Carrefour is set to continue its aggressive price-cutting strategy in 2025, responding to a challenging economic environment where consumers remain highly sensitive to price fluctuations. Chief Financial Officer Matthieu Malige highlighted that, despite solid performance in its core French market, the retailer is not expecting significant short-term improvements in consumer demand. This caution is prompting Carrefour to lower prices further to attract bargain-seeking shoppers who are increasingly switching between retailers.
Strong Performance in a Tough Market
Despite a 2.1% drop in sales in the fourth quarter a deceleration from a 3% decline in the previous quarter Carrefour's French market share hit a 10-year high in 2024. The retailer reported an operating profit in France of €1.04 billion, marking a 5.5% rise, with margins slightly improved to 2.6% of sales. These robust results helped the company generate strong cash flow of €1.46 billion for the year.
Rewards for Investors and Strategic Adjustments
Building on its solid financial performance, Carrefour increased its dividend by 6% to €0.92 per share and announced a special dividend of €150 million (or €0.23 per share). In addition, the company is reviewing its asset portfolio, notably following its recent decision to take its Brazilian unit, Atacadao SA, private. These measures, alongside a new cost savings plan targeting €1.2 billion in efficiency improvements, are designed to further bolster the retailer’s competitive position.
While Carrefour expects a modest uptick in earnings before interest, taxes, depreciation, and amortisation (EBITDA), recurring operating income, and net free cash flow in 2025, Malige warned that consumer demand in France and across Europe remains uncertain. The price cuts, funded in part by the cost savings initiatives, are seen as critical to maintaining market share against rivals like privately held Leclerc.
