* Q4 sales 22.197 bln euros, up 3.2 pct like-for-like
* French hypermarkets up 1.4 pct vs 3 pct growth in Q3
* Spain back to growth in Q4, first time since 2008
* Carrefour shares down 3.1 pct, stock rose 49 pct in 2013
(Recasts with share reaction, CFO and analyst comments)
By Dominique Vidalon
PARIS, Jan 16 Carrefour, the world's
second-biggest retailer, said sales growth slowed in Brazil and
turned negative in China in the final three months of last year,
dealing it a blow in the two major emerging markets it has
earmarked for expansion.
Shares in the French firm fell nearly 4 percent on Thursday,
after it also reported a slower improvement at domestic
hypermarkets than in the previous quarter, though it hailed a
return to growth in Spain for the first time in five years.
"Very mixed results," Bernstein analysts said. However,
commentators were reassured that Europe's No.1 retailer remained
comfortable with the consensus forecast for 2013 earnings before
interest and taxes of 2.19 billion euros ($2.98 billion).
Carrefour is battling to reverse years of underperformance
in Europe, where it makes about 65 percent of its sales. Its
problems are partly due to a reliance on the hypermarket format
it pioneered as time-pressed customers shop more locally and
online, and buy non-food goods from specialists.
Chief Executive Georges Plassat has had some success in the
group's home market of France by cutting costs, revamping
stores, improving price competitiveness, simplifying product
offerings and giving more autonomy to store managers.
He has also highlighted Brazil, the firm's second-biggest
market behind France, and China as key markets for expansion.
But Carrefour said sales at Chinese stores open over a year
fell 3.1 percent in the fourth quarter compared with a 1.1
percent rise in the third - joining a string of consumer groups
reporting a slowdown in the world's second-biggest economy.
Cosmetics group L'Oreal recently said it would
pull its Garnier brand out of mainland China, while Revlon
said it would exit due to falling sales.
Carrefour also said like-for-like sales growth in Brazil
slowed to 5.8 percent against 8.8 percent in the third quarter.
Nevertheless, it pledged to push ahead with expansion plans
in South America's largest economy, and notably seek to
accelerate store openings at its Atacadao cash & carry format.
Finance chief Pierre-Jean Sivignon reiterated an initial
public offering was an option among others to fund expansion in
"THE RIGHT DIRECTION"
Carrefour, world No.2 behind U.S. group Wal-Mart,
said fourth-quarter sales as a whole totalled 22.2 billion
euros, for like-for-like growth of 3.2 percent excluding fuel
and calendar effects.
Retailers across Europe have been struggling as shoppers'
disposable income is squeezed by subdued wages growth and
austerity measures, and Carrefour's overall performance compared
favourably with some of its peers.
Smaller French rival Casino said on Tuesday it
expected sales at its domestic hypermarkets would return to
growth in the next six months, while Dutch grocer Ahold
on Thursday reported a steeper-than-expected decline
in fourth-quarter sales.
German retailer Metro AG, meanwhile, posted a drop
in sales in its fiscal first quarter.
"Despite today's relatively weak trends, we still think the
recovery in France is on track and the group appears to be
taking appropriate measures in other countries in particular
Italy to improve operations, margins and returns," Societe
Generale analysts said of Carrefour's performance.
"The group is undoubtedly moving in the right direction but
there is still a lot to be done and the stock appears fully
valued in the short-term," they added.
Carrefour shares trade at 17.2 times 12-month forward
earnings against 14.9 for Casino and 10.9 times for
Britain's Tesco. At 1210 GMT, Carrefour stock was down
3.1 percent at 27.42 euros. It surged 49 percent in 2013.
In France, which accounts for over 40 percent of group
revenues, same-store sales at Carrefour's hypermarkets rose 1.4
percent compared with a 3 percent increase in the third quarter.
Sivignon said this was the third consecutive quarter of
growth for French hypermarkets and the fifth for food in
hypermarkets where price perception was improving. November was
a particularly strong month, he added.
In Spain, Carrefour's third-largest market, sales rose 0.2
percent like-for-like. Food sales were flat while non-food sales
were positive, supported by a Christmas bonus to civil servants
being paid this year after having been suspended in 2012.
Sivignon said he wanted to wait another quarter before
calling the improved performance in Spain a trend.
But the economic climate was still tough in Italy where
sales fell 5.9 percent, and it would take a few quarters before
action plans such as promotions would bear fruit, he said.
($1 = 0.7356 euros)
(Editing by James Regan and Mark Potter)