. * Operating Income (EBIT) Operating Income (EBIT) is defined as the difference between gross margin from current operations and sales, general and administrative expenses, depreciation, amortization and non-recurring items Non-recurring income and expenses are certain material items that are unusual in terms of their nature and frequency, such as impairment, restructuring costs and expenses related to the revaluation of preexisting risks on the basis of information that the Group became aware of during the accounting period. * Free Cash Flow Free cash flow is defined as the difference between funds generated by operations, the variation of working capital requirements and capital expenditures. DISCLAIMER This press release contains both historical and forward-looking statements. These forward-looking statements are based on Carrefour management's current views and assumptions. Such statements are not guarantees of future performance of the Group. Actual results or performances may differ materially from those in such forward-looking statements as a result of a number of risks and uncertainties, including but not limited to the risks described in the documents filed with the Autorité des marchés financiers as part of the regulated information disclosure requirements and available on Carrefour's website (www.carrefour.com), and in particular the Annual Report (Document de référence). These documents are also available in English language on the company's website. Investors may obtain a copy of these documents from Carrefour free of charge. Carrefour does not assume any obligation to update or revise any of these forward-looking statements in the future. 1 In accordance with IFRS 5, income and expenses from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Net income from discontinued operations" of the consolidated income statement in 2011 and 2012. 2 The 2012 social and consolidated accounts were approved by the Carrefour Board of Directors, which met on March 6, 2013. The accounts were audited by the Group`s auditors. 3 In accordance with IFRS 5, income and expenses from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Net income from discontinued operations" of the consolidated income statement in 2011 and 2012. 4 In accordance with IFRS 5, income and expenses from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Net income from discontinued operations" of the consolidated income statement in 2011 and 2012. 5 In accordance with IFRS 5, cash flows from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Impact of discontinued activities" of the consolidated cash flow statement in 2011 and 2012. 6 In accordance with IFRS 5, income and expenses from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Net income from discontinued operations" of the consolidated income statement in 2011 and 2012. 7 In accordance with IFRS 5, income and expenses from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Net income from discontinued operations" of the consolidated income statement in 2011 and 2012. 8 In accordance with IFRS 5, income and expenses from discontinued activities (Greece, Singapore, Colombia, Malaysia and Indonesia) have been reclassified on the line "Net income from discontinued operations" of the consolidated income statement in 2011 and 2012. Carrefour Investor relations: Réginald Gillet, Alessandra Girolami, Matthew Mellin Tel : +33 (0)1 41 04 26 00 or Shareholder relations: Céline Blandineau Tel : 0 805 902 902 (n° vert en France) or Group Communications Tel : +33 (0)1 41 04 26 17 Copyright Business Wire 2013
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