Colruyt warns of 'quite significant' drop in net profit
Supermarket chain Colruyt has revised its profit forecast for the financial year that ended in March. On Friday, the retailer warned of a sharp fall in net profit after previously predicting a stable result, prompting investors to sell its shares.
In December, Colruyt said it aimed to match its operating profit of 470 million euros and net profit of 368 million euros for the 2023/2024 financial year. The retailer will not publish its full-year results until 17 June but is already telling investors that the target will not be met.
Sales will be below expectations due to strong competition and lower than expected food inflation. As a result, operating profit will fall "rather slightly" and net profit "quite significantly" compared to the previous financial year, Colruyt said.
According to the Flemish chain, the combined market share of its supermarkets Colruyt, Okay, Spar and Comarkt fell in the past financial year. However, the decline in the second half of the year was less than in the first, and the group claims that its market share has been growing again since the beginning of the calendar year.
The group is considering shedding some of its loss-making elements. In April, it announced that it was examining the possibility of selling its Colruyt Prix Qualité shops and Dats 24 service stations in France. Despite investment, they were still unprofitable due to strong competition in France, Colruyt said.
Friday's news sent Colruyt's share price deep into the red. Within 20 minutes of the Brussels stock exchange opening, its shares had fallen more than 17 per cent to their lowest level since mid-January.
#FlandersNewsService | © BELGA PHOTO NICOLAS MAETERLINCK
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