Auchan reports profit drop on French price war, ruble fall

(MENAFN- AFP) Supermarket giant Auchan said that a price war in France pushed net profit down 11.5 percent in the first half, but that overall sales held up because of international performance.

In the first six months of the year, net group profit fell to 272 million euros ($359 million).

Global sales rose by 4.7 percent to 31.2 billion euros, boosted by a strong performance in eastern and central Europe and in Asia.

The group said it had made "good progress in emerging countries which offset the negative trends in the eurozone."

But Auchan said that crisis over Ukraine and Russia, countries in which the currencies have fallen heavily, had an unfavourable exchange rate effect on the figures.

Sales in France, the group's main market, fell by 1.9 percent from the equivalent level last year.

Auchan did not forecast figures for the full year but said it did not expect the economic climate, notably in the eurozone, to improve.

"During the first half of the year we saw sustained growth in Eastern Europe and Asia," chief executive Vianney Mulliez said in a statement, and the group had taken action to counter performance problems in France and Italy.