Carrefour to Cut 1,672 Belgian Jobs, Shut Stores(70249)

Carrefour to Cut 1,672 Belgian Jobs, Shut Stores

Carrefour SA, Europe s largest retailer, plans to eliminate 11 percent of its staff in Belgium, shutter or sell 41 of its 627 stores in the country and cut wages to restore profit following five years of declining sales.

Carrefour will close 21 unprofitable Belgian stores by June 30, cutting 1,672 jobs, and may start talks with closely held Groupe Mestdagh SA to sell an additional 17 to 20 stores, Gerard Lavinay, executive director of Carrefour Belgium NV, told reporters in Brussels today.

Sales at Carrefour s Belgian stores open at least a year fell for a fifth consecutive year in 2009, dropping 2.9 percent. More than half its 56 suburban superstores in the country, the Paris-based retailer s fifth-largest market, were unprofitable last year. It plans to spend 300 million euros ($407 million) in the next three years refurbishing its Belgian outlets.

Our cost structure in Belgium is too high, Lavinay said. However, it doesn t make sense to lower your cost base if you don t have a plan for a commercial strategy at the same time.

Carrefour declined 37 cents, or 1.1 percent, to 33.715 euros at 4:05 p.m. in Paris trading. The stock has advanced 0.4 percent this year.

Carrefour will transfer staff in its owned supermarkets to the same collective wage agreement that is applied by Delhaize Group SA and Colruyt NV. Delhaize overtook Carrefour as Belgium s largest food retailer by market share in the second quarter, according to AC Nielsen data. Workers at Carrefour s Belgian headquarters will see their salaries frozen.

The retailer also plans to save 25 million euros in the next three years by renegotiating terms of contracts with suppliers of goods and services.

Carrefour to Cut 1,672 Belgian Jobs, Shut Stores

Related News

Photos

trade

market

finance