GROUPE CASINO: Sustained 6.5% Growth in Third-Quarter 2010 Sales

Regulatory News:

CASINO (Paris:CO):

Ongoing faster organic growth of 3.4% (excluding petrol)
Double-digit growth in international markets
Return to same-store growth for Leader Price

Consolidated net sales

Q3 2010 €m

9 months 2010 €m

% change QoQ

% change 9Mo9M

Reported

Organic(1)

Reported

Organic(1)

Continuing operations

7,184.7

20,773.6

+6.5%

+4.1%

+6.9%

+3.8%

France

4,540.3

13,136.2

+1.1%

+1.3%

+0.9%

+1.1%

International

2,644.4

7,637.4

+17.0%

+10.2%

+19.0%

+9.9%

⁽¹⁾ Based on constant scope of consolidation and exchange rates.

Organic growth Excluding petrol		2009		Q1 2010		Q2 2010		Q3 2010
Continuing operations		-0.1%		+2.6%		+2.9%		+3.4%
France		-2.7%		-0.9%		+0.2%		+0.2%
International		+5.0%		+10.2%		+8.7%		+10.0%

Consolidated net sales rose by a reported 6.5% in the third quarter of 2010.

Changes in scope of consolidation – mainly the deconsolidation of Venezuelan operations – had a 3.3% negative impact. The currency effect was a positive 5.7%, reflecting the sharp increase in the Brazilian real, Colombian peso and Thai baht against the euro.
Petrol sales had a 0.7% positive impact on growth for the period. The calendar effect was a slightly positive 0.4% in France and was neutral at a negative 0.1% internationally.

Excluding petrol, organic growth for the period came to 3.4%, confirming the faster pace of growth observed in the previous two quarters.

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In France, sales were up 0.2% on an organic basis (excluding petrol).

• Same-store sales at Leader Price returned to growth, rising by 1.1% (vs 6.1% decline in the first half) thanks to the effectiveness of the banner’s sales revitalisation programme.
• Franprix and Monoprix reported solid gains, with total sales up 4.2% and 5.9%, respectively. Casino Supermarkets and Superettes delivered satisfactory performances.
• Cdiscount enjoyed significantly faster organic growth of 18.1% during the period.
• Géant Casino’s sales fell back 4.1% on a same-store basis (excluding petrol) while the decline in footfalls slowed to 2.8% from 5% in the first half.

International operations enjoyed double-digit organic growth, at 10.2%, reflecting strong momentum in the Group’s key countries (Brazil, Colombia, Thailand and Vietnam) as well as the quality of its asset portfolio.

• South America continued to report very robust organic growth, at 12.8%, led by continued strong advances in same-store sales in Brazil (up 13,1%) and a very satisfactory performance in Colombia.
• In Asia, same-store sales rose 6.5% over the period. Big C in Thailand achieved solid same-store growth, while Vietnam continued to enjoy strong momentum.

Overall, international sales expanded by 17.0% over the period and represented 37% of the consolidated total.

Organic growth continued to gain momentum in the third quarter, confirming the effective positioning of the Group’s asset portfolio, both in France and internationally.

Casino intends to strengthen market share in France by improving the banners’ price competitiveness and speeding up the expansion of the convenience and discount networks.
Internationally, the quality of the Group’s assets is expected to drive strong, profitable growth for 2010 and beyond.

The Group will pursue its €1 billion asset disposal programme and reaffirms its objective of a net debt/EBITDA ratio of less than 2.2x at year-end 2010.

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FRANCE

Sales in France rose 1.3% on an organic basis, with petrol sales adding 1.1% to growth.

In € millions		Third quarter								9 months
		2009		2010		% change		Organic growth excluding petrol		2009		2010		% change		Organic growth excluding petrol
Net sales, France		4,489.3		4,540.3		+1.1%		+0.2%		13,018.9		13,136.2		+0.9%		-0.1%
Franprix-Leader Price		965.1		933.0		-3.3%		-3.3%		2,982.8		2,948.0		-1.2%		-1.2%
Monoprix		421.3		446.3		+5.9%		+5,9%		1,326.6		1,385.9		+4,5%		+4,4%
Casino France		3,102.9		3,161.0		+1,9%		+0,5%		8,709.4		8,802.3		+1,1%		-0.5%
Géant Casino HM		1,444.4		1,440.7		-0.3%		-2.8%		4,032.1		3,989.5		-1.1%		-4.0%
Casino SM		910.1		943.4		+3.7%		+1.9%		2,515.2		2,603.8		+3.5%		+1.2%
Superettes		424.8		426.8		+0.5%		+0.5%		1,155.8		1,147.3		-0.7%		-0.7%
Other businesses		323.6		350.1		+8.2%		+12.1%		1,006.3		1,061.8		+5.5%		+10.3%

Same-store sales		Q3 2010				9 months 2010
		% change (reported)		% change (excluding petrol)		% change (reported)		% change (excluding petrol)
Franprix		+0.1%		+0.1%		+1.0%		+1.0%
Leader Price		+1.1%		+1.1%		-3.9%		-3.9%
Géant Casino hypermarkets		-1.3%		-4.1%		-2.1%		-5.2%
Casino Supermarkets		+2.8%		+0.9%		+2.1%		-0.3%
Monoprix		+3.7%		+3.7%		+2.7%		+2.6%

• Franprix-Leader Price

Leader Price returned to same-store growth (up 1.1%), confirming the significant improvement in the sales trend observed in the second quarter. Growth was led by a tangible 2.1% increase in footfalls that attested to the effectiveness of sales initiatives implemented during the first half of the year, including measures to improve price competitiveness and stepped-up advertising. Marketing initiatives have been strengthened in the second half. Around 100 national brand products have been introduced in the integrated stores since the end of July and the assortment is being extended to include 250 national brand items, which will be available in all Leader Price stores from mid-October. The new store concept is being rolled out in line with the business plan, with 55 stores converted by end-September. In the first nine months of the year, 23 stores were opened and 18 were closed or rebannered.

Franprix’s same-store sales were stable, rising by 0.1% in the third quarter. The banner opened eight stores during the third quarter (bringing the total since January to 61) and continued to deploy the new store concept (with 152 stores converted in the first nine months of the year).

Total sales for Franprix/Leader Price contracted 3.3%, mainly as a result of the sharp drop in sales to Caillé group, which has been Leader Price’s franchisee in Reunion since the third quarter of 2009.

• Monoprix

Monoprix reported a solid 3.7% increase in same-store sales, led by robust apparel sales and a good performance in food.
A new Citymarché store was opened during the period and expansion of the new store formats continued with the opening of five Monop stores and one Naturalia store, bringing the total number opened since January to 20.
Total sales rose by 5.9%, driven by the tangible contribution of store expansion to growth.

• Casino France

Géant Casino’s same-store sales contracted by 4.1%, excluding petrol. The decline in footfalls slowed to 2.8% in the third quarter from 5% in the second. The average basket was 1.2% lower.

Food sales were down 3.5%, versus 6.9% in the second quarter. Second-quarter price cuts led to a noticeable improvement in price competitiveness, with the banner’s IRI index down 3 points at end-August. The banner will strengthen its competitiveness in the second half of the year by leveraging promotions and loyalty programmes.
On the non-food side, Géant Casino continued to reposition the offer around the most promising categories. As a result, sales in the apparel and home segments were virtually unchanged, while sales of less promising categories, such as DVDs/games/videos and large appliances continued to be carefully scaled back. Non-food sales were down 5.5%.

Excluding petrol, Casino Supermarkets reported a 0.9% increase in same-store sales in the third quarter, versus a 1.0% decline in the first half. Three new stores were opened during the period. Total sales excluding petrol rose by 1.9%.

Superette sales rose by 0.5%, reflecting the ramp-up of the expansion programme and the end of the store-base rationalisation programme. Sixty-three stores were opened during the period, bringing to 265 the total number opened since the beginning of the year.

The Other businesses reported 12.1% organic sales growth, led by the excellent performance of Cdiscount, which enjoyed third-quarter organic growth of 18.1%. Its additional sales largely offset the decline in Géant Casino’s non-food sales.
The Group continued to promote synergies between Cdiscount and its store network. After developing a hypermarket pick-up service for Cdiscount purchases, the Group has started extending the service to Petit Casino superettes for parcels weighing under 30kg since the beginning of July. This initiative will be rolled out to all 1,900 integrated stores by the year-end and to the entire Superette network in first-half 2011.

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INTERNATIONAL

International sales increased by 17.0% over the period.
Changes in scope of consolidation had a 10.2% negative impact, mainly resulting from the 1 January 2010 deconsolidation of Venezuelan operations.
The currency effect was a positive 17.1%, due to the rise in the Brazilian real, Colombian peso and Thai baht against the euro.

Organic growth in international markets remained very high at 10.2%, led by very strong 12.8% growth in South America and a robust 6.2% increase in Asia.

Consolidated net sales

Reported growth

Organic growth

Same-store growth

Q3 2010

9 months 2010

Q3 2010

9 months 2010

Q3 2010

9 months 2010

South America

+17.6%

+22.2%

+12.8%

+12.4%

+10.5%

+10.0%

Asia

+23.6%

+15.8%

+6.2%

+6.3%

+6.5%

+5.5%

In South America, same-store sales rose by 10.5%, lifted by sustained growth in Brazil and the ongoing improvement of business in Colombia.

• In Brazil, Grupo Pão de Açucar (GPA) reported same-store sales growth of 13.1%. Excluding Globex, GPA’s same-store sales rose 7.8%, reflecting good performances in both food and non-food. Globex same-store sales increased by 28.5%. E-commerce sales grew at a very fast pace, above 60%. GPA total sales grew by 16.9%*.
• In Colombia, the improvement in same-store sales continued in the third quarter, with Exito reaping the benefits of successful hypermarket promotions. The banner opened two stores in the third quarter, bringing to four the total opened since the beginning of the year (of which 1 hypermarket), and stepped-up its programme of store conversions (with 23 completed to date).
• Growth in same-store sales was sustained in Argentina and Uruguay.

In Asia, organic growth remained robust at 6.2%, fuelled by the satisfactory same-store performance of Big C in Thailand and ongoing very strong growth in Vietnam. In Thailand, Big C pursued the development of its new formats, opening two Mini Big C stores and seven Pure stores during the period.
The pace of expansion will move up a gear in the fourth quarter with the opening of three hypermarkets in Thailand (four openings in 2010) and four in Vietnam, bringing the total number of hypermarkets to 14 in this country by end-2010.

In the Indian Ocean, sales were down 0.4% on an organic basis and down 0.8% on a same-store basis.

* Data published by the company.

Main changes in the scope of consolidation

- Ponto Frio has been consolidated by the Grupo Pao de Açucar (GPA) sub-group since 1 July 2009.
- Operations in Venezuela have no longer been consolidated since 1 January 2010.

		Third quarter				% change				9 months				% change
		2009 €m		2010 €m		Reported		At constant exchange rates		2009 €m		2010 €m		Reported		At constant exchange rates
FRANCE		4,489.3		4,540.3		+1.1%		+1.1%		13,018.9		13,136.2		+0.9%		+0.9%
Of which:
Franprix-Leader Price   Monoprix   Casino France		965.1   421.3   3,102.9		933.0   446.3   3,161.0		-3.3%   +5.9%   +1.9%		-3.3%   +5.9%   +1.9%		2,982.8   1,326.6   8,709.4		2,948.0   1,385.9   8,802.3		-1.2%   +4.5%   +1.1%		-1.2%   +4.5%   +1.1%
Géant Casino HM Casino SM Superettes		1,444.4 910.1 424.8		1,440.7 943.4 426.8		-0.3% +3.7% +0.5%		-0.3% +3.7% +0.5%		4,032.1 2,515.2 1,155.8		3,989.5 2,603.8 1,147.3		-1.1% +3.5% -0.7%		-1.1% +3.5% -0.7%
Other segments		323.6		350.1		+8.2%		+8.2%		1,006.3		1,061.8		+5.5%		+5.5%
INTERNATIONAL		2,259.6		2,644.4		+17.0%		0.0%		6,417.8		7,637.4		+19.0%		+4.1%
Of which:
South America		1,653.7		1,944.6		+17.6%		-1.4%		4,544.6		5,553.1		+22.2%		+3.8%
Asia		397.6		491.6		+23.6%		+6.2%		1,262.7		1,461.7		+15.8%		+6.3%
Other segments		208.2		208.2		+0.0%		-0.8%		610.5		622.6		+2.0%		+1.6%
NET SALES – CONTINUING OPERATIONS		6,748.9		7,184.7		+6.5%		+0.7%		19,436.6		20,773.6		+6.9%		+1.9%

Average exchange rates		H1 2009		H1 2010		% change		9 months 2009		9 months 2010		% change
Argentina (ARS / EUR)		0.207		0.195		-5.8%		0.198		0.195		-1.3%
Uruguay (UYP / EUR)		0.032		0.038		20.1%		0.031		0.038		20.8%
Venezuela (VEF / EUR)		0.349		n/a		n/a		0.341		n/a		n/a
Thailand (THB / EUR)		0.021		0.023		7.5%		0.021		0.024		11.2%
Vietnam (VND / EUR) (x1000)		0.044		0.041		-7.5%		0.043		0.041		-4.9%
Colombia (COP / EUR) (x1000)		0.325		0.386		18.7%		0.332		0.397		19.6%
Brazil (BRL / EUR)		0.342		0.419		22.4%		0.352		0.427		21.0%

Store network

France		31 Dec 2009		30 June 2010		30 Sept 2010
Géant Casino hypermarkets		122		124		125
Of which French affiliates		5		6		6
International Affiliates		5		5		5
French Franchises				1		2
+ Service stations		99		99		99
Casino supermarkets		390		396		402
Of which French Franchise Affiliates		53		52		53
International Franchise Affiliates		21		24		27
+ Service stations		156		154		158
Franprix supermarkets Of which Franchise outlets		789 472		832 498		838 497
Monoprix supermarkets Of which Naturalia Of which Franchise outlets/Affiliates		463 41 117		479 44 124		485 45 127
Leader Price discount stores Of which Franchise outlets		559 266		562 280		564 281
TOTAL supermarkets and discount stores Of which Franchise outlets/Stores operated under business leases		2,201   929		2,269   978		2,289   985
Petit Casino superettes		1,816		1,795		1,796
Of which Franchise outlets		28		28		28
Eco Services superettes		3		2		2
Of which Franchises		2		1		1
Spar superettes Of which Franchise outlets		896 739		910 752		922 757
Vival superettes Of which Franchise outlets		1,753 1,753		1,802 1,802		1,793 1,792
Casitalia and C Asia superettes		1		1		1
Other Franchise stores Corners, Relay, Shell, Elf, Carmag, other   Wholesale outlets		1,257 1,257   1,025		1,307 1,307   928		1,310 1,310   927
TOTAL CONVENIENCE STORES Of which Franchise outlets/Stores operated under business leases		6,751 4,805		6,745 4,819		6,751 4,816
Other affiliate stores		13		18		18
Of which French affiliates		13		15		15
International Affiliates				3		3
Other businesses Casino Restauration		277 277		283 283		287 287
TOTAL France		9,364		9,439		9,470
Hypermarkets Supermarkets Discount stores Superettes and other stores Other		122 1,642 559 6,764 277		124 1,707 562 6,763 283		125 1,725 564 6,769 287

International		31 Dec 2009		30 June 2010		30 Sept 2010
ARGENTINA Libertad hypermarkets Leader Price discount stores Other businesses		49 15 26 8		22 14 0 8		22 14 0 8
URUGUAY Géant hypermarkets Disco supermarkets Devoto supermarkets		53 1 28 24		53 1 28 24		53 1 28 24
VENEZUELA Exito hypermarkets Cada supermarkets		41 6 35		0 0 0		0 0 0
BRAZIL Extra hypermarkets Päo de Açucar supermarkets Sendas supermarkets Extra Perto supermarkets CompreBem supermarkets Assai discount stores Extra Facil convenience stores Eletro, Ponto Frio (other businesses) Of which Ponto Frio		1,080 103 145 68 13 157 40 52 502 455		1,102 105 146 67 15 153 43 69 504 457		1,112 105 146 59 33 143 48 74 504 457
THAILAND Big C hypermarkets Big C supermarkets Mini Big C convenience stores Pure stores (other businesses)		97 67 0 11 19		96 67 1 9 19		105 67 1 11 26
VIETNAM Big C hypermarkets		9 9		10 10		10 10
INDIAN OCEAN Jumbo hypermarkets Score/Jumbo supermarkets Cash and Carry supermarkets Spar supermarkets Other businesses		50 11 21 5 6 7		49 11 21 5 6 6		49 11 21 5 6 6
COLOMBIA Exito hypermarkets Pomona, Carulla and Exito supermarkets Surtimax discount stores Exito Express, Carulla Express convenience stores Ley and others		260 74 93 47 11 35		261 72 98 51 12 28		263 72 104 52 15 20
TOTAL INTERNATIONAL		1,639		1,593		1,614
Hypermarkets Supermarkets Discount stores Convenience stores Other businesses		286 595 113 74 571		280 564 94 90 565		280 570 100 100 564