February 27, 2020 / 6:56 AM / in 3 months

Retailer Carrefour raises cost savings goal as 2019 core profits rise

PARIS, Feb 27 (Reuters) - Carrefour said on Thursday that its turnaround plan was well on track and raised its cost savings goal, after Europe’s largest retailer delivered cost cuts of 1.030 billion euros ($1.1 billion) in 2019 and a higher free cash flow.

The French supermarket retailer also reported a well-flagged 7.4% rise in 2019 operating profit, reflecting strength in Brazil and cost savings in France.

Carrefour is in the midst of a five-year plan to cut costs and jobs, boost E-commerce investment in an effort to lift profits and sales and tackle the competition of E-commerce giant Amazon.

Carrefour kept its annual dividend unchanged at 0.46 euros and set a new target to sell 300 million euros worth of non-strategic real estate assets by 2022.

It said it now eyed cost savings of 2.8 billion euros on an annual basis by end-2020 against a previous target of 2.6 billion euros, having achieved 2 billion euros to date. It also promised more savings beyond 2020.

Its 2019 recurring operating profit reached 2.088 billion euros, in line with the company’s own guidance for 2.090 billion provided in January.

In France, where CEO Alexandre Bompard has made reviving flagging sales at hypermarket stores a priority, operating profit rose 15.6%, also in line with company’s guidance.

$1 = 0.9201 euros Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta

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