France: Auchan to get aggressive on pricing
Auchan has announced plans to compete directly with Leclerc and will introduce an aggressive new pricing structure to kick start things. It is also going to focus efforts on international expansion.
The group said its 'Drive' concept continues to perform well, with revamped stores reporting a rise in customers using the service. However, it also said it does not plan to rapidly expand its Auchan City and A2Pas concepts, saying they have not achieved their initial targets.
The comments came after the group said its net profit for 2011 rose by 14.9% to €810m, although underlying profit fell by 9%, and EBITDA was down 5.5% to €2.38bn. Sales were up a modest 4.4% to €44.4bn, helped largely by its international operations (+13.6%) which helped offset a decline across Europe (-1.3%).
Auchan termed the results as "very acceptable given the deterioration in economic conditions last summer”, and added that its European units were impacted as “our clients are suffering from the effects of the crisis and austerity plans intended to resolve debt problems".
Source: www.kamcity.com
