Le Groupe Rallye

Message from Jean-Charles Naouri, Rallye's Chairman

Jean-Charles Naouri - Casino

Jean-Charles Naouri
Chairman

Rallye’s primary asset, accounting for 98% of its consolidated net sales, Casino is one of the world’s leading food retailers, with more than 12,200 stores in France, Latin America and the Indian Ocean region. Driven by its commitment to convenience, attentiveness to customer needs and a passion for retail, the Group has developed strong, dynamic and complementary banners that are able to innovate and transform in line with their markets.
 
In 2017, the Group enjoyed a positive sales dynamic in France, with sales rising by 0.8% year on year on a same-store basis and by 0.1% on an organic basis. This performance was driven by the excellent profitability of the Franprix, Monoprix and Casino Supermarkets banners, which are delivering a convenient, high-quality, services-rich shopping experience, developing promising new, innovative concepts and demonstrating robust momentum in both the own-store and franchise networks. Total gross sales under banner, including Cdiscount, ended the year up 2.3%(1), reflecting gains of 1.7%(1) in food and of 5.6% in non-food. Trading profit for France Retail was up 9.5% year on year to €556 million, of which €463 million excluding property development.
 
Outside France, the year saw a good performance by the Group, with organic sales growth of 6.4% excluding fuel and calendar effects at a time of slowing food price inflation. Organic net sales were up 1.2% for Éxito (excluding GPA Food), while in Brazil, organic sales climbed 8.7%.
 
Rallye’s consolidated net sales amounted to €38.6 billion in 2017, up 5.0%.
 
Trading profit stood at €1,237 million, a 19.7% year-on-year gain that was led by the good performance in Latin America, where trading profit rose by 32.7% as reported and by 11.3% excluding the favourable impact of the tax credit catch-up effect, and in France, where the 9.5% increase was lifted by the firm margins at Franprix and Monoprix and a stronger contribution from Casino Supermarkets.
 
Underlying net income, Group share came to €36 million in 2017 versus €17 million in 2016, thanks to a good performance by all of the businesses.
 
The net debt of the Rallye holding company totalled €2,877 million at 31 December 2017, versus €2,899 million a year earlier. Recurring cash flow was once again positive in 2017, at €29 million, in line with 2016. This primarily reflected the sustained optimisation of net finance costs and overheads over the year and the adjustment of the company’s dividend policy, with a dividend of €1.40 per share and a scrip dividend option that was chosen for 78% of the payout and for 100% of the dividend paid to Foncière Euris.
 
Groupe GO Sport reported business volume of more than €980 million in 2017, up 5% year on year, and consolidated net sales of €807 million, up 7.7% as reported and 4.4% on a same-store and constant exchange rate basis.
 
Rallye’s liquidity position is very robust, with €1.7 billion in confirmed, undrawn lines of credit with an average maturity of 3.6 years. The reinvestment of 78% of the dividend payout in new shares strengthened the positive recurring cash flow and increased shareholders’ equity by €53 million. In 2018, Rallye will maintain its positive recurring cash flow by constantly optimising its finance costs and overheads, and adjusting its dividend policy.
 
Rallye reiterates its strategy to maximise its assets’ value and confirms the strength of its financial structure, especially by maintaining positive recurring cash flow.
 
In order to maintain positive recurring cash flow, the Board of Directors’ meeting of 7 March 2018 approved the proposal of an adjusted dividend of €1.00 per share at the next Shareholders’ Meeting on 23 May 2018. The dividend will be paid on 21 June 2018 and shareholders will also be able to opt for payment in shares.
 
(1) Excluding fuel and calendar effect.
 
 

Jean-Charles NAOURI