October 16, 2017 / 7:53 AM / 2 years ago

Carrefour turns to Fnac Darty again for new finance chief

PARIS (Reuters) - New Carrefour (CARR.PA) boss Alexandre Bompard has turned to a former colleague from Fnac Darty to be his finance chief as he strives to revive the world’s second-biggest retailer.

The logo of France-based food retailer Carrefour is seen on shopping trolleys in Sao Paulo, Brazil July 18, 2017. REUTERS/Paulo Whitaker

Carrefour said on Monday that former Fnac Darty (FNAC.PA) chief financial officer Matthieu Malige, 43, would start with immediate effect, replacing Pierre Jean Sivignon, 60, who is stepping down for personal reasons.

The French company's shares, which plunged in August after it warned 2017 operating profit could fall by as much as 12 percent, were up 1.8 percent in early trading, the top performer on the CAC-40 .FCHI index of French blue-chip stocks.

“Matthieu Malige and Alexandre Bompard successfully turned Fnac around .... We have been impressed by the complementary nature of this team at Fnac, where Matthieu Malige built a strong track record in managing cost-cutting, working capital, and cash,” wrote analysts at brokerage Raymond James.

“We believe, just as at Fnac back in 2011, Carrefour needs to make some progress on these three metrics,” they added.

The new Carrefour team faces a challenge to improve the performance of its French hypermarkets, a goal that has eluded several predecessors. Carrefour is up against fierce competition in France, which accounts for nearly half of group sales and 44 percent of operating profit, from online and other rivals.

A union official said last month that Carrefour’s options included closing some hypermarkets, turning some into franchises or introducing Sunday opening for others.

Malige should know the challenges ahead of him, as he worked at Carrefour between 2003 and 2011, holding several positions including finance chief of Belgium and France.


His appointment comes at a crucial time as Bompard, who joined from music, books and electricals chain Fnac Darty in July, has yet to unveil his turnaround plan.

“It’s a bit of a surprise, but it confirms the idea that Bompard wants a new team around him. Shareholders will want Malige to review the hypermarkets business, which is losing market share, and to accelerate Carrefour’s online strategy,” said Benoit de Broissia, a fund manager at Paris-based Keren Finance, which owns Carrefour shares.

Bompard has already made other management changes as he looks to revive the company’s fortunes.

Carrefour said Sivignon, who had been group finance chief since 2011, would stay on as an adviser to Bompard.

“The lack of a robust and or effective capital allocation framework is one of the big reasons that Carrefour is in its difficult situation today. As a CFO, Mr. Sivignon stood over that capital allocation framework. Therefore a clean start will help convince investors that things might change for the better at Carrefour,” said Bernstein analyst Bruno Monteyne.

Carrefour shares have fallen around 24 percent this year, underperforming the STOXX Europe 600 index and France's benchmark CAC-40 .FCHI, which are both up by roughly 10 percent.

Reporting by Sudip Kar-Gupta and Dominique Vidalon; Additional reporting by Pascale Denis; Editing by Jason Neely and Mark Potter

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