French supermarket chains Carrefour and Casino are seen posting a small fall in third-quarter sales next week as falling food prices and consumer weakness in France outweigh growth in emerging markets.
A Reuters poll of 11 analysts showed Carrefour, the world's second-biggest retailer, posting quarterly sales down 1.7 percent to 24.3 billion euros ($35.83 billion) from 24.7 billion euros ($36.42 billion) a year ago.
Excluding the impact of new store openings and currency effects, the decline should be limited to around 0.5 percent.
Sales in France, which account for more than 40 percent of Carrefour's total revenues, have suffered as food prices continue to decline and consumers hold back from discretionary non-food purchases.
Analysts expect a fall in French sales of around 3.4 percent, to 10.4 billion euros ($15.33 billion).
Carrefour's drive to rebrand its Champion supermarkets under the Carrefour Market banner has had some success, with some analysts expecting like-for-like supermarket sales growth of almost 6 percent.
Carrefour has also stepped up promotional activity, particularly in the first half of the year.
Sales at Carrefour's bigger hypermarkets, however, have suffered from exposure to non-food goods and cannibalisation from the company's own supermarkets. The group is expected to report a 3.9 percent drop in hypermarket sales, excluding petrol. According to French newspaper Les Echos, Carrefour hypermarkets lost 50 basis points of market share between Aug. 10 and Sept.6.
Smaller rival Casino Guichard is expected to report broadly stable quarterly revenues of 7.17 billion euros ($10.57 billion) on Oct. 14, according to a poll of six analysts, down just 0.6 percent from last year's 7.21 billion euros ($10.63 billion).
This is mainly thanks to international growth. French sales, which account for nearly two-thirds of Casino revenues, are seen falling 4.5 percent over the year.
Casino may choose to report sales at Dutch subsidiary Super de Boer under discontinued operations, after Dutch retailer Jumbo entered into exclusive talks to buy the unit. Another bidder, Sperwer, said on Wednesday it had started due diligence on Super de Boer after putting in a higher offer than Jumbo.
Carrefour Chief Executive Lars Olofsson, who joined this year, has made it a priority to turn around the company's performance in France and has promised to put 600 million euros towards cutting prices this year.
The company also aims to save 4.5 billion euros ($6.64 billion) in costs by 2012 as part of a transformation plan, of which 212 million euros ($312.6 million) were achieved in the first half of this year.
Carrefour shares have only risen 2.2 percent since the start of June, while the Dow Jones Euro Stoxx retail index is up 7.7 percent and rival Casino Guichard's shares are up 15.2 percent.
Stock markets worry about companies when they come out with cost-savings plans, said Justin Scarborough, an analyst with Royal Bank of Scotland in London. In markets that are very competitive they worry about the retention of savings in the profit and loss statements.
Carrefour on Wednesday moved to quash press speculation that it was looking to sell its Latin American operations, denying a report in Le Monde that claimed top shareholders were pressuring the board to sell assets in Brazil, Colombia and Argentina.
(Reporting by Lionel Laurent and Noelle Mennella; editing by Simon Jessop)