Amazing Classic
(AOF) –
Casino
(+ 4.43% to 12.96 euros)
The big sign holds the rope of the SBF. The title finds the favor of the investors for a few days which irons with the purchase. Over one week, it gained +10.85%, after six months marked by a drop in price (-35.68%).
AOF – LEARN MORE
Key points
– Food distribution group created in 1898 present in France, Brazil, Colombia and Uruguay;
– Distributor weighing €30.5 billion organized into 3 branches: France Retail under the Casino, Monoprix, Franprix and Naturalia brands, Latin Retail in Latin America under the Assaï, GPA and Extra brands in Brazil, Exito and Libertad in Colombia, Disco and Deveto in Uruguay and, finally, the new activities – Green Yellow for solar energy and CDiscount for e-commerce;
– Business model based on 5 pillars: a portfolio of buoyant formats in France, the leading food and non-food e-commerce offer, the development of new growth levers, a significant stake in the major players in distribution from Latin America, and strengthening the structure of the group;
– Capital locked at 52.3% by the Rallye holding company (62% of voting rights), itself a subsidiary of Euris, owned by Jean-Charles Naouri, Chairman and CEO of the 13-member Board of Directors;
– Financial situation eased by the disposals of Leader Price and FLOABanl, with €5.6 billion in equity and €2.6 billion in cash compared to net debt of €5.9 billion.
Challenges
– Strategic plan to reduce the share of hypermarkets to 15%, 50% growth in the organic product offering to €1.5 billion, progress in e-commerce and, for new activities, expansion of the network photovoltaics installed and rising data center revenues;
– Dynamic innovation strategy: data management and monetization within RelevanC, cloud offer with ScaleMax, partnerships with Google Cloud and Accenture in distribution, Gorillas in quick-commerce in France and Rappi in Colombia / deployment of the C Discount offer / digitalization of logistics and delivery platforms with Amazon and Ocado;
– Environmental strategy: capitalizing on the “Green Yellow” photovoltaic expertise with a pipeline of 4.5 GWp, reinforced by a fundraising in February, and by its partnerships (Schneider Electric and Amazon web services), aiming to reduce CO2 emissions by 18% in 2025 and 38% in 2030 (vs 2015);
– Simplification of Latin American assets via a direct holding of 41% in GPA and Assai;
– Progress in buoyant formats in France, premium and proximity to the Monoprix, Naturalia and Franprix brands (€484 million in revenue, or 7.7% of the French market) and the transformation of the Géant Casino hypermarkets into supermarkets.
Challenges
– Recurrent speculation on a merger with Alibaba, Amazon and on the intentions of the Czech Kretinski, already holder of 4% of the capital;
– After a growth in the 1st quarter, 2022 objective of an increase in free cash flow, high profitability and continuation of the disposal plan, the full implementation of which is confirmed for 2023.
Urban transformation to enhance real estate heritage
Several initiatives are intended to densify the land around hypermarkets and/or to play on the mix of uses (commerce, office, housing and even urban logistics). Nhood, the company launched by the Mulliez family, has the mission of transforming into mixed neighborhoods sites belonging to the real estate companies of Auchan, Ceetrus and Nodi, and the real estate assets of other companies in the group. It will accelerate in this business of urban regeneration. The Mulliez family had planned to invest 1.8 billion euros between 2022 and 2026 in its real estate projects. This objective should soon be revised upwards. Carrefour, for its part, joined forces with the promoter Altarea in early 2021 to transform commercial areas into mixed neighborhoods.
