Casino, Guichard-Perrachon S.A. (CO) Earnings Call Transcript & Summary

Welcome to the First Quarter 2020 of Casino Group conference call. I'll now hand over to Mr. David Lubek, Chief Financial Officer of Casino Group. Sir, please go ahead.

Thank you. Good evening, everyone, and thank you for joining us on our quarterly sales conference call. I am with Régine and the IR team. We hope that you are all safe and well. Before going into Q1 numbers, let me start with a few words about the current context. The COVID-19 pandemic has had a major impact on all our lives. Our thoughts are with everyone affected in their personal health, their families, their jobs, their economic situation, their daily lives. It is challenging for everyone, and we are all in this together. In France, we have now been in lockdown for over a month, which means a stay-at-home order for most of us. But some people perform essential tasks and have to be out there every day to serve others, first and foremost, health workers, of course, who are on the front line and to whom we are all grateful; and also other workers who provide us with essential services that need to continue even during a full lockdown. This brings me to the employees of Casino and particularly our operational staff, cashiers, handlers in stores and warehouses and staff in charge of home delivery. They are performing an essential duty, ensuring that the population is fed and they have shown a dedication to their task that is nothing short of humbling. I want to take this opportunity to thank them again on behalf of Casino's management for their daily dedication, their empathy to our customers and their unwavering commitment. Of course, our first priority has been to make sure they are safe. We have provided our staff with masks, gloves and cleaning solutions and have put screens in place for our cashiers. This has been our primary focus since the first week of the lockdown. In keeping with our long-standing commitment to social dialogue, these measures were taken in close consultation with our employee representatives, who have been particularly supportive in these challenging times. We have also worked hard to ensure that our customers were able to shop safely in our stores, ensuring the right distances between clients, maintaining our opening hours so that the flow of customers could be spread across the day and the week and encouraging the use of our digital tools, including sales scanning with smartphones, our automatic cashiers, order and home delivery and our Click & Collect solutions. Accordingly, we have accelerated the rollout of those initiatives that were already going in the previous quarters to facilitate our customers' experience, and which are now even more relevant since they contribute to their safety. Our teams have also been working very closely with our suppliers and transporters to ensure that all of our banners have been well stocked throughout this period even with demand at elevated levels. To give you a sense of the level of demand we are experiencing, I'd like to share some elements of our current trading in France. Put simply, we have seen a shift from eating out to eating at home that is unprecedented. Meals that were taken in restaurants, cafés or at school or at work are now cooked at home. This has led to a structurally higher demand for food retail and especially for formats that answer people's needs in the current environment, Proximity, urban formats and E-commerce. Purchases that were spread between different outlets are now typically concentrated on the stores closest to people's homes. This means our stores, most of which belong to this format, have been in particularly high demand, both by our usual customers, who have increased their average basket, and by new customers. On a 4-week basis, as of last Monday, our sales in food banners are up 9% and plus 12% excluding hypermarkets. Franprix, Casino Supermarkets and Proximity are up plus 24% on average. E-commerce has been particularly in demand, both food e-commerce and nonfood e-commerce. Food e-commerce has seen a triple-digit increase across all our banners, first, at Monoprix with home delivery running full speed and a strong Click & Collect offer being rolled out. Franprix has ramped up its delivery operations by foot to people living near our stores. All our banners have developed new offers targeted at our most vulnerable customers that have ready-made baskets available for delivery via phone call to a special toll free number. Our hypermarkets and supermarkets have ramped up their drive and home delivery capacity. We now deliver 20,000 orders a day across all our banners, tripled the numbers we had before March. Nonfood e-commerce with Cdiscount has also seen a strong surge in demand. Cdiscount is fully operational and performing well, providing nonfood essentials across its markets. I will get back to this in detail. For now, I will just mention a few numbers. GMV growth has reached plus 40% since the beginning of April. This includes the growth of our direct sales at plus 19% and the growth of our marketplace at 69%, building on our strong partnerships with online merchants. With this acceleration, market share of GMV has stopped 50% during the same period. Specific measures have been taken to maintain customer experience such as transferring orders to express carriers and reinforcing by 30% the staff dedicated to customer service. Cdiscount's strong organization and culture of agility have allowed them to face this surge in demand while maintaining the full range of services. Finally, as you have seen, of course, in our press release, the surge of sales since mid-March in France, combined with the impact of the actions we have taken last year to reduce our cost base and optimize our store footprint, have led to a strong growth of our EBITDA in Q1, plus EUR 67 million compared to last year for the combined scope of our French businesses, including Cdiscount. As a result, last 12-month EBITDA as of end of March '20 over the same scope has reached EUR 1.6 billion, EUR 948 million after rent payments. These are the general comments I wanted to make before going through Q1 numbers and the main highlights per banner, starting with our French business. Monoprix like-for-like sales grew by 3.6% this quarter. Since the beginning of the lockdown, Monoprix has registered strong growth in food, particularly in fresh, and also significant sales in some of the nonfood categories, such as home and leisure. E-commerce has grown strongly, both on Amazon Prime Now and on the Monoprix website with triple-digit growth. Our IT systems have been resilient and have handled the inflow of orders well. Home delivery is running at full speed. And to enhance our capabilities, a strong Click & Collect offer has been ramped. We have also launched a partnership with Deliveroo in 38 stores located in 15 cities. As already mentioned at our full year results, the first Ocado warehouse has been running in test mode since March 18, with a view to open the service to the public in the coming weeks. With a very strong inflow we have seen on monoprix.fr and the big increase in orders for home delivery, the demand is clearly there to justify the ramp-up of our Ocado operations. Monoprix has been keen to do their part in the solidarity efforts, in particular with health workers and vulnerable population. Among many initiatives, they have launched a portal dedicated to hospital staff to give them priority access to e-commerce and home delivery. Finally, I should mention that the expansion continues with 8 new stores opened in Q1 mostly in Monop' and Naturalia format. Casino Supermarkets recorded a 7.5% growth in the quarter with a strong acceleration since mid-March and plus 15% over the last 4 weeks. Our supermarkets are mostly situated in urban areas, and they are usually have an optimized size. They provide a complete food offer, including fresh, meat, fish, foods and vegetables. And they have efficient solutions for automatic checkout with 142 autonomous stores, of which 42 were rolled out this quarter. The banner is therefore particularly well equipped to deal with the needs of our customers in difficult times. E-commerce has been further strengthened with 35 new Click & Collect locations, 15 additional cities eligible for home delivery, to reach a total of 65 cities and a partnership with Uber Eats in 17 cities. Franprix had a plus 12.6% like-for-like growth in Q1 with a strong acceleration to plus 26% over the last 4 weeks, especially in the Paris suburbs. In the Greater Paris area, Franprix has a network with their highest density, and it has a full offer in food, including fresh. As a result, it is a natural destination for people looking for a stock close to home. In recent weeks, we have seen a particularly strong bond built between our teams and our customers with usual customers concentrating their purchases at Franprix and new customers coming there to find what they need in a safe environment. E-commerce capacities, both in home delivery and Click & Collect, have been ramped up to accommodate increased demand, among them the partnership with Deliveroo as for Monoprix. Convenience recorded a plus 11.5% growth over the quarter, with an impressive acceleration to plus 40% over the last 4 weeks. Our convenience banners constitutes the largest network in France with 5,130 stores and have been of particular use to our customers. Our logistic teams have put in a special effort to make sure our franchises are fully stocked every day, even in the face of such high demand. To meet our customers' needs in this new environment, home delivery and Click & Collect solutions have been deployed in 364 stores. Finally, Géant hypermarket like-for-like sales were up plus 1.5% over the quarter with 2.9% like-for-like growth in food. The French market has been more difficult for hypermarkets since the lockdown since customers have tended to flow to smaller stores and stores closer to home. However, we have optimized the footprint of our Géant store size over the years, and a number of them have good locations in cities. We have also maintained extended opening hours to spread the flow of customers, and we have maintained a strong product offer. And of course, our digital solutions ensure additional safety. 45% of checkouts are now done automatically. All of these elements have led to a significant outperformance of our hypermarkets in the recent weeks compared to the overall market. We have also accelerated the rollout of previous initiatives. Home delivery has been extended to 12 additional cities to reach a total of 41 cities, including a partnership with delivery. And 20 additional autonomous stores were deployed during the quarter, bringing the total to 39 stores, almost half of the store base. Let's move to Cdiscount. In its sales report published on April 17, Cdiscount presented how it has managed the significant increase in demand it has experienced. I will sum up the main highlights. First, and most important, fully operational capacity was maintained at Cdiscount and its 10 warehouses. This was achieved by moving very quickly to put in place measures to protect our colleagues, strict distancing, protection, disinfection and regular temperature checks. This was done, of course, in close coordination with our employee representatives in keeping with our tradition of social dialogue. All our teams at Cdiscount have shown a tremendous commitment to ensure timely delivery to our customers of nonfood essential items as well as an expanded food offer to meet the needs of those who wish to stay at home. Since most pickup points are closed, 95% of goods are delivered to home with a massive transfer to express careers to ensure timely delivery and meet the surge in demand for teleworking equipment, home leisure, personal care and daily shop. Looking at current trading numbers allow us to grasp the extent of this surge. Since the beginning of April, GMV has been up 40% with direct sales up 19% and marketplace, growing 69% with an acceleration since the beginning of the month. This additional growth has come with a strong positive impact on Cdiscount's margin. First, the share of marketplace has reached 51%. That is 9 points higher than last year. And as you know, marketplace sales are the most profitable ones. Second, direct sales have seen a big increase in their margin, up 9.9 points since the beginning of April, due to a strongly favorable mix of products. Cdiscount is also doing its part to help with the national effort. There are many solidarity initiatives going on, so we'll just highlight a very special one. 60 million masks will be sold and delivered to French small firms and public institutions through Cdiscount in the coming weeks. This has been launched in partnership with the French government based on our team's ability to adapt and deliver quickly. Cdiscount is honored to have been chosen to perform this distribution, and our teams are fully mobilized to help workers and small firms get the protection they need to get back to work. After this focus on the most recent events, a few comments on Cdiscount's performance across the quarter. GMV was stable at EUR 900 million. At the beginning of the year, the market faced a challenging start with a sales period shorter than last year and lower marketplace activity in the first 2 months due to the initial impact of COVID-19 on third-party vendors, first from China and then from Europe. Now as you can see, this hurdle has passed, and marketplace activity is very strong. Enrollments of new merchants has been accelerated with a simplified process and a 6-month free subscription, allowing nonfood stores that have no physical visitors to keep on selling through our platform. Also, in Q1, the further continuation of the dynamics previously highlighted that underpin Cdiscount's business model: fulfillment by Cdiscount up 30% and driven by its strong logistic performance; the growth of B2C services, such as Cdiscount Energie up 50%, with 100,000 customers; and international expansion with international GMV up 57% during the quarter; 26 additional websites connected; and delivery is now possible within 25 European countries. Before moving to Latin America, a few words about our new B2B activities. They have continued growing their business in Q1, building on the strong organization and the dedication of our teams. GreenYellow continued to execute well, both in solar and energy-saving solutions in all geographies, notably projects with SEB in Colombia, with Valeo in Thailand and new solar projects in Madagascar. In data, 3W-relevanC sales under banner reached EUR 20 million over the quarter, a 92% growth year-on-year, driven by advertising activities. And our ScaleMax data center business has won new contracts over the quarter with start-ups. Let's move on to Latin America. GPA has already provided its Q1 2020 sales report yesterday. I will therefore highlight the main points. As you know, after the reorganization of our operations, GPA now consolidates Éxito and has been listed on Novo Mercado since March 2, 2020. During the quarter, Latin America sales rose by 8.5% on a same-store basis and by 14% on an organic basis. Foreign exchange effect was negative minus 14.5%. In Brazil, GPA food sales were up 15% on an organic basis over the quarter with a strong acceleration mid-March in the context of COVID-19. As in France, beyond the initial stockpiling, there has been a switch of customer behavior from eating out to eating at home, which has led to a surge of sales among all banners. Assaí, our fastest-growing banner from 9 years in a row, once again posted organic growth above 20%, at 23.8% with 40 new store openings over the last 24 months. Like-for-like growth remained strong at 7.1% on a comparison basis of 10.7% in Q1 '19. The rapid pace of expansion is set to continue in the coming months with 14 stores under construction and 3 hypermarkets under conversion into Assaí. Multivarejo also had a good quarter with a 6.6% like-for-like growth, driven by renovated formats. The 46 renovated stores of our premium brands, Pão de Açúcar, had a 14% growth over the quarter. They represent 40% of the store base, and 20 more stores are under review for renovation. In supermarkets, the new models had another successful quarter with 100 Mercado Extra stores recording a solid 11% same-store growth and the 28 Compre Bem stores, a plus 42% like-for-like growth. Convenience saw another dynamic quarter with plus 22.5% like-for-like growth on a strong comparison basis of 20% in Q1 '19. Minuto Pão de Açúcar and Mini Extra had an excellent performance as well as the Aliados franchise format. Extra Hypermarkets registered strong growth resumption, driven by promotional efforts and the development of the Clube extra app, particularly in the 70 high-performing Extra Hyper stores. The portfolio optimization process has advanced with 3 stores, in particular, in the process of conversion into Assai. Finally, food E-commerce grew 82% during the quarter. The share of E-commerce has grown steadily in all banners, especially in our premium Pão de Açúcar banner, where it now accounts for 7% of sales. A few words regarding the COVID-19 impact. It has been detailed in GPA's communications, so I will concentrate on the main points. Strong protection measures have been deployed, of course, to ensure the safety of our employees and our customers. They include distribution of hand sanitizers to employees at all stores, distribution of masks, installation of acrylic panels at the checkouts in all stores and physical distancing. Our banners in Brazil have recorded a strong demand for food retail following the increased severity of the COVID-19 pandemic. Between March 14 and March 31, brick-and-mortar sales increased by 16%. This includes a surge of demand for basic and essential products, both at Multivarejo and Assai and also very strong sales of frozen product, meat and dairy products and hygiene. And with increased social distancing, food e-commerce sales orders accelerated to 150% growth with James Delivery and Cheftime in particularly high demand. To conclude on Latin America, a few words on Éxito. Éxito Group recorded an increase in same-store sale of 12.1% over the quarter with good performance in Colombia, Uruguay and Argentina. In Colombia, like-for-like growth reached 9.7%, first, driven by the Éxito anniversary campaign and then by an increase in sales during the second half of March in all banners, especially Éxito Wow, FreshMarket and Surtimayorista. Uruguay same-store sales were up 11.8%., driven by a strong tourist season and the impact of COVID-19. Argentina also recorded a high increase in sales with Hiper and Proximity formats above country inflation. To conclude, a few words looking forward. We are living challenging times. This is the period where the essential nature of the service we provide has been made obvious to everyone. In France, our formats are the ones most impacted by the switch of customer habits with a very high demand for Proximity and e-commerce, which are the core formats of our group. Our colleagues have truly excelled in very challenging circumstances. It is, of course, difficult to make a reliable forecast at the current time given the unpredictable nature of this pandemic, potential government response and its impacts on economic activity. As you will remember, this is why we chose the prudent decision to suspend guidance at the time of our full year results publication. However, in the immediate future, we expect the current trends to continue. We have a date for an end of the lockdown period in France, which is May 11. We also know the lockdown will only be gradually removed with some activities still closed after that date, and it is likely that demand for food retail will remain at elevated levels. In any case, all our teams are fully mobilized to respond to our customer needs, both in our stores and at Cdiscount. This crisis has increased the relevance of the initiatives that we started a few quarters ago, such as digital solutions in stores or, in some cases, a few years ago, such as our partnership with Ocado. We will continue to accelerate them to meet the immediate needs of our customers for efficient and safe service and also looking forward to be ready for the likely acceleration of shifts in consumer behavior after this crisis. Thank you for your attention. I'm now ready to take your questions.

[Operator Instructions] We have one first question from Mr. Arnaud Joly from Societe Generale.

Régine and David, I have 3 questions. The first one regarding the profitability in France. I calculate an improvement in the EBITDA margins of around 160 bps. As there are many moving parts for margins in the ongoing context, positive and negative, can you give -- can you please give some flavor on this moving part? My second question is regarding your pricing policy in France. What were your price trends in stores over the last few weeks? Stable, up or down? And the last question. It seems that food retailers have started to relaunch their commercial policies over the last few days with now flyers, promotions and loyalty rewards being back in stores. Just I'm wondering if this is the same case for you. And what is your plan for the coming weeks?

Thank you, Arnaud. If you look at what happened in Q1, the growth -- I would say the EUR 67 million growth in EBITDA that we see is 2/3 additional sales in our same store, and 1/3 is the full year impact for this quarter. The measures we took last year, that is the Rocade Plan, of course, the cost-saving plan. So that would explain the growth of the EUR 67 million EBITDA. Our price has been stable throughout this period, of course. We have maintained our price stable. We have been very careful to do that, and we have made a strong commitment not to move our price during this period. So that is very clear. There's no doubt about this. As you mentioned, promotions have been reduced because basically, catalogs could not be distributed during this period. It was impossible. So that entailed reduced promotions by suppliers. How this will come back at what -- this is going to be discussed. This is going to be seen. On our side, this will depend for partly on the suppliers. On the professionals' behavior. On our side, we also have our own incentives, our own promotions in our apps, and we target these the right way to target the right effect. But in the current -- for instance, what we did in the past was have special incentives for customers to buy fresh food. Today, people buy fresh food in our stores without need for special incentives. So this is not needed. And of course, we'll adapt our commercial policy to the circumstances in the coming weeks and months.

We have the next question from Mr. Xavier Le Mené from Bank of America.

The first one, you look back to prices, actually, you said you have not changed prices in the recent weeks, but how are -- your price are comparing year-on-year? Just to get a sense of the inflation. You've got year-on-year in France. That would be quite helpful. Going forward, actually, you mentioned that 2/3 of the EBITDA improvement is actually due to the sales improving, but how should we think about the kind of leverage you've got with incremental sales as you will get some benefit also in April, potentially in May? So how do we think -- should we think forward in terms of the leverage you've got? And can you comment also about nonfood sales in your Géant stores and Monoprix stores?

Yes. Thank you, Xavier. On price, I think the variation of prices beginning of the year, they haven't moved. And last year, as I remember, I mentioned that we didn't move the price either. So there were some prices up, some prices down. But on average, prices didn't move. So overall, I don't see any real inflation. You may have some inflation measured by some people looking just at the headline price. But once you take everything into account, we don't see really any inflation, at least not in our stores year-on-year or since the beginning of the year, same thing. The operating leverage, basically, we have -- we are in a business where we a lot of fixed costs. So the additional EBITDA we get on additional sales, they're actually quite close to the gross margin. We have some variable costs, of course, but it's quite close to the margin. So it's around, let's say, about 25%. If -- that's what I mentioned last year, actually, in Q4, where we missed, of course, some sales. We missed this EBITDA by a factor of 25% of the loss on sales, and it's about the same thing the other way around. So this is how we see things, and this is how you can compute actually the 2/3 of additional EBITDA that I mentioned. It translated into around EUR 150 million additional sales or something. And if things go down like that in the coming weeks and months, of course, we should have the same kind of operational leverage on average. Nonfood sales in -- we have 2 different types of nonfood sales. Someone can say they are actually quite in demand, for instance, small appliances, ink cartridges. Ink cartridges have a lot of demand, not only at Cdiscount, but also in stores and hypermarkets, Monoprix. All the nonfood sales are obviously not so much in demand. They are still sold. We have not closed any of our nonfood, but people tend to focus more on food in the stores, they tend to concentrate the purchase on food when they go in the stores. So our nonfood sales actually have increased a lot for Cdiscounts during this quarter, which is our main conduits to sell nonfood in France.

We have next question from Mr. Clement Genelot from Bryan Garnier.

Two questions from my side, if I may. The first one is Casino has been said recently considering about partial unemployment regarding some employees in the headquarters. If it is still the case, how many employees do you intend to put in the partial unemployment there? And just to understand, was it not possible to temporarily relocate them, for instance, in some other stores or warehouses? Because I understand that less for the employees, it's just regarding a lot of training, also expansion are really on hold. But is it possible to relocate all of them in another store? And just another thing regarding the leverage on EBITDA. I understand that, that additional sales will hurt you, but do we have to also take into account higher logistical costs? And of course, the cost to implement was -- I would say, are measured inside your other stores.

Sure. Sure. So to answer your question, of course, most of our employees are actually fully mobilized. As you know, especially employees in stores, employees in the warehouses, they are all mobilized. Most of our headquarters' employees are also working, of course, from home, but they are still working. There are some cases where some people, as you mentioned, currently have no job because if you're on expansion, as you mentioned, or in the catering business or if your job is to draw out paper catalogs and there are no catalogs around, you don't have a job. So on a voluntary basis, of course, people who are in this situation can work in the store, but, of course, we can't force that on them. So in that case, we apply the usual rules, which is partial unemployment. Of course, the vast majority of our employees are fully mobilized, more than fully mobilized right now. As for higher costs, well, when the 25% personal leverage I mentioned includes, of course, the usual viable costs is the average gross margin -- commercial margin in our stores is higher than 25%. So when I get to 25%, it already includes some additional logistic costs, some additional temp focus, if necessary. We have some specific costs, as you mentioned, in this current context, such as masks, such as hydro-alcoholic solutions, something like that. It is not a very high level of cost compared to the very, very strong surge in sale that we see. So, so far, it's been the kind of impact that you can see on our EBITDA, quite positive.

The next question is from Mr. Andrew Gwynn from Exane BNP Paribas.

Two quick questions, if I can. So you're ramping up the Ocado distribution centers that's going live in the next few weeks, but clearly a lot of demand for that. So how quickly do you think you could turn the taps on that? And then secondly, on Monoprix, obviously, presumably a little bit more difficult because of the nonfood. I'm just wondering if you could elaborate a little bit more on that. And also whether or not there's much inventory risk given some of the apparel sales simply are quite sharply down?

Thank you, Andrew. Ocado, we are going as quickly as we can. So the tests, it's been running in test mode. We will have to be, of course, very careful to make sure that when we do the big launch, it works perfectly. That's absolutely key. So we've been testing that since the 18th of March first on a small subset of voluntary friends and family, let's say, then a few more people above that. And in the coming weeks, we don't specify the date today. I will specify when it's really -- set date very quickly, very, very clear, but it's, of course, going to be a matter of weeks. Then it will be open to the public. And in that case, you will see a lot of our -- most of our Monoprix customers will be able to order on Ocado. So it's going to be, I think, quite fast once it's open. And when will it be open, it's a matter of weeks today. The tests are running fine. As usual, you have to be very, very sure of what you're going to do in such a case, which explains why we started testing 18th of March, and we'll only open in -- probably in May in the coming weeks. Monoprix sales, yes, as you mentioned, actually, food sales at Monoprix are excellent. They are quite close to the supermarkets -- casino supermarket sales that we published. We have this kind of double-digit number at Monoprix in food. In nonfood at Monoprix, as in hypermarket, as I mentioned, you have different type of nonfood. You have the home and leisure nonfood, which was quite well, paper, ink cartridges, smaller do-it-yourselves, things like that, this is up. What is down, as you mentioned, is textile, obviously. Textile is still open. I mean you can buy textile at Monoprix stores, but people tend to focus more their purchasing on food right now. At first, it was a very -- it was very significant, the drop in textile, and now it's picking up. In the past few weeks, it started to pick up. So it's not a big risk for us because, as you know, textile is non -- is not a perishable product. They have been very quick to adapt their orders to the suppliers to adapt to the kind of sale that we're seeing. And I think this is -- will be totally manageable. The overall margin at Monoprix is still up, given the very high surge in food and the switch to more fresh. Because when people go to a Monoprix store now, they buy -- tend to buy everything. So they're going to the butcher, going to the baker, going to the cheese merchant. They buy everything at the Monoprix store. And this fresh food is, of course, of higher margin. So the overall result for Monoprix is still positive. And I think they manage the April issue quite well. And it's already -- we already see that picking up. So we're not worried.

Next question is from Madam Fabienne Caron from Kepler.

Three questions from me. The first one, when you talk about the costs in France, and remember, at the full year results, we had a question regarding the bonuses to staff. You told the news that most of your competitors are [ eager to front-office staff ] logistically in stores. You were saying that you were discussing with the unions. I was wondering if you find a solution for that. And if you could help us quantifying the cost and if it is including the operating leverage that you were talking about would be my first question. And the second question, you had a very strong grocery online growth. Can you tell us, with your weight in France, how much does it represent in percentage of the total food or French sales? Would be useful. And the last question, you say on Page 2 that you would give for your covenant or your bonds, debt to EBITDA, you have to do it or give it on a quarterly basis. If I remember, you said you will wait for GPA numbers. Is it because there's a number for GPA because I remember that this covenant was only for the French cost. That's why I was a bit confused why you're not giving it at this point in time.

Okay. So first question, yes, so the bonus, as we said, it was only fair, of course, to compensate our staff for their extremely strong implication. And our operational staff, our frontline staff will be compensated. There's been the discussion with the union and the parameters are [ now fat ]. So it will be compensation based on people's presence in the stores and their exposure to operational duty. So it's a bit early to give a number. Of course, we give the number once we have made all the computations. But it's, of course, easily covered by all the additional sales that we're seeing right now. And it's, of course, totally fair and justified to pay this bonus. On online groceries, it depends a lot on the banners. In some banners, it's between -- depending on the banner, we are between the low single-digit and the high single-digit share of sales online right now. We don't want to be too specific because there are some confidential information there. But it's the order of magnitude that we see for online sales. Online sales in all our banners are profitable, might I say. All incremental sales done online are done with a positive incremental margin. On the covenants, yes, we have to publish per our documentation full sets of debt, cash, EBITDA for the group, distinguishing the part of the group that is in France and the part of group that is Lat Am. You're right, the covenant is only computed on the restricted perimeter in France, but the obligation to publish covers the group level, including France, including Lat Am, which we're going to do one publication with all this data. So we have to wait for GPA to publish their own numbers to do it. That's the reason. Of course, like I had, the current situation with all these additional sales that we're seeing is very favorable to our cash variation and compared to last year. If we -- we always have working cap variations during the year as in any retailer, but what we're seeing at the end of March is, of course, better than what we had last year at the same period compared to the end of the previous year.

Next question is from Mr. Nicolas Coulter from Citi.

Just 2, if I may. Firstly, are you able to give a sense of how much of the April uplift come from the out-of-home transfer into grocery? And I guess, how much is down to your format bias? And then secondly, just coming back to your cost profile through the crisis, and one of the big levers of additional costs has been covering staff absences and people who've been off either self-isolating or actually due to illness or who are vulnerable, how do you start with that? And I guess, why isn't there kind of an increased cost profile because of the circumstances?

Thank you. First, well, I would say, of course, the surge we see in sale is mostly due to this fundamental shift that we see now. How much is there a format bias? Well, it's easy. If you look at the panelists data, you can see that, for instance, hypermarket sales in the past weeks are sharply down in the market on average. Our own hypermarkets are actually better than that. They are mostly flat. But on average, big hypermarkets, in particular, are sharply down, while the overall buying to food retail, of course, has increased a lot. So it means that the fact that we have such high numbers, it's not just because people buy more in stores. It's because they buy more in this type of stores, in the urban, in the Proximity format and the store closest to their home. So if we only had hypermarkets, I don't think we would see any surge in sale at all. So I would say it's a combination of the 2.

But what do you think the -- the market, is it 2/3 or...

Well, as I said, we -- in each format, I would say we overperform the market right now. I mean our hypermarkets are not negative compared to others who are negative. And our Proximity format, we are 40% growth. We don't see that kind of number in the market, even we look at panelists. So it's -- of course, we -- anyone can make computation. I don't want to give any precise number on the other performance because it's going to be challenged. But it's very clear that on each format, we're doing better than the market, and I think by double digits on average. But of course, we'll have to see at the end when we have the full numbers. So it's a bit difficult to appraise precisely. So I would say, first, not being too much exposed to hypermarket is key in the current situation, and that is our situation. And then, second, when you are exposed in other formats, such as the urban supermarkets, Proximity stores, it pays to have the best ones. And of course, it's better to go to a Franprix than an average convenience store right now if you want to have the wide choice and everything you need when you're in the Greater Paris area. So I think it's a combination of the 2. As for cost profit, yes, the situation you mentioned for absentees, I think, has been mentioned by a retailer in the U.K. But in France, it's quite a different situation. First, we don't have that many absentees because we don't have many people -- so many vulnerable people working in the operational staff. We do have some absentees because some people, for instance, we might have some vulnerable people and we might have some people who need to keep their children at home. But in that case, in France, it's covered by public health insurance. So it's not an additional cost to us. That's different, I think.

We have one last question from Mr. Nicolas Champ from Barclays.

Three, if I may. The first one is about Monoprix. On the first page of the press release, you provided some numbers regarding your current trading performance, including a 24% sales increase over the past 4 weeks for Franprix, Casino and Convenience stores. What is the performance of Monoprix sales over the past 4 weeks as well even? The second question concerns Brazil. I think GPA reported yesterday a like-for-like sales increase of 6.9% in Q1. And what's the inflation level in Brazil during the first quarter, please? And the third one is, again, to follow up on the issue of abundant sales and so on. I think that most companies who have implemented temporary unemployment schemes have decided to cut the remuneration packet of the management, I would say, in terms of a straight idea to contribute to this effort. Do you plan also to refinance such -- there has been a remuneration package or to prioritize paycheck of the management generally throughout the circumstances?

Thank you. So for Monoprix, I would say it's -- we have 2 things. Food performance at Monoprix in the last 4 weeks is double digits. So it's not very far from the supermarkets performance. Nonfood is negative, especially textile, as I mentioned. Part of the nonfood is positive, but textile negative. The overall performance is positive, both in sales and in margin. As textile has been down sharply first, but is now rebounding, I think looking at the dynamic will be more meaningful in a few weeks to see where it goes. But all in all, it's positive, both in sales and in margin overall, and especially good, of course, in food. GPA from the data I have, inflation is rather subdued in Brazil. It slowed down quite a bit from Q4 to Q1. Latest data I have is something like 1.5% compared to 3.5% in Q4. So the increase, of course, in sales that we see in Brazil is not linked to inflation, quite the contrary, with lower inflation accelerated their sales and published detailed number about that, I encourage everyone to look at that in their press release. They accelerated even, of course, before COVID because all the commercial initiatives they've put in place were actually quite significantly paying off. For the last question, of course, something will be done at the Executive Committee level and will be communicated in due time, but it's quite obvious that we're going to do our part in this solidarity effort, very clear.

We have no other questions.

Thank you. Thank you, everyone, for being there tonight. And everyone, be safe.

Ladies and gentlemen, this concludes the conference call. Thank you all for your participation. You may now disconnect.