Shares in Carrefour fell today after the French retailer cut its annual earnings target, warning that riots and looting in France could reduce operating income by as much as €200m.
The stock was down around 15% this morning, heading for its biggest one-day drop on record, making it the weakest performer both on the Paris blue-chip and the wider pan-European STOXX 600 indexes.
Carrefour generates roughly half of its sales in France, making the group particularly exposed to any prolonged disruption in its home market.
The company lowered its full-year earnings outlook, citing higher costs and store disruptions linked to recent unrest in France.
Chief Financial Officer Matthieu Malige said the total impact could amount to between €80m and €200m of operating income.
Analysts said the downgrade raised questions about whether the group’s challenges were confined to France.
JPMorgan said in a note the update highlighted “a lack of underlying momentum” across Carrefour’s key markets, pointing to weak volumes in France, Spain and Brazil.
The bank added the guidance downgrade appeared broader than management indicated, noting Carrefour had not cut its outlook during the 2018-2019 Gilets Jaunes (Yellow Vests) protests and had repeatedly fallen short of expectations in recent years.
AlphaValue said the French unrest had compounded already fragile trading trends.
The session’s losses have wiped €1.7 billion off the company’s market cap.
