PARIS (Reuters) - French retail giant Carrefour (CARR.PA), under mounting pressure from traditional rivals as well as new competitors like Amazon, sought to reassure investors that its plan to turn around its business was on track following a report of a delay.
Shares in the world’s second-biggest retailer fell nearly 2 percent on Monday after BFM Business radio said new CEO Alexandre Bompard was unlikely to unveil his revival plan before early 2018 instead of before end-2017 as previously announced.
The company is working on what is expected to be a far-reaching restructuring plan that some analysts estimate could involve one billion euros (£890.3 million) of cost cuts.
One reason for postponing the announcement was to avoid any labour trouble over the crucial Christmas period, BFM said.
A Carrefour spokesman said work on the plan was “progressing rapidly” and that the company would say in the coming days when the plan would be announced. He neither confirmed nor denied there would be a delay.
Newly-appointed CEO Bompard said in August he would give details of his strategy for revitalising the company by the end of the year after Carrefour warned that its operating profit this year could fall by around 12 percent..
Bompard is under pressure to improve the group’s business in the core French market where it is losing market share to unlisted rival Leclerc and to speed up its expansion into e-commerce where it faces competition from Amazon (AMZN.O).
Options for the French market range from turning some stores into franchises to moving others to lease management, closing loss-making stores as well as opening stores on Sundays.
There could also be some restructuring at the group’s head office and more price cuts to attract shoppers, union sources have said.
Natixis analysts estimate that Carrefour’s turnaround plan could entail cost cuts worth one billion euros at group level over three years, half coming from France to help fund price cuts there.
By 1059 GMT, Carrefour shares were down 1.54 percent at 17.24 euros, among top decliners on the CAC-40 index of French blue chips .FCHI.
Carrefour shares are down 24 percent so far this year, underperforming a 5 percent decline in their European sector .SXRP.
Reporting by Pascale Denis, Dominique Vidalon; editing by Brian Love and Adrian Croft