Carrefour: Plassat sold what others valued more and put the group back into growth

When Georges Plassat took over as chairman and chief executive in 2012, Carrefour had, in his own words, 'suffered from having developed in too haphazard a way internationally, without having the resources to underpin its aims'. Store modernisation had fallen behind, especially in France. In 2011 the group earned just €371M of net income, lost €3.35 per share on recurring operations, and its market value sank to €12.0B with the share price at record lows.

Plassat's plan had three priorities, which he restated in the 2013 report: refocus the group on countries where it held strong positions, go back to the basics of retail, and simplify the organisation so store directors could act. In 2012 alone the group sold its operations in Colombia and Malaysia and converted Greece, Singapore and Indonesia into franchise and partnership structures, booking €1,120M of income from discontinued operations. 'Some of our assets, such as those in Colombia where we were behind in market share, were more valuable for others than for us,' he said.

The proceeds went back into the core: France returned to a price offensive, stores were renovated, and net debt fell by €2.6B to €4.3B in a single year. Net income, group share, tripled to €1,233M in 2012 and the dividend rose to €0.58. In 2013 recurring operating income rose 9.8% to €2,238M, France posted its best organic growth since 2007, and the group bought a 42% stake in a €2.7B shopping-centre company with Klépierre to control the land around its hypermarkets.

By 2014 the three-year plan was visibly on track: recurring operating income reached €2,387M (3.2% of sales), net income from recurring operations grew 24.6%, and like-for-like sales excluding petrol rose 2.8% — the best performance in over seven years. Plassat had also been explicit about pacing: 'you don't accomplish anything of substance in under three years.'

Recurring operating income rose from €2,140M (2012) to €2,387M (2014); net debt fell €2.6B in 2012; France posted its best like-for-like growth in over seven years.

Carrefour had expanded into over 30 countries faster than it could modernise stores, so its French hypermarkets aged and its price image slipped as discounters attacked.

Plassat framed the retreat as valuation arbitrage, not defeat — assets 'more valuable for others than for us' were sold or franchised, so shrinkage funded reinvestment rather than just cutting losses.

He priced patience honestly, telling shareholders that real repair takes three years, which gave the plan room to work instead of chasing quarterly cosmetic fixes.

Price image was treated as the precondition: France went back on the price offensive and won back traffic before the group harvested margin.

Shrink to where you are strong: sell what is worth more to others, franchise what you cannot run, and reinvest the proceeds in the stores customers actually visit.

The recovery carried through the rest of the plan. In 2014 every region contributed, Spain returned to growth after years of resistance, and €2.4B was reinvested, much of it renovating stores and the real estate around them; the Dia France acquisition added convenience stores converted to Carrefour banners. Alexandre Bompard succeeded Plassat in 2017 and largely kept the playbook: concentrate on core markets, control the real estate, compete on price. The group handed over was growing in all its main markets, with profit rising and the balance sheet repaired.