© Bloomberg

Shares in Casino were up as much as 3.75 per cent in early trade on Tuesday after the French supermarket reported that sales growth had accelerated in the second quarter and confirmed its guidance for the full year.

Casino recorded group sales of €8.916bn in the three months to the end of June, slightly ahead of the €8.8bn average of analysts’ forecasts compiled by the company.

Stripping out the impact of acquisitions, currency moves and fuel revenue, sales were up 5.2 per cent, compared to growth of 3.1 per cent in the first quarter.

“Our performance is very good” in France, a challenging market, said finance director Antoine Giscard d’Estaing on a conference call. In its home country, Casino and rivals such as Carrefour face intense competition from German discounters Aldi and Lidl, and the threat of Amazon encroaching on their turf.

“All [Casino’s] strategic initiatives in France from previous years seem to be paying off,” analysts at Bernstein wrote in a note following the results.

These initiatives included the “decision to transition non-food online with corresponding space reductions in hypermarkets, price competitive position driving footfall, e-commerce investments across the network, and a corporate focus on convenience and premium formats,” they said, and were “supported by a return to food inflation in France.”

Meanwhile, Mr Giscard d’Estaing said an “important point” was the “recovery” of the group’s performance in Brazil, Casino’s second-largest market, which would be achieved through a “better commercial policy.” As in France, the trading environment in Latin America was difficult, he said, pointing to continuing food deflation.

Casino confirmed its annual guidance for 2018, predicting French earnings before interest and taxes would rise by 10 per cent, excluding the expected gains from the sale of certain real estate assets. Last month the group announced a disposal plan of €1.5bn in non-core assets, including real estate, to help reduce debt and shore up investor support.

Despite Tuesday’s gains Casino’s share price is down over 30 per cent this year, reflecting investor concerns about the increase in the group’s structural complexity over the past three decades and worries about the financing arrangements in its complex chain of investment vehicles, some of which face imminent debt refinancing deadlines.

Get alerts on Casino Guichard-Perrachon SA when a new story is published

Copyright The Financial Times Limited 2018. All rights reserved.

Comments have not been enabled for this article.

Follow the topics in this article