Carrefour Brasil said on Monday that its fourth-quarter adjusted net profit fell 28.2% from the previous year to 550 million reais ($106.19 million), owing to a double-digit increase in spending.
Carrefour SA (CARR.PA), the Brazilian subsidiary of French retailer Carrefour, reported a 36.3% increase in net sales to 28.16 billion reais, boosted in part by the acquisition of food store Grupo BIG.
Carrefour Brasil’s Atacadao business increased net sales by 22.6%.
Operating costs were 4.15 billion reais, a 64.9% increase over the previous year, spurred by a “anticipated” increase in expenses due to Grupo BIG integration and store conversion acceleration, as well as high interest rates.
Profit was reduced by shop conversion, according to the company’s chief financial officer David Murciano, who added that sales will increase once all locations have been converted.
EBITDA (profits before interest, taxes, depreciation, and amortization) increased 12.4% to 1.974 billion reais. Excluding Grupo BIG, the company’s adjusted EBITDA increased by 17.6% to 2.07 billion reais.
Carrefour Brasil announced the opening of six new wholesale format stores. In the fourth quarter, 52 Grupo BIG shops were converted to Carrefour’s brand, according to the company.