Carrefour (EPA:CARR) (CA.PA) has reported a significant increase in sales for the first quarter of 2024, with a 13.5% rise on a like-for-like basis. This growth has been attributed to strong performance in Brazil and Argentina, while maintaining stable revenue in France and Europe. The company has also confirmed its commitment to meeting its full-year financial objectives, as outlined in its strategic plan.
Key Takeaways
- Carrefour's Q1 sales rose by 13.5% on a like-for-like basis.
- The company is intensifying price reductions and accelerating its cost savings plan to €1.2 billion.
- Strategic initiatives include growing Carrefour-branded products and increasing e-commerce GMV.
- Cost savings are exceeding expectations, with an additional €200 million identified for 2024.
- Carrefour aims to enhance market share across all markets through a price war on high-rotation products.
- The company is confident in growing EBITDA in Brazil and profitability in France.
- Limited reaction from competitors to Carrefour's price investments has been observed so far.
Company Outlook
- Carrefour plans to continue its strategy of price reductions and cost savings throughout 2024.
- The company remains focused on improving customer satisfaction and experience.
- Carrefour is determined to regain market share and grow its e-commerce presence.
Bearish Highlights
- The company is engaged in a price war, which could lead to margin pressures if competitors react more aggressively.
- Trading down dynamics and volumes are expected to stabilize later in the year, indicating a period of potential volatility.
Bullish Highlights
- Carrefour is seeing positive dynamics in B2B sales and converted stores.
- The company is experiencing a restoration of purchasing power in Europe due to less inflation pressure.
Misses
- There were no specific misses mentioned in the earnings call summary.
Q&A Highlights
- Nicolas Champ from Barclays (LON:BARC) inquired about competitor reactions to Carrefour's pricing strategy, particularly in France, and the company's confidence in profitability growth in Brazil and France.
- Carrefour has observed limited competitor reactions and is closely monitoring the situation.
- The company is confident in increasing EBITDA and EBIT in Brazil and France, respectively, due to top-line performance and rebounding dynamics.
In summary, Carrefour's first quarter of 2024 has been marked by robust sales growth and strategic advancements. The company is not only meeting but exceeding its cost savings goals and is aggressively reducing prices to gain market share. With a clear focus on customer satisfaction and a positive outlook on profitability in key markets, Carrefour is poised to continue its upward trajectory while keeping a close watch on market reactions and inflationary trends.
InvestingPro Insights
Carrefour's (CRRFY) recent announcement of a 13.5% rise in Q1 sales is bolstered by several key financial metrics and strategic moves that reflect the company's strong position in the market. With a commitment to enhancing shareholder value, the company has not only raised its dividend for the past four consecutive years but also maintained dividend payments for an impressive 33 years. This consistent return to shareholders is a testament to Carrefour's financial stability and prudent capital management strategies.
InvestingPro Data highlights that Carrefour is trading at a low P/E ratio of 6.91, indicating that the stock may be undervalued relative to its near-term earnings growth. This is further supported by an adjusted P/E ratio for the last twelve months as of Q4 2023, standing at 9.89. The PEG ratio for the same period is 0.43, which suggests that the company's stock price is potentially undervalued given its earnings growth prospects. Additionally, the price to book ratio as of Q4 2023 is 0.97, reinforcing the potential for investment value.
An InvestingPro Tip that aligns with the article's narrative is the aggressive share buyback strategy management has undertaken. This move can signal confidence in the company's future and a commitment to increasing shareholder value. Another InvestingPro Tip worth noting is that Carrefour is a prominent player in the Consumer Staples Distribution & Retail industry, which may provide a certain level of stability in volatile markets.
For readers interested in a deeper dive into Carrefour's financials and strategic positioning, InvestingPro offers a comprehensive list of additional tips. With a total of 11 InvestingPro Tips available, investors can gain a more nuanced understanding of the company's performance and potential investment opportunities.
Carrefour's strategic initiatives, such as price reductions and cost savings, align with the financial insights provided by InvestingPro. The company's strong fundamentals and shareholder-friendly actions underpin its positive outlook for 2024. For those looking to explore further, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
Full transcript - Carrefour SA PK (OTC:CRRFY) Q1 2024:
Operator: Good day and thank you for standing by. Welcome to the Carrefour Q1 2024 Sales Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there'll be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Matthieu Malige, Chief Financial Officer. Please go ahead, sir.
Matthieu Malige: Thank you. Good afternoon to all of you and thank you for attending this Q1 2024 sales call. I'm here with Sébastien Valentin, Head of Investor Relations; and the rest of our IR team. Let me start with a few key highlights before we get into the details of Carrefour's Q1 performance. The quarter was marked by the following elements. First, an inflection in Brazil with a return to sales growth, then broadly stable revenue in France and Europe, primarily driven by the slowdown in food inflation across all markets and continued strong momentum in Argentina. Overall sales were up 13.5% on a like-for-like basis over the quarter. A key highlight of the period was investments in competitiveness, notably in France, which we intensified since the beginning of the year. These investments are already visible translating into an improvement of our price positioning in the market. This contributed to an increase of six points in customer satisfaction at group level as measured by the Net Promoter Score. In view of this, we decided to intensify and accelerate price reductions throughout 2024. At the same time, we are heightening our cost reduction dynamics with a new objective of 1.2 billion for our 2024 cost savings plan versus 1 billion initially. That increase is made possible by the strong momentum we have on current actions, which are rolled out at a rapid pace and by incremental measures. This gives us confidence in our capacity to increase our investments while preserving our financial model. In addition, Carrefour continued to implement its 2026 strategic plan with new progresses on key initiatives. Carrefour-branded products continued to grow at a rapid pace. They now represent 37% of food sales, up 2 points versus last year. E-commerce GMV grew 33% in Q1, driven once again by a strong 52% increase in Brazil and double digit growth in France. In light of these Q1 achievements, we confirm today our full year financial objectives, including growth in EBITDA and recurring operating income and a net free cash flow in line with the Carrefour 2026 plan trajectory as presented last February. Let's now dive into Q1 numbers starting on Slide 3 with group sales. Total sales for the quarter reached €22.2 billion, increasing by 12.1% at constant currency. Group like-for-like sales were up 13.5%. Expansion and M&A had a negative contribution of 0.4% over the quarter, many as a consequence of transfers to franchise and lease management and store closures in Brazil. Petrol contributed negatively for -2.3% driven by lower volumes. The positive calendar effect of 1.4% reflects the leap year and the timing of Easter in March this year versus April last year. ForEx had a strong and favorable impact on total sales growth of -11.8% over the quarter, essentially reflecting the depreciation of the Argentinean peso. In total, reported revenue was up 0.4% in Q1. Before reviewing our different markets in more details, let's have a quick look at food inflation in Europe on Page 4. A sharp slowdown in inflation that started in Q2 last year continued dropping to a low single digit number in most European markets in March. Moving on to more details on France on Slide 5, in this context of slowing inflation, like-for-like sales were slightly down at minus 0.4%. Customer purchasing patterns were in line with the previous quarters, including more trading down and volumes in the market remaining negative. Food sales were slightly up in Q1, offset by more pressure on non-food. As mentioned during our full year presentation, we amplified the price investments that we initiated in Q4. At national level, more than 700 basic products have seen substantial price reduction during the quarter. We will continue with new waves of price reduction every other week until the end of the year. Besides these national waves, other price initiatives are being implemented at store level with good success. In parallel, our cost savings plan is being implemented at a rapid pace, and as said, we decided to take additional measures. With that, we are confident that we can sustain these investments in our competitiveness while maintaining growing profitability in France this year, both in absolute terms and as a percentage of sales. Moving on to Europe on Slide 6, like-for-like sales were globally stable over the quarter, with some company patterns among geographies. First, inflation slowed materially in all our markets by more than three points on average compared to the previous quarter, which explains softer top line trends. Second, we see strong competition in all our markets, and we are very active to make sure we maintain the right level of competitiveness. Here again, our investments are funded by the strong momentum on cost savings, notably driven by good progress on European mutualization. We now have 20 international suppliers on our Eureca European purchasing platform. In this context, the best-performing countries in the quarter were Spain and Romania with like-for-like sales growth driven by solid increase in food sales of respectively, 1.2% and 2.1%. In Belgium, commercial momentum remained very good during the period with like-for-like sales up plus 4.3% in January and February. This was offset by a well-anticipated decline in March on very high comps as March last year had benefited from disruptions as a competitor. The performance was tougher in Poland with a decline of minus 4.2% like-for-like in the context of increased price competition in the country since the beginning of the year. Let's move on to Latin America on Slide 7. The quarter was marked by return to growth in Brazil in a context of positive food inflation with strong improvements in all formats. Like-for-like sales increased 1.3%. At Atacadão, which accounts for 70% of our activity, delivered a solid 1.8% like-for-like sales growth, driven by both B2B and B2C sales, the ongoing rollout of service counters such as bakery, butchery, and cold cuts is meeting great success with customers. They are now rolled out in about 60 stores, and we plan to double that number by year-end. The retail division is also showing sequential improvement with a slight minus 1.4% drop in like-for-like sales over the quarter. Here again, our self-help initiatives are bearing fruit, including giving a more discount flavor to the stores notably with the offering of some Atacadão [indiscernible] ranch products on the shelves. Sam's Club keeps delivering strong performance with like-for-like sales up 6.9% and a 33% increase in active numbers over the quarter. E-commerce GMV in Brazil keeps increasing at a high pace. It was up 52% in Q1 and particularly buoyant at Atacadão and Sam's Club. Lastly, the bank also showed positive dynamics with 22% growth of the credit portfolio over the quarter. After a tough 2023 marked by the rapid integration of Grupo BIG in an adverse business and macro context, we now see most signals turning to green in the country. The converted stores keep ramping up rapidly with another plus 21% like-for-like sales growth for the new Atacadão that now contribute to earnings and margin growth. We continue to restructure the Retail segment. Four Carrefour stores and one Bompreço were converted to Atacadão last quarter and nine more are currently undergoing conversion work. In addition, all the 123 unprofitable hypermarkets, supermarkets and Todo Dia, we decided to close or sell have now been restructured. Our strategic initiatives are producing material results, both in terms of top line and costs. With this, we are confident that 2024 will be a strong year for Brazil and will provide clear evidence of the relevance of our investments in the country. A quick word about Argentina, where we keep delivering outstanding growth in a very high inflationary environment, notably with the strengthening of our price leadership. A few words on our €700 million share buyback program on Slide 8. As mentioned, this program is well underway. We have already repurchased 29 million shares to-date for a total amount of €428 million. This includes 25 million shares, both from our shareholder Galfa, as announced last month. We will receive the shares at the end of May after payment of the dividend. To-date, the net number of outstanding shares amounts to €690 million. In summary, Q1 showed further progress on all key pillars of our strategic plan. Our investments in competitiveness are being well executed, and we decided to strengthen our efforts on the matter, which will be financed by incremental cost savings with a new objective of €1.2 billion for the full year. Sales in Europe have stabilized with a sharp slowdown in inflation now at a low single-digit levels in all our markets. Recovery in Brazil is well underway, giving us confidence in the strong rebound in profitability expected this year. In view of all this, we're happy to confirm today our financial objectives for the year. That said, I want to thank you for your attention. Sébastien and I are now happy to take your questions.
Operator: Thank you. [Operator Instructions] We will now go to your first question. One moment please. And your first question comes from the line of Izabel Dobreva from Morgan Stanley (NYSE:MS). Please go ahead.
Izabel Dobreva: Hello, good evening. Thank you for taking my questions. So my first question is on the incremental savings, which you have announced. Could you give us more color on which areas exactly the savings are coming from? And both in terms of category but also in terms of geographical split. Should we assume that most of them are coming out of France? And really, what I'm trying to understand is, is there any danger that you impact the customer experience by accelerating these savings? That is the first question. Then my second question is on the price investments. Can you help us understand what you target in terms of endpoint and end goal for these price investments. So what I'm trying to understand is whether you're trying to get on the front foot and get to a price point where you're gaining future? Or are these really defensive catch-up price investments because your markets are becoming more competitive? And then the final question is shorter just in terms of the French market share. When do you expect these price investments to really gain traction and get the market share to at least a neutral position?
Matthieu Malige: Thank you very much, Izabel for your questions. So first, on the savings. So the geographical split is really a relatively even contribution from all geographies relating to their level of activity. There's really two dynamics behind this increase in cost savings. First, as I said, the ongoing plan that we had launched now a few months ago, for 2024 is delivering well. It’s delivering ahead of what we had anticipated. And so that’s a positive. And then in the context of the competitive landscape, we have decided to accelerate on price investments. And so we’ve made work in each of our countries to find additional areas where we could improve our cost in each of the countries. And so this leads to the additional €200 million. For sure, what we’re trying to achieve and in the message today is improving customer satisfaction, improving customer experience. And so we have a clear line, which is that these cost savings do not negatively impact the customer experience. I think we have a long track record of delivering cost savings and we’ve always paid a lot of attention to this. Now, the main domains behind these cost savings, obviously, they include the head offices where we’ve asked for a number of complementary efforts on spendings and on resources. We’re also renegotiating a number of contracts with our GNFR suppliers where we had significant inflation over the past few years in the macro context, we all know in order to try to improve conduction these conditions. We’re also asking efforts from our merchandise for our COGS suppliers, including at Eureca level, and we’re also – we’ve also revisited with the arrival of Emmanuel Grenier, our IT costs throughout the group. So it’s quite a widespread analysis as you understand. So that’s for your first question relating to costs. Let me move now to the price investments and what our objective. Well, our objectives are quite clear, and we commented already in the full year presentation. And we’ve not changed our objective since 2018 and the arrival of Alexandre. We want to gain market share in all our markets. That’s clear. That’s what we have been able to deliver notably in France for two years in 2001, 2022 and beginning 2023, the landscape has become competitive, as we already commented, and so we had to increase our investments into competitiveness. The objective is to gain market share. Obviously, we are starting a price war. And so that’s why we have started to decrease of very high number of prices, €700 million over the first quarter. And since beginning of April, we have one wave in one dedicated category every two weeks with at least 100 high-rotation products which have a significant decrease. Why focusing on a small number of products with a high decrease in terms of percentage in order to strike the minds of the consumers that there is something happening? We have strong relay in communication as well in the stores and online to relay on all these initiatives. These national initiatives are complemented by initiatives at store level. So there has also been a mapping of the relative competitiveness level of all of our stores. And so complement to these national initiatives, we have more local price reduction campaigns at store level, which has also a very good impact. And so that’s under this scheme that we’re going to continue to invest in the following months and until the end of the year. On your third question, with the pace of the market share and when that should turn positive. I think we're doing things in order. We invest in the competitiveness. We see that the customers have noticed. It is already visible in the price indices. And so then it's hard to be very precise on the elasticity and when it will occur. What sure is that the volume, market share, market share in volume terms should have the inflection point ahead of the market share in value terms, given the magnitude of the price investments that we are putting into the market. That's where we are on these topics, Izabel.
Izabel Dobreva: Thank you very much.
Operator: Thank you. We will now go to the next question. And your next question comes from the line of Viraj Brahmbhatt from Citi. Please go ahead.
Viraj Brahmbhatt: Thank you. Good evening. I have two questions, if I may. So, the first one, following up on Izabel's second question, in France, you noted an uptick in NPS following your investments and also noted Leclerc somewhat stepping off the gas at full year. The recent market share data doesn't indicate a change in dynamics, but have you since noted uptick since April, especially on the volumes front? And my second question is on the Eureca ramp up, you mentioned previously moving on to your second wave of suppliers, how have the supply negotiations progressed here? If possible, can you quantify the cost saves achieved from your buying platform or broadly, how much this contributes to the raised cost save target? I appreciate that involves ongoing supplier negotiations, but any color here is helpful.
Matthieu Malige: Thank you, Viraj and let me welcome you. You recently took over. So let me welcome you to the Carrefour story. On the first one and the price investments, there's always a lag between the market share dynamics and the price investments. So we're clearly, at this moment where the market share dynamics reflect the investments, notably of Leclerc in 2022 and 2023. And all the investments that we're making at the moment are not yet visible in market share. We've done it in the past, as I said earlier. First you have your NPS, which starts reacting. That's the case in Q1. It was already the case in Q4. So that's good news. And then we know that traffic and number of products per basket are going to follow lifting market share. So we just need to give it some more time. Maybe what we notice, which is not a surprise, is that the elasticity of these price investments comes a little faster than we experienced in the past, which is an obvious consequence of the sensitivity of our customers on price and competitiveness, particularly at this moment of the macro cycle. On your second question regarding Eureca. So good news that we wanted to share with you. We're having these negotiations with 20 suppliers. So this is exactly what we had planned. You remember that we had a ramp up over four years to which close to 50% – 50 suppliers, sorry, which will represent 50% for FMCG purchases. So we had all suppliers last year. We've extended that to another 16. Negotiations are underway. We're very satisfied with the dynamics, these additional 16 suppliers have understood the benefits and the value added of negotiating at European level and for all the Carrefour European countries. And so negotiations are underway, so hard for me to comment precisely. But good dynamics. And obviously, as I said in my speech, Eureca and other European initiatives are levers, which do contribute to our cost savings and they do contribute to our increasing our cost-saving objective for this 2024.
Viraj Brahmbhatt: Very clear. Thank you.
Operator: Thank you. We will now go to the next question. And your next question comes from the line of Clément Genelot from Bryan Garnier & Co. Please go ahead. Hello, Clément is your line on mute.
Clément Genelot: Hello. Thank you. Two questions from my side, if I may. So the first one is on the – do you hear me?
Matthieu Malige: Yes. Clément, we can hear you.
Clément Genelot: Do you hear me? Hello?
Matthieu Malige: We hear you, Clément. Go ahead.
Clément Genelot: Okay. Good. Thank you. So two questions from my side, if I may. The first one on – okay, thank you. The first one on the French [indiscernible] investments. Are they financed by your own margin – I mean, what part of them are financed by your own margin versus what part comes from, let’s say regular deflation in some categories post negotiations front. The second one is also regarding the cost savings and the [indiscernible] and investments. Is it fair to assume that the cost saving target upgrade of €200 million is at least a magnitude of price investments to be made as [indiscernible] and if not, that means that our full year EBIT estimates is too low for this year. Thank you.
Matthieu Malige: Thank you, Clément. Okay. So on the price investments, it’s a relative game as you all very well know. So we – there is very limited deflation in the market, as I commented. It’s true that it’s the case on some products depending on commodities. But overall, we have a slightly inflationary environment. So – and again, when we announce a price decrease, some of them being double digits, because we want to, again, focus this price decrease on a limited number of products. Well, this is significant price investments. And anyway, the customers realize very well what’s the level of competitiveness. And so it has to be real and meaningful competitiveness gain for the customers. So that’s how we look at it. Then the – I don’t think we can exactly map the additional cost savings and price investment, notably for one geographical reason, the additional €200 million is a group number and as I said, we are focusing our price investments into Europe and notably in France. I think – so we’ve not changed our guidance, both for the French segment and at group level while announcing that we are reinforcing our investments. This is due to the additional cost savings, obviously, but also to a number of initiatives, which are ramping up quite well and which contribute positively to our bottom line, which is a continuation of what we already shared with you at the full year results. That includes e-commerce. So you saw a good traction on e-commerce top line and as we shared with you with that kind of commercial dynamics, we're able to improve the profitability of e-commerce. So it does contribute to lifting up the profitability, including in France. We also have an acceleration of our retail media business, both for Carrefour and with third parties through the unlimited. We also have a ramp-up of stores that we converted to the lease management way of operations and you know that these stores, they take time to ramp up to improve their performance. And now we have quite a significant number of stores. I think it's 38% of our hypermarkets today, which are operated by third parties. And so we have now a portfolio effect of stores ramping up and contributing to the profitability. So that's also an element in our appreciation of what's the level of price investments that we can dedicate to the French market, while preserving our financial trajectory in line with the objectives that we shared with you and that we reaffirmed today.
Operator: Thank you. We will now go to the next question. And your next question comes from the line of Nicolas Champ from Barclays. Please go ahead.
Nicolas Champ: Hi good evening. Thanks for taking my questions. I have two. The first one is, do you see any reaction from competitors following your price investments in the different countries and especially in France? And the second question, I think you said, Matthieu, that you're you were confident to grow EBITDA this year on the back of improving top line performance in Brazil. To what extent are you confident to also grow your EBIT in France this year despite the cost savings, but given also the price investment? Thank you.
Matthieu Malige: Thank you, Nicolas. So on France, limited reaction from competitors so far and it's now been a little more than six months that were active. So we monitor that very, very closely. Then it's also true that we are responding to some investments which were made by some competitors ahead of us in the cycle. So that could be an explanation, but – and so our price investments do translate in our price indices and price – quantitative price indicators. So there is a reality of improvement of our level of competitiveness in France as of today. And so as I said in my speech, I'm happy to confirm that, we are confident given everything that is going on in France that we are going to be able to increase our profitability, both in absolute terms and as a percentage of sales, as we discussed back in February. On Brazil, yes, I did also mentioned that we were confident notably, after this strong rebound and clearly an inflection in the dynamics, commercial dynamics in Brazil. So we're confident that Brazil is going to rebound in terms of profit and profitability in 2024 as we had expected. Clearly, the very good dynamics on Atacadão including on the B2B sales, we don't talk so much about these B2B sales. But as we said, when we have declining inflation or deflation, the B2B customers tend to reduce their level of inventories and so they don't buy so much from Atacadão. We now have a positive inflation level on food in Brazil for now a few months. And so we've seen a rebound in our B2B sales at Atacadão. So this is a driver on the B2C sales a lot of focus, as I said, to improve our competitiveness and have more services, including the counters, which have visible effect on customer traffic and level of basket. So clearly, having more services does respond to an expectation from our B2C customers at Atacadão. So that’s very, very positive. Then the converted stores are also continuing on the good dynamics in terms of top-line. I mentioned the number, but also bottom-line. So that’s very good. We already following the path that we had set and shared with you back in July last year in terms of our profitability. So, well, all this is going in the right direction. Then maybe a comment on the Banque [ph] where you’ve seen now for quite a while, very dynamic portfolio growth which is good. It didn’t translate so much in 2023 into the bottom-line because the level of delinquencies and associated cost of risk had increase in the macro environment that prevails. We see things normalizing in terms of macro [ph]. We see some form of restoration of purchasing power. And so that’s good news for delinquencies entering into 2024. So that’s behind our confidence on the Brazil output.
Nicolas Champ: That’s it. Thank you.
Operator: Thank you. [Operator Instructions] We will now go to our next question. And your next question comes from the line of Frederick Wild from Jefferies. Please go ahead.
Frederick Wild: Hi. Good evening, Matthieu, Sébastien and team. Two from me, please. You mentioned that you’ve seen sales stabilize in Europe. Do you now see the outlook for inflation as also having stabilized as we’ve moved through the balance of this year? And then secondly, have you seen any signs yet of easing down trading in France and Europe in March or so far in April? Thank you.
Matthieu Malige: Thank you, Frederick. We think that prices and we discussed that in February, but the trend continues. Prices in France have been very stable, and I think we shared the month-to-month inflation in the presentation. The prices on the shelves in the market are very stable now since the summer of last year. And we don’t see any meaningful change in this. You see that it's still very stable. So we think that we are just lapping over the peak of inflation, which occurred in end of Q1, beginning Q2 last year. And so we think that the headline inflation numbers are going to stabilize pretty much where they are today, which is a low single-digit level for the rest of the year, except new developments on the geopolitical front or commodities. But with what we have on the table today, that’s what we see and that confirms what we thought and shared with you a few months ago.
Frederick Wild: I’m sorry. Is that the case in Europe as well as France?
Matthieu Malige: Yes, yes. It’s exactly the same trends, then you may have slight differences in that of that market, but we see this trend overall being the same everywhere, which we think is quite good because with less pressure from inflation on consumers’ purchasing power, we see a restoration of purchasing power, and we think that’s good for the outlook for volumes. Now on trading down, so far, we've not seen any easing of this trading down still very strong dynamics of switching from a national brand to private label. We still see a lot of success of promotions. And so nothing specific there. We think that the pressure – accumulated pressure on purchasing power is still quite high. Which materializes in declining volumes and still strong trading down dynamics at play in the market.
Frederick Wild: Great. Thank you very much.
Operator: Thank you. We’ll now take our final question for today. And your final question comes from the line of François Digard from Kepler Cheuvreux. Please go ahead
François Digard: Good evening Matthieu and team. I would like to come back to the volumes in France and Europe. Could you share with us any sign of evolution across the quarter? Or more generally in the context of consumption erosion on fragmentation. Do you see that the volumes could evolve structurally or in a cyclical way in the coming months? My question behind that is, where do you put the threshold of success? Is flat volume would be a success? Or do you expect actual growth in the coming months? Thank you.
Matthieu Malige: Thank you. We don't see any significant evolution through the quarter on volumes, François, still relatively negative – slight negative with quite the same level from one month to the other. Then I don't really know what you have in mind in terms of cyclicality. What we see is that the inflation on salaries is now higher than the inflation we have the CPI and so we see some form of restoration of purchasing power. It does translate into the level in confidence indices that are published by a number of statistical institutes in all our geographies. And so you see that this level of confidence of consumers are improving regularly now for a few months. So we draw the line and we tend to think that volumes should stabilize later in the year. I think we're quite clear with this. Not very clear on when exactly we will cross the line, but we know this is the trend. Now what would be success? Success is market share? Success is market share in volume terms. That's what I said. We don't control the market, but we control our relative performance versus competition and you hear in tonight's [ph] publication and announcement, a strong determination to have the right level of experience and competitiveness in our stores to come back to a market share gaining dynamics.
François Digard: Thank you very much.
Operator: Thank you. I will now hand the call back for closing remarks.
Matthieu Malige: Thank you very much to all of you for this meeting, and we will be meeting again at our general meeting or at the end of July for our H1 release. Thank you.
Operator: Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect. Speakers, please standby.
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