(Reuters) – Struggling French retailer Casino reported a drop in first-half operating profit on Tuesday as it undergoes a restructuring that includes the sale of hypermarkets and supermarkets, closures and conversions to franchises. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) fell 24% to 255 million euros ($280 million) in the January-June period, the group said in a statement.
The half-yearly financial results were “degraded by a penalizing legacy and the context of restructuring”, declared the distributor, taken over last March by the Czech businessman Daniel Kretinsky after having narrowly avoided cessation of payments.
The group unveiled a restructuring plan last April, which includes the elimination of 1,293 to 3,267 jobs, with the aim of returning to growth by focusing on local retail.
“In order to improve our economic performance, we have initiated the rationalization of the store network: closing unprofitable points of sale, transferring integrated sites to franchises, rigorous selection of our new franchise partners and opening new points of sale with high potential,” said Philippe Palazzi, the group’s CEO, in a press release.
He specified that the franchisees were at the heart of the Saint-Etienne group’s project.
Casino has just sold 66 stores to the Les Mousquetaires-Auchan Retail France group and has announced a firm agreement for the sale, during the second half of the year, of a real estate portfolio for more than 200 million euros to Tikehau Capital.
(Written by Diana Mandiá, edited by Kate Entringer and Augustin Turpin)
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