Casino profit warning triggers sell-off in food retailer

Shares in French supermarket operator Casino fell 14 per cent on Monday after the retailer warned that its annual profit would be lower than expected as the recent Covid-19 surge dented demand.

The heavily indebted group controlled by entrepreneur Jean-Charles Naouri said in a statement that earnings before interest, taxes, depreciation and amortisation at its French retail operation would not increase as it had earlier forecasted, but instead contract by 1.7 per cent to €1.28 billion for 2020.

The company's various chains, which include the upmarket, city-focused Monoprix and convenience-oriented Franprix, have suffered from the Omicron-driven surge in infections that caused France to impose restrictions including clamping down on international travel and requiring homeworking in December.

Casino said the French food retail market had “conjuncturally declined at a higher rate than expected” in the fourth quarter, down 3.7 per cent nationally, and down 5.6 per cent in the greater Paris region where it earns about one-third of revenues.

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Casino’s woes also hit the shares of its larger rival Carrefour, which were trading down more than 5 per cent by mid-day on Monday. – Copyright The Financial Times Limited 2022